January 5, 1996
VIA UPS OVERNIGHT
Tom Gilmartin, Jr., et al.
January 5, 1996
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Tom Gilmartin, Jr., Vice President
International Brotherhood of Teamsters
25 Louisiana Avenue, N.W.
Washington, DC 20001
James P. Hoffa
2593 Hounds Chase
Troy, MI 48098
Michael Ruscigno
303 Summit Avenue
Jersey City, NJ 07306
James Jacob
1377 Sassaquin Avenue
New Bedford, MA 02745
Darryl Sullivan
2059 Richmond
Arlington, TX 76014
John F. Murphy, Secretary-Treasurer
Teamsters Local Union 122
650 Beacon Street, Suite 601
Boston, MA 02215
Ron Carey, General President
International Brotherhood of Teamsters
25 Louisiana Avenue, N.W.
Washington, DC 20001
Judith Scott, General Counsel
International Brotherhood of Teamsters
25 Louisiana Avenue, N.W.
Washington, DC 20001
John J. Sullivan, Assoc. General Counsel
International Brotherhood of Teamsters
25 Louisiana Avenue, N.W.
Washington, DC 20001
Tom Sever, General Secretary-Treasurer
International Brotherhood of Teamsters
25 Louisiana Avenue, N.W.
Washington, DC 20001
Lawrence Brennan, President
Teamsters Joint Council 43
2801 Trumbull Avenue
Detroit, MI 48216
Philip E. Young, President
Teamsters Local Union 41
4501 Van Brunt Boulevard
Kansas City, MO 64130
Chuck Mack, President
Teamsters Joint Council 7
150 Executive Park Boulevard, Suite 2900
San Francisco, CA 94134
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Robert G. DeRusha, Secretary-Treasurer
Teamsters Joint Council 10
650 Beacon Street, Room 501
Boston, MA 02215
William T. Hogan, Jr., President
Teamsters Joint Council 25
1645 W. Jackson, 6th Floor
Chicago, IL 60612
Anthony Rumore, President
Teamsters Joint Council 16
265 W. 14th Street, Room 1201
New York, NY 10011
Paul E. Bush, President
Teamsters Joint Council 18
132 Genesee Street, Auburn
Utica, NY 13201
Michael J. Riley, President
Teamsters Joint Council 42
1616 W. Ninth Street, Room 500
Los Angeles, CA 90015
Joseph Padellaro, Trustee
Teamsters Joint Council 64
200 Wallace Street
New Haven, CT 06507
T. C. Stone, Secretary-Treasurer
Teamsters Joint Council 80
1007 Jonelle Street
Dallas, TX 75217
Frank H. Wood, Secretary-Treasurer
Teamsters Local Union 28
5318 Wade Hampton Boulevard
Taylors, SC 29687
Chuck Mack, Secretary-Treasurer
Teamsters Local Union 70
70 Hegenberger Road
Oakland, CA 94621
Stephen J. Mack, Secretary-Treasurer
Teamsters Local Union 78
492 C Street
Hayward, CA 94541
Daniel J. Kane, President
Teamsters Local Union 111
50 Broad Street
New York, NY 10004
Joseph F. Bennetta, Secretary-Treasurer
Teamsters Local Union 191
1139 Fairfield Avenue
Bridgeport, CT 06605
Jack Cipriani, President
Teamsters Local Union 391
3100 Sandy Ridge Road
Colfax, NC 27235
Joseph W. Morgan, Jr., President
Teamsters Local Union 444
211 Pontotoc
Auburndale, FL 33823
Joseph J. Sullivan, President
Teamsters Local Union 470
3565 Sepviva Street
Philadelphia, PA 19134
Bobby Logan, President
Teamsters Local Union 515
4431 Bonny Oaks Drive
Chattanooga, TN 37416
Jerry Younger, Secretary-Treasurer
Teamsters Local Union 554
4349 S. 90th Street
Omaha, NE 68127
Jerome L. Vercruse, Secretary-Treasurer
Teamsters Local Union 630
750 S. Stanford Avenue
Los Angeles, CA 90021
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January 5, 1996
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Jim Santangelo, Secretary-Treasurer
Teamsters Local Union 848
9960 Baldwin Place
El Monte, CA 91731
W. C. (Willie) Smith, President
Teamsters Local Union 891
2560 Valley Street
Jackson, MS 39204
Joel LeFevre, Secretary-Treasurer
Teamsters Local Union 840
345 W. 44th Street
New York, NY 10036
Jack Powers, Secretary-Treasurer
Teamsters Local Union 1150
150 Garfield Avenue
Stratford, CT 06497
Lester A. Singer, President
Ohio Conference of Teamsters
435 S. Hawley Street
Toledo, OH 43609
T. C. Stone, President
Texas Conference of Teamsters
1007 Jonelle Street
Dallas, TX 75217
Real Teamster Caucus
P.O. Box 34285
Chicago, IL 60604
Delacorte/Shinoff
145 Natoma Street, Suite 200
San Francisco, CA 94105
RL Communications
1959 E. Jefferson Avenue
Detroit, MI 48207
Paul Levy
Public Citizen Litigation Group
1600 20th Street, N.W.
Washington, DC 20009
George Geller
30833 Northwestern Highway
Suite 200
Farmington Hills, MI 48334
Marvin Sacks
100 W. Monroe Street, Suite 804
Chicago, IL 60603
Gerry Miller
Previent, Goldberg & Uelmen
1555 N. River Center Drive, Suite 202
Milwaukee, WI 53212
Sherman Carmell
Carmell, Charone & Widmer
225 W. Washington Street, Suite 1000
Chicago, IL 60606
Hugh Beins
Beins, Axelrod, Osborne & Mooney
1341 G Street, N.W., Suite 700
Washington, DC 20005
Robert M. Baptiste
Patrick J. Szymanski
Baptiste & Wilder
1150 Connecticut Ave. N.W. Suite 500
Washington, DC 20036
James Hicks
Hicks & Associates
1420 W. Mockingbird Lane, Suite 760
Dallas, TX XXX-XX-XXXX
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TABLE OF CONTENTS
STATEMENT OF FACTS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 10
A. The Dispute Over the Area Conferences . . . . . . . . . . . . . . .. . . . . . . . . 10
B. The Creation of RTC . . . . . . . . . . . . . . . . . .. . . . . . . . . . . . . . . . . . 27
ISSUES . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .. . . . . . . . . . . . . 51
DISCUSSION . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 52
I. The Claims That The RTC And IBT Affiliates Engaged In Prohibited
Campaigning or Made Prohibited Campaign Contributions. . . . . . . . 52
A. The Rules on Campaigning and Campaign Contributions . . . . 52
B. Distinction Between Campaigning and Campaign
Contributions . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 56
C. No Campaigning Prior to October 1994 . . . . . . . . . . .. . . . . . . 61
D. Campaign Contributions by and to the RTC After October
1994. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .. . . . . 63
1. The Shinoff Strategy Memos . . . . . . . . . . . . . . . . . . . . 63
2. Implementation of the Shinoff Strategy Memos. . . . . . 65
3. RTC’s Public Communications . . . . . . . . . . . . . . . . . . . 69
4. The Presence of Candidates Opposed to Carey and
Creation of an Anti-Carey Network . . . . . . .. . . . . . . . . 71
E. Conduct of TADEF . . . . . . . . . . . . . . . . . . . . . . . . .. . . . . . . . . 75
F. Claims of Employer Contributions. . . . . . . . . . . . . . . . . . . . . . 76
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II. The Protests by RTC Claiming Retaliation . . . . . . . . . . . . . . . . . . . . . 77
A. The TITAN Messages . . . . . . . . . . . . . . . . . . . . . . . . . .. . . . . . 78
B. The October 3 Constitutional Interpretation. . . . . . . . .. . . . . . . 80
C. Creating an Atmosphere That Chills Free Participation In
The Election Process . . . . . . . . . . . . . .. . . . . . . . . . . . . . . . . . . 86
D. Additional Claims . . . . . . . . . . . . . . . . .. . . . . . . . . . . . . . . . . . 89
CONCLUSION. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 89
THE REMEDY. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 90
NOTICE. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 94
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January 5, 1996
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Re: Election Office Case Nos. P-032-LU245-PNJ
P-058-IBT-EOH
P-074-LU840-EOH
P-094-IBT-EOH
P-185-IBT-EOH
P-277-IBT-EOH
(CORRECTED)
Gentlemen:
Related pre-election protests have been filed pursuant to Article XIV, Sections 2(a) and (b), of the Rules for the 1995-1996 IBT International Union Delegate and Officer Election ("Rules"), concerning the formation and operation of The Real Teamsters Caucus ("RTC") and the Teamsters Affiliates Defense and Education Fund ("TADEF").[1] Because these protests raise similar legal claims, they have been consolidated by the Election Officer.
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By letter dated May 21, 1995, International Vice President Tom Gilmartin, Jr. filed a protest (P-032-LU245-PNJ), alleging 14 counts of violations by James P. Hoffa for using union funds to campaign for election as general president. One of the counts alleges that a number of IBT affiliates[2] had violated the Rules by using membership monies to support the RTC and the "National Defense Caucus and National Education Caucuses," which were promoting the candidacy of Mr. Hoffa and politically attacking the administration of General President Ron Carey.[3]
By letter dated May 24, 1995, James Jacob, a member of Local 251, Michael Ruscigno, a member of Local 138, and Darryl Sullivan, a member of Local 745, filed a protest (P-074-LU840-EOH), alleging that a number of IBT affiliates[4] violated the Rules by using union funds to support the RTC and its campaign activities. The protest alleges that affiliated unions provided technical support not just through contributions, but through union payments for travel to RTC events and by reproducing and distributing RTC bulletins. The protest further alleges campaign violations against the RTC itself. The protest also suggests that at least two employers, RL Communications and Delacorte/Shinoff, charged the RTC less than the market rate for services provided and thus the RTC accepted unlawful employer contributions. For a remedy, the protesters request an order ending all contributions to the RTC from employers or IBT affiliates, and that all affiliates who made illegal contributions to the RTC, directly or indirectly, should be required to make equal contributions to the Ron Carey slate of candidates.
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By letter dated May 24, 1995, General President Ron Carey transmitted to the Election Officer materials which an IBT Fact-Finding Committee had compiled about the RTC. In the cover letter, Mr. Carey stated that he had determined that any questions relating to the use of dues money for campaigning should be decided by the Election Officer. The letter was ultimately docketed as a protest (P-123).[5]
In addition, by letter dated May 24, 1995, Chuck Mack, President of Joint Council 7, filed a protest (P-058-IBT-EOH) against Mr. Carey, General Secretary-Treasurer Tom Sever, Mr. Gilmartin, and General Counsel Judith Scott. In essence, the protest alleges that the respondents had made threats against officers and members of IBT affiliates who support the RTC or TADEF, including threats of disciplinary action. The protest asserts that the threats are designed to support Mr. Carey's reelection campaign by stifling all legitimate criticism of the Carey administration's policies. As stated in the protest, "These repeated threats create an atmosphere of intimidation and coercion that extends to chill the exercise of Title I protected activity supporting or opposing candidates for delegate or International office."[6] An amended protest was filed the same day further alleging that the IBT's threats, including the activities of an IBT fact-finding committee, violate the Rules because they were communicated using union resources and staff.
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By letter dated June 19, 1995, James P. Hoffa, a member of Local 614, filed a protest (P-094-IBT-EOH), alleging that the IBT’s investigation of RTC is itself a violation. He argues that the IBT’s report on the RTC is an asset to the union since it was produced with union funds. However, he claims, Mr. Gilmartin did not use the report to further a legitimate objective of the union but rather to support a pre-election protest unrelated to his responsibilities as a union officer. Mr. Hoffa alleges that Mr. Carey instructed the Election Officer to coordinate with the IBT Legal Department in order to determine whether the Rules have been violated. He also makes the following points: (1) reports produced with union funds may not be used to assist Mr. Carey, nor can Mr. Carey use the IBT Legal Department to process election protests on behalf of him as a candidate. Mr. Hoffa further asserts that Mr. Carey has "tarnished the image of the Election Office as an independent entity;" (2) use of internal IBT documents to support a protest against an organization which has challenged Mr. Carey's programs raises doubts as to whether there was any legitimate union purpose to be served by the investigation. Therefore, any funds expended on investigation constituted campaigning in support of Carey; and (3) Mr. Carey's letter of May 24, 1995, done at union expense, constitutes further campaigning by the IBT in support of Mr. Carey because it furthered his political objective of isolating the RTC.[7]
As a remedy, Mr. Hoffa requests an accounting of the cost of the IBT's investigation, the May 24, 1995 letter, and Mr. Gilmartin’s protest; an accounting of the time and costs of the IBT Legal Department in preparing these materials, and any meetings with the Election Officer; an order that Messrs. Carey and Gilmartin reimburse the IBT; and a requirement that they distribute a letter advising that it was inappropriate for the IBT to have filed a protest regarding the RTC, since the IBT is neutral in the election.
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By letter dated October 4, 1995, John F. Murphy, secretary-treasurer of Local Union 122 and Joint Council 10, filed a protest (P-185-IBT-EOH) concerning Mr. Carey's interpretation of the IBT Constitution, issued October 3, 1995, that found the RTC to be an unauthorized subordinate body of the IBT that is illegally spending members' dues to support its activities. The protest alleges that the constitutional interpretation is a misuse of union funds and resources to further the Carey campaign, and is designed to suppress dissent and interfere with the eligibility of potential Carey opponents to run in the International officer elections. The protest further alleges that the interpretation violates Judge Edelstein's ruling that the Election Officer has jurisdiction to determine whether contributions to the RTC violate the IBT constitution.[8]
By letter dated December 15, 1995, Mr. Murphy filed a protest (P-277-IBT-EOH ) over the General Executive Board’s (“GEB”) decision of December 12, 1995 approving Mr. Carey’s constitutional interpretation of October 3, 1995. The protest asserts that the approval constitutes a misuse of IBT resources to aid the campaign of Mr. Carey, in violation of the Rules, the free speech and assembly provisions of the LMRDA, and a decision of Judge Edelstein in United States v. IBT, No. 88 Civ. 4486 (DNE) (S.D.N.Y. Aug. 17, 1995). The protest also alleges that the perfunctory treatment of the RTC’s appeal to the GEB is further evidence of illegal and improper retaliation against the RTC.
In addition to these protests, there are various lawsuits which relate to this dispute, which are described more fully below.
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These protests were investigated by Election Office Staff Attorneys David S. Paull and Tara Levy.[9]
STATEMENT OF FACTS
A. The Dispute Over the Area Conferences
In order to understand the nature of these protests, it is necessary to recount the history of the dispute which preceded the formation of the RTC: the dissolution of the Area Conferences.
For some 40 years, the IBT has had four main levels of organization. Local unions are grouped into joint councils. Locals and joint councils also belong to state conferences. Joint councils in turn belonged to one of five Area Conferences that geographically divided the United States and Canada: Eastern Conference, Western Conference, Southern Conference, Central Conference, and Teamsters Canada. Standing above the Area Conferences was the International Union.
All of the U.S. Area Conference chairs during 1994-1995 - Michael Riley, Walter Shea, William Hogan and Jerry Cook - had opposed General President Carey during the 1991-1992 election. While there was a certain amount of effort to work together after the election, deep political differences between them remained.
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Since 1991, the IBT has faced a rapidly worsening financial crisis that has been draining the union's assets.[10] Reluctant to call for a special convention to vote on a dues increase,[11] on January 5, 1994, the GEB instead conducted a referendum on a proposal to raise dues. All of the Conference chairs strongly opposed the dues increase and campaigned against it in local union, joint council and Conference newsletters. The campaign became bitter, with both the IBT leadership and the Conference spokespeople harshly criticizing each other. The Conferences also brought suit to enjoin the dues referendum.[12] The U.S. District Court for the District of Columbia denied the request for preliminary relief and later transferred the matter to Judge Edelstein.[13] The proposed dues increase was defeated by a three-to-one margin, an embarrassing blow to Mr. Carey and his administration.
On March 21, 1994, before the dues referendum vote was tabulated but after the trend of the voting was apparent, Mr. Carey announced that the GEB would conduct a hearing on his request to abolish the Area Conferences. Mr. Carey called the Conferences "dinosaurs," a wasteful and unnecessary level of bureaucracy that mainly existed to provide multiple salaries and a political base for what he called the "Old Guard" traditionalists in the union who had supported the pre-RICO leadership. A GEB meeting to consider the matter was initially scheduled for April 19, 1994, although the date was postponed several times and the hearings ultimately began on May 16, 1994.
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The same day Mr. Carey announced the hearings, he sent personal representatives to the offices of each of the Area Conferences for the asserted purpose of inspecting the Conferences' books and insuring the integrity of the records. At the offices of the Eastern Conference in Bethesda, Maryland, the leaders refused to immediately provide the records or space at the office to conduct the inspection. The Conference supporters claimed the IBT representatives were acting in a threatening and unreasonable manner; the IBT asserted that its representatives were being stonewalled. A supporter of Mr. Carey brought internal union charges against the leaders of the Eastern Conference for allegedly refusing to obey legitimate directives of the IBT. The IBT sent notice of these charges to all IBT affiliates via TITAN.[14] Those charges are still pending. On March 23, 1995, the IBT limited the Area Conferences' access to TITAN to only 4-5 messages per day, which was a severe restriction on their ability to communicate.
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Not surprisingly, Mr. Carey's announcement touched off a bitter, public battle between the International Union and the leaders of the Area Conferences. One of the key players on behalf of the Conferences was Delacorte/Shinoff, a public relations firm located in San Francisco with experience in providing communication services and advice on political strategy to candidates for election and to labor unions. The two principals in the firm, Paul Shinoff and Toni Delacorte, are experienced public relations operators who have worked for various unions and candidates for public office. The firm had previously done work for IBT Joint Council 7. Mr. Shinoff had been a free-lance journalist before spending several years as a writer and later member of the editorial board for the San Francisco Chronicle. In 1990, he was a policy advisor and strategist for Diane Feinstein in her campaign for the governorship of California. Publicity statements for Delacorte/Shinoff lists consultation on strategy as one of the services provided by the firm. Eric Johnson is an account supervisor at the firm.
Delacorte/Shinoff was originally retained in March 1994 by the Western Conference to assist the campaign against the revocation of the Conferences' charters. Within a month or so, they were providing services to all of the U.S. Conferences on that issue. There was no written contract between Delacorte/Shinoff and these clients.
A press release, issued March 22, 1994, on Joint Council 42 letterhead, listed Messrs. Riley, Shinoff and Johnson as contacts. Mr. Riley was chair of the Western Conference and president of Joint Council 42. The release attacked Mr. Carey's plan to dismantle the Conferences and quoted Mr. Riley as saying, "It's a desperate move by Carey to hold onto power . . . . Carey's acting like a second-rate dictator of a banana republic."
In a release dated March 24, 1994, on Joint Council 42 letterhead, carrying the same contact persons, Mr. Riley commented on the results of the dues referendum, stating of Mr. Carey, "The man must live on Mars . . . . It was a strong mandate for one major change, the end of bureaucracy at Carey's International office . . . ." It also quoted Mr. Riley as saying, "The Conferences represent the members. Carey's bloated Washington bureaucracy represents his own interests." The release quoted William Hogan, chair of the Central Conference, saying, "This was a vote of confidence in Carey's abilities to lead our union, and he lost." Jerry Cook, chair of the Southern Conference, was quoted as commenting, "The vote totals do not lie. The only person who cannot face the truth is Ron Carey."
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In a memo dated March 23, 1994 to Mr. Riley and Chuck Mack, President of Joint Council 7, Mr. Shinoff commented that "this appears to be the beginning of Carey's Spring Offensive to consolidate power." He made a number of observations about Mr. Carey, including that he is "a good political operator" with a "committed group of about 10,000 TDU members" behind him, that he "moves quickly and is willing to take risks," and that he "has a good public relations operation." Mr. Shinoff then stated:
This is the opening curtain to the coming battle. Short-term, Carey may prevail. Long term, he cannot attack the local leadership and succeed. It's going to be a battle for the hearts and minds of the membership. The battle over the dues increase shows we can win that fight.
Urging Mr. Riley and Mr. Mack to be "pro-active," Mr. Shinoff proposed a national, long-term strategy, which includes the following:
- a series of two page, 8 ½ by 11 bulletins to be distributed to members;
- "Create an opposition organization;"
- respond to Carey's corruption attack;
- "We must also warn the news media that they are spreading potentially libelous charges. This should muffle Carey's drum and act to discredit him."
- establish an ongoing press operation that can quickly respond to Carey.
According to Mr. Shinoff, he never received any feedback from anyone on this memo.
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On March 25, 1994, Messrs. Shinoff and Johnson, and Ms. Delacorte sent a memo on Delacorte/Shinoff letterhead to Mike Riley, Tony Locke,[15] Bill Hogan, Walter Shea, and Jerry Cook, entitled "Opening of Communication Campaign." They announced the plan for a "major communication program" being initiated by the Western Conference. The memo stated that beginning March 28, 1995, they would begin regular distribution of a one-page informational bulletin entitled The Real Teamster, to be sent by fax to all local unions and joint councils on a near-daily basis. The memo also said that Delacorte/Shinoff would continue to send out press releases, contact selected labor reporters, and conduct regional conferences.
A fax on March 28, 1994 designated as the first bulletin of The Real Teamster, a national fax network set up by the Western Conference to inform others about the "escalating leadership crisis" in the IBT. On the same day, the Western Conference produced a press advisory on letterhead entitled "The Real Teamster" with the subheading "Published by The Western Conference of Teamsters in Cooperation with all the Regional Conferences." Messrs. Riley, Shinoff and Johnson were listed as media contacts.
The March 29, 1994 issue of The Real Teamster quoted Mr. Riley as saying, "There are those who depict Carey as a reformist. If reform is a total dictatorship, then we has [sic] succeeded." It also quoted Mr. Hogan saying, "Ron Carey is out to destroy the [IBT]. He wants to destroy it because he can't control it."
The March 30, 1994 issue had Mr. Riley observing that Mr. Carey wanted to absorb the treasuries of the Conferences to make up for the International Union's mismanagement of funds, and stating, "It's a Carey grab." It quoted Mr. Mack as saying, "This is a struggle for power." Among the other comments cited in the issue was one from a local member "who criticized Carey's 'Gestapo-like attitude,'" and another who said, "We have to tell Ron Carey who owns this union . . . ."
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On March 30, 1994, a press release by Delacorte/Shinoff also reported on an emergency meeting in San Francisco that took place the day before to organize a rank and file campaign "to preserve regional autonomy and restore financial stability" to the union. Also on
March 30, the Conferences filed suit against the IBT and Mr. Carey in the U.S. District Court for the Southern District of New York. Central Conference of Teamsters v. IBT, No. 94 Civ. 2247 (DNE) (S.D.N.Y.) The complaint alleged that the threatened abolition of the Conferences violated the IBT Constitution and constituted retaliation against the Conference chairs' exercise of free speech rights under LMRDA. The plaintiffs sought a preliminary injunction. The IBT had previously filed its own action, seeking to have the Court declare that the IBT had the authority to abolish the Conferences. IBT v. Eastern Conference of Teamsters, No. 94 Civ. 1950 (DNE) (S.D.N.Y.).
The March 31, 1994 issue, No. 4, reported that some 200 members joined Southern Conference officials at a Dallas meeting, many of them wearing "Impeach Carey" t-shirts. It also quoted International Vice President Gene Giacumbo as stating, "It seems Carey's going to do whatever he can to defame me."
The April 4, 1994 issue gave a "sneak peek" at the latest issue of the IBT magazine and then concluded, "Carey says he's using your money to help locals fight for better contracts. Instead, it appears he's using your money to promote his personal agenda . . . ." It then offered the "Quote of the Day" from a local union officer who said that some members had originally felt that Ron Carey was a government plant to destroy the union; "I did not believe that at the time. I wonder if I was wrong." The bulletin then gave "Monday's Tip," suggesting readers check out a story in Business Week called, "A Question for the Teamsters' Mr. Clean: How did Ron Carey finance those resort properties on his modest pay?"
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The April 5, 1994 edition, in its "Quotes of the Day," cited a recent Time article as stating, "Carey seems to run his own finances more acutely than his union's." It also quoted Mr. Hoffa as stating, "We've started to turn the tide."
On April 8, 1994, Judge Edelstein began hearing evidence on the Conferences' motion to preliminarily enjoin the IBT from abolishing the Conferences. In response to critical comments from the Court, the IBT agreed to reinstate the Conferences' access to TITAN, postponed any activity on the charges against the leaders of the Eastern Conference, and partially limited the access of the IBT representatives to the Conference offices.
In the April 11, 1994 issue, The Real Teamster reported on the injunction hearing before Judge Edelstein in which the conferences sought to prevent their dissolution by the International. The bulletin made repeated reference to Mr. Carey, such as "Carey's inner circle," "Carey's lawyers," "Carey's takeover attempts," "Carey's so-called Personal Representatives," and "Carey's top political operatives." The last paragraph of the bulletin asked, "Does Carey plan mass take-overs of local unions?" That same day, Judge Edelstein denied the Conferences' motion for preliminary injunction. The U.S. Court of Appeals for the Second Circuit later affirmed. The cases are still pending in the District Court.
The April 15, 1994 edition began with a headline, "What does Carey want?" and then stated:
Plenty! Teamster President Ron Carey wants to get his hands on your pension money. Carey wants a dues increase and he wants the end of local control. To achieve these goals, Carey launched a civil war that now threatens to destroy our union.
It then urged members, “Do not allow Ron Carey and his camp to destroy the union we have worked so hard to build and defend!” (emphasis in original). Most of this bulletin was also contained in a press release issued the same day.
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The issue of April 18, 1994 prominently announced a rally in front of IBT headquarters in Washington in support of the striker protection bill before the U.S. Congress and in support of the Conferences, giving the date and time it was supposed to start. The rest of the bulletin denounced Mr. Carey because of the alleged unfairness of the rules that would govern the hearing on abolition of the Conferences. The bulletin stated, "The rules are consistent with Carey's practice of saying one thing and doing another." (emphasis in original). It continued, "He trumpets democracy but acts like a dictator."
Bulletin No. 14 of The Real Teamster, April 19, 1994, again prominently announced the rally to be held that day "to protest against President Carey and his mineworker cronies who are attempting to destroy the organization . . . . [Carey] is an unpopular and besieged leader who takes advice from outsiders who have never been members of our union, who know little about our organization and care less about its members." The second article was headlined, "G.E.B. Member Giacumbo Blasts Carey." A short, final item had the subheading, "It's about time to let some oxygen into that bunker, Ron."
On April 19, 1994, some 1,000-2,000 of what one reporter called "boisterous, enthusiastic" members demonstrated at the IBT International offices in Washington, protesting abolition of the Conferences. Mr. Hoffa was a featured speaker at the rally, and tables sold baseball caps with "Hoffa" on the front. Vendors were also selling t-shirts that said "Impeach Carey" and buttons saying, "Don't Blame Me, I Voted for R.V.," a reference to R.V. Durham who was defeated by Mr. Carey in 1991.
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On April 20, 1994, Mr. Shinoff sent a memorandum to all Conference chairs, stating that he was putting together a "strategic communications plan" for their consideration. Mr. Shinoff advised them that it assumed a "worst case situation" in which the Conferences were abolished. His plan, Mr. Shinoff said, "proposes to create a ‘government in exile,’ a shadow IBT, allowing us to maintain organizational and political unity, and speak to the membership with one voice." The plan would assume that Mr. Carey had support from about ten percent of the membership, and that "we have about 25 per cent solid backing." The plan would be both defensive and offensive: "We have to give these 'at risk' locals and undecided members a reason to support us beyond the fact that we are simply anti-Carey." It refers to the fact that the plan would have two aspects, an internal and external program. The external program would enhance "our ability to work with the press, coordinate with our legal strategy, legislative lobbying and relationships with other labor organizations." Mr. Shinoff states that he received no response to his memo from any of the recipients.
Another memo of April 20, 1994 from Mr. Shinoff to the Conference chairs noted, "We have been able to stop pro-Carey stories from being written by the labor press, but now have to take them further to report on our side of the issue." The April 20, 1994 issue of The Real Teamster was devoted to reporting on the previous day's demonstration, claiming 4,000 members participated in the march on the "Marble Palace." The quotations of speeches all involved sharp criticisms of Mr. Carey personally; Mr. Shea referred to Mr. Carey's "reign of terror."
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In anticipation of the GEB hearings on abolishing the conferences, Mr. Shinoff sent a memo to the Conference chairs on April 21, 1994, advising them "to be as aggressive to [sic] overcome and overshadow the predicted results of their kangaroo court. Our recommended message is that Carey is conducting an attack on union democracy, a message that some of his own VPs might find difficult to defend." Mr. Shinoff related his scheduling of a press briefing, a pre-press briefing meeting, and announced an ongoing press room that he and his people would staff at a nearby hotel. Mr. Shinoff came in from San Francisco to handle this himself.
Mr. Durham and his local union’s secretary-treasurer, Charles S. Williams, filed internal union charges against Messrs. Carey and Sever and the members of the GEB. There were six counts in the letter-complaint, including misuse of union monies, the failure to call a special convention to address the financial crisis, ordering an illegal strike against UPS, attempting to revoke the charters of the Area Conferences, hiring an inflated work force at the IBT, and taking monies from service providers, including employers. Mr. Durham specifically requested that his charges be heard by a convention; the charges are thus still pending.
National Bulletin No. 16 of The Real Teamster, dated April 25, 1994, reminded Mr. Carey that he was elected by a minority of the union and reiterated the call for a special convention. It also reported that Mr. Durham had filed internal union charges against Mr. Carey and most members of the GEB, asserting that the charges "could force a special election or even drive Carey from office."
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By memo dated April 27, 1994, Mr. Shinoff delivered to the Conference chairmen three recent press stories for their review. He ended the short memo by stating, "Carey is no longer a media darling. He has not had a positive story written about him in nearly four weeks." A May 2, 1994 memo from Mr. Shinoff to Conference chairmen apprised them of that day's New York Times story concerning Mr. Carey's real estate transactions which were under investigation by the Independent Review Board ("IRB"). It also stated, "We should continue to effort [sic] to split the GEB, divide the Carey camp, and build our base of support among the membership." It also said, "We should avoid personal attacks on Carey, as the material speaks for itself."
The Real Teamster of May 5, 1994 again called for a special convention to solve the financial crisis. The May 9, 1994 edition refers in two places to IBT headquarters as the "Marble Palace." Bulletin No. 22, dated May 9, 1994, reported on suggestions of leaders of the IBT staff union for controlling costs at the International headquarters. The headline was, "Is Carey listening? Staff union leaders demand fiscal controls at Marble Palace." Another section also referred to the Marble Palace.
Also, on May 9, 1994, Mr. Shinoff sent to Conference chairmen "and key leaders" a copy of his draft proposal for a strategic plan for the Conferences. The proposal incorporated many of the ideas from his March 23 memorandum. The cover memo stated that aspects of the plan "can be changed, discarded, and added." The goal of the draft proposal, printed on Delacorte/Shinoff letterhead, "is to restore moderate, competent and knowledgeable leaders to power . . . ." The proposed plan consisted of two coordinated campaigns: one among members to strengthen local unions, solidify membership support and build a base of activists; the second, a Washington campaign "to put severe political and legal pressure on Carey."
Criticizing Mr. Carey for seeking to take the IBT, "a uniquely bottom-up union," and turn it into a top-down union, the plan continued:
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We have done well. Carey is on the defensive. Never has a general president been so unpopular. Yet Carey maintains the considerable power at the office and will use it. He has the support of the government. We have been reactive. We must become pro-active. We need a strategic plan. In politics, there is one overriding lesson: The campaign with a good plan and message will win because it can maintain momentum in the face of unanticipated events. The campaign without a good plan and message will lose.
Mr. Shinoff then presented two alternative strategies: "The 'soft' strategy assumes that due to disunity in the GEB, splits among his base, and fear of an all-out fight, Carey seeks a negotiated settlement." This, said Mr. Shinoff, would lead to "power-sharing" with Mr. Carey, and "would not resolve the power struggle," causing the conflict to continue "through 1994 and 1995 elections and the 1996 campaign." While the soft strategy might create less risk to the union and most officers, "we would be forced to dig in for a long fight that could exhaust the finances and demoralize members."
The "hard" strategy, according to Mr. Shinoff, "seeks to short-circuit a prolonged conflict by going for Carey's political throat. It aims for his removal or resignation within six months." Mr. Shinoff stated that the plan "is designed to build our base among pro-Conference members, isolate Carey's, and focus on those who are active but undecided." The plan also proposed the creation of a national caucus to begin aggressive membership contact and allow leaders of key joint councils and local unions to play active roles.
The caucus can become a "shadow government" with a Washington office should the Conferences be abolished. It creates organizational tools that can be used by allied campaign groups to support vulnerable officials in the Fall 1994 elections, and go on to elect delegates in 1995 and fight the election of 1996.
The plan then makes eight strategic recommendations, which are summarized in the memo's headings:
1. Defend the Conferences by strengthening the locals;
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2. Divide the radicals from the opportunists;
3. Act as insurgents, not incumbents;
4. Isolate Carey, do not divide the union;
5. Respond to the undecided member;
6. Maintain the trust of the membership;
7. Learn from Carey;
8. Create a caucus; a "government in exile."
As to the last point, Mr. Shinoff recommended, "Should Carey succeed in abolishing the Conferences, we must be ready to announce the formation of the [Caucus] on the same day, to rob him of a PR victory and seize the initiative."
The proposal then set forth a detailed action plan. It proposed that if the May 16 GEB meeting went forward, "we" will warn wavering GEB directors that they "will be held personally accountable in the external legal sphere and internally within the IBT when we regain power." It proposed calling a "Teamster Truth Squad" press conference to respond to the GEB session. In preparation for the GEB charter revocation meeting scheduled for May 25, Mr. Shinoff noted, "Only the threat of raw power and fear may move some of Carey's weaker GEB allies away from him. We must show GEB directors that they will be held personally responsible for the financial and organizational chaos that charter revocation will bring." Mr. Shinoff proposed to go forward with news briefings that had been scheduled before the GEB meeting had been postponed. He would staff a press operation at an adjacent hotel and take responsibility for overall organization and direction of press events.
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Recognizing it as the "most radical concept in the plan," Mr. Shinoff stated that a caucus would be "our national campaign committee," "our organizing committee." It would be designed to put a network of local union leaders and activists in place "to counter TDU and focus on the 1994 Local Union election elections [sic], 1995 delegate elections and the 1996 contest."
The plan also recommended that "We must continue our call for a special convention, as it underscores our demand to make democratic decisions and Carey's fear of open decision-making." Mr. Shinoff recommended that the special convention be called for "continually."
In a section entitled "Washington Strategy," Mr. Shinoff stated that "Carey is seen as a labor saint among some on Capitol Hill . . . We have to go after his clean image and increase pressure on the Carey administration." Mr. Shinoff asserted that there were legitimate areas of inquiry for Congressional hearings, such as Carey's attacks on dissidents, the union's financial troubles, and "allegations of personal wrong-doing and questionable associations. . ." Noting that many officials of IBT affiliates have close ties to members of Congress, he advised, "We must lobby them hard for hearings."
To gain the support of other unions on their behalf, Mr. Shinoff advised that "We should declare Carey and his allies to be 'union busters.' We should hang that slogan around his head with all the negative attributes it holds for labor."
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As part of a sophisticated communications program, the plan envisioned continuation of The Real Teamster, both in its current fax form and as a new printed newsletter. The plan also recommended use of other publications, such as local union and joint council publications. Mr. Shinoff advised them "not to be afraid if Carey's side demands space as well. By encouraging the debate, we will encourage noncommittal members to become involved." The plan further recommended that members and officials be encouraged to write letters for publication "in Carey's magazine," which he explains is The New Teamster, the official magazine of the IBT.
Under the heading "Newspaper Ads," Mr. Shinoff noted that Roll Call was the best read publication on Capitol Hill. He proposed that "we" would design a full page ad tentatively titled, "What's Going on in the Teamster's Union?" After noting that "the so called 'white knight' of the labor movement" is attacking dissidents and free speech, calling unnecessary strikes, spending the union into bankruptcy, and facing allegations of wrongdoing, the ad would ask, "Isn't it time Congress starting asking questions?" The plan also recommended other communication techniques, such as an 800 number, billboards, buttons, bumper stickers, flyers, and use of public opinion surveys.
In the section on the press, Mr. Shinoff divided the media into two camps: the "long-time labor reporters who are reflexively routing for Carey," and the "younger and less experienced reporters who remain more open." He then wrote:
The press likes to see things in black and white. We must present ourselves as the dissidents and Carey as the incumbent. By adopting the language and message of dissidents, and being open with the media, we have blunted the more cynical long-time reporters - but they will never be on our side. But we are winning over the less experienced reporters through one-on-one discussions and by being a source of information.
Mr. Shinoff recommended a press program comprised of using press kits, staging events, getting key spokespeople on national media and talk shows, etc., one-on-one discussions with reporters and editors, drafting op-ed columns in the name of Conference chairman and key union leaders, distributing press releases, and conducting internal media training.
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According to Mr. Shinoff, he did not receive any feedback or comments from anyone in response to his May 9, 1994 memo. Mr. Riley later gave a deposition in which he said the May 9 memo had nothing to do with the goals of RTC and was just "bullshit." At the time, however, he said nothing about the memo to Mr. Shinoff or anyone else.
The Real Teamster of May 18, 1994, reported that the GEB had voted an emergency $1 per member per month dues increase. It noted that Mr. Carey would cut $10 million in expenses, "[b]ut no reported mention was made of cuts in Carey's bloated Marble Palace PR staff." Another article contained the headline, "Carey Suffers Another Embarrassing Loss; IBT Finishes Third at USAir."
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A press advisory, dated May 20, 1994, began with the headline, "Teamster Conferences prepare for war to counter Carey power grab." The May 23 press advisory contained the headline, "Regional leaders to oppose witch-hunt by 'reform' president, attack on union democracy, as 1.4 million-member Teamsters heads toward civil war." The May 23 issue of The Real Teamster was devoted to criticism of Mr. Carey by International Vice President Sam Theodus, headlined "Carey Blasted by Key Ally." It also referred to the Marble Palace, as did a press advisory and another press release, both dated May 25, 1994. Another release, dated May 25, 1994, accused Mr. Carey of having a double standard by allowing high multiple salaries for his supporters while denouncing the practice among his opponents. The release also stated that "[w]hile Carey charges his opponents with corruption, he is being investigated . . . for allegations of personal financial wrongdoing" in connection with his real estate activities. It further stated that Mr. Carey is facing internal charges for requesting and accepting monies from employees and vendors to pay off his 1991 campaign debts. Several press releases and editions of The Real Teamster during May attacked Mr. Carey for his "flawed" settlement of the National Master Freight Agreement and his "misrepresentations" of the agreement's terms.
On May 26, 1994, Delacorte/Shinoff distributed a release to the press entitled, "Canadians Say Au Revoir; Walk Out of Carey's Hearing . . . ." The headline refers to the two Canadian members of the GEB who allegedly walked out of the hearings to revoke the Conference charters, telling Mr. Carey and other officials, "You are destroying the union." The release quoted Walter Shea saying, "It is a sad and tragic day. Ron Carey is tearing the union apart." It further quoted Mr. Riley as saying, "We are working to build the Teamsters union while Carey and his allies are acting to destroy it." It also referred to "Carey's PR department" alleging the circulation of "slanderous and vicious materials" that falsely accused the Conferences of waste and corruption. The release ended with:
Just two years ago, the Teamsters were the largest, wealthiest, and most powerful union in North America. After two years of Carey's leadership, the Teamsters are financially insolvent and politically divided.
On June 7, 1994, Delacorte/Shinoff put out a press release entitled, "Teamsters Internal Peace Talks Sabotaged by Carey," reporting on the apparent breakdown of discussions between leaders of the Conferences and the Carey administration.
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The GEB voted on June 9, 1994 to dissolve the Area Conferences, having held seven days of hearings on the subject. On June 10, 1994, Delacorte/Shinoff distributed a press release entitled, "Power Grab: Teamsters' Carey, Allies, Vote to Destroy U.S. Conferences in Attempt to Eliminate Dissent . . . ." It quoted Mr. Hogan as stating, "This is not a civil war because the Teamsters are not split. We have the members. All Carey has is a building, a bankrupt treasury, Mineworker Union advisors and a PR office." Commenting on the hearings, the release stated that "testimony showed that Carey has a poor record of servicing Local Unions, preferring instead to put his resources into politically motivated activities and high-profile disputes." It further quoted Mr. Shea as saying, "Carey came to power as a reformer, but has acted as a despot." Bulletin No. 38 of the same date contained the same story.
B. The Creation of RTC
National Bulletin No. 40 of The Real Teamster, dated June 14, 1994, carried the headline, "We're back: Teamster Leaders announce formation of regional caucuses to continue organized fight for union democracy." The bulletin stated that such caucuses were necessary to defend against "the despotic conduct of the Ron Carey administration." It claimed that Mr. Carey shut down the Conferences because of their "opposition to his programs and criticism of his performance." The June 15, 1994 edition of The Real Teamster contains the same masthead, layout and typeface as the previous issues. The only difference was that under the name, where it once said, "from the Conferences of the International Brotherhood of Teamsters," it now said, "from the caucuses of the International Brotherhood of Teamsters." Starting with Bulletin No. 42, the masthead referred to the "Regional Caucuses.”
The June 15, 1994 issue of The Real Teamster bemoaned the demise of the Conferences with the headline, "Monday Morning Massacre" Carey selectively purges political opponents . . . ." The headline for Bulletin No. 42 on June 17, 1994, was "Conference Leaders to Carey: Keep hands off Joint Councils and Local Unions!/Carey's secret meeting today in Washington, D.C."
In the June 20, 1994 issue, No. 43, an article entitled "Carey tries to gag Real Teamster," reported that IBT Attorney Judith Scott faxed a letter to them warning them not to incur additional expenses by printing another issue. The article stated:
Carey is acutely aware of the role played by fax machines in the downfall of another "evil empire" -- the Soviet Union . . . . Face it, Ron. All you have is the IBT building. We have the members and we are everywhere.
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Sometime around June 1994, 32 union members sent a notice, calling for a meeting on June 28 in Rosemont, Illinois "to discuss ways of protecting our members, Local Unions and Joint Councils in these difficult times where we are without strike benefits or the services from the Area Conferences that we so heavily relied upon." The notice also stated, "If anyone plans to come to this meeting with a political agenda, we request that you stay home. The crises facing our membership are too great to allow politics to interfere . . . ." Approximately 50 copies of the notice were telecopied out. Among the signers were Larry Brennan, president of Joint Council 43; Frank Carracino, president of Joint Council 73 and principal officer of Local 575; Dan Darrow, president of Joint Council 41 and member of the policy committee of the Central Conference; R.V. Durham, president of Local 391 and member of the policy committee of the Eastern Conference;[16] William Hogan, chairman of the Central Conference; Chuck Mack, president of Joint Council 7; John Neal, president of Joint Council 69, the Indiana Conference, and Local 135; Michael Riley, chairman of the Western Conference; Walter Shea, chairman of the Eastern Conference; T.C. Stone, president of the Texas Conference and principal officer of Local 745; Jerry Vincent, secretary-treasurer of Local 783; and Jack Powers, secretary-treasurer of Local 1150 who declared his candidacy for general president on March 30, 1994.[17]
In 1991, Messrs. Shea and Durham were defeated by Mr. Carey in the election for general president. Messrs. Brennan, Carracino, Darrow, Hogan, Mack, Neal, Riley, Stone and Vincent all lost their election bids for International vice president to members of the Carey slate.
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Approximately 50-100 IBT members attended the Rosemont meeting.[18] Among other things, they passed a resolution favoring the establishment of a Teamster Affiliates Caucus to, among other things, defend the autonomy of IBT subordinate bodies, protect free speech and other member rights, enforce the International Constitution, "bring the Union back to the membership," and further the rights of workers. The resolution provided that the Caucus would not support or oppose any candidate for union office, become a bargaining agent for any employees, and in no way advocate "dual unionism."[19] The resolution established an interim steering committee which was empowered to adopt appropriate participation fees and procedures to pay for the Caucus' activities. The group also discussed and approved creation of a defense and education fund.
The June 28, 1994 issue of the bulletin, No. 46, began with the headline, "Now, a word from the Real Teamster Truth Squad:/Carey's New Teamster spreads same old lies;/Continues campaign to silence opponents/. . . . Real Teamsters may need gloves to handle Carey's toxic waste."
In a July 1, 1994 memo from Mr. Shinoff to reporters and editors on Real Teamster letterhead, he stated:
One of the characteristics that distinguishes the Teamsters is the fierce independence of the membership. One of Ron Carey's fatal mistakes is that he turned his back on the union's talented regional leadership. Instead, he surrounded himself with outsiders of the Mineworkers cabal is who [sic] do not understand Teamster culture. In the classic manner of right and left-wing ideologies, they have attempted to arrogantly impose their will upon the people. And have moved to punish and purge those who protest. As King George learned, Americans do not take well to top-down decision-making. It sparks rebellion. And that is why we will prevail.
Another meeting notice went out to some 65 members, inviting them to a followup meeting on July 6-7 in Rosemont. The notice again stated, "We reiterate that anyone who plans to come to this meeting with a political agenda should stay home."
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Delacorte/Shinoff's work for the Conferences ended when the Conference charters were finally revoked in mid-June 1994. By memo dated July 5, 1994, Mr. Shinoff submitted a proposed communication plan and budget to Caucus leaders. The plan, incorporating ideas from his March 23 and May 9 memos, contained two segments: an "outsider Washington" strategy that "puts pressure on Carey from the media, Congress, Justice and Labor Departments, and other labor organizations." The "inside or membership strategy" would use the same issues "but on a more practical level. It emphasizes the quality of representation and the effect on members."
In a section entitled "Strategy: Timing and Emphasis," Mr. Shinoff stated, "While we are building toward the 1996 convention and election, events are moving much faster." He noted that "We have initiated a series of efforts in the legal, regulatory, media, and political arenas that may well combine to create new crosses for Carey and opportunities for us." However, since Mr. Carey would continue his attacks, "We must continue to aggressively build the caucus structure and communications network."
As part of the action plan, Mr. Shinoff recommended continuing The Real Teamster fax bulletin and a press program of ongoing press communications, placement of key people on talk shows, editorial board visits, writing columns, getting on magazine interview programs, and doing media training. The memo again proposed putting a full page ad in Roll Call entitled, "What's Going On in the Teamsters Union?" and ending the ad with the question, "Isn't it time Congress starting asking questions?"
The July 6-7 meeting took place with approximately 50 union members in attendance. (The RTC reports that 38-41 members signed in while others attended but declined to sign in.) Mr. Riley described it as a "steering committee to set up a permanent dissident organization to resist the political reign of terror upon which Carey had embarked."
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bylaws, the objectives of the RTC were essentially At the meeting, the Caucus changed its name to the Real Teamsters Caucus and approved a set of bylaws. According to the the same as those contained in the June 28 resolution.[20] The bylaws again repeated that the RTC would not support or oppose, or contribute to the support or opposition of, any candidate for union office. The RTC would not advocate succession from the IBT or dual unionism in any form, nor would it seek to represent employees for the purpose of collective bargaining.
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According to the bylaws, participation in the RTC is voluntary and open to any member, retiree, local union, joint council, conference, and officer whose participation is approved by the RTC steering committee. The steering committee sets "voluntary participation fees" for the various participants. After three months from the adoption of the bylaws, voting on the steering committee would be limited to representatives of participating affiliates who are current on their suggested participation fees.[21] The RTC accepts contributions from any member, former member, retiree, local union, joint council, conference and their officers, but not from any employer. In between meetings, the RTC is governed by a steering committee consisting of its officers, one member from each area conference area, and one from each participating joint council.
The RTC voted to set the suggested contributions at $2,500 quarterly for any joint council, with an additional $2,500 paid quarterly to the defense and education fund. For local unions, the meeting set the suggested contribution for the RTC and TADEF at ten cents per member per month to each organization.
The same meetings also established TADEF, with virtually identical bylaws. The object of the fund was described as "defending and educating Union members, Teamster affiliates, officers and the public" with respect to their legal rights, legislation and other issues, proper conduct of union affairs and other issues of concern. The bylaws further stated the goals as providing education and information to affiliates on collective bargaining, employment laws, and actions taken by the International that violate or affect those rights.
During the July 7, 1994 session, the combined meeting of both the RTC and TADEF elected officers. For RTC, the meeting elected Dan Darrow as chair, Al Panek as treasurer,[22] John Murphy as recording secretary, Bobby Logan as Southern regional representative, William Hogan as Central regional representative, Chuck Mack as Western regional representative, and Walter Shea as Eastern regional representative. Each nomination was unopposed, and each person was elected unanimously.
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For TADEF, the assembly unanimously elected Jack Powers as chair,[23] T.C. Stone as treasurer, Jerry Younger as recording secretary, Joe Morgan as Southern regional representative, Mike Riley as Western regional representative, Les Singer as Central regional representative, and Dan Kane as Eastern regional representative.
The meeting also unanimously resolved to oppose Mr. Carey's proposal for creating a voluntary strike benefit, and to request that Mr. Carey convene a constitutional convention to deal with the strike fund issue and other financial problems of the IBT.
The RTC also provided to participants at its meetings an opinion letter prepared by Attorney Robert Baptiste, a former general counsel to the IBT and longtime lawyer for many Teamster affiliates. The Baptiste letter, written in cooperation with other labor lawyers, concluded that it was lawful for IBT affiliates to use union funds to pay participation fees to the RTC.
During the July 7 meeting of the RTC, Mr. Shinoff made a presentation seeking to be hired. According to Attorney Baptiste, Mr. Shinoff left the room after his presentation, and "[a]fter a discussion, his proposal was totally rejected and the delegates specifically disapproved his reference to elections." The formal minutes of the meeting state that the Shinoff proposal was rejected and that the delegates "specifically disapproves any reference or plan that relates to local union officer elections, the 1995-96 Delegate elections and the 1996 International Officers Election." Mr. Shinoff states that after the meeting, he was told by Mr. Baptiste that his proposal was rejected as inconsistent with the RTC's bylaws and function. Mr. Shinoff says that Mr. Baptiste also told him in mid-July that neither Mr. Shinoff nor RTC could engage in politics or any activity that could be interpreted as seeking to remove Mr. Carey by political means. Mr. Shinoff says that he did not receive any other feedback on his proposal.
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However, the RTC unanimously voted to hire Delacorte/Shinoff to provide communications and public relations services, with other services and activities to be discussed. RTC agreed to pay $20,000 per month retainer to Delacorte/Shinoff plus expenses. There is no written agreement between RTC and Delacorte/Shinoff which would state the nature of the services performed, nor is there any document (apart from the minutes described above) which reflects a rejection of Mr. Shinoff's proposed strategy.
From June through September 1994, Mr. Shinoff continued to prepare and disseminate The Real Teamster to various local unions, joint councils, and members of the press. The name and format of the publication did not change from when it was published by the Area Conferences, and even the numbering of the issues continued numerically from when it was first published in March 1994. Starting with Bulletin No. 52, issued on July 29, 1994, the masthead changed from being the publication of the “Regional Caucuses” to that of "The Real Teamsters Caucus."
A press release dated July 11, 1994 was entitled, "Carey congratulates himself on being 'cleared' of charges, while reign of terror against members continues." The release consisted of a statement by Mr. Shinoff as spokesman for the RTC, noting that RTC never made the charges of corruption against Mr. Casey but "We have been quite concerned about the seriousness of these allegations . . . ."
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By memo dated July 14, 1994, Richard Leebove wrote to Mr. Shinoff, Eric Johnson, R.V. Durham, Chip Roth,[24] Mr. Baptiste, John Murphy, Bob DeRusha, and "Caucus leaders." Mr. Leebove is a private publicist with a long history of opposing any reform efforts or reform candidates within the IBT. He has regularly performed services for various IBT affiliates opposed to Mr. Carey. In his memo, Mr. Leebove stated that he had just reviewed some of the financial documents released by the IBT at the July 11-12, 1994, meeting of the GEB. He noted, "Many of these items are fascinating and can provide some good leaks for the press as well as for distribution to the membership." Noting that Mr. Carey had asked the AFL-CIO to waive part of their per capita taxes, Mr. Leebove stated, "Perhaps the Trustees should request to attend that meeting [with the AFL-CIO] as a way to further embarrass Carey . . . Maybe we should demand further cuts by Carey instead of weakening the AFL-CIO, which is fighting for America's workers (I personally don't believe this but it would certainly embarrass him!)."
After reviewing reports of the IBT's current finances, Mr. Leebove stated, "Clearly we must attack Carey hard on the continued financial crisis . . . ." Finally, Mr. Leebove observed that, "It appears that Carey is trying to head off the Real Teamster efforts for Congressional hearings . . . ."
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The RTC asserts that it at no time hired or authorized Mr. Leebove to act for it. It appears that, at the very least, Mr. Shinoff stayed in touch with him, as evident from Mr. Shinoff's memo to Mr. Riley dated April 26, 1994 ("Giacumbo reported to Lebove [sic] that pressure on Carey was reducing our support"). Mr. Shinoff's files contained dozens of pages of material on Carey's alleged ties to organized crime which he obtained from either Mr. Leebove or George Geller, a lawyer for Mr. Brennan and close associate of Mr. Leebove. Delacorte/Shinoff's phone list for the "Real Teamsters" includes Mr. Leebove's office, home, pager, and fax numbers. Mr. Shinoff's diary shows at least five telephone conversations with Mr. Leebove in September-October 1994. In addition, Mr. Leebove was present at several RTC meetings, including at least one in 1994 in Chicago and the RTC conference in Washington on January 18, 1995.
On July 25, 1994, the IBT issued a press release describing the Shinoff memo of May 9. The release began:
OPPONENTS OF TEAMSTER REFORM PLAN TO USE THE
"THREAT OF RAW POWER AND FEAR" TO PROTECT THEIR
SALARIES AND PENSIONS BY FORCING OUSTER -- WITHOUT
MEMBERS' VOTE -- OF FIRST DIRECTLY ELECTED PRESIDENT
They Seek to Use Friends in Congress and Prey Upon "Less
Experienced Reporters" Unfamiliar with Recent Teamster History
A plan commissioned by union officials trying to block Teamster reform and paid for with union members' dues provides valuable insights into the goals and methods of those conducting a smear campaign against General President Ron Carey.
This was followed by a detailed description of elements of the Shinoff plan, with a number of quotations.
On July 26, 1994, Mr. Carey sent a short TITAN message to all affiliates about the RTC and TADEF. It concluded with the statement, "Recent information raises serious questions whether the funding of these two entities is consistent with the fiduciary obligations of local union and joint council officers and whether such funding violates the IBT constitution." No specifics about these "serious questions" were provided or discussed at that
time.[25]
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On August 4, 1994, Mr. Darrow, as chairman of the RTC, wrote to Lane Kirkland and Thomas Donahue, president and secretary-treasurer, respectively, of the AFL-CIO. The letter, on RTC stationery, purported to support Mr. Carey's request to defer or waive the IBT's per capita to the AFL-CIO. However, the bulk of the letter went on to criticize Mr. Carey for allegedly not allowing the International trustees to examine the IBT's expenditures, and to inform the AFL-CIO officers that the union was close to insolvency. The letter called upon the AFL-CIO to "persuade" Mr. Carey to disclose financial data to the trustees. Copies of the letter went to all members of the AFL-CIO Executive Committee, which consisted at that time of the presidents of all of the major U.S. unions. The August 4 letter to AFL-CIO closely tracked the language of a draft prepared by Mr. Shinoff and circulated to Caucus leaders on July 25, 1994, although certain phrases were somewhat softened.
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Mr. Carey sent another TITAN message to all U.S. affiliates on August 9, 1994, concerning the RTC and TADEF. It quoted from the Shinoff memo of May 9 about forming a national campaign committee to focus on elections. After stating that the former Conference leaders were free to campaign to replace the administration, the message ended, "Subordinate bodies, however, should be aware that using dues money to fund activities to affect union electoral campaigns is illegal and may involve personal liability."[26]
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On August 12, 1994, Delacorte/Shinoff distributed to Caucus leaders a proposed agenda and "Outline for Fall Kick-Off Plan" in anticipation of the Chicago meeting on August 15, 1994. The document actually reflected the ideas of Mr. Murphy, the RTC’s recording secretary. It was also distributed to the 32 RTC leaders and members who attended the meeting. Among the items for the RTC’s consideration was a discussion of services that RTC could provide to local unions that used to be provided by the Conferences, including assistance in local elections and organizing campaigns. According to this memo, the purpose of the Fall kickoff plan was to "begin building a base of support at the Local Union level, by expanding the educational role of the RTC." As part of that, Mr. Murphy proposed holding two seminars at the September 12 meeting scheduled for Chicago, one on local union elections, another on avoiding trusteeships. The plan suggested inviting then-Election Officer Amy Gladstein to speak.
The document also proposed an RTC mission statement. The memo stated that proposals have included resolutions calling for a special convention, support for local union autonomy, support for free speech rights, a special meeting with the general president and the general secretary-treasurer on finances and strike benefits, and a proposed "unity" conference. The plan also proposed regional meetings, described as "educational sessions to anticipate upcoming external and internal issues of concern to IBT leaders and active members." "Externally," the meetings would focus on issues such as bargaining and upcoming legislative measures. "Internally," the meetings would be forums to give RTC leaders a chance to discuss their program and concerns and organize regional networks of RTC supporters among local union officers and shop stewards.
The proposed plan also called for an RTC speakers bureau, "truth squads," "communication activities such as the "Caucus Report," an RTC page in The New Teamster, creating and distributing flyers and brochures, and using The Real Teamster fax bulletin. It also suggested continuing to circulate materials to Congress and to lobby for Congressional oversight hearings. Under a heading entitled "Internal IBT Action Points," the plan included proposals to support the International trustees, a call on the secretary-treasurer to release records, and meeting with the director of the International's political action committee, DRIVE. There was also an item stating, "Proposed actions concerning Affiliates' Pension Fund."
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The RTC steering committee met on August 15, 1994 in Chicago. They heard reports on the shutdown of the Area Conferences and the status of various legal proceedings against the IBT. The committee voted to conduct a series of educational seminars at its September meeting. It also reaffirmed its position that only a special constitutional convention could change the IBT's dues structure.
In a letter to Mr. Carey on RTC letterhead dated August 19, 1994, Mr. Darrow denounced the IBT press release of July 25. According to Mr. Darrow, he had never seen the Delacorte/Shinoff memo of May 9, 1994, until the IBT distributed it. "I do know, however, that the Real Teamster Caucus has expressly rejected the fantastical views and strategies apparently fabricated by Delacorte/Shinoff." Mr. Darrow emphasized that the Delacorte/Shinoff memo had never been authorized, approved, adopted or endorsed by any officer or member of RTC.
Also on August 19, Mr. Darrow responded to Mr. Carey's TITAN messages of July 26 and August 5, which warned affiliates about possible illegalities in the operation of the RTC. Mr. Darrow denounced the messages as "an obvious and illegal threat to impose sanctions against any person or IBT affiliate that supports the Caucus."
Calling the prohibition against political involvement part of the "core of the Caucus," Mr. Darrow stated, "[A]s long as I am part of the Real Teamsters Caucus it will maintain a non-political posture and will not support, or otherwise become entangled in, directly or indirectly, any political agenda or candidate." Relying on Mr. Baptiste’s opinion letter, Mr. Darrow stated there was no question as to the legality of the RTC's operations, and stated that it would continue its activities.
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On September 11-12, 1994, the RTC held its first general meeting in Chicago. The activities included a closed meeting of the RTC Steering Committee; seminars on conducting local union elections and alternative strike fund operations; reports on national master agreements, political and economic forecasts, legislation, and "maintaining an autonomous local union." There was also a legal report by Attorney Baptiste.
A September 15, 1994 press release claimed that the IBT formed a "puppet joint council" in Southern California to punish Mr. Riley, described as an official critical of the Carey administration. The release stated, "The plot . . . was apparently hatched in the IBT's Marble Palace headquarters in Washington."
On September 22, 1994, Mr. Shinoff drafted an election strategy memo for the RTC concerning another possible referendum on a dues increase. He ended by saying, "If the IBT wants a referendum, we should make it a NO dues increase - NO confidence vote" (emphasis in original).
In a letter to Mr. DeRusha dated September 26, 1994, IBT General Counsel Scott went through in greater detail the union's concerns about the funding and nature of the RTC, with citations to case decisions on the responsibility of union officers. She ended by stating that the letter is written "to put you and Joint Council 10 officers and delegates on official notice that serious questions exist concerning the legality of expenditures by IBT affiliates to fund the Real Teamsters Caucus and its 'defense fund.'" She also stated, "I cannot render a legal opinion that officers who use members' dues money to fund these entities despite this information do not expose themselves to liability under federal law and/or internal union discipline."
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A virtually identical message went to all local unions and joint councils via TITAN from Mr. Sever on September 27, labeled as a letter from the IBT general counsel.[27]
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On or about September 29, 1994, Mr. Shinoff drafted a four-page "Strike Fund Campaign Plan" in anticipation of a referendum to be called by the IBT for a new dues assessment to fund a strike and defense fund. Assuming the IBT called for the referendum, Mr. Shinoff described the strategy and tactics of how the RTC could defeat the proposal. He advised:
We need to "pull" members in to vote their natural instincts. Most members now see our struggle as a leadership fight. We must be inclusive and isolate the IBT[.]
Mr. Shinoff divided the "messages" to be delivered by the RTC campaign into inside and outside messages. The "outside or members' message" included, "Get the International out of your pocket," "No blank checks," "Attack the IBT for pushing another expensive, divisive vote," and "present alternatives." The "inside message directed to officials," however, was:
1. No confidence.
2. Take back the IBT.
3. Call for a special convention.
A detailed campaign plan followed. The memo went to at least some of the RTC officers. The plan was never implemented, since the IBT never called for another referendum.
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On September 30, 1994, the RTC filed suit against the IBT in the U.S. District Court for the District of Columbia, alleging that the IBT's warnings about joining the RTC constituted retaliation for engaging in protected free speech, in violation of LMRDA. Darrow v. IBT, C.A. No. 94-2113 (D.D.C.). On motion of the U.S. Attorney, Judge Edelstein enjoined the Darrow plaintiffs from maintaining the action in the D.C. District, holding that the dispute should be adjudicated as part of the ongoing RICO case before him. United States v. IBT, No. 88 Civ. 4486, 150 LRRM (BNA) 2210 (S.D.N.Y. August 18, 1995). After some delay, the case was transferred and is still pending before Judge Edelstein.
In a memo dated October 11, 1994, to Caucus leaders, Mr. Shinoff concluded, "We're putting pressure on the IBT." He attached four recent press stories, the tone of three of which he considered good. One of the stories, he noted, called the RTC "dissidents" in the lead paragraph.
Delacorte/Shinoff ceased performing work for RTC sometime in October 1994.[28] Mr. Murphy says that he called Mr. Shinoff and terminated him.[29] Mr. Murphy and the other RTC leaders felt that Mr. Shinoff's efforts were simply too expensive for them. In addition, they claim that his communications were not what the RTC wanted, that Mr. Shinoff's rhetoric was too strident and that Mr. Shinoff kept hatching new schemes for activities that were not what RTC wanted to do.
A TITAN message from Mr. Sever to all IBT affiliates on November 15, 1994, mentioned the pending lawsuit in Darrow v. IBT and reminded all affiliates that "a legal opinion does not always shield union officials from liability where improper payments are concerned."[30]
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According to a press release by the Michigan Teamsters Joint Council 43, dated January 18, 1995, 30 members of the House of Representatives and two U.S. Senators met on January 17 with Joint Council 43 and other regional Teamster leaders, "at which Union spokesmen demanded congressional hearings into the federal government's 'corrupt' administration of the Teamsters under a court-approved consent decree." According to the release, Joint Council 43 President Larry Brennan accused the Justice Department and the IRB of subverting the Consent Decree "by suppressing evidence of mob ties of Teamster General President Ron Carey." Mr. Brennan accused Justice Department attorneys of suppressing evidence "of Carey's own organized crime ties because of the government's embarrassment at having previously characterized Carey as a 'reformer.'" The release listed as its contact Mr. Leebove of RL Communications. The RTC states that it did not sponsor or endorse the press conference, which was an activity of Joint Council 43 and/or other Michigan Teamsters. In fact, the RTC states that it refused to allow the materials from the Congressional luncheon to be distributed at the RTC meeting. The RTC did, later that month, circulate petitions for signature which called on Congress to conduct oversight hearings on the Justice Department's administration of the Consent Decree. According to the RTC, the signed petitions have yet to be delivered to Congress.
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RTC held a second educational meeting on January 18, 1995 in Washington. Panel discussions focused on the IBT's financial situation and preventing forced mergers of local unions with less than 500 members. The seminar also featured a presentation by then-Election Officer Amy Gladstein discussing the proposed Election Rules.
On March 6, 1995, Mr. Carey sent a TITAN message to all IBT affiliates, announcing the formation of a fact-finding committee on the purpose, activities, and circumstances surrounding the creation and operation of RTC and TADEF.
In April 1995, the RTC faxed to its contacts Volume 1, No. 1 of Just The Fax, subtitled "Important News From the Real Teamsters Caucus." The issue criticized Mr. Carey and the International for merging a number of smaller locals against the will of the members, claiming that it was, in part, "to reward Carey political allies at the expense of vocal opponents." According to the RTC, all of the issues of Just The Fax were drafted by Mr. Murphy and reviewed by Attorney Baptiste.
Volume 1, No. 2 of Just The Fax also appeared in April 1995, again criticizing the recent mergers, as well as a GEB vote to approve paying the counsel fees for defending International Vice President Gilmartin in a lawsuit by an IBT member. In an article about the Women's Caucus meeting in Las Vegas, it stated, "The only downside to the meeting was an inaccurate partisan attack by IBT VP Kilmury" on Mr. Hogan. Ms. Kilmury is an ally of Mr. Carey. It also contained one of the few positive notes about the International union, a single sentence congratulating the IBT for the "impressive" election victory among UPS clericals who voted to have the union represent them.
In an undated newsletter entitled, "News From the Real Teamsters Caucus," the RTC criticized Mr. Carey's "continuing campaign of threats and innuendo" against the RTC by establishing a fact-finding committee. It quoted RTC Chairman Darrow as stating that the Caucus does not engage in any political activities.
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In Volume 1, No. 3 of Just The Fax, issued May 1995, an article insinuated that the IBT was engaged in union busting in Chicago Local 743. It claimed that four local staff members were Just The Fax fired for attempting to organize in the face of the trustee's "authoritarian style." Another article, entitled "Javits Center Hype Leads to Union Busting," accused Mr. Carey of grandstanding at a press conference at the Javits Center, which was alleged to have given an opening to the Governor of New York State to bring in a union busting law firm and review all labor contracts at the Center. Another article noted that a previously reported verdict against International Vice President Gilmartin had been overturned, but further noted, "As far as knows, the GEB has never hired legal counsel to defend any other local union."
By letter dated May 24, 1995, Mr. Carey issued a letter announcing that his fact-finding committee on RTC had reported to him by transmitting a series of relevant documents on the RTC's activities.[31]
The July 1995 issue of Just The Fax, Volume 1, No. 4, reported that the Court, far from vacating the judgment against Mr. Gilmartin and his local union, increased the judgment by awarding pre-judgment interest and attorneys fees. It again noted that the GEB hired and had IBT members pay for Mr. Gilmartin's counsel.
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In Volume 1, No. 6 of Just The Fax, released in September 1995, the RTC criticized the International Union for backing John Sweeney, a candidate for president of the AFL-CIO, over current incumbent Secretary-Treasurer Tom Donahue. Claiming that Mr. Donahue had been instrumental in obtaining an AFL-CIO loan to the IBT last year, it continued, "But what else can you expect from people who refuse to discuss the real issues and instead brought us 'New Teamsters' vs. 'Old Teamsters', 'New Guard' vs. 'Old Guard' . . . ." In an article on strike benefits, the bulletin stated, "[A]lthough hundreds of thousands of members and local union leaders have signed petitions demanding a special convention, the GEB has refused to call one because they are afraid to face local union delegates." Another article reported that the "heavy-handedness" of the IBT organizing director had driven the union's organizing staff to petition the NLRB for representation by their own union. The article reported that the organizing staff leaders alleged that the IBT has "responded with all too typical union-busting tactics . . . ."
On September 21 and 22, 1995, Delacorte/Shinoff sent out press advisories in support of Mr. Hoffa's campaign for general president, describing his scheduled appearances for September 22-23. The September 22 advisory also listed Chuck Mack of Teamsters Local 70 as a contact person and gave a union telephone number.[32]
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On October 3, 1995, Mr. Carey issued a letter decision in which he found that the organization and funding of the RTC using union monies violated the International Constitution because the RTC "functions as an uncharted body of IBT affiliates, receiving and spending dues money of IBT members outside the system of accountability and governance specified by the IBT Constitution." Mr. Carey found that the RTC's bylaws created a body predominately composed of Teamster affiliates and governed and funded by the affiliates. The RTC must therefore conduct its affairs in compliance with the provisions of the IBT Constitution, including applying for a charter and seeking IBT approval of the bylaws. Moreover, an IBT affiliate is subject to the "ultimate governance" of the GEB.
According to Mr. Carey, the RTC further evades IBT supervision by not being subject to the trusteeship or auditing powers of the International. In addition, this lack of accountability might conflict with the prerogatives of the IRB under the Consent Decree. Mr. Carey added, however, that “members are free to join the RTC or any caucus, for that matter, on a solely voluntary basis and contribute to any such caucus from their own funds.”
Mr. Carey ordered that dues money could not be contributed to or used by the RTC; that IBT affiliates were not authorized to join the RTC; that affiliates must not make any future contributions; and that IBT members who wielded authority within the RTC must provide an accounting of all dues monies received by it and return the monies to the respective affiliates. Mr. Carey expressly limited his interpretation to the RTC only, stating that he is "continuing to review the permissibility of TADEF. . . ."
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The RTC appealed that decision to the GEB on October 6, 1995, pursuant to Article VI, Section 2(a) of the International Constitution. It also requested that the IBT stay the relief ordered by Mr. Carey pending consideration of the RTC appeal to the GEB; in return, the RTC would commit in the interim to not solicit, accept or use any dues money for its activities, and would not allow any additional affiliates to join the RTC during the pendency of the appeal. The IBT agreed to stay the return of any monies pending the RTC’s appeal in return for the RTC's promises, but otherwise required the RTC to comply with Mr. Carey's order.[33]
On October 7, 1995, the RTC published issue No. 7 of Just The Fax, criticizing Mr. Carey's constitutional interpretation regarding the RTC. "[F]or Carey to say that we are not accountable to the membership is the height of hypocrisy for a guy who has been doing everything imaginable to keep the International Trustees from finding out how he spent us into near bankruptcy." The box at the bottom announced:
WE'RE STILL HERE! No, Ron Carey hasn't chased us away. And just so Ron doesn't get all bent out of shape, we want everyone to know that this issue of Just The Fax is being completely paid for by voluntary contributions by individual members - and all future issues will be paid for in the same way until the status of the Caucus is settled.
A second October issue, No. 8, faxed October 17, 1995, criticized Mr. Carey for ordering the IBT delegates to the AFL-CIO convention to vote as a bloc in the election of a new president for the AFL-CIO; however, the publication took no stand on who to vote for but urged members to contact Mr. Carey and let their opinions be heard. A separate article reported on the status of the RTC's appeal to the GEB of Mr. Carey's October 3 order, noting that Mr. Carey has stayed his repayment order. A separate paragraph factually reported that the Election Officer had ruled against Mr. Carey and Matt Witt, communications director of the IBT, in two recent protest decisions. A final paragraph, seeking member support, noted that the RTC "does not support or oppose any candidate for union office."
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During its meeting of December 12, 1995, the GEB denied the RTC appeal and affirmed Mr. Carey's constitutional interpretation of October 3, 1995, and ordered compliance. By letter dated December 21, 1995, the IBT extended the deadline for return of all dues monies until January 12, 1996.
From their inception through October 5, 1995, the RTC's records show they received approximately $137,269 in monies from IBT subordinate bodies and an additional $23,040 from various individual members.[34] Of that amount, $46,971 was paid to Delacorte/Shinoff for work performed prior to their termination in October 1994. As of October 31, 1995, the RTC had $79,398 in the bank.
From its inception through October 31, 1995, TADEF received approximately $117,887 in dues or contributions from IBT subordinate bodies, and an additional $2,740 from individuals, for a total of $120,697.29. Of that amount, some $35,619.35 was paid to the law firm of Baptiste and Wilder for legal work performed in support of the International trustees in their dispute with the International officers. An addition $557.50 was paid to the law firm of Martin and Bonnett for an opinion letter as to the legality of using its funds in support of the trustees. TADEF has not made any other expenditures. As of October 31, 1995, TADEF had $84,501 in the bank.
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There are a number of other caucuses within the IBT. While the parties did not provide complete evidence on this issue, it appears that the Teamsters National Black Caucus, the Hispanic Teamsters Caucus, and the International Teamster Women's Caucus all receive significant contributions and financial assistance from the IBT and/or IBT affiliates. The Women's Caucus also provides for nonvoting associate membership for local unions. Teamsters for a Democratic Union does not receive any funds or in-kind services from the IBT or its affiliates.
ISSUES
1. Did the RTC, TADEF, or the IBT subordinate bodies which belong to them violate the Rules by using members' dues monies to campaign for or against any candidate for International office?
2. Did the RTC, TADEF, or the IBT subordinate bodies which belong to them violate the Rules by making campaign contributions whose foreseeable effect was to attack Mr. Carey as a candidate for office?
3. Did two employers, Delacorte/Shinoff and RL Communications, violate the Rules by making campaign contributions in the form of providing services at less than the commercially reasonable rate?
4. Were the IBT communications to members concerning the RTC a form a retaliation against RTC supporters for engaging in protected activities, in violation of the Rules?
5. Was the IBT investigation into the RTC an improper use of union assets to support the re-election campaign of Mr. Carey?
6. Was the constitutional interpretation of Mr. Carey dated October 3, 1995, a form of retaliation against RTC supporters for engaging in protected activities, in violation of the Rules?
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DISCUSSION
I. The Claims That The RTC And IBT Affiliates Engaged In Prohibited Campaigning or Made Prohibited Campaign Contributions.
A. The Rules on Campaigning and Campaign Contributions
The protests in P-032 and P-074 raise the question of whether the RTC and its affiliated bodies have crossed the line between debate on the issues and campaign-related activity. In Martin, Case No. P-010-IBT-PNJ (August 17, 1995) (decision on remand), aff'd, 95 - Elec. App. - 18 (KC) (October 2, 1995), the Election Officer noted that there are "at least two debates going on" within the union:
The first is how the IBT should prepare for the future in light of the institutional changes wrought by the Consent Decree and the changes in the national economy. These topics are manifested in such issues as corruption and racketeering in the union, the imposition of trusteeships on local unions, the abolition of the area conferences, the bankruptcy of the strike fund, strategies for organizing and the collective bargaining agreements recently attained . . . . The second debate is over what individuals and groups within the union will hold power over the next four years.
In adjudicating protests, the Election Officer has attempted to recognize the distinction between these two overlapping debates by affording the broadest possible space to IBT members and officers to debate the substantive issues, while insuring that union incumbents do not take improper advantage of this to fund their electoral efforts with members' dues money. The distinction between free debate and campaigning, found in the Rules as well as the LMRDA, is not designed to censor debate within the IBT, but simply to insure that electioneering is paid for by the proponents of the opinions, not by unwilling members.
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Article VIII, Section 8(a) of the Rules states in part: "No publication or communication financed, directly or indirectly, by a Union may be used to support or attack any candidate or the candidacy of any person . . . ." To ascertain whether a communication constitutes campaigning, the Election Officer looks to the tone, content and timing of the communication. See, e.g., Ruscigno, Case No. P-65-JC37-EOH (July 21, 1995). In Martin, the Election Officer described guidelines to aid in this determination, which tend to be fact specific. Article VIII, Section 11(b) of the Rules recognizes the right of union officers and employees to engage in campaigning, providing it does not involve the expenditure of union funds.[35]
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The Rules clearly envision that the union as an institution should not be partisan in any election. In In Re: Hoffa, 95 - Elec. App. - 31 (KC) (October 31, 1995), the Election Appeals Master held that notwithstanding the remoteness in time from the election process, an attack upon a candidate's integrity by an IBT official using union resources constituted a violation of the Rules. There, the International's public relations department responded to attacks on Mr. Carey from supporters of Mr. Hoffa by issuing a flyer in March 1994 asserting, among other things, that Mr. Hoffa inherited his union position from his father and also received $200,000 in cash from organized crime at his wedding many years ago. The Election Officer had dismissed this part of the protest primarily on its remoteness in time from the election. Reversing on this issue, the Election Appeals Master found that the IBT "should be a neutral party in this election, and Mr. Carey should use his own campaign funds and personnel to conduct campaign activities."
This injunction applies equally well to subordinate bodies of the IBT, which are similarly bound by the Rules not to engage in campaign activity. It must be remembered that many of the IBT's affiliates are not small, helpless local unions, but sizable labor organizations in their own right with considerable resources at their command. Joint Council 16 in New York has over 126,000 affiliated members; Joint Council 25 in Chicago has over 109,000; Joint Council 42 in Southern California has over 91,000. These joint councils - all of which are affiliated with the RTC and are currently led by political opponents of the Carey administration - are larger than some international unions in the AFL-CIO. If the heads of joint councils use union monies to campaign or to make campaign contributions, their actions should be reviewed under the same standard applicable to International union officers and staff.
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In addition to the prohibition against union-financed campaigning, Article XII, Section 1(b)(1) prohibits campaign contributions from the Union.[36] The term "campaign contribution" is broadly defined in the Rules to include "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 . . . ." Rules at viii. The Consent Decree mandates a broad interpretation of the term "campaign contribution." Brennan, Case No. P-971-IBT (October 16, 1991); Scott, Case No. P-969-IBT (October 18, 1991); United States v. IBT (In re: Petition for Review of Decision 91 - Elec. App.- 106), 764 F. Supp. 817, 822 (S.D.N.Y. 1991), dismissed as moot in part and vacated in part on other grounds, 964 F.2d 180 (2d Cir. 1992). Thus, even if the activities themselves do not amount to campaigning, the dues money used to fund those activities may be an unlawful campaign contribution if there was a purpose or object to use the monies to support or oppose a candidate. Similarly, it is not necessary to prove intent if, by an objectively reasonable standard, support or opposition of a candidate would be a foreseeable effect of the contribution.[37]
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B. Distinction Between Campaigning and Campaign Contributions
In Giacumbo, et al., Case No. P-001-IBT-PNJ, et seq. (September 29, 1995), aff'd in relevant part, 95 - Elec. App. - 32 (KC) (November 1, 1995), the Election Officer noted the distinction between union-financed campaigning under Article VIII, Section 11(b) of the Rules, and campaign contributions by a union under Article XII, Section 1(b) of the Rules. Campaigning requires some advocacy for or against a candidate. See also Caffrey, Case No. P-047-JC16-NYC (October 19, 1995). A campaign contribution, however, requires only that it have a "foreseeable effect" to influence, positively or negatively, the election of a candidate. In Giacumbo, the Election Officer found that the IBT had made a campaign contribution in violation of the Rules by funding an opinion poll which asked members how they felt about Mr. Carey at a time when he was a candidate for re-election, despite the lack of evidence that Mr. Carey himself had ever used the poll results for campaign purposes.
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The Rules do not indicate when a union expenditure should be examined under the test for campaigning and when it should be analyzed under the test for campaign contributions. The use of the wrong test could result in an undesirable restriction on free speech activity within the union. For example, suppose a local union publishes an issue of its newsletter which contains an article critical of the policies of the Carey administration. Normally, the Election Officer looks to the tone, timing and content of the article to decide whether it constitutes campaigning. See, e.g., Martin; Jacob, Case No. P-071-LU319-EOH (September 7, 1995), aff'd, 95 - Elec. App. - 19 (KC) (October 3, 1995). However, if the material is not determined to be campaigning, it would be inappropriate to also apply a contribution analysis and decide whether the union funds used to publish the article would have a "foreseeable effect" to influence, positively or negatively, the election of a candidate. Once Mr. Carey became a candidate, a publication critical of him could almost always have a "foreseeable effect" to negatively influence his re-election. Using a campaign contribution analysis for union publications would not just prevent campaigning by the union and its subordinate bodies, but would also restrict debate on union policies and activities - just the opposite of what was intended by the LMRDA and the Consent Decree.
However, suppose an announced candidate for International office flies across the country, at union expense, for the sole purpose of having a private meeting with his or her campaign manager. The candidate has not engaged in campaigning, since the event did not generate any communication to IBT members supporting or opposing a candidate. However, by paying for the travel, the union would have violated the Rules by making a campaign contribution; the purpose of the union expenditure would have been to support a candidate for election to International office. In that situation, the campaign contribution analysis is necessary to prevent candidates from financing their campaigns with dues money.
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The Election Officer has accommodated free speech rights with limitations on campaigning by noting that "restrictions on campaigning must not be read so broadly as to restrict the right and responsibility of union officers to conduct their official business nor prohibit other members and subordinate bodies from criticizing the policies or official conduct of those officers." Martin at 12. Thus, when considering an official union publication, Martin allows a relatively broad scope of permissible content, because "[d]uly elected union officials have a right and responsibility to . . . advise and report to the membership on issues of general concern." Martin at 9, quoting Camarata v. IBT, 478 F.Supp. 321, 330 (D.D.C. 1979), aff’d, 108 LRRM (BNA) 2924 (D.C. Cir. 1981). "Duly elected union officials" occupy their positions pursuant to a process regulated by a union's constitution and bylaws and by the LMRDA. The labor organizations themselves are subject to federal regulation, and have the legal right and responsibility to represent the members under conditions also prescribed by federal law.
Thus, when elected union officers use union funds to communicate to the members, it takes place in a legal and organizational framework which helps insure that such funds will be spent appropriately. These communications often address issues which are involved in an election, and could, indeed, have a foreseeable effect of influencing the election. However, so long as such communications concern issues of legitimate concern to the members and are not campaigning per se, the "subtext" of the communications is acceptable as related to the union officials' responsibilities. See Art. VIII, Section 11(b) ("Campaigning incidental to regular Union business is not, however, violative of this section"); Pope, Case No. P-046-JC7-PNJ (October 13, 1995), aff’d, 95 - Elec. App. - 35 (KC) (November 14, 1995) (no violation where local official stated in meetings that "Carey is no good for the local union, or the International"); Jacob, Case No. P-060-LU745-EOH (July 21, 1995), remanded on other grounds, 95 - Elec. App. - 6 (KC) (August 14, 1995) (local union officer's criticisms of Mr. Carey at union meetings fell within legitimate union business).
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The same checks and balances are missing where a labor organization does not directly communicate with its own members, but instead contributes money to a separate, independent organization which engages in a variety of activities, one of which is communicating with members of the union.[38] Under these circumstances, the union officials are not reporting to their members, but are allowing a third party to communicate its own independent message to the union's members - even if it is a message with which the union officers agree. The activities of the donee organization must be considered its own, not those of the union. While there may be nothing illegal in such donations by a union, there is also nothing in LMRDA or the Election Officer's decisions which insulate monetary contributions to a third party from scrutiny based upon of the right of union officers to report to the membership.
This distinction between campaigning and campaign contributions is consistent with the Election Officer's decision in Hoffa, Case No. P-132-LU237-NYC (September 29, 1995), where the local's payment to an outside polling company was deemed an unlawful campaign contribution, while the local's publication of the polling results in the union newsletter - favorable to Mr. Carey and unfavorable to Mr. Hoffa - was found to be improper campaigning by the local union.
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This principle is also consistent with Election Officer decisions from the 1991 election. In Scott, Case No. P-877-IBT (October 14, 1991), an issue of the newsletter of the Hispanic American Labor Council (HALC) carried four articles concerning Walter Shea and Daniel Ligurotis, candidates for general president and general secretary-treasurer, respectively, of the IBT. The HALC was a voluntary organization of Hispanic trade unionists from various labor unions, not just the IBT, and it was not an affiliate or officially recognized body of the IBT. Most of its income came from individually paid membership dues. However, some unions supported HALC's work by purchasing tickets to its annual banquet.
The Election Officer found that the section of the 1990-91 Rules prohibiting campaigning in IBT publications did not apply because HALC was not an IBT affiliate. However, the Election Officer held that since HALC was financed in part through monies received from unions, it was prohibited from making campaign contributions under the 1990-91 Rules. A letter in the HALC newsletter signed by Messrs. Shea and Ligurotis did not mention the IBT elections but stated that the union had lost focus and discussed the type of leadership members wanted. The letter ended, "That's the kind of leadership we have provided and always will provide. This is a great Union. Working together we can make it even greater." The Election Officer found the letter to be a prohibited campaign contribution because it amounted to "a naked plea for support from IBT members who participate in HALC and/or receive its newsletter."
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In Committee to Elect Ron Carey,[39] the Carey campaign prepared a videotape which discussed, among other things, the features of a pension plan which Mr. Carey had negotiated for the members of his local. The union trustees on the Western Conference of Teamsters Pension Trust Fund - all political opponents of Mr. Carey - arranged a letter from one of them to another IBT member who also opposed Mr. Carey, criticizing the Carey-negotiated pension plan and comparing it unfavorably to the Western Conference plan. The letter was subsequently reproduced and distributed in other local unions. The Election Officer held that the letter was a prohibited campaign contribution, since it was clearly motivated by the Carey campaign tape and had the purpose, object or foreseeable effect of adversely affecting the Carey campaign - although it appears that the offending letter did not mention the election or expressly declare support for or opposition to any candidate.
Based on the above, the Election Officer concludes that a union's communications to its own members will be reviewed to see if the communications constitute campaigning under Article VIII, Sections 8(a) and 11(b) of the Rules. However, transfer of union dues monies to a separate organization will be reviewed to determine if they are campaign contributions under Article XII, Section 1(b) of the Rules. Here, the RTC is not a recognized affiliate of the IBT; its leaders have no responsibility as RTC representatives to report to IBT members. Therefore, the Election Officer does not review the RTC’s publications for evidence of campaigning, but looks to see if the RTC or the funding affiliates have made campaign contributions.
C. No Campaign Contribution Prior to October 1994
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In order to have campaign contributions, there must be a candidate, as defined by the Rules, at the time the communication or contribution was made. Ruscigno, Case No. P-067-LU20-EOH (July 19, 1995); Martin. An individual does not become a candidate merely because he or she is attacked or criticized. In Re: Jacob, 95 - Elec. App. - 11 (KC) (September 5, 1995); In Re: Jacob, 95 - Elec. App. - 9 (KC) (August 29, 1995). In Martin, the Election Officer concluded that the earliest date at which Mr. Carey became a candidate for re-election was October 1994. There is no evidence in this case which would change that determination.
Thus, the activities of the RTC prior to October 1994 cannot be deemed campaign contributions since there is no express or implicit support given to any other candidate, and Mr. Carey was not a candidate at that time. Although James P. Hoffa is considered to have become a candidate in March 1994, see Crawley, Case No. P-027-LU988-PNJ (August 23, 1995), there is no mention of him as a candidate in any of the RTC literature. There is only a six-word quotation from him in The Real Teamster of April 5, 1994, and his appearance at the D.C. rally at IBT headquarters in support of the Area Conferences on April 19 - both events prior to RTC having been formed. The RTC states that while Mr. Hoffa has attended several Caucus functions, he has not spoken at any RTC event, been invited to any function and is not an officer. At the request of his employer, Larry Brennan, Mr. Hoffa did make telephone calls to IBT members to see if they would be attending the first RTC meeting in Rosemont. This connection with Mr. Hoffa, however, is simply too little and too remote from the campaign itself to constitute campaigning by the RTC on Mr. Hoffa's behalf.
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Similarly, any support given to the RTC by individual locals or joint councils prior to October 1994 were not campaign contributions since they did not support any candidate and could not have the foreseeable effect of attacking a candidate who did not yet exist. Further, there is insufficient evidence to show that monies used by the RTC to attack Mr. Carey had a foreseeable effect of supporting Mr. Hoffa. It could not be known in 1994 that Messrs. Carey and Hoffa would be the only candidates for general president. In fact, there are at least two other candidates: Jack Powers, who declared his candidacy in March of 1994, and Sam Theodus, who declared in December 1994. Attacks on Mr. Carey do not automatically translate into expressions of support for Mr. Hoffa.
The protesters in P-074 claim that the RTC engaged in improper campaigning against TDU. While the RTC's communications have indeed liberally attacked the TDU, the Rules define campaigning only with respect to candidates, not independent caucuses or political committees. There is no prohibition against speech directed against a group. In theory, attacks on a caucus or committee could amount to political campaigning because, in context, the attack on the group was intended and understood to be an attack on a candidate. However, the violation depends on the presence of a candidate. See Kilmury, Case No. P-843-JC56-MOI (October 9, 1991) (Union newsletter violated Rules by reprinting an article critical of TDU, but only where there were nominated candidates for International office who were acknowledged members or leaders of TDU). Here, any mention of TDU by the RTC was in the context of attacks upon Mr. Carey, which must be analyzed based on Mr. Carey's status. RTC attacks on TDU do not in themselves constitute prohibited campaigning.
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The protesters in P-074 further argue that the Shinoff memos demonstrate that during the period prior to October of 1994, the specific purpose of the RTC was to make Mr. Carey lose, thus benefiting Mr. Hoffa, and that the RTC publications during this period were therefore contributions to Mr. Hoffa. Counsel asserts that this argument is legally distinct from the ones rejected by the Election Appeals Master in 95 - Elec. App. - 9 (KC) and 95 - Elec. App. - 11 (KC), cited above. After consideration, the Election Officer finds the protesters' argument rests on a distinction without a difference. Even the RTC's avowed anti-Carey purpose cannot create a candidate where one does not exist. Nor can it be presumed that anti-Carey communications are intended to, or have the foreseeable effect of only supporting Mr. Hoffa. Making the avowed purpose more explicit does not make this situation distinguishable from that of the previous cases, and the protesters' argument is accordingly rejected.
Thus, the Election Officer finds no violation of the Rules for any activity prior to October 1994. However, while those activities of the RTC prior to October 1994 are not in themselves violations of the Rules, evidence of such activities may well be relevant in deciding whether subsequent conduct violates the Rules. As described below, the activities of the RTC and its agents prior to October 1994 demonstrate the purpose of the organization and the purpose or foreseeable effect of monies contributed to it.
D. Campaign Contributions by and to the RTC After October 1994
The Election Officer finds that there have been prohibited campaign contributions by the RTC and by the IBT subordinate bodies to the RTC since October 1994. As described below, it was reasonably foreseeable that such contributions would be used for the purpose of attacking Mr. Carey, a candidate for election. The evidence supporting this conclusion consists of the strategy memoranda of Mr. Shinoff, the adoption of those strategic ideas by the RTC, the public communications of the RTC, the prominence within the RTC of Mr. Carey's electoral opponents, and the RTC’s role as a network of anti-Carey activists that could provide Mr. Carey’s opponents with a valuable campaign asset.
1. The Shinoff Strategy Memos
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The purpose or foreseeable effect of contributions to the RTC is best (although not exclusively) shown in the May 9 and July 5, 1994, memos from Mr. Shinoff outlining a strategy for the Area Conferences and later the RTC. As described at length above, both memos focused on the question of who ultimately would be in power and run the IBT: Mr. Carey or his opponents. Both memos pointed out that the opposition was building toward the 1996 election, although the May 9 memo refers to a "hard" strategy which aimed for Mr. Carey's removal from office within six months. Thus, on their face, both memos enunciated a strategy intimately related to the election process.
The RTC states that in its meeting of July 7, 1994, it rejected the strategy proposals of Mr. Shinoff's July 5 memo. However, there is substantial evidence showing that any rejection was pro forma and was quickly ignored. There was no written communication to Mr. Shinoff of any rejection, nor does any other document reflect it apart from the formal typed minutes of the July 7 RTC meeting. Mr. Darrow’s disavowal of the Shinoff memo of July 5 did not come until August 19, a fairly long delay in light of the seriousness of the allegations by the IBT in its July 25 press release. Moreover, Mr. Shinoff had previously communicated this proposed strategy to the Area Conference chairs, three of whom - Messrs. Riley, Hogan and Shea - played a leadership role in the formation of the RTC. Mr. Shinoff's communications were not limited to those two memos. As early as March 23, 1994, Mr. Shinoff was urging the creation of a permanent opposition organization and more action to discredit Mr. Carey. The April 20 memo proposed a "government in exile" and "a shadow IBT" in the event that the conferences were abolished. It referred to the need for an offensive strategy and giving members a reason to support them beyond the fact that they are "anti-Carey."
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Thus, prior to the July 5 memo, Mr. Shinoff sent at least three earlier memos containing the same basic concepts to, at least, Messrs. Riley, Hogan and Shea, who were also three of the key Caucus conveners. By Mr. Shinoff's own admission, no one rejected any of the earlier memos or even responded to them. No one ever said that these strategies were inappropriate, or focused on the wrong issues, or that they should not be followed. There is no correspondence documenting the RTC’s directive to Mr. Shinoff not to engage in politics or electoral activities. A number of RTC leaders assert that they never saw Mr. Shinoff's May 9 memo until after the IBT publicized it by releasing it to the press on July 25, 1994. Even assuming that to be true, they knew about it on July 25, yet allowed Mr. Shinoff to pursue the same strategy for another 2 to 3 months. On September 22, 1994, Mr. Shinoff advocated turning any new dues referendum into a "NO dues increase - NO confidence vote" - a phrase that can only be understood as a strategy for a political counterattack against Mr. Carey himself. On September 29, 1994, Mr. Shinoff wrote that "[m]ost members now see our struggle as a leadership fight," and advocated a campaign against a proposed dues assessment that would communicate an "inside message" to IBT officials of "No confidence" and "Take back the IBT." The weight of the evidence demonstrates that Mr. Shinoff’s private strategy reflected the consistent need and desire of his clients to replace Mr. Carey and his administration, and that he was working on this goal with their consent both before and after the creation of the RTC.
2. Implementation of the Shinoff Strategy Memos
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The Shinoff memos take on additional significance because many or most of the key ideas in the Shinoff memos between March and September 1994 were implemented, both before and after the creation of the RTC. For example, the May 9 memo recommended "the creation of a National Caucus to begin aggressive membership contact and allow leaders of key joint councils and local unions to play active roles." This is a precise definition of what the RTC became, run by leaders of the key joint councils and local unions who were opposed to the Carey administration. The Real Teamster and Just The Fax are certainly an aggressive form of membership contact based on content alone. The May 9 strategy also called for them to act as insurgents, not incumbents; the RTC public communications attempted to paint Mr. Carey as the ultimate incumbent, with repeated references to such things as his limousine, the "Marble Palace," and his alleged excessive spending on private staff.[40] In a private memo to Caucus leaders on October 11, 1994, Mr. Shinoff noted that press was starting to call the RTC "dissidents."
The May 9 memo also refers to setting up a caucus as a "shadow government" or "government in exile." This certainly appears to be how the RTC was structured. The RTC systematically sought affiliation from the various joint councils. "Voluntary" dues were assessed on affiliates based on their size, and only paid-up affiliates were supposed to vote on RTC policy. The RTC held educationals on local union administration and collective bargaining, traditional union activities. The RTC established its own communication link with its network of activists and local leaders, just as Mr. Shinoff recommended.
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The May 9 memo recommended announcing the formation of the new organization the same day as the abolition of the Conferences is announced. In fact, the RTC, as yet unnamed, made the announcement five days after the Conferences was abolished with the headline, "We're back."[41]
The May 9 memo recommended that the Caucus "continually" call for a special convention. The RTC materials have in fact made that demand on several occasions.[42]
The May 9 memo called for going after Mr. Carey's clean image in Washington by lobbying friends in Congress for hearings. The RTC did circulate petitions calling for oversight hearings on the Justice Department's administration of the consent decree, although the RTC asserts that these petitions have yet to be delivered to Congress. Further, a number of members of the House and Senate did hear from Teamster officials in their home states and requested that the Justice Department respond to complaints about the Justice Department's handling of the case.
The May 9 memo advised that Carey be labeled a union buster. The RTC materials, up to the present, continue to make that allegation against Mr. Carey and his top staff.[43] Similarly, the May 9 memo called for isolating Mr. Carey. Many of the RTC's communications attempt to do so. They pointedly talk about members of the IBT staff who came from other unions, particularly the United Mine Workers, calling them a "cabal."[44]
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The proposed agenda for the August 15, 1994 meeting of the RTC and "Outline for Fall Action Plan" further shows the extent to which the Shinoff memos accurately reflected the goals and strategy of the RTC. Although assembled and distributed by Delacorte/Shinoff, the ideas in the document are those of Mr. Murphy, which were disseminated to some 32 RTC leaders and members. It included a proposed discussion of services previously provided by the conferences that could now be provided or promoted by the RTC. It further proposed a series of regional meetings which would have the internal object of being forums to discuss the RTC program and to organize regional networks of RTC supporters among local union officers and shop stewards. These proposals are consistent with Mr. Shinoff’s suggestions of how to create the “organizing committee,” “shadow government,” or “government in exile,” to use Mr. Shinoff’s phrases. The document also proposed creation of a speakers’ bureau, RTC “truth squads,” communication activities, lobbying Congress for oversight hearings, more letters to AFL-CIO leaders outside of the IBT criticizing IBT attacks on elected local union leaders, and continued support for the International trustees in their fight with the Carey administration. All of these proposals simply echo the components of Mr. Shinoff’s strategy as expressed in his various memos, including that of May 9, 1994. Although Mr. Murphy's proposals do not specifically mention the 1996 elections, they embody virtually all the components which Mr. Shinoff said were necessary in order to regain power in 1996.
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In summary, the Shinoff memos demonstrate an intent to engage in campaign-related activity, an intent borne out by the actual communications and events sponsored by the RTC. While the RTC may have formally rejected any election-related purpose suggested by Mr. Shinoff, the fact remains that RTC through its actions adopted most programs and themes suggested by an experienced public relations and electoral strategist who candidly told the RTC that this plan was how to get rid of Mr. Carey. It was certainly foreseeable to anyone who had given money to RTC and had read the Shinoff memos that the effect of the RTC's various activities was to negatively affect Mr. Carey's reelection. More importantly, in evaluating the Shinoff program, it was objectively foreseeable that contributions to the RTC would have the effect of opposing Mr. Carey whether one had read the Shinoff memos or not. Any outsider would see the RTC as the organization of Teamsters opposed to Ron Carey, not just as a group opposed to some of his policies.
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The RTC argues that the initial Shinoff memos are irrelevant because they were prepared for the Area Conferences before the RTC ever came into existence. However, the memos, distributed to the same Conference leaders who played a key role in creating the RTC, are obviously evidence as to the true purpose of the organization. Further, there is a clear continuity in purpose and activity between the Conferences' fight to avoid dissolution and the activity of the RTC. The official publication of each, until after October 1994, was The Real Teamster, with the same masthead and format, written and published by Delacorte/Shinoff. The publication did not even change volume or issue numbers with the creation of RTC, but continued uninterrupted from the previously numbered issues published by the Area Conferences. Three of the four conference chairs became officers of either the RTC or TADEF. Most of the Teamster leaders quoted or featured in The Real Teamster during the Conference dispute became officers or key supporters of the RTC. The May 17, 1994, issue of The Real Teamster highlighted a speech by International Trustee Robert Simpson on the difference between "Real" Teamsters and "New" Teamsters - over a month before the RTC was formed. The May 19 issue, in discussing a GEB meeting on the financial crisis, asked, "Will the Carey clique use any financial defaulting as part of a plan to take over or consolidate Local Unions that are part of the majority Real Teamster, pro-conference network, and have them run by 'New Teamster' trustees?" Five days after the Conferences were dissolved, The Real Teamster announced, "We're back," a phrase that can only be understood as referring to the same group of members continuing their fight against the Carey administration on the same issues. Indeed, the themes, rhetoric, positions and activities of the pro-conference struggle and the RTC are virtually identical. This evidence supports a finding that the Conference struggle carried over into the activities of the RTC, and that the Shinoff memos before June 28, 1994 are relevant in determining the purpose and intent behind contributions to the RTC.
3. RTC’s Public Communications
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The public communications of the RTC also demonstrate that the organization is not primarily defined by its positions on substantive issues, but by its opposition to Mr. Carey and his administration. With one debatable exception in April 1995, the RTC has never praised Mr. Carey or his administration on any issue. With few exceptions, substantive issues have been discussed only in the context of criticism of Mr. Carey's position or actions with respect to those issues. These attacks were largely written by Mr. Shinoff, who had the admitted aim of driving Mr. Carey from power in a campaign that was designed to culminate in the 1996 election process. RTC leaders knew that the attacks on Mr. Carey were for this purpose, and although they claim not to have shared that aim, they tolerated Mr. Shinoff's rhetoric and therefore ratified his conduct. Drafts of many issues of The Real Teamster were circulated to Caucus leaders prior to issuance. It must therefore be assumed that the attacks against Mr. Carey were purposeful and intentional conduct by the RTC.[45] Thus, contrary to the aims stated in the bylaws, in practice the primary intent and purpose of the RTC is to oppose Mr. Carey. While IBT members are certainly free to criticize Mr. Carey and his team, the communications make clear that the purpose, object and foreseeable effect of union contributions to the RTC are to oppose Mr. Carey's reelection.
It is true that in union politics (as elsewhere) the chief executive officer of an organization must take responsibility for the successes or failures of his/her administration. See Martin. The Election Officer has previously rejected the argument that the president of the IBT is simply a proxy for the institution itself. See Giacumbo, P-001-IBT-PNJ (public opinion poll asking questions about how members felt about Ron Carey constituted improper campaign contribution from IBT to Carey campaign). The RTC could have directed its criticisms to the International Union, or to the administration or even the GEB. However, it has chosen to direct many, if not most, of the attacks to Mr. Carey personally - as Mr. Shinoff advised.
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Although the most recent issues of the RTC newsletter are more restrained in tone and less personalized than those a year ago, they still convey a distinct anti-Carey message. Since the RTC's activities are being reviewed as campaign contributions rather than campaigning, the tone of the public communications is not determinative; it is the foreseeable effect of the contribution. Here, notwithstanding the more moderate tone of the recent newsletters, their overall content and the conduct of the organization still demonstrates a purpose or foreseeable effect of political opposition to Mr. Carey, such that the union monies given to the RTC constitute prohibited campaign contributions.[46]
4. The Presence of Candidates Opposed to Carey and Creation of an Anti-Carey Network
The purpose or foreseeable effect of contributions to the RTC is strengthened in light of the fact that many of its officers, initiators and key supporters are candidates for International office opposed to Mr. Carey and his team. Mr. Hogan has been considered a candidate for International office since March 1992. Epperson, Case No. P-034-LU41-SCE (September 27, 1995). Since June, 1995, Mr. Mack has been recognized as a candidate for International vice president. Mr. Stone declared himself a candidate in October 1995. Phil Young, James Santangelo, Les Singer and Larry Brennan have declared themselves candidates for International vice president. Mr. Powers, while inactive in terms of campaigning, is a declared candidate for general president.
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The presence of so many anti-Carey candidates in the RTC underscores the organization's campaign potential. The RTC provides a ready-made network of activists across the country who are united in their opposition to Mr. Carey. Candidates can tap into this network to solicit campaign funds and volunteers, pool political intelligence, and hammer out campaign themes - and all at union expense. Indeed, Mr. Shinoff stated that one of the goals of his strategy was to "build a base of activists" and create a "shadow government" that "creates organizational tools that can be used by allied campaign groups" to, among other things, "fight the election of 1996." Such a nationwide committee of activists is one of the most important assets a candidate can have. In an election that is extremely dependent on fact-to-face contact at thousands of workplaces throughout the country, such a network is invaluable. Mr. Shinoff recognized, as did many other commentators on the 1991 election, that without TDU’s network of activists campaigning on Mr. Carey’s behalf, he would not have won the election. Unlike TDU, however, the RTC built its network with heavy reliance on union funds.
The RTC’s role in creating a network opposing Mr. Carey’s reelection is enough to establish the foreseeable effect of the contributions. This is the case even if there is no clear evidence that a specific opposition candidate actually benefited from this contribution. See Giacumbo, P-001-IBT-PNJ, supra. (Carey campaign received prohibited campaign contribution by portions of the poll related to him whether or not he utilized the data collected for campaign purposes).
It was certainly foreseeable to anyone who had given money to the RTC that the effect of the RTC's various activities was to negatively affect Mr. Carey's reelection. The financial records show that between its inception and the end of October 1994, RTC received $21,082.80 in monies from IBT affiliates. Between October 1994 and October 5, 1995, RTC received an additional $116,187.14. Thus, the bulk of the contributions were made after the RTC had demonstrated its consistent animosity toward Mr. Carey and after Mr. Carey had become a candidate.
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Although not raised by the parties, the Election Officer notes that the RTC does not meet the caucus exception to the rule against campaign contributions. In In Re: Gully, 91 - Elec. App. - 158 (SA) (June 12, 1991), aff'g Sargent, Case No. P-249-LU283-MGN (May 21, 1991), the Election Officer held that an entity otherwise prohibited from making campaign contributions under the Rules could make such contributions if (a) it is a caucus of union members; (b) it properly allocates and segregates resources obtained by persons or entities prohibited from making campaign contributions from resources received from persons or entities permitted to make such contributions; and (c) it utilizes only the latter resources with respect to its campaign activities. Here, as described in Part II below, the RTC is not a caucus of union members but in essence a confederation of IBT subordinate bodies. Further, the RTC does not allocate or separate resources received from individual union members from the payments received from IBT locals, joint councils and conferences which have affiliated with it. Indeed, since the RTC claims that it does not engage in any campaign-related activity, any previous allocation of funds would be contradictory. Thus, the RTC cannot benefit from the caucus exception to the rule against making campaign contributions.
Based on the above analysis, the Election Officer finds that all of the IBT affiliates which contributed to the RTC after October 1994 violated Article XII, Section 1(b) by making prohibited campaign contributions. The Election Officer further finds that RTC itself has violated Article XII, Section 1(b) by making prohibited campaign contributions of the Union monies received from IBT affiliates. Scott; Committee to Elect Ron Carey, Case No. P-291A-LU70 (March 14, 1991).
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Although this decision affects the RTC most immediately, it is designed to safeguard the election rights of all members. Were the Election Officer to deny the protests against the RTC, nothing would prevent Mr. Carey's supporters within the IBT from creating a similar organization, funded by dues monies, to personally attack RTC supporters in ways that fall short of campaigning, but give practical assistance to pro-Carey candidates. Such an organization could, for example, be formed under the rubric of attacking corruption. The difference between that and the RTC would be that Mr. Carey could command not just financial assets but potentially more valuable resources by virtue of his incumbency as general president--such as trained, experienced International staff; the physical resources of the IBT’s Washington office; and the advantages that come from being in the nation’s capital. As a result, both sides - and perhaps other candidates as well - would be able to use union monies without restraint in support of their electoral strategies. This would be unacceptable. It would weaken the strict rules designed to divorce, as much as possible, the union's institutional operations from the electoral contest for power.
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It is important to note what this decision does not do. It does not prohibit any IBT officer, member or affiliate from discussing issues of legitimate concern to the membership. It does not in any way restrict officers or members of IBT subordinate bodies from criticizing the officers or policies of the International or any affiliate. It does not restrict the newspapers of IBT affiliates from criticizing Mr. Carey or his policies, nor does it prevent union officers from making speeches containing such criticism - so long as such criticisms do not become campaigning as defined by the Rules. It does not restrict officers or members of IBT affiliates from campaigning for the candidates of their choice, so long as campaigning is not done on union time or with union assets. In addition, this decision does not prohibit the RTC from continuing to criticize Mr. Carey and his administration, so long as union monies are not used for that purpose. No protester has sought the dissolution of the RTC, and this decision does not order it.
The Rules, the Consent Decree, and past cases require that campaign contributions be strictly regulated. All of the evidence demonstrates that the RTC was created to primarily act as an anti-Carey organization. Contributions by IBT affiliates to the RTC, and the RTC expenditures themselves, were either intended to oppose Mr. Carey as a candidate for re-election or had that foreseeable effect. The expenditures by the RTC and the payments to the RTC by the IBT affiliates since October 1994 thus constitute campaign contributions in violation of Article XII, Section 1(b) of the Rules.[47]
E. Conduct of TADEF
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The Election Officer fails to find any evidence that TADEF has violated the Rules. While created at the same time by the same group of people that organized the RTC, TADEF has separate officers, by-laws, bank accounts, contributions, and attorneys. TADEF has not engaged in any conduct such that contributions to it would have the foreseeable effect of supporting or opposing a candidate. No protester has made an alter ego argument, and the Election Officer does not discern at this time sufficient evidence to warrant such a finding. See Sargent, Case No. P-249-LU283-MGN (May 21, 1991), aff’d, In Re: Gully, 91 - Elec. App. - 158 (SA) (June 12, 1991); Halberg, Case No. P-019-LU174-PNW, et seq. (December 14, 1995) (Decision on Remand). Apparently, TADEF has not done anything except to finance legal assistance to the International trustees in an information dispute with the IBT. While that dispute has obvious political overtones and was heavily promoted by the RTC, the payment of legal fees from a segregated fund should not impute the partisan activity of the RTC to the defense fund. Gully. Based on TADEF's conduct to date, the protests against it must be denied.
F. Claims of Employer Contributions
The protest in P-074 also alleges that two employers, RL Communications and Delacorte/Shinoff, charged the RTC less than the market rate for services provided and thus made prohibited employer campaign contributions. In the case of Delacorte/Shinoff, it appears that it did eventually accept less than the originally agreed upon amount for performing its services. Mr. Murphy says that he renegotiated the price downward as they went along because Delacorte/Shinoff was simply charging too much money for the services provided. Ms. Delacorte's contemporaneous memos to the RTC in 1994 and 1995 term the modification as a discount. It is unnecessary to resolve this discrepancy, since all of Delacorte/Shinoff's services were provided prior to Mr. Carey becoming a candidate. Even if it had provided services for less than a commercially reasonable amount, no campaign contribution can be involved without a candidate as explained more fully above. There is no evidence that Delacorte/Shinoff made a campaign contribution in violation of the Rules.
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As to RL Communications, there is insufficient evidence that it was an agent of or vendor to the RTC. Even examining the conduct of RL Communications independently, it appears that the company was retained by Mr. Brennan to do work surrounding the press conference of January 17, 1995, calling for Congressional oversight of the Justice Department's administration of the Consent Decree. The Congressional meeting and press conference also apparently raised again the allegations that Mr. Carey was somehow tied to organized crime. These were issues of legitimate concern and cannot be considered campaigning in these specific circumstances. Although the IRB had completely rejected the allegations of impropriety by Mr. Carey, the press conference was sufficiently close in time to a related event (Mr. Geller's letter to the Attorney General asking for review of the IRB decision) and sufficiently remote from the election itself to prevent a finding of campaigning.[48] Since there was no campaigning, it is unnecessary to determine whether RL Communications worked at commercially reasonable rates. The Election Officer finds insufficient evidence of any violation of the Rules by this employer.
II. The Protests by RTC Claiming Retaliation
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The protests in P-058, P-094, P-185 and P-277 all allege retaliation by the IBT against the RTC and its members and constituent unions for exercising the right of free speech to criticize the union and its leaders. Together, they allege three principal violations. First, they claim that the various TITAN messages and letters from the IBT, warning that participation in the RTC and use of union monies may subject participants to legal sanctions, constitute retaliation. Second, they make the same claim as to Mr. Carey's October 3, 1995. determination that the RTC is unconstitutional and must pay back the dues monies received from IBT subordinate bodies.[49] Third, they claim that Mr. Carey has, through a variety of actions, chilled the free exercise of speech within the union which has adversely affected the election process.
To demonstrate retaliation, a protester must show that conduct protected by the Rules was a motivating factor in the adverse decision or conduct in dispute. The Election Officer will not find retaliation if she concludes that the union officer or entity would have been taken the same action even in the absence of the protester’s protected conduct. See. Leal, Case No. P-051-IBT-CSF (October 3, 1995) aff'd 95 - Elec. App. - 30 (KC) (October 30, 1995); Wsol; Cf., Wright Line, 251 NLRB 1083 (1980), enforced, 662 F.2d 899 (1st Cir. 1981), cert. denied, 455 U.S. 989 (1982). Here, the IBT addressed a legitimate issue of concern: that the funding of RTC with dues money and its operation as an uncontrollable affiliate may be a violation of the IBT Constitution and/or federal law. As shown below, this non-election related basis for the IBT’s action defeats a claim of retaliation.
A. The TITAN Messages
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The TITAN messages and letter from the IBT general counsel do not constitute unlawful threats or retaliation. The first TITAN of July 26, 1994, stated only, "Recent information raises serious questions whether the funding of these two entities [RTC and TADEF] is consistent with the fiduciary obligations of local union and joint council officers and whether such funding violates the IBT Constitution." In light of the fact that the IBT had in its possession a copy of Mr. Shinoff's May 9, 1994 memorandum described above, it was certainly true that "recent information" did raise precisely those questions.
The second TITAN of August 9, 1994 similarly constituted a warning to affiliates that "using dues money to fund activities to affect Union electoral campaigns is illegal and may involve personal liability." Again, the basis for this warning was the Shinoff memo linking the creation of the RTC to the campaign to replace Mr. Carey in the 1996 elections. The TITAN message was legally correct: it is illegal for affiliates to fund election campaigns, 29 U.S.C. §481(c) and (g). It is also correct that union officers can be held personally liable under certain circumstances for violations of LMRDA.[50] Certain warnings by the IBT to members are perfectly appropriate. See Yager v. Carey, C.A. No. 93-1054 (RCL) (D.D.C. Nov. 27, 1995) at 44 ("Demanding compliance with the rules does not amount to suppression of dissent"); Rumore v. Belk, C.A. No. 95-0672 (RCL) (D.D.C. Nov. 27, 1995). The warning was not overbroad, since it expressly recognized that "former conference leaders are . . . free to campaign to replace the current administration." There is nothing improper about the TITAN messages.
The general counsel's opinion letter, sent out over the TITAN system on September 27, 1994, was no different than the messages above except that it provided more of a legal analysis to support its warning to officers of affiliates. It did not contain any impermissible threat. Since there was a reasonable basis for the statements contained in the TITAN messages, the protesters have failed to prove retaliation.
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B. The October 3 Constitutional Interpretation
The Election Officer similarly finds no violation of the Rules based on Mr. Carey's constitutional interpretation of October 3, 1995, because there was a legitimate, non-election-related reason for acting. A union is normally entitled to interpret its own constitution. See Yager at 55, citing Lucas v. Bechtel Corp., 800 F.2d 839, 849-51 (9th Cir. 1986) (a union's reasonable, good faith interpretation of its constitution is entitled to considerable judicial weight); Leal, citing Nelson v. Iron Workers, 680 F. Supp. 16, 21 (D.D.C. 1988). Mr. Carey ruled only on the issue of whether the RTC's use of union dues to create an unsupervised affiliate violated the International Constitution. His decision did not turn on whether the RTC was engaged in campaigning as defined by the Rules. Indeed, Mr. Carey did not rule at all on whether the activities of the RTC violated the Rules promulgated by the Election Officer, but rather deferred to the Election Officer on all campaign-related questions.
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Mr. Carey determined that the affirmative restrictions on IBT affiliates contained in the International Constitution implies a prohibition against creating unsupervised entities financed by members' dues monies. It is consistent with the provisions of the Consent Decree which impose a very high standard of accountability upon the IBT, its affiliates, and the officers and agents thereof.[51] The U.S. Attorney's office found it a sufficiently reasonable concern that it used it as one of three bases for arguing why Judge Edelstein should enjoin the Darrow plaintiffs from seeking a declaratory judgment in D.C. that would legitimate the funding of the RTC with union monies. The Election Officer finds this interpretation is not an unreasonable one and establishes a legitimate, non-election-related basis for the IBT’s action. See In Re: Golubovic, 95 - Elec. App. - 49 (KC) (December 28, 1995) ("The fact that a union
member. . .is a declared candidate for union office or is active in union politics does not ensure that the Election Rules will supply a remedy for every union-related matter in which that party believes he or she has been mistreated.")
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The RTC supports its protest by noting the disparity between the International's treatment of the RTC and other caucuses, such as the Hispanic, Black and Women's caucuses. The RTC asserts that the latter three caucuses also receive some funding from the members' dues monies and are not chartered by the IBT, yet the IBT has not taken any action against them. The evidence shows that the Hispanic, Black and Women's caucuses have received significant contributions and financial support from IBT affiliates. See also Cook, Case No. P-955-IBT (November 8, 1991), aff’d, 91 - Elec. App. - 232 (SA) (November 22, 1991); Rodriguez, Case No. P-1062-IBT (November 13, 1991). Certainly IBT affiliates support them by paying the travel expenses of certain members to attend caucus meetings. The Women's caucus provides for nonvoting associate membership by IBT affiliates.
In his report to the GEB in December 1995, Mr. Carey distinguished the RTC from the other caucuses in the IBT based on the RTC's membership of constituent IBT subordinate bodies. Mr. Carey acknowledged that other caucuses received "sporadic" contributions of dues money of IBT affiliates. However, he further stated:
Unlike the RTC, the [other caucuses] have not presented any clear prospect for evasion of the chartering, supervisory, audit and disciplinary provisions of the IBT Constitution nor the provisions which assure democratic governance of the union at all levels.
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The Election Officer finds that the GEB's distinctive treatment of the RTC was not unreasonable. The other caucuses are fundamentally groups of IBT members, with the caucus decisions made by the IBT members who are also caucus members. The RTC, however, is structured to be controlled by the IBT affiliates that belong to it. See RTC bylaws, Sections 6 and 8. It is not a caucus of members as that term has been used by the Election Officer,[52] but a confederation of affiliates. As discussed above, this not a minor distinction, but a significant concern, particularly in light of the ongoing RICO case.[53] Moreover, it was not unreasonable to see the RTC as very different from the Black, Hispanic and Women's caucuses in light of the evidence that the RTC sought to act as a "government in exile" and continue the functions and authority of the former Area Conferences. There does not appear to have ever been a concern that other IBT Caucuses ever sought to place union assets beyond the reach of the International union and create a union-within-a-union in the same way that the RTC seemed to be doing.
Although the RTC claims that in practice all IBT members who show up for meetings debate and vote on all matters, it was not unreasonable for the IBT to rely on the text of RTC's duly adopted bylaws. In its public communications, the RTC has stressed that it represents 1.1 million members,[54] a figure clearly computed based on the number of IBT members contained in IBT locals and joint councils which have joined the RTC, not the number of union members who joined the Caucus. The RTC has made a great deal of the fact that IBT affiliates joined the Caucus only after reviewing the RTC bylaws and obtaining a legal opinion issued by Attorney Baptiste. Thus, the very act of joining the RTC is premised on an understanding and acceptance of a structure that gives decision-making power to the contributing IBT affiliates. The RTC cannot now argue that the IBT should have ignored the Caucus's bylaws in favor of a practice that, to date, has violated those bylaws.
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This is not to suggest that Mr. Carey's constitutional interpretation is the only proper interpretation, or that it does not suffer from some other legal deficiency. That is a matter for the International convention and/or the District Court to decide. Since, however, Mr. Carey's interpretation appears not to be unreasonable and has a legitimate basis, it defeats the protest that it constitutes retaliation for engaging in protected campaign activity.[55] Wsol; Leal.
The protesters argue that the IBT order of October 3, 1995, interferes with the jurisdiction of the Election Officer to decide whether contributions to the RTC violate the International Constitution or any free speech rights of RTC members, whether related to the election or not. As support for this argument, counsel for the protester cites the District Court's decision of August 18, 1995, particularly the following paragraph:
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The Election Officer bears the responsibility of determining whether the IBT Constitution has been violated because these election protests concern whether IBT members are improperly using the Caucus and the Defense Fund to influence the IBT elections and because the Election Officer is charged with the "[c]omplete supervision of all facets of the election process." July 10, 1990, Opinion & Order, 742 F. Supp. at 106. Moreover, the Election Officer must also decide whether LMRDA Section 401(g) has been violated because Article XIII of the Election Rules incorporates this very section of the LMRDA.
United States v. IBT, No. 88 Civ. 4486, 150 LRRM (BNA) 2210, 2217 (S.D.N.Y. Aug. 18, 1995). The Election Officer does not believe that the Court's decision supports such a broad reading of her authority. The Court ruled that the Darrow action could not go forward in the D.C. District Court because, among other reasons, the declaratory relief sought by the plaintiffs would impede the functioning of the Election Officer. Slip op. at 20. The complaint in Darrow sought declaratory judgment that, inter alia, the use of union funds to participate in the RTC and TADEF would not violate section 401(g) of LMRDA. Id. at 17. The Court noted that the Election Officer had been called upon by various protests to decide whether contributions to the RTC violate Section 401(g) of the LMRDA and the IBT Constitution. However, nowhere did the Court state that the Election Officer was empowered to remedy such violations if they do not involve the election process. To the contrary, the Court pointed out that the Election Officer has jurisdiction precisely because of the allegations that the RTC is improperly influencing the elections. Id. at 21. The reference to the IBT Constitution arose from an argument by the U.S. Attorney's office in support of its motion to enjoin litigation of Darrow in the D.C. District. Id. at 18.[56]
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The limitation of the Election Officer's authority to election-related matters was discussed at length in Wsol and is supported by previous Court decisions in the ongoing RICO case. United States v. IBT ("Ellis"), 3 F.3d 634 (2d Cir. 1993); United States v. IBT, No. 88 Civ. 4486 (DNE), 150 LRRM (BNA) 2275 (S.D.N.Y. Aug. 17, 1995) (slip op. at 48) ("Unfortunately, however, the Consent Decree is not a panacea"). The Election Officer must therefore decline the invitation to exercise her authority beyond the limits of the powers granted to her under the Consent Decree. If Mr. Carey's order violates the International Constitution but does not involve the election process, the matter does not belong before the Election Officer.
The protesters further complain that Mr. Carey's decision will intimidate RTC officers and supporters from running for union office. Such an assertion is at this point speculative. Protesters have not presented evidence that a single person has been deterred from seeking office because of any improper conduct of Mr. Carey or the IBT. The constitutional interpretation does not attack members who support the RTC, nor does it prohibit the RTC from carrying on its activities; it is addressed solely to the issue of using monies from IBT subordinate bodies to finance those activities. There is no evidence that RTC supporters will be subject to retaliation in the future for being engaged in election-related activity.[57]
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Finally, the Election Officer finds no violation in the action of the GEB on December 12, 1995, affirming Mr. Carey's October 3 constitutional interpretation. There is no evidence about the conduct of the GEB which demonstrates retaliation against the RTC and its supporters for election-related conduct or other protested activity under the Rules. Even viewing the protester's evidence in its best light, a lack of perceived due process in the GEB's deliberations does not constitute a violation of the Rules, nor does it add anything to the legal arguments rejected above as to the propriety of the October 3 constitutional interpretation. The protest in P-277 must therefore be denied.
C. Creating an Atmosphere That Chills Free Participation In The Election Process.
In recent submissions to the Election Officer, the RTC has argued that the actions of the IBT and Mr. Carey have been so all-pervasive as to chill the free participation of members in the electoral process. It describes the following course of conduct by Mr. Carey against his political opponents:
- imposition of trusteeships against local unions;
- creating new and competing joint councils;
- merging local unions into larger locals allied with Mr. Carey;
- dismissing appointed IBT officials who have publicly criticized Mr. Carey;
- use of the International's auditors against local unions;
- prohibiting locals from escrowing funds to fight future trusteeships;
- interference with traditional local union autonomy.
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In alleging an overall plan to suppress dissent and affect the election, the burden is on the protesters to show by clear and convincing evidence that the conduct complained of was “part of a deliberate attempt by union officials to suppress dissent within the union.” Newman v. Local 1101, CWA, 570 F.2d 439, 445-46 (2d Cir. 1978); Schonfeld v. Penza, 477 F.2d 899, 904 (2d Cir. 1973); Yager at 40; Rumore at 9. The Election Officer has previously recognized that there could be a situation in which a union incumbent embarked on a series of actions which, while each lawful in itself, together created a climate of fear that improperly affected the election. Wsol. See also Cotter v. Owens, 753 F.2d 223, 229 (2d Cir. 1985). Here, however, there is no persuasive evidence that the conduct of the International or Mr. Carey has had the purpose or effect of chilling member participation in the election. Most of the conduct alleged by the RTC had no obvious connection with the election and no discernable effect on the election process.
The RTC's argument has a breadth to it that is not matched by the evidence. The implication of the RTC's argument is that much of the International's activities in running the union have been part of grand design to affect the upcoming International elections. However, the protesters have not provided specific evidence to support these broad allegations. Moreover, many of the incidents and factors alleged by the RTC have already been found not to constitute retaliation or suppression of free speech.[58] Further, the District Court in two recent cases rejected allegations by RTC supporters that the Carey administration has created a pervasive climate of fear within the IBT.[59]
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The Election Officer finds that there is simply insufficient evidence to prove the "climate of fear" argument. The fact that some of Mr. Carey's long-time political opponents like Mr. Durham and Mr. Darrow have retired does not prove the presence of an atmosphere of intimidation. While the Election Officer is not limited to evidence presented to her but retains the power and prerogative to seek additional evidence in a pending matter, a protester must still do more than make vague allegations of improprieties. Martin.
In addition, the evidence shows a vigorous and heated struggle in which the current administration and its political opponents have sought to maneuver to obtain advantage, invoke the powers of the Court, seek adherents among the rank-and-file, and woo the press in support of their cause. The conduct and rhetoric of the Carey administration does not appear in any way out of proportion to that of its rivals. Statements alleging a "reign of terror" are simply not credible in light of the evidence.
Another problem with the RTC's argument is that the IBT's warnings and Mr. Carey's constitutional interpretation are simply not as draconian as alleged. The IBT accepts that members may join the RTC, make contributions to it, and use it to criticize the International's leadership. The IBT has decided only that the IBT Constitution prohibits the RTC from using union funds to create unchartered affiliates. Such a position may or may not be upheld by a court of law, but there is insufficient evidence that the taking of that position creates or contributes to a “climate of fear.”
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The RTC also argues that the timing of the October 3 constitutional interpretation was designed to retaliate against campaign opponents, since all of the facts and legal issues have been known to the International for over a year. The IBT responds that it did not focus on the problem until the complaint was filed in Darrow and the U.S. Attorney's office raised questions about having an IBT body not subject to union governance. At that point, Mr. Carey made the decision to wait until the complaint in Darrow v. IBT had been transferred to Judge Edelstein as part of the ongoing RICO case before taking formal action.
The IBT argument is certainly plausible; whether it is considered "legal maneuvering" or simply sound tactics, there is nothing illegal or unethical in seeking the most favorable forum in which to present one's case. Even if that rationale were specious, there is nothing in the timing of Mr. Carey's constitutional interpretation which evinces a sinister purpose or motive related to the election. See In Re: Giacumbo, 95 - Elec. App. - 35 (KC) (November 28, 1995) (the fact that IBT could have acted sooner does not by itself establish that an action against a member is prohibited retaliation).
To the extent the protesters and the RTC have a claim that Mr. Carey's various actions including his constitutional determination of October 3, 1995, constitutes a violation of LMRDA, the appropriate forum to adjudicate that claim would seem to be the District Court, which already has jurisdiction over the RTC's retaliation claim as part of the Darrow matter.
D. Additional claims
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The protester in P-094 alleges that the IBT investigation of RTC is itself a violation. Since the Election Officer has found the IBT's concerns and Mr. Carey's constitutional interpretation to be based on legitimate, non-election related grounds, the investigation did not violate the Rules. Contrary to the allegations in the protest, there is no evidence Mr. Carey used the IBT Legal Department to process election protests on behalf of himself as a candidate. The IBT Legal Department appears at all times to have been properly acting on behalf of the institution. The May 24, 1995 letter by Mr. Carey, referring all election-related issues to the Election Officer, far from "tarnishing the image of the Election Office," instead constituted a recognition of the independence and primary jurisdiction of the Election Officer over all election-related disputes. These additional claims in P-094 do not show any violation of the Rules.
CONCLUSION
For the above-stated reasons, the protests in P-032-LU254-PNJ and P-074-LU840-EOH are GRANTED in part and DENIED in part. The protests in P-058-IBT-EOH, P-094-IBT-EOH, P-185-IBT-EOH, and P-277-IBT-EOH are DENIED.
THE REMEDY
When the Election Officer determines that the Rules have been violated, she may "take whatever remedial action is appropriate." Article XIV, Section 4. In fashioning the appropriate remedy, the Election Officer views the nature and seriousness of the violation, as well as its potential for interfering with the election process. Martin, supra. Where the union has improperly contributed to a candidate for International office, the Election Officer has in certain cases required that the union be reimbursed for the costs of the contribution or the contribution be returned by the campaign. Durham, Case No. Post-75-IBT (January 10, 1992). See also The Committee to Elect Ron Carey, Case No. P-651-IBT (August 14, 1991); Rodriguez, Case No. P-1062-IBT (November 13, 1991).
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First, the RTC shall hereby cease and desist from collecting any further monies from IBT subordinate bodies. This shall not prevent it from continuing to accept voluntary dues or contributions from individual IBT members. Similarly, the following IBT subordinate bodies who have made contributions shall be ordered to cease and desist from contributing any further dues monies to the RTC: Local Unions 28, 70, 78, 111, 122, 391, 444, 515, 554, 630, 637, 840, 848, and 1150; Joint Councils 7, 10, 16, 18, 25, 41, 42, and 80; the Texas and Ohio State Conferences.
Second, the RTC shall, within seven (7) days of this decision, publish the attached notice via facsimile to the same distribution list as its most recent issue of Just the Fax prior to this decision. All of the IBT affiliates listed above shall, within seven (7) days, post a copy of the notice on all union bulletin boards (as that term is defined in the Rules) for a period of at least thirty (30) days. The same affiliates shall also publish the notice in the next regular issue of their union newspaper or other periodical literature sent or otherwise made available to its members.
Third, the RTC must return monies received from the unions on or after November 1, 1994. The purpose of the RTC has been found to be election-related. Therefore, all monies contributed to it after October 1994 had the purpose or foreseeable effect of supporting or opposing a candidate for election.
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Here, the RTC’s financial records show that it received $116,187.14 from various IBT affiliates since October 1994. However, as of October 6, 1995 - the day the RTC committed that it would no longer accept or utilize monies from affiliates pending a GEB decision on this appeal - the RTC had only $79,398.46 in assets, all in a bank account. After careful consideration, the Election Officer determines that the RTC shall be required to repay to all contributing IBT affiliates, on a pro rata basis, a total of $79,398.46. This decision is based on the nature of the Election Officer’s supervisory powers which are designed to insure a democratic election rather than provide strict compensation to financially injured parties. See In Re: Ford, 95 - Elec. App. - 46 (KC) (December 20, 1995) (Respondent cannot evade a finding of a violation based on an argument of unclean hands. The primary goal of the Election Rules is to ensure that the [elections] are conducted fairly and free of the taint of impropriety.) Forcing the entity to pay back substantially more than its assets would be beyond what is necessary to eradicate the effect of the Rules violation. The Election Officer concludes that this remedy serves the goal of a free and untainted election.
The Election Officer has further determined in this case not to require individual members who attended RTC functions to reimburse IBT affiliates for travel and related expenses. While such a remedy is appropriate in some cases, it is not required here. The Election Officer recognizes that certain of the travel and other expenses involving RTC functions were incurred in conjunction with other union-related business. Imposing a substantial financial burden on all individual attendees to reimburse their locals or joint councils does not seem necessary where the remedy ordered above should be fully effective in protecting the election process from the unlawful influence of union funds.
Finally, the principal officer for the RTC and Local Unions 28, 70, 78, 111, 122, 391, 444, 515, 554, 630, 637, 840, 848, and 1150; Joint Councils 7, 10, 16, 18, 25, 41, 42, and 80; the Texas and Ohio State Conferences shall file affidavits of compliance with the Election Officer within seven (7) days of this decision.
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The protester in P-074 has requested as a remedy that all affiliates who contributed to the RTC should be required to make equal contributions to the Carey slate of candidates. The Election Officer does not find such a remedy warranted here. It should be remembered that the Election Officer has not made any finding that the monies were actually used for campaigning, but that the contribution of the monies had the foreseeable effect of opposing Mr. Carey. Moreover, the prohibitions against union campaign contributions are designed not only to level the playing field between candidates, but to safeguard the dues monies of the members and maintain the division between legitimate union functions and campaigning. The latter two goals would not be served in this case by having affiliates now spend another large sum for campaign purposes. The goal of keeping a level playing field is just as easily protected in this case by requiring the RTC to disgorge the improper contributions.
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 and 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 North Capitol Street, Suite 855, Washington, D.C. 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
Regional Coordinators
TO ALL MEMBERS OF:
JOINT COUNCILS 7, 10, 16, 18, 25, 41, 42, and 80;
LOCAL UNIONS 28, 70, 78, 111,122, 391, 444,
515, 554, 630, 637, 840, 848, AND 1150
AND THE OHIO AND TEXAS
CONFERENCES OF TEAMSTERS
The Rules for the 1995-1996 IBT International Union Delegate and Officer Election (“Rules”) prohibit IBT affiliates from contributing, directly or indirectly, anything of value, where the purpose, object or foreseeable effect of the contribution is to influence, positively or negatively, the election of a candidate.
The Election Officer has found that the above IBT affiliates contributed union funds to the Real Teamsters Caucus (“RTC”) in violation of the Rules because a foreseeable effect of the contributions to the RTC was to oppose Ron Carey, a candidate for election to the office of general president.
The Election Officer has ordered the RTC to cease and desist from collecting any further funds from IBT affiliates. The Election Officer has also ordered these IBT affiliates to cease and desist from contributing further dues monies to the RTC.
The Election Officer has further ordered that the RTC return to IBT affiliates certain funds paid to the RTC by these affiliates. This remedy is necessary to eliminate the effect of these improper contributions on the 1996 election.
_________________________
Barbara Zack Quindel
Election Officer
This is an Official Notice and must remain posted for thirty (30) consecutive days from the day of the posting, and must not be altered, defaced or covered by any other material.
[1] Some of these protests were “reach-back” protests filed within the 30-day period following the final promulgation of the Rules on April 24, 1995, and allege violations occurring prior to the issuance of the Rules. The Rules, at Article XIV, Section 2(a), state:
Protests regarding violations of the [Labor-Management Reporting and Disclosure Act, as amended] (including violations of the IBT Constitution) allegedly occurring prior to the date of issuance of the Rules and protests regarding any conduct allegedly occurring within the first twenty-eight (28) days after issuance of the Rules must be filed within thirty (30) days of the date of issuance, or such protests shall be waived.
[2] Joint Councils 7, 10, 16, 18, 25, 41, 42, 43, and 80; Local Unions 28, 70, 78, 111, 122, 191, 391, 444, 470, 515, 554, 630, 840, 848, 891, and 1150; the Ohio and Texas Conferences of Teamsters.
[3] In a decision dated December 19, 1995, the Election Officer ruled separately on the remaining allegations of P-032-LU295-PNJ, denying the protest.
[4] The protest lists the same affiliates as those charged in P-032, with the addition of Joint Council 64.
[5] The letter from Mr. Carey did not itself take a position as to whether the RTC had violated the Rules. By letter dated October 11, 1995, the IBT requested withdrawal of the protest. The Election Officer granted that request by letter dated October 17, 1995.
[6] The reference is to Title I of the Labor-Management Reporting and Disclosure Act (LMRDA), 29 U.S.C. § 401 et seq.
[7] According to Mr. Hoffa, "[U]nless you demonstrate that your Office is independent of the IBT and does not take its orders from either Mr. Carey or the Legal Department, the members' faith in the integrity of your operation will be irreversibly undercut."
[8] As part of his protest, Mr. Murphy requested interim relief from the Election Officer, seeking to stay the remedy ordered by Mr. Carey, including the requirement that the RTC account for and disgorge any dues monies paid to it by any IBT affiliates. By letter dated October 13, 1995, the RTC asked that its request for interim relief be held in abeyance after the RTC and the International Union each voluntarily agreed to certain interim conditions pending the GEB’s consideration of Mr. Murphy’s appeal. The Election Officer deemed the request for interim relief withdrawn without prejudice by letter dated October 25, 1995.
[9] Counsel and representatives of the IBT, the RTC and TADEF cooperated fully with the Election Officer's investigation, providing witnesses, detailed position statements, and thousands of pages of relevant documents. The Election Officer is grateful to all parties for their cooperation and assistance.
[10] The reasons for the financial crisis are sharply disputed by the parties. It is unnecessary to assess the merits of that dispute here.
[11] It appears that Mr. Carey was concerned that his opponents would use a special convention to amend the International Constitution and limit Mr. Carey's power within the union.
[12] Durham v. Carey, C.A. No. 94-0216-NHJ; and Shea v. IBT, C.A. No. 94-0292-NHJ (D.D.C.).
[13] The IBT had also brought its own action to have the dues referendum declared lawful. IBT v. Brennan, No. 94 Civ. 0072 (DNE) (S.D.N.Y.).
[14] TITAN is a computer network that connects virtually every IBT affiliate with the International office and with each other to provide various services, including electronic mail.
[15] Tony Locke was executive assistant to Mr. Riley, chair of the Western Conference, and held other positions within the Western Conference.
[16] Effective October 31, 1995, Mr. Durham and Mr. Darrow retired from the Union.
[17] Interviewed in connection with this investigation, Mr. Powers confirms that he is still a candidate although he has not been actively campaigning.
[18] RTC organizers state that 75 IBT members signed in; as many as another 75 attended but declined to sign the sign-up sheet out of apprehension of retaliation. The amended complaint filed by the RTC leaders in Darrow places the number of member attendees at 50. The District Court adopted the number 33 from the plaintiffs' injunction papers. The exact number is not relevant here.
[19] “Dual unionism” describes the efforts of union members to undermine the union and substitute another union as the employees’ representative. Dual unionism is almost universal grounds for expulsion from membership. See Bureau of National Affairs, Labor Relations Expediter at 510:301.
[20] The goals of the RTC were stated as follows:
. . . to establish, promote and protect the institutional and membership interests of all Teamster [affiliates] . . . discuss, recommend and publicize action necessary and appropriate to preserve, protect and defend autonomy, integrity, independence and democratic control of [affiliates]; to provide education and information to affiliates concerning collective bargaining and grievance adjustment matters as well as concerning federal and state employment laws relevant to their representational responsibilities; to preserve and enforce the free speech and other legal rights of members and officers; to enforce the provisions of the International Constitution; to educate Union members and employees on matters of mutual concern; to bring the Union back to the membership; and to pursue other similar goals designed to further the rights of members and working men and women and the efficient operation of Local Unions and other affiliates.
[21] RTC witnesses claim that, in fact, all decision-making meetings were open to any attendee, and no restrictions on voting were ever enforced.
[22] Mr. Panek subsequently declined to serve and was replaced by Jim Santangelo, secretary-treasurer of Local Union 848. Mr. Santangelo stepped down in late April 1995.
[23] On December 4, 1995, Mr. Powers resigned as chair of TADEF, stating that his joint council had just been placed in trusteeship by the IBT.
[24] Mr. Roth was an assistant to Mr. Durham who assisted the Conferences in the dispute with the IBT.
[25] The full text of the TITAN message states:
A number of local unions have raised legal concerns regarding pending resolutions in certain joint councils to raise their per capita and/or divert existing dues money to fund two entities named "Teamster Affiliates Defense and Education Fund" and "Real Teamsters Caucus."
Local unions should be aware that any amendment to the Joint Council bylaws cannot become effective until the amendment has been reviewed and approved at the International Union pursuant to Article XV, Section 5 of the Constitution. Recent information raises serious questions whether the funding of these two entities is consistent with the fiduciary obligations of local union and joint council officers and whether such funding violates the IBT Constitution.
[26] The full text of the TITAN message states:
A number of joint councils and local unions continue to raise legal concerns regarding resolutions to raise per capita and/or divert existing dues money to fund the "Real Teamsters Caucus" (RTC) and/or "Teamster Affiliates Defense and Education Fund" (TADEF). For example, Joint Council 73 has unanimously rejected resolutions funding those two labor organizations because of, among other things, concerns about fiduciary obligations.
Joint councils and local unions should be aware that internal files of the former US Area Conferences and a statement by an RTC spokesperson suggest that the RTC was conceived and founded as a "national campaign committee" to "focus on the 1994 local union . . . elections, 1995 delegate elections and the 1996 contest" as a means of restoring former conference leaders to International office. Similar evidence suggests that the TADEF was founded, in part, to fund campaign work for an electoral slate of candidates.
Former conference leaders are, of course, free to campaign to replace the current administration. Subordinate bodies, however, should be aware that using dues money to fund activities to affect union electoral campaigns is illegal and may involve personal liability.
[27] The TITAN message stated in part:
The Labor-Management Reporting and Disclosure Act (LMRDA) expressly prohibits the use of "dues, assessment or similar levy" to promote candidacies in internal union elections. In addition, LMRDA sets forth a fiduciary responsibility for union officers with respect to the use of union's monies and property . . . Finally, the Consent Decree has outlined standards for Teamster officers of which you should be aware, including the duty to investigate . . .
Certain documents have come to light that raise serious questions with regard to the purpose of the Real Teamsters Caucus and its defense fund, and the legality of the expenditure of dues money to finance them.
. . .
[T]he mere existence of written Bylaws does not insulate officers from liability, if the actual activity undertaken is otherwise violative of federal law and/or the IBT Constitution. Further, reliance on a legal opinion on the legality of an expenditure may not protect those making the expenditures from liability.
. . .
Questions also remain about the constitutional implication if dues money is being funneled away from duly chartered bodies of the International Union to an unchartered body that purports to provide services delegated to constitutionally chartered subordinate bodies. Is this a "shadow government" funded by dues money and acting outside the requirements of the IBT Constitution and any oversight for membership accountability? Some members have raised concern about dual unionism and misuse of union dues money.
Official notice is hereby given that serious questions exist concerning the legality of expenditures by IBT affiliates to fund the Real Teamsters caucus and its "defense fund." Based on the above, officers who use members' dues money to fund these entities despite this information may expose themselves to liability under federal law and/or internal union discipline.
[28] Counsel for RTC states that the last work performed by Mr. Shinoff was a press release dated October 6. However, as of his deposition on October 24, 1994, Mr. Riley was not aware of any plans to terminate Mr. Shinoff. On October 26, 1994, Mr. Shinoff wrote a memo to Mr. Riley on behalf of the RTC seeking additional funding so that “we” could continue the work. Mr. Shinoff gave every impression of still working for the RTC at the time.
[29] According to Mr. Shinoff in his deposition of September 8, 1995, there was no formal ending of the relationship.
[30] The message stated in part:
In the last TITAN message on this issue, you were reminded that a legal opinion does not always shield union officials from liability where improper payments are concerned. However, the message inadvertently failed to add that this is especially true where the lawyer offering the opinion about the legality of a payment stands to personally gain from the expenditure.
[31] The wording of the letter gives the impression that the committee issued a report. It did not, having merely compiled a set of relevant documents for Mr. Carey.
[32] In Olson, Case No. P-172-LU70-CSF (November 1, 1995), the Election Officer found that use of the Local 70 telephone for the release violated Article VIII, Section 11(c), notwithstanding the fact that Delacorte/Shinoff had placed the telephone number on the press advisory without the knowledge or consent of the union. Delacorte/Shinoff was also ordered not to encourage or cause the improper use of union resources for campaign purposes.
[33] In a letter to the District Court, the IBT has stated its intent to move for leave to file an amended answer and counterclaim in Darrow and Central Conference, to seek enforcement of Mr. Carey's October 3 ruling. No further action has been taken.
[34] The Election Officer's investigation did not require the RTC or TADEF to disclose the names of individual contributors, nor has such information been provided to the IBT. Only the identity of IBT affiliates who financially supported the organizations has been provided.
[35] Article VIII, Section 11(b) states:
All Union officers and employees, if members, retain the right to participate in campaign activities, including the right to run for office, to openly support or oppose any candidate, to aid or campaign for any candidate, and to make personal campaign contributions. However, such campaigning must not involve the expenditure of Union funds. Accordingly, officers and employees (and other members) of the Union may not campaign on time that is paid for by the Union. Campaigning incidental to regular Union business is not, however, violative of this section. Further, campaigning during paid vacation, paid lunch hours or breaks, or similar paid time off is also not violative of this section. An endorsement of a candidate may be made by a Union officer or employee, but solely in his/her individual capacity. The Union or a Local Union as such or the General Executive Board or an Executive Board of a Local Union as such may not endorse or otherwise advance a candidacy, even if all members agree on the endorsement or candidacy.
[36] Article XII, Section 1(b)(1) states in part:
No labor organization, including but not limited to the International Union, Local Unions and all other subordinate Union bodies, whether or not an employer, may contribute, or shall be permitted to contribute, directly or indirectly, anything of value, where the purpose, object or foreseeable effect of the contribution is to influence, positively or negatively, the election of a candidate, except as permitted by subparagraphs (2) and (3) below. No candidate may accept or use any such contribution. These prohibitions extend beyond strictly monetary contributions made by a labor organization and include contributions and use of the organization's stationery, equipment, facilities and personnel.
[37] Campaign contributions are further regulated by Article XII, Section 1(b)(3), which prohibits the use of any union assets in campaigning unless the union is reimbursed at fair market value, and all candidates are provided equal access to such assistance.
[38] This does not apply to the situation where the union utilizes an outside vendor for the purpose of communicating the union's message to the union's members - for example, where the union pays a printer or publishing house to design or print the union's newsletter. See Committee to Elect Ron Carey, Case No. P-284-IBT (September 20, 1991), aff’d in relevant part, 91 - Elec. App. - 194 (SA) (October 2, 1991).
[39] Case No. P-291A-LU70 & P-278-CSF (March 14, 1991), aff’d, 91 - Elec. App. - 106 (SA) (March 22, 1991), aff'd, United States v. IBT (In re: Petition for Review of Decision 91 - Elec. App. - 106), 764 F. Supp. 817 (S.D.N.Y. 1991), dismissed as moot in part and vacated in part on other grounds, 964 F.2d 180 (2d Cir. 1992).
[40] See The Real Teamster, No. 46 (June 28, 1994); No. 50 (July 19, 1994); No. 52 (July 29, 1994); No. 58 (October 3, 1994); press release, September 15, 1994. The term “Marble Palace” is a long-standing derogatory reference to the imposing IBT headquarters on Capitol Hill in Washington, built in 1954 during the administration of IBT General President David Beck.
[41] The Real Teamster, No. 40 (June 14, 1994).
[42] Resolution, July 7, 1994; Resolution, August 15, 1994; The Real Teamster, No. 48 (July 11, 1994); No. 55 (September 9, 1994); Just the Fax, vol. 1, no. 6 (September 1995).
[43] Just the Fax, Vol. 1, No. 3 (May 1995); Vol. 1, No. 6 (September 1995).
[44] Memo, Shinoff to press (July 1, 1994).
[45] The RTC denies that it has made any "political" attacks on the Carey administration. This denial can only be understood as relying on an extremely narrow definition of the word "political" as simultaneously with "electoral." The Election Officer understands the term to embrace any dispute over the control and exercise of power within an institution. See R. Dahl, Modern Political Analysis, chapt. 2 (1963). Mr. Shinoff stated in a deposition that he had been told by Mr. Hogan in April 1994 not to get involved in any policy or political matters, and to only provide communication services. This assertion, in light of his memos of April 20, May 9, July 5, September 22 and September 29, 1994, is simply not credible.
[46] The Election Officer does not rely on any activity by the RTC in petitioning Congress or the Executive Branch for oversight of the consent decree. Such activity is expressly protected by the First Amendment to the U.S. Constitution. In Re: Hamilton, 95 - Elec. App. - 43 (KC) (December 15, 1995); Liberty Lobby, Inc. v. Pearson, 390 F.2d 489, 491 (D.C. Cir. 1968). This does not mean that republication of such material, for example in a press release or flyer, would defeat a finding of prohibited campaigning under appropriate circumstances. See Hamilton.
[47] No evidence was submitted by protesters or uncovered in investigation which showed that Local Unions 191, 470, or 891 or Joint Council 64 ever made any payments to the RTC. There was no evidence that Joint Council 43 made any contribution after October 1994. Accordingly, the protests as to those three locals are DENIED.
[48] This is not to say that repetition of discredited allegations of mob ties in the future will be protected. See In Re: Hoffa, 95 - Elec. App. - 31. Protests over future conduct will be reviewed on a case-by-case basis.
[49] Protesters also mention a statement made by International Vice President Gilmartin on July 12, 1994 at a GEB meeting to the effect that the IBT legal department should find some way to eliminate RTC and TADEF; and another statement at a September 1994 meeting of Joint Council 64 that RTC supporters would go to jail. Mr. Gilmartin asserts that at the GEB meeting, he asked only that the Legal Department investigate to see if the RTC violated any laws. As to the September 1994 meeting, he claims that all he did was voice his concern that if the delegates voted to join the RTC without first determining whether it was lawful, they could go to jail. Even assuming the truth of the protester's version of the facts, the alleged comments of Mr. Gilmartin do not change the Election Officer's view that there was no retaliation by Mr. Carey or the IBT against anyone for engaging in any right protected by the Rules.
[50] Section 501 of LMRDA, 29 U.S.C. § 501, permits individual union officers to be held personally liable for any breach of the fiduciary duty they owe to their members. See Morrissey v. Curran, 650 F.2d 1267, 1281 (2d Cir. 1981) (defendant union officer can be surcharged for improper payments received by other officers of which defendant had knowledge); Council 49 AFSCME v. Reach, 843 F.2d 1343, 1347 (11th Cir. 1988) (union officer liable to union for $1200 in bank overdraft charges because the “careless expenditure of union funds was unauthorized and manifestly unreasonable”); Pignotti v. Local 3, Sheet Metal Workers, 477 F.2d 825, 832 (3d Cir. 1973). The Second Circuit has indicated that proper authorization of an expenditure pursuant to the union bylaws will usually defeat a claim under § 501 unless the union officer personally benefitted and the court finds the payment manifestly unreasonable. Morrissey, 650 F.2d at 1274. However, it was not unreasonable for the IBT to believe that an authorized payment for an illegal purpose under LMRDA - campaigning - could violate § 501 and thus subject the officers to personal liability.
[51] The RTC also argues that the members of Mr. Carey's appointed fact-finding committee were biased. Since the committee did little more than assemble documents, any bias connected with the formation or operation of the committee has no significance here. The Election Officer did not limit her investigation to the documents compiled by the fact-finding committee. In particular, she sought and reviewed additional information in connection with the operation of various caucuses within the IBT.
[52] “A caucus, such as the TDU, is nothing more than a group of Union members, combining their efforts to advance a unifying goal.” Gully at 10.
[53] The RTC also asserts that TDU receives union monies. In support, the RTC submitted a report from the IRB to Mr. Carey dated October 27, 1995, in which the IRB stated that their investigation of Local Union 186 found a check in the amount of $495, made out from the local union to TDU. However, TDU as a matter of policy refuses to accept any union monies, and the financial records of TDU/TRF made available to the Election Officer show that the check was deposited by TRF in support of its convention activities. Moreover, there is no evidence that the IBT condoned any payments to TDU. To the contrary, the IBT placed Local Union 186 into trusteeship on November 6, 1995. Internal union charges are currently pending against the principal officer of Local 186 for causing the local to pay his expenses to the TDU convention.
[54] The Real Teamster, No. 47 (July 1, 1994). Bulletin No. 56, September 13, 1994, began its description of the just completed RTC meeting by stating, “Two hundred Teamster leaders from across the U.S., representing nearly one million members, met in Chicago...” (emphasis added).
[55] RTC cites two federal decisions for the proposition that unions may use dues monies to support an internal union caucus. Retail Clerks Local 648 v. Retail Clerks International Union, 299 F. Supp. 1012 (D.D.C. 1969); Gabauer v. Woodcock, 594 F.2d 662, 670-73 (8th Cir. 1979). While supportive of the RTC's argument against the October 3 constitutional interpretation, Retail Clerks is hardly determinative of the issue. The IBT further challenges the viability of Retail Clerks, arguing that subsequent cases have limited Title I rights to members, not officers or union affiliates. Finnegan v. Leu, 456 U.S. 431 (1982); Local 267 v. Ohio Carpenters Health & Welfare Fund, 926 F.2d 550, 556 (6th Cir. 1991). The decision in Nelson v. Iron Workers, 680 F. Supp. 16 (D.D.C. 1988), also cited by the RTC, held that a local union may assert claims under Title I of LMRDA. In that case, the union constitution contained a clause prohibiting locals from publishing derogatory statements about any member or another local without first submitting it to the general executive board. The court found the clause to be a violation of Title I. Even assuming this to be good law, it is not in conflict with Mr. Carey’s conclusion that affiliates may not spend dues monies to fund an unchartered body with no accountability to the IBT.
Gabauer addresses whether a union can make contributions to an outside political or charitable organization --a different issue than the one presented here. Further, the decisions in Retail Clerks and Gabauer are not relevant to the questions presented in P-032 and P-074, since the Election Officer found that the use of union funds constituted prohibited campaign contributions. Gabauer expressly notes that one of the few limits on free expression is the prohibition on promoting candidates contained in Section 401(g) of LMRDA.
[56] See Memorandum of Law in Support of Government's Motion for Injunctive Relief at 3 n.2 (“If the Caucus and the Defense Fund are engaged in or contributing to prohibited campaigning activities, participation in or contributions of union funds to these entities also arguably would constitute a violation of the IBT constitution.”), 14-15.
[57] Were the IBT to discipline RTC participants in such a way as to disqualify them from running for or holding International office, a new protest could be filed at that time. This decision is not meant to pre-judge the specific facts of any future dispute regarding eligibility to run for office.
[58] See In Re: Murphy and In Re: Robbins, 95 - Elec. App. - 3 (KC) (July 26, 1995) (series of IBT-ordered mergers of local unions in 1995 did not violate the Rules); Yager (no suppression of dissent when Carey supporter brought internal union charges against leaders of Eastern Conference); Wsol (dismissal of appointed grievance chair not retaliation under the Rules); Leal (suspension of International trustee not found to be retaliation); IBT v. Local Union 705, 827 F. Supp. 513 (N.D. Ill.), appeal dismissed, No. 93-2789 (7th Cir. 1993) (trusteeship not found to be imposed for political reasons); Giacumbo, Case No. P-029-IBT-PNJ (August 4, 1995), aff’d, 95 - Elec. App. - 10 (KC) (September 5, 1995) (no evidence found that prediction of merger of local union was to suppress political opponent of Mr. Carey); Giacumbo, Case No. P-100-IBT-PNJ (October 13, 1995), aff’d, 95 - Elec. App. - 27 (KC) (October 25, 1995) (no evidence IBT retaliated against candidate by denying him travel requests, office space, etc.); Giacumbo, Case No. P-177-IBT-PNJ (November 2, 1995), aff’d, 95 - Elec. App. - 38 (KC) (November 28, 1995) (trusteeship not found to be imposed to “disenfranchise” opponent of Mr. Carey); Hammond, Case No. P-250-IBT-SEC (December 21, 1995) (trusteeship not found to be imposed to chill free expression).
[59] Rumore; Yager. The Court in Yager added, "The LMRDA was not promulgated to give subordinate labor entities an additional weapon to use against the dominant organization for political gain." Id. at 14.