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Office of the Election Supervisor for the International Brotherhood of Teamsters

January 15, 1998




James P. Hoffa

January 15, 1998

Page 1


James P. Hoffa

2593 Hounds Chase

Troy, MI  48098


Tom Sever, General Sec.-Treas.

International Brotherhood of Teamsters

25 Louisiana Avenue, NW

Washington, DC  20001


Peter McGourty

15 Fieldstone Place

Wayne, NJ  07470


Joseph Padellaro

28 Basin Road

Newburyport, MA  01950

Ron Carey Slate

c/o Richard Brook

Cohen, Weiss and Simon

330 West 42nd Street

New York, NY  10036


Bradley T. Raymond, Esq.

Finkel, Whitefield, Selik

  Raymond, Ferrara & Feldman

32300 Northwestern Highway

Suite 200

Farmington Hills, MI  48334


James P. Hoffa

January 15, 1998

Page 1



Re:  Election Office Case No. PR-030-LU97-NYC




James P. Hoffa, a candidate for general president, filed a protest pursuant to Article XIV, Section 2(b) of the Rules for the 1995-1996 IBT International Union Delegate and Officer Election (“Rules”) against Ron Carey, the Ron Carey Slate, Joseph Padellaro, Peter McGourty, and Concerned Teamsters 2000.  Mr. Padellaro is a candidate for International Trustee and the appointed trustee of Local Union 97.  Mr. McGourty is vice-president of Local Union 11 and Mr. Padellaro’s assistant at Local Union 97. 


Mr. Hoffa alleges that a loan made to the Carey Campaign by Peter McGourty in the initial election was misrepresented to the Election Officer as a donation.  Additionally, Mr. Hoffa contends that a fundraiser held by Concerned Teamsters 2000 on behalf of the Carey Slate was not reported on any Campaign Contribution Expenditure Report (“CCER”).  Mr. Hoffa finally asserts that a bank account established to hold funds raised by Concerned Teamsters 2000 is currently available to the Carey Campaign for potential use in the rerun election. 


James P. Hoffa

January 15, 1998

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By letter of October 28, 1997, the Interim Election Officer citing Cheatem, Post 27-EOH (August 21, 1997) aff’d in rel. part, 97 - Elec. App. - 322 (KC) (October 10, 1997) advised Mr. Hoffa that his protest would not be docketed or considered because the allegation concerned the initial election.


The Interim Election Officer’s decision was appealed by the protester and a decision was issued in In re: McGourty, 97 - Elec. App. - 327 (KC) (November 10, 1997).  The Election Appeals Master ordered the Interim Election Officer to docket the protest and conduct a full investigation.


The protest was investigated by New York City Protest Coordinator Barbara C. Deinhardt.


In addition to the allegations in his protest, Mr. Hoffa submitted a letter dated November 19, 1997 and attached a copy of a news article appearing in the Wall Street Journal on November 18, 1997.  The article consists of statements relating to the fundraiser referred to in the protest.  No other evidence was presented by Mr. Hoffa concerning his initial allegations.  However, this post-remand letter made allegations not contained in the protest, specifically that two former business agents of Local Union 97, Bill Ross and Joan Porter, were improperly solicited and coerced in connection with the fundraiser; and that Bruce Kapp, a former member of Local Union 1034, was also pressured to contribute.


Mr. McGourty claims that the funds referred to in the protest were a contribution and not a loan.  Both Mr. McGourty and Mr. Padellaro deny that any member was improperly solicited or pressured.  In addition to contesting the merits of the improper solicitation and coercion allegations, the Carey Campaign asserts they are untimely and exceed the scope of the Election Appeals Master’s remand.


The investigation consisted of interviews with Mr. McGourty and Mr. Padellaro, an examination of prior statements made to the Independent Review Board (“IRB”) and an inspection of bank and corporate records relating to Concerned Teamsters 2000.  Mr. Ross, Ms. Porter, and Mr. Kapp were also interviewed.


I.  The Fundraising Activities of Concerned Teamsters 2000 


The investigation disclosed that Mr. McGourty and Mr. Padellaro are active supporters of Mr. Carey.  Mr. Padellaro was a candidate for the office of International Trustee in the initial election on the Carey Slate.  Mr. McGourty was the New Jersey Coordinator for the Carey Campaign. 


In January 1997, Mr. Padellaro received a telephone call from a representative of the Carey Campaign requesting that he attempt to raise $75,000 to retire election-related debts.  Several people were contacted by Mr. Padellaro and he was initially successful in arranging a pledge in the amount of $10,000. 


James P. Hoffa

January 15, 1998

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At the time the call was made to Mr. Padellaro, he and 12 other Carey supporters including Mr. McGourty were planning a fundraiser for the purpose of generating funds which could be utilized in future elections.  “We were also looking to the future,” stated Mr. Padellaro, “so that in this [geographical] area we could raise some funds for future races to support candidates that were sensitive to our needs.”  After being contacted by the Carey Campaign, Mr. McGourty and Mr. Padellaro agreed to use the fundraising event to raise the remaining balance of the $75,000 which the Carey Campaign had requested to retire its debt.


In February, Mr. Padellaro was advised by the Carey Campaign that the funds were needed immediately and Mr. Padellaro in turn advised Mr. McGourty that “we would have to raise the money a lot faster.”  The possibility of borrowing the money from a bank was discussed, using the fundraiser organizers as co-signers.  Upon further inquiry, Mr. McGourty was advised that it would be difficult to obtain an unsecured loan based solely on the signatures of campaign supporters.  Mr. McGourty also checked with his personal financial advisor.  He was advised that $65,000 in cash could be provided from his personal assets.  Thereafter, Mr. McGourty telephoned Mr. Padellaro and explained that he had made little progress in arranging a bank loan but that he was willing to donate the $65,000 himself. 


When Mr. Padellaro expressed reluctance in accepting such a large sum as a contribution, Mr. McGourty states that he responded, “The $65,000 isn’t a big deal to me.  If that’s what it takes to clear the way, it’s cheap.” Mr. Padellaro stated that he viewed Mr. McGourty’s contribution as an advance on the future collection of contributions and recalls proposing to Mr. McGourty several methods by which the money might be repaid, including the use of expected proceeds from the fundraiser which they were in the process of planning. 


In March 1997, Mr. McGourty drew a check in the amount of $65,000 from a personal bank account and transferred this amount to the Carey Campaign.  Eugene P. Maney, an assistant trustee to Local Union 807 and an organizer of the Concerned Teamster 2000

fundraising event, recalled in a statement to the IRB that repayment of the $65,000 did not concern Mr. McGourty .  “If I get it back, I do,” he reportedly stated to Mr. Maney.  “If I don’t, I don’t.”  Mr. McGourty corroborates this testimony.


On April 18, 1997, a certificate of incorporation was filed in the State of New Jersey for a C-corporation in the name of “Concerned Teamsters 2000, Inc.”  The newly organized company notified the State of New Jersey on or about May 1, 1997, that it intended also to use the alternative name of “Teamsters 2000.”  Mr. McGourty serves as the registered agent for the

organization, as well as its sole officer, director and shareholder.  The certificate of incorporation states that Concerned Teamsters 2000 was created to “engage in any activity within the purposes for which corporations may be organized” under New Jersey law. 


As to the purpose of the fundraiser, however, Mr. Padellaro told all the other fundraiser organizers that the moneys raised would be used to retire debts previously incurred by the Carey Campaign.

James P. Hoffa

January 15, 1998

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A bank account was established in the name of “Concerned Teamsters 2000.”  An examination of a corporate resolution authorizing the bank account indicates that the signatures of Mr. McGourty, Mr. Maney, and David LaBois were authorized for the purpose of writing checks.  Mr. LaBois is the Assistant Trustee of Local Union 945 and an organizer of the fundraiser. 


The event was held on June 7, 1997, at the Pines Restaurant in Edison, New Jersey.  Mr. Carey was a guest.  Contributions in the form of checks and cash were collected and deposited in the account.  Copies of all the checks have been made available to the Election Office.  Bank records indicate that a total of $49,240 was collected in connection with the event and that three checks were written against the account to pay for expenses in the amount of $14,379.50.  No contributions to any candidate have been made from the account.  The current balance is $34,860.50, less miscellaneous bank charges. 


In his statement, Mr. McGourty describes several conversations with Susan Davis, in her capacity as counsel to the Carey Campaign, regarding his $65,000 contribution.  According to Mr. McGourty, Ms. Davis advised him on several occasions that “if I did pay myself back, I should call . . . so that they could amend the [CCER] report.”


The Rules at Article XII, Sections (b) (5), (6) and (7), generally provide that a candidate may utilize both contributions and loans to finance a campaign for International office.  There is no evidence that Mr. McGourty intended the $65,000 as a loan.  There is evidence that Mr. McGourty has considered repaying himself from the funds which are currently on deposit in the Concerned Teamsters 2000 account, but to date, no expenditures from the account have been made except for those which relate to the direct costs of the fundraiser.  The Carey Campaign has reported Mr. McGourty’s transfer as a contribution, and not a loan, in its CCER report for the period beginning December 21,1996 and ending March 28, 1997. 


The Election Officer concludes that the evidence shows that the Carey Campaign did not misrepresent the nature of Mr. McGourty’s contribution on the CCER report, nor did Mr. McGourty misrepresent the nature of his payment to the Carey Campaign.  In the event the Carey Campaign repays any part of the funds contributed by Mr. McGourty, a CCER report disclosing the transaction must be filed.


The Rules at Article XII, Section 2(a)(2) provide that the obligation to file CCERs extends to:


James P. Hoffa

January 15, 1998

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Every slate of candidates for International office, whether full or partial, including any slate which has received or solicited any contributions, whether of money or of any other thing of value, or made any expenditures, where the purpose, object or foreseeable effect of any such contribution or expenditure is to influence the election of one or more International Officer candidates, whether or not the slate is as yet declared as such . . .


The evidence indicates that the original purpose of the fundraiser was to raise money for future candidates and elections.  However, after Mr. Padellaro was notified by the Carey Campaign of the immediate need for funds and he advised Mr. McGourty, the purpose of the event was effectively modified.  At the time the event was held, its announced purpose was to raise money to retire Carey Campaign debts, with any excess money going for future elections.  The idea to use the planned fundraiser for this purpose originated from Mr. McGourty, a Carey Campaign Coordinator, and Mr. Padellaro, a member of the Carey Slate in the initial election.  The evidence further establishes that Mr. Padellaro told the other organizers of the event that its purpose was to retire the Carey Campaign debt.  Mr. Padellaro, personally thought that some of the monies should be used to repay Mr. McGourty.


Because it received no contributions and made no expenditures with respect to the Pines Restaurant fundraiser, the Carey Campaign has no reporting obligation at this time.  In the event that the Carey Campaign receives contributions attributable to this fundraiser or incurs any related expenses, a corresponding duty to file the appropriate CCER will arise.


However, Concerned Teamsters 2000 has an immediate obligation to file a CCER and make a full disclosure of the amounts collected and expenditures made in connection with the fundraiser.  Mr. Carey appeared at the fundraiser.  Mr. Padellaro was a member of the Carey Slate during the period that the debts were incurred.  The representations made by Mr. Padellaro to the other organizers establish that contributions were collected and expenditures were made which had the “purpose, object or foreseeable effect” to “influence the election of one or more International Officer candidates,” specifically Mr. Carey.  Thus, while the Carey Campaign has no current obligation to report, the fundraiser must be determined to be an event to benefit the Carey Slate, requiring a report under the Rules at Article XII, Section 2(a)(2).  Should Mr. McGourty decide to repay himself in whole or in part from funds collected in the name of Concerned Teamsters 2000 or the contribution is repaid from any other source, the CCER report must disclose the financial details of this transaction.


It would not be proper to utilize any of the funds deposited in the bank account in the rerun election unless Concerned Teamsters 2000 can demonstrate that all of the contributors to the fundraiser were IBT members or that contributions received from non-members were appropriately segregated. 


II.  Allegations of Improper Solicitation and Coercion


A.  Bill Ross


James P. Hoffa

January 15, 1998

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Mr. Ross was discharged from his employment as a business agent at Local Union 97 on September 2, 1997, and claims that the reasons were election-related.  He stated that in May 1997, his supervisor Roy McClam gave him a packet of ten tickets to the fundraiser.  Mr. McClam functions both as an assistant trustee and as the business agent supervisor at Local Union 97.  When Mr. Ross returned all but two of the tickets to Mr. McClam unsold, Mr. McClam told him that he had  “let him [Mr. McClam] and Joe [Padellaro] down.”  According to Mr. Ross, he then complained about the cost of the tickets.  Mr. McClam replied that he had just received a raise of $100 per month, and that “if I were in your shoes I would have bought more.”  Mr. Ross reports that Mr. McClam then stated that the contents of their conversation were not to “leave this office.”  Thereafter, according to Mr. Ross, his working conditions deteriorated.  He claims that his reporting obligations increased and that he was treated with a general “coldness.”


Mr. McClam generally replies that the same reporting obligations imposed on Mr. Ross were applied to all other business agents at Local Union 97 and that the change began well before the fundraiser.  With respect to the sale of tickets, Mr. McClam admits giving Mr. Ross and all other business agents a packet of ten tickets to sell and notes that most of the business agents returned many unsold tickets.  He denies expressing disappointment with the number of tickets sold by Mr. Ross or referring to his recently obtained raise.  According to Mr. McClam, when Mr. Ross referred to the high cost for the tickets, McClam remarked that all the business agents to whom he distributed tickets had mentioned the price, which he agreed was quite high.  Mr. McClam also recalls commenting to Mr. Ross that he was surprised that he had not bought more tickets, given what he described as Mr. Ross’ “strong support” for Mr. Carey. 


Mr. McClam further states that when he asked business agents to sell tickets for Mr. Carey, he emphasized that it was not done on union-paid time and “had absolutely nothing to do with the job.”  According to Mr. McClam, those business agents who agreed to campaign for Mr. Carey did so of “their own free will.”


Mr. Padellaro states that Mr. Ross was terminated because of a large number of complaints received concerning his work performance and because of what Mr. Padellaro considered a breach of trust.  The breach of trust involved Mr. Ross’ failure to deny that certain of his local union activities were being directed by his father who had been barred from the union by the IRB.


Mr. Ross is in the process of challenging his termination before the NLRB alleging that he was fired for activities related to the formation of a collective bargaining unit consisting of business agents.  He has also contested his discharge in state court, alleging that he was fired both for election and union-related reasons.


B.  Joan Porter and Bruce Kapp


James P. Hoffa

January 15, 1998

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Former Local Union 97 Business Agent Joan Porter stated that she too had been asked by Mr. McClam to purchase tickets for the fundraiser.  She said it was never stated, but was “understood” from the way the business agents were approached about contributions that if they were not supportive of Mr. Carey, then they would not have a job.  She left the union in October in what she said was a forced retirement, after being told by Mr. McClam that she could not use her newly purchased foreign car for union business.


Mr. McClam states that Ms. Porter quit after an argument concerning her newly purchased foreign car.  Local Union 97 permitted Ms. Porter to use a union-owned car for union business.  Ms. Porter purchased a foreign car and, in October of 1997, she asked Mr. McClam whether or not she could use it, rather than the union-owned car, and be reimbursed for expenses.  Mr. McClam refused to allow her to drive the foreign car to union job sites.  The next day, according to Mr. McClam, Ms. Porter did not appear at a grievance meeting.  This failure to appear caused a heated discussion with Mr. McClam, during which Ms. Porter resigned her position.


Bruce Kapp was removed as the secretary-treasurer of Local Union 1034 by the IRB on  August 20, 1997, after serving only seven months.  Mr. Kapp stated that he bought a ticket for the fundraiser from James Lahey, president of Local Union 1034.  He does not assert and there is no evidence that Mr. Lahey or any other person pressured him to buy the ticket.


The Rules at Article XIV, Section 3(a), provide that post-election protests must be filed within two working days of the date the protester “becomes aware or reasonably should have become aware of the action protested.”


The claims raised by Mr. Ross and Ms. Porter were all brought to the Election Officer’s attention beyond the two working day period and are therefore not timely.  Since these claims involve retaliation, however, the Election Officer has investigated them.


In­­ Strzezewski, Decision on Remand II, P-416-LU705-CHI (August 27, 1996), aff’d, 96 - Elec. App. - 236 (KC)(September 19, 1996), the Election Officer summarized the elements of proof required to sustain a protest based on improperly motivated adverse action:


(1)  A showing that the protester was engaged in an activity protected by the Rules;


(2)  A showing that the charged party had actual or constructive knowledge that the protester was so engaged; and


(3)  The activity which is protected by the Rules was a motivating factor in causing the adverse action.


The Election Officer has specifically stated that no violation of the Rules at Article VIII,

Section 11(f) can be sustained unless some evidence is presented or disclosed which expressly or inferentially connects the conduct which is alleged to be improper to an activity protected by the RulesGiacumbo, P-100-IBT-PNJ (October 13, 1995); Salucci, P-178-LU552-MOI

(October 31,1995). 

James P. Hoffa

January 15, 1998

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Additionally, the Election Officer has repeatedly held that the existence of a reasonable independent basis for a discharge or removal from an appointed office defeats an allegation of improper motivation, so long as such basis does not form an excuse for or is a pretext for conduct or action which is actually in violation of the Rules.  The Election Officer will not determine that conduct or action is retaliation for the exercise of election-related rights if he concludes that the union officer or entity would have taken the same action, even in the absence of the protester’s protected conduct.  See Gilmartin, P-032-LU245-PNJ (January 5, 1996), aff’d, 95 - Elec.

App. - 75 (KC) (February 6, 1996); Leal, P-051-IBT-CSF (October 3, 1995), aff’d, 95 - Elec. App. - 30 (KC) (October 30, 1995); Wsol, P-095-IBT-CHI (September 20, 1995), aff’d,

95 - Elec. App. - 17 (KC) (October 10, 1995); Cf., Wright Line, 251 NLRB 1083 (1980), enforced, 662 F.2d 899 (1st Cir. 1981), cert. denied, 455 U.S. 989 (1982). 


The Election Officer concludes that the reasons given for the termination of Mr. Ross are independent of the election and not unreasonable.  There is no objective evidence of any increased scrutiny over Mr. Ross’ activities following the fundraiser and no specific conduct was described to support the claim that he was treated with “coldness.”  The timing of the discharge, more that three months after the fundraiser, supports the conclusion that the discharge was unrelated to the fundraiser, but for the reasons stated by the trustee.


Similarly, the timing of the events relating to Ms. Porter, approximately four months from the fundraiser, fails to support her allegations.  She does not deny that she quit following an argument with Mr. McClam that did not involve the election.  The evidence is insufficient to establish that Ms. Porter was solicited to support the fundraiser in violation of the Rules.


Accordingly, the protest is GRANTED as to Concerned Teamster 2000's failure to file a CCER report on the Pines Restaurant fundraiser, and DENIED in all other respects.


When the Election Officer determines that the Rules have been violated, he “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.  The Election Officer orders the following remedy:


1.  Concerned Teamsters 2000 shall cease and desist from all future violations of the Rules and shall file all CCER reports in a timely manner for any period in which election-related financial activity is conducted.


2.  Within five (5) days of receipt of this decision, Concerned Teamster 2000 shall file a CCER report for the period which begins with the date of its first expenditure or first collection of funds and ends on November 19, 1997.


James P. Hoffa

January 15, 1998

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Any interested party not satisfied with this determination may request a hearing before the Election Appeals Master within one day of receipt of this letter.  The parties are reminded that, absent extraordinary circumstances, no party may rely upon evidence that was not presented to the Office of the Election Officer in any such appeal.  Requests for a hearing shall be made in writing and shall be served on:


Kenneth Conboy, Esq.

Latham & Watkins

885 Third Avenue, Suite 1000

New York, NY  10022

Fax (212) 751-4864


Copies of the request for hearing must be served on the parties listed above as well as upon the Election Officer, 400 North Capitol Street, NW, Suite 445, Washington, DC 20001, Facsimile

(202) 624-3525.  A copy of the protest must accompany the request for a hearing.






Michael G. Cherkasky

Election Officer




cc:               Kenneth Conboy, Election Appeals Master

Barbara C. Deinhardt, New York City Regional Coordinator