Breaking the Devil’s Pact

Front matter

BREAKING THE

DEVILS PACT

The Battle m Free the Teamsters from the m

Contents

Acronyms and Abbreviations Preface

US. v. IBT Timeline Principal Names

IBT Resistance and Judge Edelstein’s Resolve: July 1989-September 1992

Preface

[United States. v. International Brotherhood of Teamsters] flies in the face of democratic principles [and] . . . smacks of totalitarianism. —US. Senator Orrin Hatch, July 1988

[United States. v. International Brotherhood of Teamsters] is the most significant organized-crime-[control] measure in the history of the United States.

—Michael Cherkasky, IBT election officer, April 1998

I

I first heard of United States v. International Brotherhood of Teamsters in the summer of 1988. Marla Alhadeff, an assistant U.S. attorney in Manhattan, called to ask if I would serve as an expert witness in a civil RICO (Racketeer Influenced and Corrupt Organizations Act) case that U.S. Attorney Rudolph Giuliani had just filed against a slew of Cosa Nostra figures and the leaders of the International Brotherhood of Teamsters (IBT). She sent me the RICO complaint and a box of supporting documents. The complaint laid out a compelling story of systemic union corruption and organized-crime racketeering over several decades. The government's narrative of Cosa Nostra’s infiltration and exploitation of the Teamsters Union was not a revelation because, over the years, congressional hearings, criminal prosecutions, and media accounts had illuminated much of that history.

In its scope and ambition, U.S. v. IBT would clearly be a seminal case. The U.S. Department of Justice (DOJ) was simultaneously taking on the nation’s largest and most powerful union and the nation’s most powerful crime syndicate. This was also the first civil RICO lawsuit against an international union. I imagined, with trepidation, sitting on the witness stand xi xii Preface across from rows of defendants: nineteen Teamsters officials and twenty-six reputed mobsters.

I was both relieved and disappointed when, several months later, the parties settled, agreeing that there should be no organized-crime influence in the union and that the district court judge would appoint remedial officers to enforce a two-pronged consent decree. An investigations officer (IO) and independent administrator (IA) would investigate, “prosecute,” adjudicate, and sanction IBT members’ violations of the union’s disciplinary rules. An election officer (EO) would supervise nationwide rank-and-file elections of IBT international officers.

I turned my attention to other research projects. However, while working on Busting the Mob: United States v. Cosa Nostra (1994), a contemporary history of the federal government's effort to eradicate Cosa Nostra, I encountered U.S. v. IBT again. Part 2 of my book consisted of five chapters, each devoted to a major organized-crime case of the 1980s. Two cases involved civil RICO lawsuits against the Teamsters Union. The first was DOJ’s 1982 suit against Union City, New Jersey IBT Local 560. Controlled by powerful figures in the Genovese crime family, Local 560 was one of the most “mobbed-up” union locals in the United States. A year-long trial ended in a resounding government victory. The federal judge appointed a trustee to run Local 560 until it was purged of Cosa Nostra’s presence and influence.

The second Teamsters case covered in Busting the Mob was U.S. v. IBT. Writing that chapter required a close examination of the litigation. By the time Busting the Mob was published, the US. v. IBT settlement had been in effect for several years. Ron Carey, an insurgent, had won an extraordinary victory for the general presidency in the first direct rank-and-file election of international officers. Moreover, the court-appointed disciplinary officers (the IA and IO) had expelled dozens of corrupt officials from the union for, among other things, being members of organized crime, associating with members of organized crime, stealing from the union, and obstructing the court-appointed officers’ investigations. The remedial phase of the lawsuit seemed to be succeeding spectacularly. I could not have imagined that, a few years later, the court officers would expel General President Carey from the union or that, in 2011, they would still be on the job.

My 1999 book, Gotham Unbound: How New York City Was Liberated from the Grip of Organized Crime, focused on what federal prosecutors and New York City Mayor Giuliani’s administration were doing to eliminate the

Preface xiii five Cosa Nostra crime families’ (Lucchese, Bonanno, Gambino, Colombo, and Genovese) entrenched position in New York City’s economy, especially their control of union locals in the construction industry, garment center, cargo operations at JFK Airport, Fulton Fish Market, and Javitz Convention Center. The Cosa Nostra crime families leveraged their influence and control of unions (especially Teamsters local unions) to take over companies and set up employer cartels. However, through criminal prosecutions, civil RICO lawsuits against union locals, and innovative administrative licensing strategies (e.g., requiring a license to operate a carting company in NYC), the government had significantly weakened Cosa Nostra’s grip.

In the early 2000s, I myself played a minor role in U.S. v. IBT. IBT General President Jim Hoffa (Jimmy Hoffa’s son), who had succeeded Ron Carey, hired Edwin Stier, the former court-appointed trustee in the IBT Local 560 case, to lead an internal IBT anticorruption unit (Project RISE) that would demonstrate to DOJ and the federal judge that the US. v. IBT consent decree was no longer necessary. Stier, in turn, appointed an advisory board of organized-crime and labor-relations experts. Through service on that board, I became aware of some of the hundreds of legal battles over the court-appointed officers’ authority and decisions.

The US. v. IBT remediation reached one of several critical moments in 2004, when Edwin Stier and his top assistant, former FBI official James Kossler, resigned from Project RISE, charging that General President Hoffa had reneged on his commitment to give Stier’s team free rein to investigate corruption and racketeering. After the advisory board dissolved, a student coauthor and I wrote a journal article about the rise and fall of Project RISE. I then turned my attention to writing Mobsters, Unions, and Feds: The Mafia and the American Labor Movement (2006), a study of when, why, and how the Cosa Nostra organized-crime families became involved in labor unions, expanded their power and influence, profited from labor racketeering, and operated without significant opposition from labor ofhcials, employers, or federal, state, and local law-enforcement agencies.

I thought I was finished writing about labor racketeering. But as the remedial phase of U.S. v. IBT went on and on, I realized that this case was the most important labor-union litigation since the 1950s. First, at the time the lawsuit was filed, the IBT had the largest membership of any U.S. private-sector union. Second, the IBT was indisputably the nation’s most powerful union. Third, the IBT was the most written-about union. More than twenty books and scores of articles by journalists, historians, labor studies xiv Preface scholars, and Teamsters offer a rich, if uneven, history of a single labor union, thereby providing a window on twentieth- and twenty-first-century American labor history and American history generally. Obviously, the case warranted a major study. Thus, in 2007 and 2009, a student coauthor and I wrote two articles about the U.S. v. IBT remediation, one focusing on the disciplinary machinery and the other on the electoral reforms.

Because U.S. v. IBT was, first and foremost, meant to sever ties between Cosa Nostra and its most important economic and political power base, the IBT, this study also contributes to twentieth- and twenty-first-century organized-crime studies, especially to the history of the government's organized-crime-control strategies. U.S. v. IBT was groundbreaking for federal law enforcement because it stretched the legs of civil RICO farther than ever before. DOJ sought to purge Cosa Nostras presence and influence from an international union (the United States, Canada, and Puerto Rico) with nearly seven hundred local and regional affiliates. US. v. IBT tested DOJ’s ability to use civil RICO to achieve systemic organizational reform, a goal that scores of criminal prosecutions had failed to achieve. Moreover, the stakes were huge. Failure would likely dissuade DOJ attorneys from bringing future civil RICO suits against systemically corrupted organizations and might thereby encourage labor racketeering. Success would likely encourage similar lawsuits against organized crime’s influence in other unions.

A close study of U.S. v. IBT also contributes to the history of institutional-reform litigation. Much of the extensive academic debate on the proper relationship between federal courts and state/local government agencies takes its data from constitutional litigation against public agencies, such as prisons, jails, mental hospitals, and schools. The use of litigation to reform systemically corrupted private-sector organizations has attracted little attention, except for the nascent scholarly corpus on the use of deferred prosecution agreements (requiring organizational reform in lieu of prosecution) in corporate-crime cases.

US. v. IBT also offers opportunity for an important case study of the potential and limits of union democracy. No other international union, let alone a union as large, geographically diffuse, and politically established as the IBT, has undergone as far-reaching a compulsory (or even voluntary) democratization. Since 1991, a court-appointed election officer, working with a sizeable staff, has thoroughly supervised five IBT international-officer elections. The consent decree’s election machinery requires not only direct rank-and-file, secret-ballot election of international officers

Preface xv but also meticulous oversight of local-union delegate elections, campaign donations and expenditures, candidate nominations, and general-election balloting.

US. v. IBT also tests the efficacy of union democracy as an anticorruption prophylactic. In shaping its settlement demands, DOJ accepted union democracy proponents’ argument that, in free and fair elections, the IBT rank and file would “throw the crooks out” and that the requirement that candidates for union office stand for election would, going forward, prevent mobsters and their associates from attaining positions of influence. That hypothesis led the government to insist on radical election reforms. The electoral-reform prong of the case therefore holds important lessons for the potential of both union democracy and political democracy to prevent corruption and racketeering.