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Seventh Circuit Upholds Validity Of LIUNA'S Internal Reform Process

 

By Michael Bologna

Thursday, December 23, 1999

 

CHICAGO--The U.S. Court of Appeals for the Seventh Circuit Dec. 17 rejected a challenge by the Chicago District Council of the Laborers' International Union of North America to the international union's authority to place it under a trustee's control (Laborers' International Union of North America v. Caruso, 7th Cir., No. 99-1276, 12/17/99).

 

Noting that the CDC failed to demonstrate the international union had targeted it for unwarranted discipline, the Seventh Circuit called "meritless" the CDC's argument that the international union acted in "bad faith" in imposing the trusteeship. The CDC, which oversees the operation of 21 LIUNA Locals in Chicago, was placed under the control of a trustee in February 1998.

 

The court also rejected the CDC's claims that the international union's Ethics and Disciplinary Procedure (EDP), which was established five years ago under a consent agreement between the union and the Department of Justice, was improperly enacted. The Seventh Circuit previously found appropriate the EDP and the consent agreement, which created the foundation for LIUNA's current internal reform process.

 

"The CDC's attempts to characterize its new challenges to the EDP as challenges to how the EDP is implemented do not alter the fact that the EDP was appropriately enacted and we are not aware of any compelling reason that warrants concluding that LIUNA's efforts to establish a trusteeship over the CDC was in bad faith," Judge John L. Coffey wrote.

 

Past Point of Arguing Validity, GEB Lawyer Says

 

Robert Luskin, who directs LIUNA's internal reforms as General Executive Board attorney, said he was not surprised by the appeals court's decision.

 

"We are long past the point where there are arguments about the scope of our authority or the validity of our mission," Luskin said. "In five years, we have not lost so much as a motion in district court."

 

Luskin filed a trusteeship complaint against the CDC on June 16, 1997, alleging the body had been under the control of Chicago crime bosses for at least 25 years. Peter Vaira, LIUNA 's independent hearing officer, concurred on Feb. 7, 1998, after a 19-day hearing on the issue (27 DLR A-9, 2/10/98). Vaira endorsed the action, arguing that a trusteeship was necessary to expel the influence of organized crime, restore democratic processes, and conduct the legitimate business of the union. Chicago labor attorney Robert Bloch was appointed trustee.

 

The executive board of the CDC, however, refused to grant Bloch access to its building. LIUNA and Bloch eventually gained a restraining order, barring the CDC and its board from interfering with the trusteeship. The CDC filed a counterclaim and LIUNA sought summary judgment. Among other things, the CDC alleged an improper relationship between the GEB attorney and LIUNA General President Arthur Coia. The CDC also alleged the trusteeship was essentially a disciplinary strike against CDC president Bruno Caruso, who had run against Coia during LIUNA's 1996 general election.

 

But Judge James B. Moran of the U.S. District Court for the Northern District of Illinois granted summary judgment to the international, holding in January that Vaira had heard and read a "massive amount of evidence" and his ruling carried "evidentiary support."

 

Bad Faith, Unclean Hands Argued

 

On appeal to the circuit court, the CDC persisted with assertions that it was the victim of a tainted hearing process. The CDC argued that LIUNA's "bad faith" and "unclean hands" precluded summary judgement.

 

But Coffey found such arguments meritless. He pointed to the Seventh Circuit's 1996 ruling in a case brought by John Serpico, a former LIUNA international vice president. Serpico challenged the validity of the agreement between the Justice Department and LIUNA and the internal discipline processes established pursuant to that agreement.

 

In that decision, the court upheld the reform process, noting that the international union would have been subject to a federal RICO complaint if reforms had not been pursued (Serpico v. LIUNA, 97 F.3d 995, 7th Cir. (1996), 203 DLR A-12, 10/21/99).

 

CDC Lawyer Calls Decision Misguided

 

Allan A. Ackerman, who represented the CDC on appeal, described the court's decision as "misguided." He also noted that the court ignored arguments pertaining to LIUNA's ability to oust CDC officers democratically elected by its membership. He said the CDC is considering an appeal to the U.S. Supreme Court on that issue and the issue of bad faith.

 

But Luskin called such an appeal "preposterous."

 

"You'll see me push a peanut down State Street with my nose if cert (certiorari) is granted in this case," Luskin said.

 

Judges Frank H. Easterbrook and William J. Bauer joined in the opinion.

 

Copyright © 1999 by The Bureau of National Affairs, Inc., Washington D.C.


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