2011-05-16 u.s. v district council transcript

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UNITED STATES DISTRICT COURT

SOUTHERN DISTRICT OF NEW YORK

- - - - - - - - - - - - - - - - - ~ - - - - - - ~ - - - - - x

UNITED STATES OF AMERICA,

P l a i n t i f f ,

v.

DISTRICT COUNCIL, e t a I ,

Defendants .

- - - - - - - - - - - - - - ~ - - - - - - - - - - - - - - - x

Before:

90 CV 5722 (RMB)

New York, N.Y.

May 16, 20112:30 p.m.

HON. RICHARD M. BERMAN,

Di s t r i c t Judge

APPEARANCES

PREET BHARARA

UNITED STATES ATTORNEY fo r P l a i n t i f f

BENJAMIN TORRANCE

Ass is tan t United Sta tes Attorney

SCOTT WEISSAttorney fo r Michael Bi le l l o

DENNIS WALSH

BRIDGET ROHDE

·At torneys fo r Review Off ice r

SOUTHERN DISTRICT REPORTERS, P.C.

(212) 805-0300

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1 APPEARANCES (Cont' d)

2 LATHAM & WATKINS

Attorneys fo r UBC

3 KENNETH CONBOY

WILLIAM RECHLER

4 NATE KALE

5 DeCARLO, CONNOR & SHANLEY, PC

Attorneys fo r Dis t r i c t counci l6 BRIAN F. QUINN

7 MARK ROSEN

Attorney fo r G e n e r ~ l Cont rac t6rs Associa t ion

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CARY KANE, LLP

9 Attorneys fo r Carpenters Committee

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LARRY· CARY


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1 (Case cal led)

2 (In open cour t)

3 THE COURT: I did get a l e t t e r from one of the union

4 members'asking tha t we adjourn today 's meeting. I , thought

5 be t te r of tha t because so many people are involved and had

6 al ready planned to come and also the meeting tha t tha t

7 individual , Mr. Franco, was concerned about, was to occur a t

8 5:00 today, and unless the re ' s something very unusual I don ' t

9 know about we ' l l be done long before 5:00 and cer ta in ly in time

10 fo r anybody to get to tha t meeting.

11 So we se t today 's meeting the l a s t t ime we were

12 together on Apri l 6 and we s t a r t ed tha t meeting with

13 Mr. Conboy. I 'm happy to s t a r t with him today to bring things

14 up to where we stand today, bylaws, e tc .

15 MR. CONBOY:' Good afternoon, your Honor. I 'm Kenneth

16 Conboy of Latham & Watkins represent ing the UBC. Judge, I do

17 want to say f i r s t with respect to the bylaws tha t they were

18 handed a week before las t . to Dennis Walsh, the review of f ice r

19 and I do note because of Mr. Walsh's cover l e t t e r your Honor i s

20 aware of the fac t tha t they are now under review by the rank

21 and, f i l e as your Honor di rec ted . So our understanding i s t ha t

22 the review period wil l continue, I bel ieve u n t i l June 9, and my

23 own view of the matter i s tha t the bylaws are const ruc t ive and

24 t ha t they broadly address the object ives and the concerns of

25 a l l of the par t ies to the consent decree.


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1 I also would ' l ike to say, your Honor, tha t with

2 respect to the funds, I am going to ask my colleague, Raymond

3 McGuire, to bring your Honor up to date with a matter tha t

4 actual ly has emerged only in the l a s t severa l days, and i s of a

5 nature tha t we bel ieve should be shared by you and by a l l here

, 6 in the courtroom, obvlously very concerned about the, in teg r i ty

7 of these funds, as those funds re la te to the ret i rement and the

8 heal th and indeed the fundamental expecta t ions of the rank and

9 f i l e vis -a -v is these benef i t funds.

10 Final ly , I would l ike to t e l l your Honor tha t a t your

11 suggestion Mr. Weiss was very accommodating to us, when I ' s ay

12 us, I mean Mr. Torrance, the United Sta tes Attorney, Mr. Walsh

13 and myself and he did arrange for a te leconference to be had

14 l a s t week with respect to i ssues t ha t he ra ised in h is l e t t e r

15 to you. Your Honor wil l reca l l tha t you appl ied a memorandum

16 endorsement to h is l e t t e r invi t ing the par t ies to have

17 construct ive discussion with respect to the s ta tus of the

18 various aspects tha t are e i the r expl ic i t ly or impl ic i t ly before

19 the Court because of Mr. Bi le l lo ' s motion.

20 We did have a conference of I th ink about an hour'S

21 durat ion and also counsel, Mr. Kane and Mr. Cary were able to

22 par t ic ipa te and I cer ta in ly fee l tha t because Mr. Weiss was

23 good enough to take the in i t i a t ive there , tha t I defer to

24 Mr. Weiss to give your Honor a repor t with respect to those

25 mat ters . But i f your Honor please , I would l ike to now ask


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1 Mr. McGuire to bring the Court and counsel and the par t i e s up

2 to date on the s ta tus of the benef i t funds and more

3 par t icu la r ly more recent developments in terms of the

4 prospect ive viab i l i t y of those funds.

5 THE COURT: I f we could in one minute turn to t ha t .

6 I 'm obviously aware of the s ta tus of the bylaws. I would· l ike

7 to hear a l i t t l e b i t more about t ha t . There were a couple of

8 draf t s , according to the c o r r e s p o n d e n c ~ exchanged, comments

9 given by Mr. Walsh back and for th , so i s th i s draf t the dra f t

10 tha t absorbs or incorporates as many of those comments as you

11 thought were helpful and i s now out for publ ic dis t r ibu t ion on

12 the theory tha t th i s i s the dra f t recommended by yourself?

13 MR. CONBOY: Yes. Judge, i f I could ju s t make a very

14 br i e f sta tement about tha t and then I do want to . defer to

15 Dennis Walsh, who obviously has a t th i s stage under Judge

16 Haight ' s order the primary respons ib i l i ty to do tw o th ings ,

17 number one, to sa t i s fy hims.elf tha t these bylaws adequately

18 address the concerns of your Honor and Mr. Torrance and

19 secondly to keep an open mind with respect to the t ex t of the

20' bylaws so tha t when the commentary period i s over he has

21 suf f ic ien t f l ex ib i l i t y to make a f ina l recommendation, I would

22 assume i n i t i a l ly to us and ul t imate ly to your Honor.

23 We have had a very const ruc t ive dialogue with

24 Mr. Walsh. We had met numerous t imes. We have had discuss ions

25 not only among the lawyers but with respect to the off i ces of

SOUTHERN DISTRICT REPORTERS, P.C.(212) 805-0300



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1 the UBC and I do bel ieve tha t the bylaws in t he i r present form

2 meet in l a rge degree the concerns tha t Mr. Walsh has repeated

3 to us in the course of these de l ibe ra t ions . And he, as we,

·4 await the comments of the , rank and f i l e in terms of t he i r

5 ca re fu l scrut iny of these bylaws. Indeed, Mr. Walsh d id advise

6 me, al though I was not aware of th i s , tha t they have been

7 pos ted on the websi te of the Dis t r i c t Council and I assume they

8 are on other websi tes as well , and I th ink probably, Judge, it

9 would be appropriate for me to ask Mr. Walsh to comment fur ther

10 before we turn to the funds.

11 . THE COURT: Sure.

12 MR. WALSH: Thank you, Mr. Conboy. Your, Honor, I can

13 endorse a l l of the background in terms of the meetings tha t I

14 did have with Mr. Conboy's off i ce and counsel from the UBC out

15 of Washington. At the end of the discussion, I agreed to keep

16 an open mind, obviously, about the bylaws tha t would be

17 submitted, but I also th ink it i s v i t a l tha t par t of th i s

18 process be considera t ion of the comments from the rank and f i l e

19 and I th ink I did mention in the l e t t e r tha t I wrote l a s t week

20 t ha t I was expect ing a th i rd draf t which would be posted. I

21 obviously received i t , it was posted immediately on the

22 Dis t r i c t Council websi te and I have received about a dozen

23 comments to date . I sent also a message to the union for

24 post ing on the websi te indica t ing tha t fo r people to

25 par t ic ipa te , tha t they heeded to ident i fy themselves and it

.SOUTHERN DISTRICT REPORTERS, P. C.

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1 would be helpful i f they could spec i f ica l ly iden t i fy any

2 sec t ion tha t they wished to endorse or cr i t i c i ze and I rea l ly

3 implore a l l the members of the union to take the time to go to

.4 the Dis t r i c t Council websi te and read these bylaws and send me

5 an e-mail or a note ind ica t ing what they th ink about them.

6 I do in tend to present the comments to the Court as

7 par t of the record. I also, though, in tend to go back to the

8 UBC on or about June 10 a f t e r ' the close of the comment per iod

9 and i f the re ' s a consensus on cer t a in comments before tha t , I

10 th ink I can actual ly go back and say th i s i s what I 'm

11 receiving, l e t ' s ta lk about t h i s . But cer ta in ly no l a t e r than

12 the close of the period ,I would take the comments back to the

13 UBC and continue the dialogue and see i f the re ' s anything t ha t

14 needs to be adjusted which I perhaps might say I s t rongly

15 bel ieve needs to be adjusted, and I 'm sure we ' l l have a

16 meaningful discussion a t tha t point .

17 So I th ink my message i s to a l l the members and to the

18 extent tha t today 's events are reported over the i n t e rne t and

19 by word of mouth, the message i s please read these dra f t bylaws

20 and l e t me know what you th ink about them.

21 THE COURT: You asked fo r language suggest ions or

22 thematic suggest ions or ideas or any of i t ?

23 MR. WALSH: Any of i t , and the responses tha t I 've

24 got ten have encompassed a l l of those bi t s and pieces . I 've

25 got ten some very exhaustive, very detai led comments about the


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1 en t i r e ty of the proposa l , as wel l as spec i f ic sugges t ions , and

2 I ' ve also got ten simple comments from people about ind iv idual

3 sect ions o r why they th ink in theory something i s good o r bad.

4 And I 'm gra tefu l fo r t ha t and make sure t ha t everyone

5 understands how important it i s , and tha t they ' re cer t a in ly not

6 l imi ted , i f they have addi t iona l thoughts , I would l ike to know

7 what they are . So i f they submitted, it's not j u s t one b i te .

8 THE COURT: Okay. So they know t ha t they have u n t i l

9 June 10.

10 MR. WALSH: June 9 would be the ac tua l close and then

11 as soon as our schedules allowed, I would go back to the UBC

12 and share not only the comments, but my thought's on the

13 comments and any poin ts which I ' ve agreed to keep an open mind

14 about which don' t necessar i ly r e f l ec t a meeting of the minds

15 with respect to the dra f t t ha t was ac tua l ly submit ted to me.

16 THE COURT: Okay. Great . So should we hear from

17 Mr. McGuire next about the funds?

18 MR. McGUIRE: Thank you, your Honor.

19 THE COURT: Do I take it from Mr. Conboy's remarks

20 tha t th i s i s in the nature of a problem t ha t you have?"

21 MR. McGUIRE: It's not as bad a problem as we thought

22 up to about two hours ago. The review of f i ce r and I have j u s t

23 come from a meeting of the fund 's t rus tees and ac tua r ie s ,

24 Siege l & Company. We had met with Siegel l a s t week and we did

25 get some dis turb ing news l a s t week.


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1 The funds in f i s ca l year 2010-2011, which wil l end on

2 June 30th of th i s year , are projec ted to have an income of

3 $199 mil l ion , t ha t i s based on the $11.25 cont r ibut ion fo r each

4 hour worked made by employers to the welfare fund, and expenses

5 o f $244 mil l ion . So we wil l be running in 2010:...2011 a de f ic i t ·

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6 of approximately $45 mil l ion . What dis turbed us was t ha t

7 Siegel to ld us l a s t week t ha t i f we d id nothing to address t h i s

8 problem the r ese rves which are always measured in months when

9 you speak of welfare plans , w i l l go from e igh t months . t h i s y e a r

10 down to f ive months in the next f i s ca l year , and down to about

11 a month and a hal f in the th i rd f i s c a l year .

12'"::"''It..:_ I

We were riot aware t ha t the s i t ua t i on was as precar lous

13 as Seigal to ld us l a s t week, al though today i t . somehow found

14 $32 mil l ion in income. I t j u s t hadn ' t accounted fo r investment

15 gains in i t s analys is l a s t week, so the s i t ua t i on i s not as

16 dramat ica l ly p recar ious , but it remains preCarious .

.17 The Dis t r i c t Counci l has always projec ted - -

18 THE COURT: What does it >mean? I s it 50 minus 34,

19 roughly?

20 MR. McGUIRE: I would say i f we d id nothing, maybe we .

21 have four or f ive years before the reserves run ou t . But i f we

22 do nothing the reserves run out , no quest ion about it. And by

23 nothing, I mean i f we do not r a i se ~ n d ra i se by perhaps

24 50 percent the employer hourly cont r ibut ion or somehow ad jus t

25 and re s t ruc ture the benef i t plans and the benef i t s ava i l ab le

SOUTHERN DISTRICT REPORTERS, P.C.(212 ) 8 05 - 030 0



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1 under the plans, we wil l be facing a ser ious problem.

2 The t rus tees are as we speak grappl ing with these

3 problems. Siege l h as come up with an analys is of the plan and

4 a l l of i t s component par t s , i n c l u d i n ~ the cos t s fo r covering

5 ea r ly r e t i r ee s , the cos t for covering Medicare r e t i r ee s , the

6 cos t fo r covering denta l , v i s ion , e t c . , e tc . so the t rus tees

7 were slogging t h e i r way through a lo t of t echn ica l de ta i l s , but

8 they I think are in reach Of a consensus as to a number of

9 changes t ha t wi l l have to take place in order to do two th ings;

10 to make sure we have a viable welfare plan fo r not j u s t our

11 r e t i r ee s , bu t fo r the present genera t ion of apprent ices and

12 journeymen,_ and secondly, we can ' t do t ha t in a way t ha t makes

13 the indus t ry , and I mean the unionized indust ry l ess

14 compet i t ive than it i s today.

15 We have an $86 and change package. I thipk we a l l are

16 apprecia t ing now t ha t it has re su l ted in a considerable loss of

17 market share over the l a s t few years , so in order to r a i se the

18 hours we know we have to contain costs and t ha t ' s what ' s being

19 done both in the t r u s t e e ' s t en th f loor meeting room as wel l as

20 a t the col l ec t ive bargaining t ab le . And I 'm fa i r ly conf ident

21 l i s t en ing to the de ta i l s and the t enor of the conversat ion the

22 t rus tees were having today t ha t a so lu t ion wi11 be reached to

23 make sure the fund remains viable in to the indef in i t e fu ture .

24 THE COURT: So . jus t to f ix on f i s ca l year 2010-2011,

25 you sa id t ha t t he re was $199 mil l ion in income and $244 mil l ion




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1 in expenses, so t ha t gives r i s e to a de f ic i t of $45 mil l ion ,

2 bu t t ha t did not- include re turn on investment as

3 MR. McGUIRE: That' ,s r igh t , your Honor.

4 THE COURT: So t ha t ' s 35 mil l ion , r ight?

5 MR. McGUIRE: I t reduced the d e f i c i t to about

6 $20' mil l ion when we accounted for the re turns .

7 THE COURT: I got 10 mil l ion .

8 MR. McGUIRE: Well, there were a number of d i f fe ren t

9 f igures thrown a round , bu t what I have in my notes here from

10 John Urbank a t Siegel was t ha t the de f ic i t was reduced from 44

11 to $20 mil l ion or i s pro jec ted to be reduced by the end of the

12 f i s ca l year when he accounted fo r investment gains .

13 THE COURT: I see . And how d id t ha t , i f you know,

14 compare with l a s t yea r ' s r e su l t s , f i s ca l year 2009-2010?

15 MR. McGUIRE: I don ' t have those f igures , your-Honor.

16 I know a l so , again, i f nothing changed in the cont r ibut ion

17 r a t e , e t c . , fo r 2011-2012, Siegel i s projec t ing expenses of

18 $260 mil l ion and income of $190 mil l ion for a $56 mil l ion

19 de f ic i t and the reserves would be down to approximately 5 and a

20 hal f months.

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22 what?

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THE COURT: So t he -de f i c i t fo r next f i s ca l year was

MR. McGUIRE: $56 mil l ion . Again, he does not - -

THE COURT: I understand.

MR. McGUIRE: Because of the vo l a t i l i t y of the




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1 markets, he doesn ' t want to projec t investment gains a t th i s

2 po in t . . So t ha t could be lower.

3 THE COURT: Got you. Okay. Anybody want to comment

4 on tha t? Okay.

5 And so what i f anything you ' re not proposing

6 anything a t t h i s t ime other than to c a l l to our a t t en t ion these

7 resu l t s?

8 MR. McGUIRE: That ' s t rue , your Honor. They're

9 meeting for the balance of the af ternoon and I 'm sure we ' l l be

10 having another meeting ear ly next week . .

11 VOICE: Your Honor.

12 THE COURT: Somebody

13 THE DEPUTY CLERK: I don ' t know who t ha t was.

14 THE COURT: I f you could j u s t l e t me f in i sh the

15 agenda, and then we ' l l hear from anybody e l se who wants to

16 speak.

17 Did t ha t conclude your repor t?

18 MR. McGUIRE: Yes, your Honor, thank you.

19 THE COURT: So was there a - - i s th i s the f i r s t t ime

20 anybody's hearing about these resu l t s or are there quar te r ly

21 sta tements t ha t are put out in wri t ing t ha t say how the fund i s

22 doing fo r the f i s ca l year or i s th,is the f i r s t t ime t ha t

23 anybody's making any kind of publ ic pronouncement about where

24 the fund i s going to end up in f i s ca l year 2010-2011?

25 MR. McGUIRE: This i s the f i r s t t ime t h i s has been


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1 discussed publiclYr and the funds normally do not publ ic ize

2 these resu l t s un t i l the funds submit a 5500 end 'of the year and

3 f i s ca l year repor t to the Department of Labor r un t i l they have

4 a l l the numbers from the accountants and the ac tua r ie s .

5 THE COURT: That ' s a little unusual to me. I don ' t

6 know about union fund report ing r but in every other f i e ld

7 quar te r ly would be l a t e r monthly would be fo r your Merr i l l

8 Lynch accountr so to speakr you would ge t a monthly s ta tement .

9 Some accounts r some s ta tements you ge t quar ter ly . This i s a

10 little b i t surpr is ing and maybe not r but a little b i t

11 surpr is ing t ha t one doesn ' t f ind out how something t ha t i s as

12 important as a fund i s doing un t i l almost on the eve of the end

13 of the f i s ca l year .

14 MR. McGUIRE: Wellr the t rus tees which represent both

15 the UBC r the Dis t r i c t Council and the important employer

16 associa t ions r they know on a quar te r ly bas i s .

17 THE COURT: Well surer I 'm sure . But

18 MR. McGUIRE: And to the extent the union chooses to

19 share what it knows with the membershipr it's f ree to do so.

20 THE COURT: A ll r igh t . Okay. So i f we could turn - -

21 did Mr. Weiss want to be heard?

22 MR. WEISS: Yes r your Honor. Sco t t Weiss on behalf of

23 Michael Bi le l lo . Mr. Conboy i s cor rec t . On May 10 we had a

24 te lephone conference which l as ted 45 minutes. There were four

25 category discussed r not the l ea s t of which your Honor may

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1 . reca l l t ha t the UBC was to provide a re s t ruc tur ing plan - -

2 THE COURT: I s th i s the l e t t e r dated Apri l 51 2011?

3 MR. WEISS: Correct your Honor. The Apri l 22 l e t t e r

4 asked there be a wri t ten plan t ha t would inc lude a t imetable

5 t ha t would inc lude re s t ruc tur ing by no l a t e r than June 301

6 2011. We t a lked about four categories or ra ther included in

7 the conferees as he d id poin t out Mr. Torrance Mr. CarYl

8 myself l Mr. Bi le l lo was included and Mr. Walsh and Mr. Conboy

9 obviously and my take-away from tha t conversa t ion was t ha t we

10 expected 'to see a wri t ten planl as one i s required l which wi l l

11 ul t imate ly be fo r review under 5(b) and well in advance of

12 June 30 1 2011 1 and I would expect tha t t ha t plan would have

13 some kind of t imetable so we unders tand what exact ly the UBC

14 in tends to do with the loca l s and the re s t ruc tur ing .

15 THE COURT: So are you sa t i s f i ed t ha t based on those

16 ca l l s t ha t you had t ha t what you were seeking i s in the works

17 or maybe forthcoming or what?

'18 MR. WEISS: At t h i s t imel I 'm genera l ly sa t i s f i ed .

19 However I would l ike to see a more def in i t ive date . Indeed l

20 the UBC has done t h i s before . I suspec t t ha t someone has whi te

21 boarded the re s t ruc tur ing plan . What they plan to dO l and I

22 th ink t ha t the membership in view of the fac t t ha t it i s t he i r

23 organizat ion l they ' re en t i t l ed to know.

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THE COURT: Okay.

MR. WEISS: Thank you lJudge.

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1 loca l s has an impact on the s t ruc ture as it re la tes to the

2 Dis t r i c t Coune - i l .So we're being to ld we ' l l . have a comment

3 period up un t i l June 9, but it's poss ib le t ha t we won' t get the

.4 re s t ruc tur ing plan u n t i l .a s l a t e as June 30 and t he re ' s a b i t

5 of a disconnect between the two. Now I understand t ha t e f fo r t s

6 were made to get the re s t ruc tur ing plan wel l in advance of

7 June 30, but having prac t iced law fo r a number of years , I know

8 t ha t deadl ines matter and oftent imes the deadl ine i s the

9 deadl ine 'as opposed to i n t en t to do something e a r l i e r . So I 'm

10 j u s t bringing th i s to the Court ' s a t t en t ion because we have

11 some concern about t ha t .

12 THE COURT: So you ' re saying it would be di f f i cu l t ,

13 perhaps , thoroughly to evaluate the bylaws unless · you know what

14 the re s t ruc tur ing plan was going to look l i ke .

15 MR. CARY: Correct .

16 MR. WEISS: Your Honor, i f I may be heard on t ha t

17 point?

18 THE COURT: Yes.

19 MR. WEISS: Yes, your Honor, I ac tua l ly had ra i sed

20 t ha t p o i n t ~ i t h Mr. Walsh, Mr. Conboy beforehand to see i f

21 t he re would be any object ion to create a comment per iod .

22 Indeed we're not looking to delay th i s process any more. We

23 want to br ing the organizat ion back to the membership. In 1996

24 t he re was, in 1996 when there was a t rus teesh ip and the

25 af termath of the t rus teesh ip there- was a plan t ha t I bel ieve


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1 was publ i shed as par t of the in ter im reports , I don ' t reca l l , I

2 apologize . There may have been a t ime per iod in which there

3 were some comments out to the membership and indeed there were

4 some var ious l awsui t s , s t i cks in my mind had the name Lebow in

I

5 it t ha t dea l t with the re s t ruc tur ing plan . I agree with Mr.

6 Cary, t ha t the tw o are in te r re la ted because they ' re a f f i l i a t ed

7 loca l s , and the af f i l i a t ed loca l s are as I mentioned in my

8 Apri l 22nd l e t t e r , the af f i l i a t ed loca l s are going to be vot ing

9 fo r those delegates so it's a l l kind of connected together .

10 THE COURT: Got you.

11 MR. WALSH: Judge, I think it's f a i r to t e l l everyone

12 · to the extent t ha t I have any advance information, t ha t the , I

13 would be the f i r s t to pro tes t to the UBC i f I thought t ha t .the

14 schedule t ha t everyone to date has agreed upon would in any way

15 be ,j eopardized by the lack of product ion of a plan, . and I wi l l

16 hold .them to tha t . But I have no reason. to be l ieve t ha t th i s

17 schedule wil l not be met, t ha t we wil l not have a wri t ten plan

18 even before the end of the comment per iod, and I think t ha t one

19 of · the connect ions to the dra f t bylaws which concerns many

20 people i s tbe a l t e r a t ion of the ra t io of rep resen ta t ion from

21 one delegate to sob members down to 1 delegate to 200 members

22 and I have received comments on t ha t par t i cu la r change.

23 As I understand what ' s being contemplated, and I have

24 been t o l d t ha t t h i s i s obviously not se t in s tone , t ha t the

25 general pres ident McCarron has y et to inform counsel and h is


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1 top people exact ly what th i s i s going to look l ike , b ~ t I

2 bel ieve tha t it wil l leave in the New York City area f ive

3 loca ls tha t reached the cap of 20 delegates each with one

4 addi t ional loca l tha t wil l probably have about ten ~ e l e g a t e s i s

5 what 's being contemplated now. Again, th is 'has not been

·6 submitted to me, about 110 delegates in the new delegate body

7 t ha t ' s contemplated by these dra f t bylaws, and these

8 reorganized loca ls and some wil l not be affec ted, wi l l in

9 September and October e lec t delegates and tha t i s a necessary

10 prelude to in s ta l l a t ion of a ful ly autonomous Dis t r i c t Council,

11 so tha t it i s something tha t needs to be se t in s tone fo r the

12 December e lec t ion and January in s ta l l a t ion t ha t we had

13 contemplated to actual ly be real ized.

14 So ju s t to be <?lear, i f a t any time I th ink tha t we

15 are get t ing close to hindering any of t ha t progress I 'm going

16 to press the UBC, and I 'm sure tha t we wil l have a, plan in hand

17 which wil l allow us to conform to the schedule .

18 THE COURT: Is tha t the hear t of the matter , the

19 number of delegates , th i s change in ra t io? I s tha t a key

20 change?

21 MR. WALSH: I can say tha t based on the comments tha t

22 I received, it i s a matter of grea t concern to some of the

23 commenters. There are other matters which I 've received

24 comment on which wil l form par t of the discussion, so t ha t ' s

25 not the only area , but it i s cer ta in ly an area tha t people have


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15GFDISC

1 expressed themselves in de ta i l .

2 THE.COURT: And in moving the r a t io from what it i s

3 now to what you th ink it might be, i s tha t in keeping with what

4 people are' asking you to do?

5 MR. WALSH: Well, comments t ha t I have received, and I

6 don ' t want to influence anybody one way o r the other - -

7 THE COURT: Sure.

8 MR. WALSH: Are questioning why the ra t io i s being

9 changed.

10 THE COURT: I see. Got you. Okay. Anybody else?

11 So some people in the audience indica ted they wanted

12 to be heard. Does anybody wish to be heard on any of these

13 topics? Sure. ·I f you could s ta te your name.

14 MR. CLARKE: Gene Clark, 52 year member, brotherhood,

15 and I 'd l ike to say tha t the t rus tees tha t are now negot ia t ing

16 for us are very suspicious. They wil l not sign a l e t t e r t ha t

17 Mr. Walsh has asked everybody to s ign. As a r e su l t of tha t

18 l e t t e r , many people stopped working and l e f t the brotherhood

19 because of t he i r dir ty background. I would l ike these people

20 before they negot ia te one more s tep , I want them to sign th i s

21 l e t t e r for the brotherhood and for the brothers and s i s t e r s

22 tha t were robbed here meticulously fo r the l a s t ten years . We

23 cannot afford th i s t ragedy to repeat i t s e l f . I t ' s therefore

24 I 'm asking you as a good man to look in to th i s problem and ask

25 them why they ' re not s igning the l e t t e r , and also, Joel


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15GFDISC

1 Oliv ier i when he used to take our i l lu s t r ious l eaders of dece i t

2 down to Mexico, they used to swim out to him to t a lk to him and

3 he would give them the orders . And the reason for the swimming

4 i s , you c a n ' t carry a wire in your bath ing su i t i f it's wet.

5 Okay? So we have problems and we're nowhere near the so lu t ion

6 to these problems un t i l we f ind the t o t a l answer of why cer ta in

7 th ings took place when Mr. Ford was indic ted years back, the

8 in te rna t iona l l e t him s tay i n o f f i ce . Then the judge, he threw

9 out the j u ro r s ' decis ion and two days l a t e r r e t i r ed . We're

10 ta lking ' about Judge Atlas . We have been a vict im of these

11 people fo r years . We can no longer to le ra te being t h e i r

,12 vic t im.

13 THE COURT: I got it.

14 MR. CLARKE: We have to f ind jus t ice and j u s t i ce i s

15 going to be found in th i s Court and I know t ha t . Thank you.

16 THE COURT: I d idn ' t qui te unders tand Mr. Walsh signed

17 the l e t t e r , t ha t i ssue .

18 MR. WALSH: What Mr. Clark i s re fer r ing to I thin.k i s

19 commonly misunderstood by many members but I'll expla in . As

20 par t of my scope, I 've embarked on what I ca l l the organized

21 crime i n i t i a t ive and a t i t s core it involves interviewing

22 employees of the Dis t r i c t Council , of f i ce r s of the D i s t r i c t

23 Council and cer ta in employees of the funds leadins up to the

24 t ru s t ees to inquire about t h e i r knowledge of organized crime.

25 And then using the author i ty t ha t I have to requi re t ha t they


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15GFDISC

1 Local 157 member. I ju s t want to express. tha t I have grave

2 concern about th i s res t ruc tur ing plan. They're saying there

3 i s n ' t one ju s t yet as fa r as I understand, but t a c t i c s t ha t the

4 .UBC has used in the pas t i s they say they don ' t have a plan and

5 a l l of a sudden they swoop in and dissolve locals . They did

6 tha t in New York Sta te and New Jergey, 33 loca l s , dissolved

7 them, re s t ruc tured them in to ten new locals , a l l appointed E

8 boards. They did t ha t in the northwest, I th ink it was 22

.,9 loca l s , dissolved, appointed new E boards. I th ink we need to

10 have th is res t ruc tur ing plan i f the re ' s going to be one well

11 before June 9. We need to be not i f i ed as soon as poss ible in

12 my opinion.

13 The other par t I want to ta lk about i s the bylaws. I

14 was one of the ones tha t ra i sed concern about the de legates ,

15 why was the ra t io change, could we get more representa t ion,

16 great , . but I 'm very dis turbed a t the cap, because it's ju s t

17 another reason why McCarron would come in dissolve a l l the

18 loca l s , consol idate us in to one m.egalocal and cap our

19 delegates to 20, take our representa t ion down from 100 whatever

20 down to 20. I don ' t want t ha t to happen. Thank you.

21 THE COURT: Thank you.

22 MR. LEBO: Good afternoon, your Honor my name i s

23 William Lebo. Gene Clark touched on something tha t was kind

2.4 of, I was going to say myself . We have the t rus tees now

25 negot ia t ing our contrac ts and I would l ike to see them sign




23

15GFDISC

1 th i s l e t t e r . I mean, i f the re s t of the counci l has to do i t ,

2 I th ink tha t it's c ruc i a l t ha t we know tha t they ' re honest

3 enough to s ign th i s l e t t e r .

4 The othe r issue i s with our contrac ts the UBC i s now

5 negot ia t ing them for us without a voice in the membership a t

6 a l l . They don ' t seem to care whether or not what our fee l ings

7 are about ,them. I can ' t understand why these contrac ts can ' t

8 be put on hold u n t i l the t ime tha t we have elec ted of f i c i a l s in

9 off i ce tha t we can have our elec ted of f ic ia l s t ha t we elected,

10 from the New York City Dis t r i c t Council deal with our

11 contrac ts . There are numerous agencies and unions across the

12 country tha t have put contrac ts o ff for months, i f not years a t

13 a t ime. There 's no reason we can ' t do it now. There 's no

14 reason they should be negot ia t ing our contrac ts for us. We

15 have to l ive under them.

16 The other i ssue too tha t I 'd l ike to speak about i s

17 they do need to l e t us know what the loca l s are going to be.

18 Right now the locals are going through an elec t ion, process.

19 157 ton ight i s holding the i r e lec t ions fo r the i r off icers ,

20 Local 45 i s going to be doing the same. We have an e lec t ion

21 process going on now, nominations and so for th . I t would be

2.2 prudent fo r us not to waste the money i f some of our loca ls are'

23 not going to exis t . Why should we waste the money on e lec t ion

24 booths and so for th and so on when those loca l s are not going

25 to be there or are going to be there . We don ' t know. So fo r


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1 ~ l i g h t window to enlarge the comment per iod i f people want to

2 weigh in on a res t ruc tur ing plan and the impact tha t it wil l

3 have on the draf t bylaws, and indeed allow myself enough t ime

4 to consider the terms of the proposed res t ruc tur ing plan

5 vis-a..:.vis the bylaws and t h e i r implementat ion . .

6 MR. McGUIRE: Your Honor, unfor tuna te ly , I have to

7 leave the hearing a t 3:30. I convened a meeting and a la rge

8 number of people at tending i t , so perhaps i f there are comments

9 about my repor t t ha t would provoke your quest ions, i f we could

10 have those now.

11 MR. BRENNER: Your Honor, i f I may, I have a comment

12 fo r Mr. McGuire.

13 THE COURT': Okay, come on up.

14 MR. CRANE: I have to address him, too. My name i s

15 Patr ick Crane, your Honor. I was unable to sign up before the

16 opportuni ty to speak.

17 Fi r s t l Id l ike to address the i ssue of delegates where

18 we1re going to have a high delegate ra t io . Theylre going to

19 take away our r igh t to vote , tha t1s why. That1s my opinion.

2Q There1s three locals , local 46, the s teamfi t t e rs , the l a t chers

21 and e lec t r i c i ans . Theylre the most powerful loca ls because

22 t h e i r membership has a voice and the representa t ives have to be

23 accountable to the membership. That1s what we lack.

24 To address the i ssue , $86 i s the reason why the

25 welfare fund i s in t rouble? Let me t e l l you why the welfare




26

15GFDISC

'1 fund i s in trouble ' . This i s supported by' Mr. Walsh's repor t

2 and something we've been going through for genera t ions . We

3 have been represented by narrow-minded of f i c i a l s content with

4 t h e i r own pr iva te agendas, unable or unwill ing to organize the

5 unorganized and incapable of res i s t ing corporate powers. Union

6 of f i c i a l s bui ld corrupt machines by s tarving our c r i t i c s and

7 in t imidat ion and se l l ing out to the bosses. They took payoffs

8 and committed forces to go nonunion.

9 We can go back to Mr. Mack. He has mentioned many

10 people in t h e i r repor t s . They were f i red from pos i t ions here ,

11 giving jobs to the in te rna t iona l . Our r igh t to vote must be

12 rees tabl ished a t a l l l eve l s . That ' s it your Honor, thank you.

13 THE COURT: Got you. Was anybody going to speak

14 d i r ec t ly to Mr. McGuire?

15 MR. BRENNER: Yes. Thank you, your Honor. Patr ick

16, Brenner. My quest ion to Mr. McGuire i s being t ha t ' t he funds

17 are in such di re s t r a i t s and being tha t we wait to end the

18 fiEjcal year I mean i s it a t a l l poss ible to ge t , a quarter ly

19 report? I mean, tha t being the condi t ion tha t they ' re in , it's

20 f a i r enough.

21 THE COURT: He sa id he would look in to those

22 poss ib i l i t i e s and l e t us know.

23 MR. BRENNER: Okay, as fa r as the bylaws, I mean there

24 are some i ssues tha t have been brought up. As fa r as in the

25 pas t , I know t ha t we had our ra t io of delegates and I know the


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1 re s t ruc tur ing they ' re going to come up with 110. Previous ly we

2 had about 88, so ' we're pre t ty much where we were in the pas t

3 with the delegate body but the problem we had was the fac t of

4 the rubber s t ~ m p and the employees of delegates , and I know

5 it's not easy fo r them and I commend Mr. Walsh on h is e f fo r t s ,

6 but it i s a grave i ssue to have employees and a de lega te . I

7 don ' t know what the answer t o t ha t i s , I don ' t know whether a

8 delegate , they should be compensated i f they ' re going to be

9 tak ing on these immense r e spons i b i l i t i e s and it's not an easy

10 task by no means.

11 What the· s o l u t i o n i s , I don ' t know. I mean they

12 should be compensated undoubtedly, but as fa r as being a paid

13 employee of the Dis t r i c t Council , it crea tes back t ha t rubber

14 stamp pa t t e rn t ha t we want to not go backwards. Let ' s t r y to

15 move forward. As fa r as the cont rac ts and unfor tunate ly I

16 don ' t bel ieve the membership has f a i th in the t rus tees a t th i s

17 'point , and it would be of grave importance to have some

18 membership, the members to be involved with it somehow and

19 iriput with the contrac ts , you know, i f t ha t ' s something we're

20 r ea l ly concerned about. Thank you very much.

21 THE COURT: What contrac ts , pr inc ipa l con t rac t s do you

22 th ink people are referencing t ha t be put on hold un t i l the re ' s

23 a new leadership?

24 MR. McGUIRE: . Your Honor, t he re are , the carpenters

25 probably have seven or e ight . They cer ta in ly have the Drywall


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1 ra t i f i ed by the membership. They would have a voice a t tha t

2 poin t in t ime as to whether they agree with th i s col l ec t ive

3 bargaining or not .

4 THE COURT: And where else i s tha t done?

5 MR. CARY: To answer your question, your Honor, many

6 unions submit col l ec t ive bargaining agreements to t h e i r

7 membership for ra t i f i ca t ion . Many unions requi re it in t h e i r

8 Const i tu t ion . Not a l l unions do. In my 30 years of exper ience

9 apar t from the UBC, every union I 've ever been involved with

10 has submitted i t s col l ec t ive bargaining agreement to membership

11 fo r ra t i f i ca t ion .

12 (Applause) .

13 MR. WEISS: Your Honor, i f I may

14 THE COURT: Well, l ~ t ' s hear and then we ' l l come back

15 to you.

16 MR. ARANA: Thank you, your Honor. Thanks fo r having

17 us, and Dennis Walsh thanks fo r having us. The union has a

18 sense tha t with Dennis Walsh tha t we have a say in the matter .

19 I want to commend tha t . Thank you very much. I want to speak

20. very quickly on the delegates which i s a hot top ic for them.

21 THE COURT: Your name, please?

22 MR. ARANA: Donald Arana. As fa r as the delegates ,

23 t ha t ' s a very hot topic , the delegates with more power, and

24 ju s t recent ly in November or December we had an e lec t ion in

25 608, and fo r some E board spots and then a week a f t e r the


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e lec t ion , the l oca l was dissolved, I 'm pre t ty sure y o u ' r ~ aware

o f t ha t . There was roughly seven o r 8,000 members and we were

consol ida ted i n to l o ca l 157 which has '3 , 4,000 members so with

t h i s plan t ha t they have fo r the de lega tes , a f t e r you have, I

th ink it's 200 members you have one delega te so a f t e r you have

4,000 members you no longer have a chance to have delega tes

t h a t rep re sen t t he o th e r p a r t o f th e body, so cur ren t ly under

t h a t r eso lu t ion t ha t took p lace , 608 went in to 157, giving us

roughly 10, 11,000 members, so you have 6,000 members under

t h i s dissolv ing and conso l ida t e p a t t e rn t ha t has been th e

h i s t o ry of the UBC. We l o se r e p ~ e s e n t a t i o n . And everybody in

t h i s courtroom knows t h a t th e UBC has plans to cont inue

.d isso lv ing l oca l s and have one b ig mega l oca l , and I th ink

t ha t ' s not f a i r and I th ink t h i s whole t h ing i s about

democracy, th e consent decree , and t h i s t o t a l l y goes aga ins t

th e members being rep re sen ted .

And ano ther t h ing tha t ' . s a t tached to t h a t , th e l a s t

cour t date I spoke to you and I spoke, and I mentioned were th e

pa id employees being de lega te s to th e D i s t r i c t Counci l and my

th inking was it was a c o n f l i c t o f i n t e r e s t and they were

proposing t h a t they would p ut ce r ta in safeguards in tha t , t ha t

delega tes c a n ' t be inf luenced, because t he y ' r e pa id employees.

I t h ink the only safeguard aga ins t t h a t i s t ha t we d o n ' t have

pa id employees as de lega tes . And I t h ink in th e new bylaws

they propose t h a t t h e r e ' s a nego t ia t ion t ha t it's only


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15GFDISC

1 50 percent of them would be paid employees as well as delegates

2 to the Dis t r i c t Council . My argument i s , i f it's agreed t ha t

3 being' a paid employee and a representa t ive of the membership

4 which i s a delegate to the Dis t r i c t Council becomes a conf l i c t

5 of in te res t , tha t no percentage should be 'allowed to be paid

6 employees and delegates a t the same t ime. I f it's not a

7 conf l i c t of in te res t , and then l e t 100 percent be paid

8 employees. That ' s my argument tha t , 50 percent i s not the

9 answer to t ha t .

10 Jus t a quick quest ion I have i s t ha t on the

11 negot ia t ions coming up for our union contrac ts they mention

12 tha t t he re ' s three t rus tees . Does anybody know ,the name of

13 those th ree t rustees?

14 THE COURT: Mr. Walsh probably does.

15 MR. WALSH: I 'm af ra id I p,on't understand the

16 question.

17 THE COURT: I th ink you mean the three tha t signed the

18 l e t t e r s . Is tha t what you mean?

19 MR. ARANA: They sa id the re ' s t rus tees negot ia t ing our

20 contracts?

21 THE COURT: Oh, then I missed i t .

22 MR. ARANA: Right now we're u n ~ e r negot ia t ions because

23 our cont rac t i s over June 31 and they sa id the re ' s three

24 t rus tees negot ia t ing our contrac ts with the contrac tors , so and

25 who were those th ree people?

SOUTHERN DISTRICT REPOR,TERS, P. C.

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1 THE COURT: Not sure t ha t ' s what was sa id, but

2 Mr. Walsh, do you know?

3 MR. WALSH: Obviously the UBC i s still under

4 supervis ion . Frank Spencer i s the supervisor. He i s one of

5 ' the negot ia tors and he i s as I 've been to ld ' been jo ined by

6 ass i s tan t supervisor John Bal lan t ine and general pres ident

7 Douglas McCarron.

8 MR. ARANA: That ' s what I thought it was, I j u s t

9, wanted to confirm i t . We did,n ' t e lec t these people to

10 negot ia te our contrac t , but fo r temporary supervision so I

11 th ink it would be appropriate in th i s s i tua t ion since the

12 contrac ts have to be negotiated and theY're current ly doing it

13 and wil l continue to do so, s ince they weren ' t elec ted by us

14 tha t when they negot ia te the contrac t before they sign it t ha t

15 the membership in th i s par t icu la r s i tua t ion should be able to

16 review it and r a t i fy it and vote on the contrac t i f we want to

17 accept i t . I th ink t ha t ' s more reasonable.

18 (Applause)

19 MR., CLARKE: Thank you, your Honor.

20 THE COURT: Yes. Who i s next?

21 MR. WELLINGTON: Hello. Good afternoon, Judge. I

22 bel ieve you received my l e t t e r because I got a rep ly from your

23 ass i s tan t .

24

25

THE COURT: What i s your name?

MR. WELLINGTON: Alex Wellington.




33

15GFDISC

1 THE COURT: You spoke the l a s t time, too, r ight?

2 MR. WELLINGTON: Yes. That i s one of the ' reasons tha t

3 Mr. McGuire has to runaway because of s ~ t u a t i o n s t ha t the two

4 want. He's given h is f igures and can ' t make the calculat ion

5 accura te ly . As you said , you correc ted him a t one point which

6 i s 199 and 44 mil l ion and the deductions and the balance.

7 These are the reasons why we face such di re issues in t h i s

8 union. We do not have our rank and f i l e in these areas or in

9 these hot seats to negot ia te and to make accurate assessment of

10 our union for the future . In going forward we would l ike

11 contracts to be hold, because we have employers looking a t the

12 maximums to give us 20 percent reduct ion in wage and benef i t s .

13 Are' we ra ts? No. So in th i s case we cannot have the same rank

14 and f i l e , I mean the same profess ional off icers and delegates

15 and t rus tees negot ia te our contrac ts . In other words, I would

16 love us to be one of the forefront , the rank and f i l e , to

17 negot ia te our cont rac t s . And last lYI I want to make sure t ha t

18 on behalf of the bylaws, I can see tha t the bylaws i s giving

19 too much power, too much power to the executive secre tary, the

20 delegates, they got too much power. The bylaws i t s e l f i s very

21 crooked.

22 THE COURT: Very what?

23 MR. WELLINGTON: Very crooked, it's giving too much

24 power to the rank and f i l e off icers . The off icers , the

25 execut ive secre ta ry has too much powers and delegates they got


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1 too much powers, so we need to r a t i fy th i s information, bring

2 it down to the bottom of the table , negot ia te it to the bes t

3 faCts and bes t vi r tue of our knowledge and bring it forward to

4 a l l members in order to grow in the future . Thank you.

5 THE COURT:· Mm-hmm.

.6 MR. SAUL: Norman Saul, Local Union 926. The

7 percentage of delegates to the union members i s not rea l ly

8 what ' s s ign i f ican t . By crea t ing mega locals , mega regions,

9 mega counci ls , we make it impossible for the rank and f i l e to

10 make an informed choice on who they choose for t h e i r delegates .

11 How,do we expect people to work 35 or 40 hours and then commute

12 hundreds of miles to get together to meet? Now, we"ll, in the

13 pas t when I s t a r t ed with th i s union we had many, many loca l s ,

14 small groups of people could get together , argue perhaps but

15 still make an informed decision. How i s someone up from Albany

16 going to meet with someone in West Virginia or southern New

17 Jersey to be able . to decide on a delegate, whether it's 2, 20

18 or 200? Unions are using th is technique. We're not the only

19 union going to these mega areas. A ll it does i s di lu te our

20 ab i l i t y to communicate and cause only those people chosen by

21 the powers tha t be to se lec t delegates, load our elect ions and

22 take more power from the rank and f i l e . I t ' s not a matter of

23 numbers, it's a matter of area .

24

25

THE COURT: Of what?

MR. SAUL: Of area .


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15GFDISC

1 THE COURT: Geography?

2 MR. SAUL: Geography. We have t rouble now get t ing

3 people to loca l union meetings. What are we going to do when

4 we have to t rave l several s ta tes? Thank you.

5 THE COURT: ,You bet. ' Yes, s i r .

6 MR. NOONAN: Hello, your Honor. My name i s James

7 Noonan. I 'm a junior carpenter 24 years .

8 THE COURT: How do you spe l l your l a s t name?

9 MR. NOONAN: N - o ~ o - n - a - n . I apologize ~ o r not being

10 so cour t savvy or whatever. However, I do fee l a lo t be t te r - -

11 THE COURT: A lo t 0f people 'say tha t and then they - -

12 including the lawyers, and then they

13 (Laughter)

14 MR. NOONAN: You know, i f I did th i s fo r a l iv ing, I

15 would have been prepared and I would have known my numbers.

16 That was disgust ing watching. I 'm sorry he l e f t .

17 I want to thank you for your honest appra isa l of the

18 s i tua t ion . I d idn ' t expect tha t . But thank you. I t was

19 spoken tha t we made $86 an hour l ike t ha t ' s a big deal . But I

20 don ' t know i f I 'm going to l ive to co l l ec t the pension. You

21 know, my body hurts . I ju s t car r i ed around my leg for three

22 months s t r a igh t , you know, and I 'm 49. I got another s ix years

23 a t minimum before I col lec t a pension and the pension i s n ' t

24 t ha t great . I 'm going to have to get another l i t t l e job, you

25 know, driving a bus or something.




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1 You know,. we don ' t work f u l l t ime, you know. We make

2 a f a i r ra te , a f a i r ra te , and when he sa id tha t , I was wait ing

3 fo r him to say tha t we were going to cut our pay. You know?

4 That ' s beside the point .

5 The gentleman who spoke before me i s , I th ink was the

6 most ' important conversat ion today. We've lo s t our union

7 because our union used to be a lo t more than our out of work

8 l i s t or benef i t department or t rying to ca l l somebody about

9 your pension or your vacat ion pay. I t was about meeting with

10 othe r carpenters and discussing l i f e and tha,t ' s a l l gone now,

11 and I'll t e l l you, i f you read those bylaws, which shouldn ' t

12 take you tha t long, I mean, without even going in depth, you ' l l

13 rea l ize tha t democracy i s gone from our uniori, and a s ' f a r as I

14 know; Mr. Walsh i s a l l about democracy.

1.5 I would never do tb,is unless I f e l t as strong about

16 what ' s going on. I got to be careful what I say or e l se I can

17 get thrown out of the union. Imagine tha t , for being honest .

18 But I do know l ike they said , what we want to know about the

19 res t ruc tur ing i s tha t because they had an elect ion and a week

20 l a t e r they dissolved 608. We asked one of the superv isors '

21 about a month ago i f he was going to make a mega loca l and he

22 said what, are you kidding me, and a week l a t e r he did. Okay?

23 So how can we t rus t the in te rna t iona l? You know what ' s

24 hyster ical? That we have somebody in the cour t today tha t

25 we're paying for to represent us and he ' s not represent ing us .


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1 Okay?

2 Why I 'm saying th is i s tha t because I bel ieve t ha t

3 you ' l l do the r igh t th ing . I t e l l you, I can get in a lo t of

4 t rouble , but I ju s t thank you. Thank you.

5 THE COURT: You're welcome. Okay, two more.

6 MR. CURCIO: My name i s Jared Curcio, loca l 1456 dock

7 bui lde rs . Jus t on the topic of res t ructur ing. The dock

8 . bui lde rs work i s a special ty t rade . I t has nothing to do with

9 l ike Mr. McGuire said about the lead contrac tors , the sheet

10 rockers. We have nothing to do with tha t and we should be

11 ~ e p r e s e n t e d in our own f ie ld . They plan on put t ing us a l l

12 together with the carpenters . The carpenters do d i f fe ren t work

13 than we do, so tha t should be considered and also with the pay

14 sca le , we're on the same s imi la r sca le with a l l the other

15 t rades in the indust ry , the e lec t r ic ians , actual ly we probably

16 'make a l i t t l e l ess , so when they ta lk about the money it should

17' be we're on the l eve l of everybody e l se , so we don ' t stand out

18 as the highest paid or anything, you know? That ' s about i t .

19 THE COURT: Thank you.

20 MR. HOLNESS: How you doing, your Honor? My name i s

21 Gauntlet t Holness loca l 137. I hear comments a t l e a s t about

22 the delegate body being kept a t a cer ta in number. Would the

23 Judge be able to comment on exact ly why it i s being proposed to

24 have tha t done?

25 THE COURT: You know, it's still in the draf t form.


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1 there i s an. ample a b i l i t y to discern what the consensus

2 opinions are , but there are people who fee l t ha t there a re

3 enough opinions t ha t it i s improper to have t h e i r voices

4 capped, so to s p e a k ~ But I th ink t ha t t ha t was the main reason

5 why and I think it also r e f l ec t ed t ha t the UBC i s contemplat ing

6 having a smal ler number of loca l unions and a piece of t ha t

7 wil l involve a small number o f l a rge loca l unions .

8 THE COURT: Mr. Conboy, did you want to-- I take it

9 the po in t i s t ha t in any rep resen ta t ive body somebody has to

10 f igure out who are the rep resen ta t ives and who i s the rank and

11 . f i l e .

12 MR. HOLNESS: We do unders tand t ha t .

13 THE COURT: So I guess the rea l ques t ion i s what would

14 be the r i gh t number.

15 MR. HOLNESS: But I don ' t th ink there should be a

16 number, per iod . I f t he re ' s numbers in a loca l they should be

17 represented . That ' s the bottom l i ne .

18 THE COURT: Okay.

19 MR. HOLNESS: So I 'm asking why can ' t he make a

20 comment on why i s it being proposed.

21 THE COURT: I th ink we've got the concept down. I

22 don ' t think we're going to resolve here today why there i s a

23 cap and what the number should be.

24 MR. HOLNESS: Whether or not could you still make a

25 comment on t ha t , please?


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1 MR. CONBOY: Well, Judge, I have to say, frankly, t h i s

2 gentleman has insul ted me. He i s suggesting tha t I do not

3 h a v e - -

4 THE COURT: Well

5 MR. CONBOY: No, Judge. I 've sa t here fo r two court

6 sessions and there has been a repeated at tack, completely

7 unres t ra ined on the UBC pres ident , the t rusteeship and me, and

8 under the circumstances there has been a grea t deal of e f fo r t

9 in consul ta t ion with Mr. Walsh who, of course , i s the designee

10 of Mr. McCarron and I th ink they have respect fo r Dennis Walsh.

11 My own view of it i s i s tha t there i s a complex quest ion as to

12 how many delegates can properly and to le rab ly meet in a room.

13 How do you contain debate . There are l imi tat ions on

14 congressmen in ind iv idual s ta te s , there are l imi tat ions on

. 15 members of the house of commons in any del iberat ive body - -

16 THE COURT: Hold o n a second. One person speaks a t a

17 t ime here. And now Mr. Conboy, Judge Conboy i s speaking.

18 MR. CONBOY: In any del iberat ive body there has to be

19 a balance between eff ic iency and access and t ha t ' s what 's taken

20 a grea t deal of time with respect to these bylaws. There i s a

21 very s t rong inc l ina t ion on the par t of those who are concerned

22 about union democracy to s ign i f ican t ly cu r ta i l the power of the

23 executive secre ta ry- t reasurer and other off icers . However,

24 federa l law makes it c lear tha t you cannot ask the rank and

25 f i l e to e lec t o f f icers who have no power, so w e a r e walking a


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1 , l ine between the requirements of federa l law and a reasonably

2 cons t ruct ive model which in the end wil l be determined by these

3 gentlemen and by your Honor, and my own view i s t ha t it i s

4 premature to take piecemeal elements of th i s plan and

5 essen t ia l ly at tack them with the kind of lack of .ba lance t ha t

6 we're hearing from a number of these commentators.

7 THE COURT: ,These are somewhat unusual perhaps a

8 l i t t l e b i t hybrid court proceedings. They have somewhat the

9 nature of a town h a ~ l meeting which i s unusual fo r a court

10 proceeding, but I don ' t th ink anybody should take of fense from

11 what i s sa id. People are ju s t having an opportuni ty to ta lk

12 and I wouldn' t take any of it personal ly . We're a t an ear ly

13 s tage , we're a t a dra f t stage and comments from people are

14 en t i t l ed to be heard. We got i t .

15 MR. HOLNESS: What .I'm going to say i f it does take it

16 tha t he ' s being i n ~ u l t e d , I apologize . But the bottom l ine i s

i7 the membership does not want i t , period. That ' s the bottom

18 l i ne .

19 THE 'COURT: Got i t .

20 MR. HOLNESS: Another th ing I want to make a comment

21 on, i s there a reason why Mr. Spencer, Ballant ine and McCarron

22 has to be the ones tha t negot ia te our contrac t , why it cannot

23 be put on hold?

24 MR. CONBOY: Judge, I understand tha t Mr. McCarron and

25 Mr. Spencer are here pursuant to federa l s ta tu te and they are


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1 here under the overa l l supervision of the consent decree

2 off icers , including th i s Court, including Mr. Walsh and

3 including Mr. Torrance, and under the circumstances there i s a

4 c lear ly to'me on the bas i s of the effor ts , made by the general

5 pres ident and by h is col leagues , there has been very

6 s ign i f i can t progress made, here .

7 The biggest problem confronting th i s union i s the lack

8 of hours recorded ~ n d the lack of funds committed to those

9 pension and welfare systems, and an e f fo r t i s underway to deal

10 with it.

11 Mr; McGuire i s a f i r s t c lass member of our Bar and of

12 the federa l Bar and he has ju s t come in to th i s r e la t ive ly

13 . recent ly . He i s doing h is bes t and yet he i s the subject of

14 mockery by a number of these speakers . So under the

15 circumstances I th ink tha t i f we are a l l together jo ined in an

16 e f fo r t to make th i s union bet te r , we ought to inform ourselves

17 as to the very s ign i f i can t and s t ruc tura l problems tha t are

18 being addressed here. And my own view i s tha t when the

19 commentary i s f ina l ly had on these bylaws, there wil l be some

20 degree of compromise. There wil l be members in th i s gal l e ry

21 who wil l be unhappy with it and there wil l be others who wi l l

22 denounce it. That ' s the nature of democracy, and under the

23 circumstances l e t ' s so ld ier on. Let ' s go through the schedule

24 t ha t we've a l l agreed on and l e t ' s show some pat ience . I said

2S t ha t l a s t t ime. I sa id there has to be some pat ience here and


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1 there was a grea t deal of heckling from the audience with

2 respect to tha t . And my own view is ' we have too much l abor

3 here ahead of us to be dragged down by thi 's kind of completely

4 poin t l ess commentary.

5 THE COURT: Okay.

6 (Chorus of boo's)

7 THE COURT: I f you want to be heard, the re ' s a way to

8 do i t . I f you don ' t want to be heard, we ' l l ju s t adjourn the

9 proceeding.

10 MR. PASSERO: My name i s Joseph Passero. I 'm from

11 loca l union 1456. The primary goal of the consent decree or

12 o ~ e of the primary goals i s to eradica te corrupt ion, i s it not?

13 THE COURT: Yes.

14 MR. PASSERO: So i f th i s goes - -maybe Mr. Conboy

15 could answer t h i s . I know how Dennis Walsh feels about i t .

16 THE COURT: You know, th i s i s re.al ly not a debate.

17 MR. PASSERO: Why--

18 THE COURT: Because the re ' s nothing rea l ly on the

19 t ab le ye t . You' re privy to , as I am, the progress report,

20 t ha t ' s being made and the re ' s rea l ly nothing to determine to

21 vote on, e tc . We're happy to , I 'm happy to hear your comments.

22 I th ink it's useful to inform the process , but th i s i s not

23 rea l ly the t ime for debate back and for th . I t ' s rea l ly more to

24 hear where you s tand and where th ings stand gene ral ly .

25 MR. PASSERO: I would l ike to see in the bylaws a

SOUTHERN .DISTRICT REPORTERS, P.C.

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15GFDISC

1 sec t ion where the delegate ·meetings are recorded by

2 stenographic record and avai lable to the membership, and those

3 stenographic records and pre fe rab ly an audio and video

4 recording of the delegate meetings a v a ~ l a b l e on l ine a t the

5 secured s e ~ t i o n of the Dis t r i c t Council websi te . There ' s also

6 no reason why the delegates i f t he re ' s going to be 110 of

7 them - -

8 THE COURT: How of ten are the meetings?

9 VOICE: Once a morith.

10 MR. PASSERO: That they can ' t have an e lec t ronic

11 vot ing and recording system in which the i ssues are presented,

12 the delegates ge t to vote and you get to know how they ,voted by

13 yes, no or abstent ion . A ll th i s could be accomplished by

14 s tandard off the she l f software and hardware. Nothing i s

15 specia l ized .

16 THE COURT: As opposed to what i s done now?

17 MR. PASSERO: Everybody say yay, everybody say nay,

18 with 110 people.

19

20

21 put t ing

22

23

24 record

25 vot ing

THE COURT: Got you.

MR. PASSERO: I know t ha t there was comment about

tha t

THE

MR.

of the

record

in the bylaws, bu t tha t never showed up.

COURT: About what, put t ing it in the bylaws?

PASSERO: About having recording, stenographic

meeting, audio and video and also an e lec t ronic

which I think most of the of the members wil l


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15GFOISC

1 of comments.

2 THE COURT: Right .

3 MR. BILELLO: Ray McGuire, I th ink he was r i gh t in h is

4 assessment tha t the Wall Ceil ing Associat ion wil l be the lead

5 contrac tor organiza t ion in negot ia t ions , and the re ' s a r ea l

6 concern on the par t of the membership because the head of the

7 Wall Ceil ing Associat ion, Joe Olivero ~ ~ s complic i t in a l l of

8 th i s tha t took place over the l a s t few years . He was ind ic ted

9 fo r per jury and he was found gui l ty l a s t year , so there 'S a

10 rea l concern on behalf of the membership about these

11 negot ia t ions , and t ha t ' s why they want a rank and f i l e

12 representa t ive a t the table . Not someone under ~ u p e r v i s i o n but

13 someone from the rank and f i l e .

14 And as fa r as the cap of 20 delegates, I th ink the

15 rea l concern comes in to p l a y a s one member mentioned before, i f

16 you have the UBC res t ructured and bring us down to one-or two

17 loca l s , which they have the power to do and the re ' s no

18 constra ints under the consent decree fo r them to do tha t , then

19 they l imi t our voice down, to it could be as low as 20 people

20 and it's a lo t eas ie r for-20 people to be persuaded than it i s

21 for 110. And as fa r as the res t ructur ing, the loca l e lec t ion

22 process begins tonight fo r severa l - loca l s . - I t ' s going to carry

23 on and conclude in the th i rd and fourth week of June and i f

24 they are going to res t ruc ture and el iminate some of these

25 loca ls then they ' re allowing us to go forward in bad fa i th .


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1 Thank you.

2 THE COURT: I think t ha t ' s i t . Anybody' else? Yes.

3 MR. WEISS:' Yes, your Honor. I wanted to follow up on

4 t ha t and one th ing . The reason the l i a i son i s so important , I

5 d idn ' t ra i se it e a r l i e r to the Court in the te lephone

6 conference on May 10, it was ra ised in t ha t May 10 te lephone

7 conference t ha t the primary discuss ion dea l t with the

8 re s t ruc tur ing plan a t t ha t t ime the UBC took a pos i t ion t ha t it

9 ,was an important ye t secondary cons idera t ion but in the 30

10 years I 've been prac t ic ing l abor re la t ions , t h i s i s a unique

11 organizat ion where Dis t r i c t Council delegates are r a t i fy i ng

12 col l ec t ive barga ining agreements. Typica l ly it's a sec re t

13 ba l lo t e lec t ion t ha t r a t i f i e s col lec t ive bargaining agreements

14 in most cases . 'But here they need someone a t the t ab le who can

15 speak to the i ssues , represent the membership 's i n t e r e s t and

16 then go back to the union meeting and be able to repor t on t ha t

17 negot ia t ion so tha t the ra t i f i ca t ion i s appropria te ly

18 supported. Otherwise it's being done by, i f you wil l , in

19 deference to Mr. Conboy, s t rangers to the en t i t y .

20 THE COURT: So how would you implement tha t?

21 MR. WEISS: Well, I would suggest t ha t , I have another

22 c l i en t who has a l i a i son committee, and they have one person

23 from each department who comes in and s i t s in on the col l ec t ive

24 bargaining negot ia t ion and repor t s and goes back to the meeting

25 and says t h i s i s the agenda, t h i s i s what we t a lked about, and


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1 by having t h i s kind of t ransparency then the membership a re

2 informed and can have an informed vote in t h e i r sec re t ba l l o t

3 e lec t ion on the r a t i f i c a t i on of t ha t cont rac t and t ha t i s t h e i r

4 r i gh t under federa l l abor law.

5 THE COURT: How do you implement t ha t s t ruc tura l ly?

6 MR. WEISS: Well, the membership o r any loca l could

7 appoint , i f you wil l , or someone could be appointed from each

8 loca l who at tends the col l ec t ive bargaining negot ia t ions , has

9 become aware of the agenda then can appear a t the negot ia t ions

10 to be, i f you wil l , the eyes and the ears of the membership.

11 THE COURT: Are those people observers? What are

12 :they?

13 MR. WEISS: Well, the negot ia t ions , the union

14 ·membership negot ia tes through memberships, representa t ives of

15 t h e i r choosing, who they e lec t . They haven ' t es sen t i a l ly

16 e lec ted the UBC. In the pas t what has happened i s t ha t

17 business agents who were elec ted or the execut ive committees

18 would be par t of the negot ia t ing committees and they would

19 negot ia te on beha l f of the membership. They would be

20 observers , I suspect , because a t th i s point · the brotherhood has .

21 the en t i ty under t rus teesh ip , but t h i s would give them a voice

22 a t the t ab le on very important pocketbook i ssues .

23 THE COURT: What do you th ink about t ha t , Mr. Walsh?

24 MR. WALSH: Judge, I t ry to be as order ly as poss ib le

25 in my profess ional a f fa i r s , and my recommendation to a l l


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1 concerned members, to the par t ies , to the Bile l lo motion and to

2 the Court would be tha t they be meticulous in making sure t ha t

3 what they are ta lking about i s properly before the Court . I am

4 unaware of anyone f i l ing a lawsui t to end the supervision, and

5 I 'm also unaware of anyone seeking any kind of in junct ive

6 r e l i e f or anything fur the r from the d i s t r i c t court to in te rd ic t

7 the lawful supervisor from doing h is f iduciary duty on behal f

8 of 23,000 members. So I don ' t suggest to anyone t ha t they not

9 avai l themselves of such r igh ts , but tha t the re ' s a time and

10 place fo r everything.

11 THE COURT: Got i t . Anybody else?

12 So when would it be usefu l to get together again?

13 MR. WALSH: Judge, I th ink c lear ly we need to give

14 ourselves j u s t the r i gh t amount of t ime to have the comments

15 and for me to be able to go back to the UBC and also for the

16 UBC to promulgate the res t ruc tur ing plan. So I would th ink

17 t ha t the middle par t of June would be .the ear l i e s t t ha t it

18 would be prudent to come back and inform the Court of the

19 progress tha t we've made.

20 THE COURT: How i s June 28? That would work fo r me i f

21 t ha t works fo r a l l of you. Is th i s a good hour? 2:30?

22 MR. WALSH: Very good, Judge.

23 THE COURT: Okay. Thank you very much. We're

2011-05-16 u.s. v district council transcript

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