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UNITED STATES v. LOCAL 560

September 14, 1988

UNITED STATES OF AMERICA, Plaintiff,
v.
LOCAL 560 (I.B.T.), Nominal Defendant, v. MICHAEL SCIARRA, JOSEPH SHERIDAN, Defendants



The opinion of the court was delivered by: DEBEVOISE

 I. The Present Proceedings

 On March 9, 1982, the United States filed the complaint in this action pursuant to 18 U.S.C. sec. 1964 (the Racketeering Influenced and Corrupt Organizations Act ("RICO")). Asserting that Local 560 was being victimized by racketeering activity, the complaint sought injunctive relief against individual defendants Anthony Provenzano, Nunzio Provenzano, Thomas Andretta, Stephen Andretta and Gabriel Briguglio, as associates of the Provenzano Group, and against the then Local 560 Executive Board incumbents, Salvatore Provenzano, Joseph Sheridan, Josephine Provenzano, J. W. Dildine, Thomas Reynolds, Sr., Michael Sciarra and Stanley Jaronko.

 Prior to trial, Anthony Provenzano, Nunzio Provenzano and Thomas Andretta entered into consent decrees barring them forever from participating in, or otherwise interfering with, the affairs of Local 560 or any other "labor organization" or "employee benefit plan." On February 8, 1984, after lengthy hearings, the Honorable Harold A. Ackerman issued an opinion, United States v. Local 560, Intern. Bro. of Teamsters, 581 F. Supp. 279 (D.N.J. 1984), holding that the Provenzano Group, through racketeering activity, had dominated and exploited Local 560 for more than a quarter of a century. Judge Ackerman issued a Judgment Order on March 16, 1984, in which the court did the following: (a) enjoined Stephen Andretta and Gabriel Briguglio from having any future dealings with and from endeavoring to influence the affairs of Local 560 or any other labor organization or employee benefit plan; (b) removed from office temporarily the remaining incumbent Executive Board officials (including Sciarra and Sheridan) and (c) imposed a trusteeship upon Local 560 for such period of time as might be necessary to eliminate the racketeer influence within Local 560 and to restore democratic processes in the Union.

 The Court stayed the Order pending appeal. On December 26, 1985, the Court of Appeals for the Third Circuit affirmed the judgment of the district court, 780 F.2d 267, and on May 27, 1986 the Supreme Court denied a petition for certiorari, 476 U.S. 1140, 90 L. Ed. 2d 693, 106 S. Ct. 2247. On June 23, 1986, the district court lifted the stay and implemented its trusteeship. Thus there was a period of approximately two years, four and one-half months between Judge Ackerman's February 1984 opinion detailing the racketeering activity and the 1986 appointment of the trustee and ouster of the Executive Board.

 At the outset of that period Sciarra and Sheridan were Executive Board members and remained in office by virtue of the stay of Judge Ackerman's order removing them. On October 29, 1984, Sciarra succeeded Salvatore Provenzano (who had been convicted of defrauding the welfare benefit fund and of receiving kickbacks) as President of Local 560. He remained in that position until superseded by the Trustee. Sheridan, who had been vice-president of Local 560, remained in that position until superseded by the Trustee. Thereafter the first trustee permitted him to remain as a business agent until approximately February of 1987.

 Judge Ackerman had found that the Executive Board (which, of course, included Sciarra and Sheridan) had aided and abetted the Provenzano Group of racketeers in extorting the rights of Local 560's members. In particular the Executive Board defendants aided the Group's extortionate conduct by (i) making certain appointments and reappointments to union offices; (ii) failing to remove certain appointees from office; (iii) spending union assets for Anthony Provenzano; (iv) permitting access to Local 560's offices by known or reputed criminals; (v) being recklessly indifferent to this kind of systematic misconduct of fellow incumbent officers. On appeal from these findings the Court of Appeals stated:

 780 F.2d at 284.

 It is now the position of the United States that even after issuance of the 1984 opinion and on into the period of the trusteeship, the Provenzano Group continued to dominate Local 560, and that Sciarra, Sheridan and other adherents of the Provenzano Group continued to protect, perpetuate and promote this state of affairs for the benefit of and in collusion with remnants of the Provenzano Group and members of the Genovese Crime Family -- all in violation of 18 U.S.C. secs. 1951, 1962(b) and (d) and 2. It is to avoid perpetuation of the conditions this lawsuit and the trusteeship were designed to eradicate that the United States asks that Sciarra and Sheridan be enjoined from further participation in the affairs of Local 560.

 In major part the application relies upon facts already established during the original hearings and set forth in Judge Ackerman's opinion. In addition, the United States has offered evidence designed to establish the facts upon which it relies which occurred after the close of the original hearings. Below I shall first summarize certain of the pertinent findings of Judge Ackerman. Then I shall set forth my own findings based on the new evidence.

 II. Pertinent Findings of Judge Ackerman

 An over-all characterization of Judge Ackerman's findings is set forth in two opening paragraphs of his opinion (the "1984 Opinion"):

 
It is not a pretty story. Beneath the relatively sterile language of a dry legal opinion is a harrowing tale of how evil men, sponsored by and part of organized criminal elements, infiltrated and ultimately captured Local 560 of the International Brotherhood of Teamsters, one of the largest local unions in the largest union in this country.
 
This group of gangsters, aided and abetted by their relatives and sycophants, engaged in a multifaceted orgy of criminal activity. For those that enthusiastically followed these arrogant mobsters in their morally debased activity there were material rewards. For those who accepted the side benefits of this perverted interpretation of business unionism . . . there was presumably the rationalization of "I've got mine, why shouldn't he get his." For those who attempted to fight, the message was clear. Murder and other forms of intimidation would be utilized to insure silence. To get along, one had to go along, or else.

 581 F. Supp. at 282.

 Findings about the defendants are set forth at pages 299-303 of the 1984 Opinion. While in their totality these findings are relevant to the present application, they need only be summarized here.

 Local 560 had approximately 10,000 members as of May, 1982. These members were employed by approximately 425 companies in the New Jersey-New York area.

 Under its constitution seven elective officers are charged with managing the day to day affairs of Local 560, namely, a president, a vice president, a recording secretary, a secretary-treasurer and three trustees. The persons holding these offices constitute the Executive Board.

 The Trucking Employees of North Jersey Welfare Fund, Inc. (the "TENJ Fund") and its Pension Account are located in Local 560's building in Union City. Two other employee benefit plan entities were merged into the TENJ Fund in May, 1977. These were formerly known as the Trucking Employees of Passaic and Bergen Counties Welfare Fund and the Trucking Employees of Passaic and Bergen Counties Pension Fund. These Funds are controlled by a governing body composed of four trustees appointed by the Local 560 Executive Board and four trustees appointed by two employer associations whose member companies have collective bargaining agreements with Local 560.

 The 1984 Opinion describes in considerable detail the twelve individual defendants. Five of them were members of the Provenzano Group which, through racketeering activity, had dominated and exploited Local 560. The rest of the defendants were members of the Local 560 Executive Board which had aided and abetted the Provenzano Group in extorting the rights of Local 560's members. In particular Sheridan had been vice president of Local 560 since July, 1981. Prior to that time he had been a business agent between July, 1976 and September, 1978, and thereafter a trustee between September, 1978 and July, 1981. Sciarra had been a trustee since May 28, 1981. Prior to that he was a Local 560 business agent between July 7, 1972 and September 30, 1976 and again between December of 1977 and May 18, 1981.

 To reiterate, the two categories of individual defendants were as follows:

 Provenzano Group

 Anthony Provenzano

 Nunzio Provenzano

 Thomas Andretta

 Stephen Andretta

 Gabriel Briguglio

 Executive Board Incumbents

 Salvatore (Sam) Provenzano

 Joseph Sheridan

 Josephine Provenzano

 J. W. Dildine

 Thomas Reynolds, Sr.

 Michael Sciarra

 Stanley Jaronko

 Each of the five members of the Provenzano Group had been convicted of one or more serious crimes for which he was then serving or had served extended prison sentences. The crimes, which were mostly labor related, and the sentences, are set forth in the 1984 Opinion. The Opinion also sets forth, 581 F. Supp. at 291-92, the crimes of seven other individuals who were associated with the Provenzano Group and who participated in the victimization of Local 560 and its members -- Robert A. Luizzi Salvatore Briguglio, Armand Faugno, Ralph Michael Picardo, Ralph Pellecchia, Frederick Salvatore Furino and Salvatore Sinno.

 As detailed in the 1984 Opinion, 581 F. Supp. at 303-06, the Provenzano Group was organized by Anthony Provenzano in the late 1940's. It was a part of the New York organized crime family which was headed at the time by Mike Miranda, who was serving as the acting boss while its former head, Vito Genovese, was imprisoned. Anthony Provenzano was a made-member of the Genovese organized crime family. As such he and his associates were authorized to and did engage in a number of criminal activities such as gambling, extortion and trafficking in stolen property. The Provenzano Group, despite occasional imprisonment and other temporary or permanent losses of its members, continued its activities until the time of the original hearings in this case and, as will be seen, thereafter.

 For the purposes of this case, the most significant project of the Provenzano Group was its conducting of a pattern of criminal and other improper acts, the object of which was to gain control over and to exploit Local 560. The details of this activity, which commenced in about 1952, are set forth in the 1984 Opinion, at 581 F. Supp. at 306-317.

 A summary of some of the criminal activity of the Provenzano Group, much of which was related to its domination, exploitation and intimidation of Local 560 and its members, is as follows:

 
(1) 1940's: Organized truck hijackings and thefts involving Anthony Provenzano and others.
 
(2) 1950's: The operation of an illegal gambling business in Hudson County, financed by Anthony Provenzano and conducted by Salvatore Sinno and others.
 
(3) 1952-59: Dorn labor peace payoffs extorted by Anthony Provenzano.
 
(4) 1960: False voter registration and manipulation of the Local 560 election by Anthony Provenzano, Salvatore Sinno and others.
 
(5) 1961: The murder of Local 560 Secretary-Treasurer Anthony Castellitto in Ulster County, New York, by Salvatore Briguglio, Harold "K.O." Konigsberg, Salvatore Sinno and another, at the behest of Anthony Provenzano.
 
(6) 1961: The Braun Company labor peace payoff demand by Salvatore Briguglio, Nunzio Provenzano and another in New York City.
 
(7) 1962-66, 1969-76: Payment of nearly $ 200,000 in Local 560 assets as "salary increases" to Anthony Provenzano, as facilitated by Stephen Andretta and Michael Sciarra.
 
(8) 1967: Middlesex County loansharking transaction involving Thomas Andretta and Armand Faugno.
 
(9) 1968: Skil Tool theft involving Thomas Andretta and Frederick Salvatore Furino.
 
(10) 1971: Counterfeiting conspiracy involving Salvatore Briguglio, Thomas Andretta, Armand Faugno and others.
 
(11) 1974: Woodstock Hotel kickback conspiracy involving Anthony Provenzano and others.
 
(12) 1974-77: Romano loan kickbacks to Anthony Provenzano, as facilitated by Salvatore Briguglio and Stephen Andretta.
 
(13) 1969-77: Seatrain labor peace payoff scheme involving Anthony Provenzano, Salvatore Briguglio, Stephen Andretta, Thomas Andretta, Gabriel Briguglio, Armand Faugno, Ralph Pellecchia and Ralph Michael Picardo.
 
(14) 1971-1980: City-man labor peace payoff scheme involving Nunzio Provenzano, Irving Cotler and others.
 
(15) 1979-81: Payment of some $ 86,000 in Local 560 assets as a "half salary pension" to Anthony Provenzano, as facilitated by Nunzio Provenzano, Michael Sciarra, Stanley Jaronko, and other members of the Executive Board.
 
(16) 1961-present: Extortion of the Local 560 members' federally protected (LMRDA) rights to union democracy -- in that various associates of the Provenzano Group systematically generated and maintained within Local 560 a pervasive and compelling climate of intimidation, as a result of which Local 560 became a captive labor organization.

 A climate of intimidation developed after the 1961 disappearance of Provenzano's political rival Anthony Castellitto and after the 1963 murder of Local 560 dissident Walter Glockner the morning after he expressed opposition to the appointment of J.W. Dildine as a business agent during a Local 560 meeting and, following the meeting, became involved in a heated argument with Thomas Reynolds.

 Contributing to the climate of intimidation was the Provenzano Executive Board's appointment and reappointment of known criminals and convicted labor racketeers to positions of power within the Local. These appointments included: (i) Salvatore Briguglio as a business agent in 1961 just after he had participated in the murder of Castellitto; as a business agent in 1969 following his release from prison in the Braun case; as a Fund trustee in 1972; as a business agent again in 1974 just after his release from prison in the counterfeiting case. (ii) Robert Luizzi as a business agent in 1964; as a trustee in 1967; as a Fund trustee in 1974; and as a business agent in 1981, all in spite of his criminal record. (iii) Thomas Reynolds as a business agent in 1970; as a Fund trustee in 1975; and as a trustee in 1977, all in spite of his criminal record. (iv) Nunzio Provenzano as a business agent in 1963, following his conviction in the Braun case; as a clerk in 1969 following his release from prison; as a Fund trustee in 1970; as secretary-treasurer in 1973; and as president in 1975. (v) Anthony Provenzano as secretary-treasurer in 1975, following his release from prison in the Dorn extortion.

 Further, known or reputed criminals such as Thomas Andretta and Armand Faugno were permitted to frequent the Local 560 offices.

 Thus, Judge Ackerman found that the Provenzano Group achieved its objective of establishing total control over Local 560 and that by force and intimidation the Group totally extinguished the rights of the Local's members to democratic control of their own union, its policies, officers and funds. As he stated:

 
Local 560 has been, since 1962, and continues to be a captive labor organization, which the Provenzano Group has dominated through fear and intimidation and has exploited through fraud and corruption. The Provenzano Group has used its control over Local 560 to victimize both individual members of the Local and segments of the trucking industry. This victimization has taken the form of multiple violations of 18 U.S.C. sec. 1962, and these violations are likely to reoccur as long as Local 560 remains a captive labor organization.

 581 F. Supp. at 319. The fact that the Provenzano Group's membership may be depleted by imprisonment does not prevent nominees or new recruits from carrying on the work of the Group.

 Of particular significance in the present proceedings are the 1984 Opinion's findings relating to the Executive Board in general and Sheridan and Sciarra in particular.

 As noted above, Sheridan was vice president of Local 560 from July 1981 until replaced by the Trustee in June 1986. Prior to that time he had been a business agent from July 1972 to September, 1978 and a trustee from September 1978 until July 1981, when he became vice president. According to the 1984 Opinion, 581 F. Supp. at 299:

 
Sheridan presented a picture of an individual whose family had taken an active role in the union in the pre-Provenzano period and who inherited the mantle . . . He appeared . . . to feel very comfortable with his earnings of $ 995 per week. He is not a boat rocker."

 Testifying at the original hearing, Sheridan stated that he did not believe the allegations about Nunzio Provenzano and would be glad to welcome him back as trustee and vice president. Despite Anthony Provenzano's various convictions, including the conviction for ordering the murder of Castellitto, Sheridan had only the highest respect and admiration for him. He could not believe that organized criminal elements had anything to do with Local 560.

 Michael Sciarra was appointed a Local 560 business agent in July of 1972, holding that position until 1976. He was reappointed in 1977 and became a trustee in 1981. He testified at the original hearings that Anthony Provenzano is his idol, and that he would welcome back Anthony and Nunzio Provenzano and Stephen Andretta even if the charges against them were true. Even if it were true that Anthony Provenzano had ordered the murder of Castellitto, Sciarra testified that he would pray for his return.

 The findings concerning the entire Executive Board applied fully to Sheridan and Sciarra. Judge Ackerman found that both the Provenzano Group and the Executive Board had extorted the rights of Local 560's members and that the acts of extortion came within sec. 1962(b) of RICO. The Executive Board had aided and abetted the extortionate acts of (1) making certain appointments and reappointments to union offices as described above; (2) failing to remove certain appointees from office; (3) spending union assets for Anthony Provenzano; (4) permitting access to Local 560's offices by known or reputed criminals; and (5) being recklessly indifferent to the systematic misconduct of fellow incumbent officers. *fn1"

 Faced with an Executive Board that was aiding and abetting the Provenzano Group, the 1984 Opinion concluded, among other things, that:

 
Removal of each Executive Board member is also necessary because each one is either unwilling or unable to evaluate objectively the criminal conduct of fellow officers or business agents, or to institute prophylactic measures to ensure as much as possible that past criminal conduct will not be repeated. Moreover, the pervasive attitude of arrogance and insolence in the face of these circumstances continues to impress upon the membership that the Local's leadership at the very least condones criminal conduct. This, too, serves to perpetuate the atmosphere of intimidation and to suppress any dissent. Id. at 321.

 The 1984 Opinion proceeds to summarize the particular factors which demonstrate that each individual Executive Board member would be likely to perpetuate domination of Local 560 by the Provenzano Group. The factors pertaining to Sheridan are set forth at page 324 of the Opinion; the facts pertaining to Sciarra are set forth at page 325 of the Opinion. I have referred to most of these factors in the foregoing summary of pertinent portions of the 1984 Opinion.

 In view of these findings, the March 16, 1984 Judgment Order removed from office the entire Executive Board of Local 560 and imposed a trusteeship. The Order, of course, did not become effective until June 23, 1986, after the district court was affirmed by the Court of Appeals and after the Supreme Court denied certiorari. The next section of the opinion will deal with the events which transpired during that intervening period, when the Executive Board remained in control of Local 560, and during the initial period of the trusteeship.

 III. Additional Findings

 A. The Government's New Charges

 The United States asserts in support of its application that:

 
Events since the Order [Opinion] of February 8, 1984 demonstrate that the Genovese Crime Family has endeavored to maintain its control over Local 560 -- notwithstanding this Court's efforts to end the quarter-century of racketeer-induced corruption, oppression and exploitation. Accordingly, the equitable remedy initially fashioned over four years ago should be modified in accordance with existing circumstances in order to facilitate the dual objective of eliminating racketeer influence within Local 560 and restoring union democracy therein.

 Application for Additional Relief, at p. 2.

 The United States goes on to assert that:

 
Throughout the post-trial period from approximately mid-May of 1983 well into the period of the Trusteeship, although progressively diminishing since shortly before February 14, 1988, Local 560 continued to be a captive labor organization -- dominated by the (previously adjudicated) extortionate climate of intimidation which a quarter-century of impacted racketeering activity had instilled within its membership and which defendants Michael Sciarra, Joseph Sheridan and other adherents to the Provenzano Regime did thereafter protect, perpetuate and promote for the benefit of and in collusion with remnants of the Provenzano Crime Group and members of the Genovese Crime Family -- all in violation of 18 U.S.C. secs. 1951, 1962(b) and (d) and 2.

 Application for Additional Relief, at p. 10.

 Certain persons and entities are involved in the government's new charges. Matthew ("Matty-the-Horse") Ianniello is alleged to be a made-member and a caporegime (i.e., a mid-level supervisor) in the Genovese Crime Family, and as such to have exercised supervisory authority over the activities of Anthony Provenzano, Nunzio Provenzano, Stephen Andretta and other associates of the Provenzano Group who served as officials within and exercised control over the affairs of Local 560.

 Thomas S. DiBiasi, Esq., a member of the New Jersey bar since 1972, was indicted on August 14, 1979, in the United States District Court for this district on charges that he committed a multi-million dollar bank fraud. On November 18, 1980, he pled guilty to a reduced charge and was sentenced to probation. He was suspended from the practice of law for three months during mid-1986. During much of the period pertinent to this action he was a partner in an Essex County law firm which conducted its business under the names of Citrino, Balsam & DiBiasi; Citrino, Balsam, DiBiasi & Katchen, and Citrino, DiBiasi & Katchen.

 New England Motor Freight, Inc. ("NEMF") transports commodities between points within and without New Jersey. Since approximately 1977 Myron Shevell has been a stockholder in and chief executive officer of NEMF. Prior to early 1982, Henry Slyboom (now deceased) was the Local 560 business agent assigned to NEMF. Thereafter that position was held first by Daniel Rubino and then by Peter Granello.

 The government sets forth specific charges to support its claim that Sciarra and Sheridan have acted to perpetuate the old order:

 1. Knowledge

 As of February 8, 1984 Sciarra and Sheridan knew, by virtue of having participated in the original hearing, that each member of the Executive Board, including themselves, had been adjudged to have aided, abetted and conspired to extort the rights of Local 560's members in the specific manner described in the foregoing section of this opinion. The findings of the district court imposed an obligation upon each member of the Executive Board to take constant, drastic action to undo the effects of the racketeering conduct and to prevent future conduct of that nature.

 2. Maintenance of Crime Family Control

 The government charges that Sciarra and Sheridan participated in a scheme to maintain the Genovese Crime Family control of Local 560 until and after the trusteeship commenced. On October 29, 1984 the Local 560 Executive Board, composed of the original Executive Board defendants in this case (except for Salvatore Provenzano, who had been forced to resign in the wake of a fraud conviction), appointed Sciarra to succeed Salvatore Provenzano as president -- a position which theretofore had been occupied by one of the three Provenzano brothers continuously since 1958. The government charges that Matthew Ianniello designated Sciarra to represent the Genovese Crime Family's interests in the Local 560 Board and that he discussed this with defendant Board member Stanley Jaronko on November 1, 1984 and with defendant Provenzano Group member Stephen Andretta on November 6, 1984.

 3. Continuing Conspiracy

  Thus from October 29, 1984 until June 23, 1986 Sciarra and Sheridan were, respectively, president and vice-president of Local 560. Each, along with the rest of the Executive Board, had been found to have aided and abetted the Provenzano-induced racketeering conspiracy. The government charges that in spite of these well-documented findings, neither Sciarra nor Sheridan made the slightest effort to renounce participation in the conspiracy nor to do anything to dispel the extortionate climate of intimidation which had enveloped the Local for 25 years.

  4. Failure to Control Conspiracy Members

  The government charges that Sciarra and Sheridan failed to act against the officials of the Provenzano regime who had been found to have committed specific acts in furtherance of the racketeering scheme. Josephine Provenzano remained on the Board notwithstanding the imprisonment of her father Anthony and her two uncles, Nunzio and Salvatore. Marvin Zalk, who had been part of the Provenzano Group's infrastructure for decades, had been guilty of benefit fund improprieties on several occasions in the past. On December 21, 1983 Zalk was convicted by a federal jury of obstruction of justice in connection with the Dental Plan Case (United States v. Marcus), et al., Cr. 83-104 (D.N.J.), yet Sciarra and Sheridan did nothing to dismiss or suspend Zalk, waiting for his removal by operation of law.

  Defendant Executive Board member Stanley Jaronko assaulted August Muller on March 23, 1983 when, at an employees' meeting, Muller challenged Jaronko about statements Salvatore Provenzano had made, reminding Muller of the murder of Walter Glockner the morning after he had voiced opposition to Local 560's leadership at a general meeting. This was one item of evidence pointing to the intimidation of Local 560's membership. Yet, according to the government, Sciarra and Sheridan did nothing to discipline Jaronko or to demonstrate to the membership that he would no longer be permitted to engage in such conduct. As a result, according to the government, 1) Jaronko engaged in extortionate "labor peace" shakedowns during the period of the Sciarra-Sheridan incumbency; 2) Jaronko conspired with Ianniello to continue to corrupt the internal affairs of Local 560 and to perpetuate Genovese Crime Family control over the union, using Sciarra as its instrument; and 3) Jaronko's continued presence served to notify the Local 560 membership that nothing had changed and that corruption, intimidation and Provenzano control continued notwithstanding the findings and proposed remedy of the district court.

  5. Walsh Trucking

  The government charges that beginning in late 1977 and continuing until approximately the beginning of the trusteeship in June, 1986, Ianniello on behalf of the Genovese Crime Family, conspired with Anthony Provenzano, Stephen Andretta and other officials within Local 560 and with Francis J. Walsh, Jr., and others associated with him in certain trucking and warehousing corporations to effectuate a "labor peace" payoff scheme between Walsh Trucking Enterprise and various officials within Local 560 and their designees. The object of the conspiracy, according to the government, was to enrich the various conspirators at the expense of the Local 560 members who were employed by Walsh. The specifics of the government's charges are set forth in the indictment in United States v. Walsh (Cr. 88-114, D.N.J.).

  According to the government Sheridan was the official within Local 560 who was immediately responsible for negotiating the 1978 sweetheart contract between Local 560 and Walsh Trucking and Consolidating Company and that thereafter Sciarra and/or Sheridan signed the Walsh sweetheart contracts in succeeding years -- all of which aided and abetted the racketeering conspiracy. The government asserts that this all continued into the period of the post-hearing Sciarra-Sheridan administration.

  The government did not seek to prove its allegations concerning the Walsh Trucking relationship with Local 560 at the preliminary injunction hearing.

  6. Prepaid Legal Services

  The government charges that between early 1979 and late 1986 Sciarra, Sheridan and others aided and abetted Di Biasi and his law firm in the commission of various offenses involving a prepaid legal services plan.

  Among the specifics of the government's charges are the following:

  a. Sciarra was aware that certain Local 560 members (because of prior union affiliations) were beneficiaries of a prepaid legal services plan which was funded by direct contributions from employers to the DiBiasi law firm and that utilization reports were required by the plan's documents to monitor the performance of the firm. Neither DiBiasi nor his firm ever submitted utilization reports and Sciarra never asked for such reports. The DiBiasi firm received more than one-half million dollars from employers and has never had any way to account for the use of such funds. Similarly, Sheridan, who signed many of the prepaid legal service contracts, never read the provisions, never thought to request utilization reports and never sought to evaluate DiBiasi's fitness to provide the services.

  b. In mid-1984 Sciarra, with Sheridan's and Jaronko's support, decided to provide prepaid legal services to an additional segment of the Local 560 membership who then participated in the Trucking Employees of North Jersey Welfare Fund, Inc. (the "TENJ Fund"). Although advised by counsel for the employer-trustees that there was a possible problem, on August 21, 1984 Sciarra, Sheridan and Jaronko caused the selection of the Di Biasi law firm as the exclusive service provider for the "TENJ Legal Services Fund" notwithstanding that i) DiBiasi had been charged with fraud and pled to a reduced charge; ii) eighteen months earlier DiBiasi had been sued by Columbia Savings and Loan Association for professional negligence in connection with a $ 2.1 million fraud allegedly committed upon the bank; iii) the employer trustees sought to obtain competitive bids for the services; iv) the DiBiasi firm did not have the capacity to provide the level of services required; and v) counsel for the employer trustees were of the opinion that DiBiasi was barred under ERISA because of his prior convictions. At the preliminary injunction hearing, the government did not seek to prove items (ii) and (iii) above.

  c. During the period between the selection of the DiBiasi law firm on August 21, 1984 and the imposition of the trusteeship in June 1986 Sciarra and Sheridan permitted the continued retention of the Di Biasi law firm notwithstanding that: i) on September 7, 1984 DiBiasi asked for and received a $ 50,000 advance to finance expansion of his law firm's resources needed to provide the required services, promising to offset the advance against per capita contributions due to begin in October; ii) repayment of the $ 50,000 advance was never sought or made until the trustee was appointed and took action to recover it; iii) on January 31, 1985 the managing partner in DiBiasi's law firm, L. William Balsam, Esq., was suspended by the New Jersey Supreme Court in connection with allegations of misconduct which were being investigated by the Essex County Prosecutor's Office; iv) on April 28, 1986 Balsam committed suicide as the Prosecutor was about to file charges of embezzlement with respect to $ 800,000 in clients' trust funds; v) on April 15, 1985 Sciarra and Sheridan voted to give the law firm a three-year contract in place of the still unexpired one-year contract, this vote taking place two and one-half months after Balsam's suspension; vi) on May 24, 1985 the TENJ trustees voted to modify the DiBiasi's malpractice insurance requirement to a flat $ 3,000,000; on June 24, 1985 the law firm's malpractice insurer cancelled its policy, a fact which was concealed from the TENJ's trustees until May 6, 1986 when the law firm's counsel informed several of the plan trustees that the firm had been operating for some eight months in violation of the contract requirements; vii) thereafter, notwithstanding all that went before, Sciarra, Sheridan and Jaronko pressured the employer trustees to extend the service contract with the DiBiasi law firm so that the firm could use the extended contract to collateralize a bank loan of $ 150,000 that the firm needed to resolve the financial difficulties arising out of the Balsam embezzlement. At the preliminary injunction hearing, the government did not seek to prove item iv) above or that pressure was exerted against the employer trustees to extend the service contract.

  7. New England Motor Freight Sweetheart Arrangements

  The government charges that throughout the period between late 1975 and mid-1986 Myron Shevell, on behalf of NEMF, cultivated a corrupt relationship with certain officials of Local 560 -- including Anthony Provenzano, Stephen Andretta, Henry Slyboom, Daniel Rubino and Peter Granello -- as a result of which NEMF obtained sweetheart benefits from Local 560 throughout the years in question and was eventually able to deunionize its operations altogether. The government claims that Ianniello and Stephen Andretta conspired with Shevell to interfere with the affairs of Local 560 by causing Sciarra to sabotage grievance actions against NEMF which ran counter to the interests of NEMF and jeopardized its sweetheart status. One result of this intervention, according to the government, was Sciarra's January 31, 1985 offer to NEMF of a collective bargaining agreement which in effect would have removed the entire NEMF workforce other than three warehousemen from Local 560 jurisdiction. NEMF did not accept this offer. On February 20, 1985 Local 560 business agent Daniel Rubino testified before the Joint Local Committee with respect to the NEMF grievance. In doing so, the government alleges, he contradicted his prior sworn statements concerning the nature and extent of past practices of NEMF. The testimony undermined the union's position, and three months later the Teamsters grievance committee deadlocked, ending the union's attempt to end NEMF's anti-Local 560 practices. The government charges that Sciarra never acted in the face of Rubino's past sweetheart deals with NEMF or in the face of his change of position before the grievance committee.

  8. Sciarra's and Sheridan's Mind-Set

  The final ground which the government advances to support its application are the asserted attitudes of Sciarra and Sheridan towards their responsibilities as officers and trustees of Local 560 in face of the devastating disclosures made during the course of the original hearing and in face of untoward events which have occurred since that hearing was concluded. Both men were, of course, found to have aided and abetted the racketeering activities which produced the situation described in the 1984 Opinion and since 1984 they have been the principal officers of Local 560. Yet, according to the government, they still profess to see no serious problems calling for drastic remedial actions on their part; they still consider the Local 560 problems to be the result of a government vendetta. They cannot believe that the Genovese Crime Family is a potential problem or danger to Local 560. All this, the government contends, shows that Sciarra and Sheridan are the same persons they were when they were ordered removed from office in 1984 and that their resumption of office would ensure the return of the conditions the trusteeship was designed to end.

  B. The New Evidence

  1. The Intercepted Conversations

  Central to the government's motion to disqualify Sciarra and Sheridan are three tape recordings of conversations held in a construction shed in Edgewater, New Jersey, as supplemented by a recording of a conversation held at the Palma Boy Social Club in East Harlem. The government contends that the conversations establish that the Genovese Crime Family sought to continue its control over Local 560 after the issuance of the 1984 Opinion and that Michael Sciarra was the Family's chosen instrument to achieve this end.

  The first tape (Exhs. 7 and 7A) records a conversation held on November 1, 1984 involving Milton Parness, Matthew Ianniello, Stanley Jaronko and an unidentified male. The second tape (Exhs. 8 and 8A) records a conversation held on November 6, 1984 between Ianniello and Stephen Andretta. The third tape (Exhs. 9 and 9A) records a conversation held on December 7, 1984 involving Ianniello, Andretta and an unidentified male. The fourth tape (Exhs. 57 and 57A) records a conversation held on November 28, 1984 (at the Palma Boy Social Club) involving Anthony Salerno, Guiseppe Sabato, Cirino Salerno and Louis Gatto. It will be recalled that Salvatore Provenzano had been convicted on December 21, 1983 of embezzlement from a dental plan of the Local 560 Welfare Fund; that in October 1984 the Taft-Hartley Act had been amended to further limit the right of convicted persons to hold labor union office; that effective October 31, 1984 Saltarore was barred from continuing as president of Local 560 and of Teamsters Joint Council No. 73 (covering the New York-New Jersey area); and that in late October 1984 the members of Local 560 selected Sciarra to succeed Salvatore Provenzano as president of Local 560. All of the taped conversations took place shortly after these events.

  The tapes must be viewed in the light of other evidence introduced at the original hearing and at the instant proceeding. Since the 1960's Anthony Provenzano and persons associated with him controlled Local 560 and subjected the Local and its members to the various abuses described above. Anthony Provenzano was President of Local 560 until his conviction and imprisonment required his removal. He was succeeded as President by his brother Nunzio who remained in office until his conviction required his removal; he in turn was succeeded by another brother, Salvatore, whose post-conviction removal occurred in October, 1984. It would appear that even while in jail at the federal penitentiary in Lompoc, California, Anthony maintained a fair degree of control over Local 560.

  Although the Provenzano Group was a principal subject of the original hearing, it operated as a constituent part of the Genovese Crime Family and was subject to the direction and control of the Family's hierarchy.

  In 1984, Anthony ("Fat Tony" or "Tony") Salerno was the boss of the Genovese Family. His headquarters was in Harlem. In November 1984, Vincent ("The Chin" or "Chin") Gigante was acting boss.

  Beneath the boss and underboss of an organized crime family comes a consigliere (or counsel). Beneath him there are a number of caporegimes, who are very powerful men in charge of various soldiers who are made members of the family. Each soldier, along with others associated with him, conducts criminal enterprises which produce profits for himself and for those higher in the family.

  Anthony Provenzano was a soldier in the Genovese Family. Among his undertakings was the control of Local 560. Among his associates, as found by Judge Ackerman, were Nunzio Provenzano, Thomas Andretta, Stephen Andretta and Gabriel Briguglio.

  In 1984, Matthew Ianniello was a caporegime in the Genovese Family. The Provenzano Group was within his jurisdiction. The tape recordings, among other things, reflect his position within the Genovese Family and they reflect his and the Family's steps to remain in control of Local 560 after Salvatore Provenzano's removal as President, during the period of the trusteeship and thereafter.

  The November 1, 1984 conversation was between Ianniello, Milton Parness, Stanley Jaronko and an unidentified man. Jaronko, of course, was a member of the Local 560 Executive Board and had been found by Judge Ackerman to have aided and abetted the Provenzano Group in its control and exploitation of Local 560.

  The participants in the conversation discussed various union matters, not limited to Local 560, and they discussed organized crime figures who are not involved in this case. They ...


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