I N V E S T I G A T I V E  R E P O R T  T O  C O N G R E S S

 

THE HAC REPORT III

2001

 

 

An Executive Report on the Status of the Federal Case Hanson v. Herman and an Update on the Latest Information Regarding Corruption and Entrenchment at Local 302 of the International Union of Operating Engineers (IUOE).

 

Prepared for the Committee on Education and the Workforce, the Honorable John Boehner, Chairman

 

United States House of Representatives

One Hundred Seventh Congress

 

 

TABLE OF CONTENTS

 

 

 

INTRODUCTION                                  page 1

 

THE CASE OF EDGAR HANSON                      page 1

 

THE JUDGE                                     page 3

 

THE UNITED STATES DEPARTMENT OF LABOR         page 4

 

THE EVIDENCE                                  page 9

 

HAC's RECOMMENDATION TO CONGRESS              page 14

 

CONCLUSION                                    page 15

 

 

 

 

 

 

(i)

 

 

INTRODUCTION

 

The purpose of this report is to provide an update to the Committee on the status of the federal case, Hanson v. Herman. This report also provides other details concerning Local 302 of the International Union of Operating Engineers (IUOE) and the service providers of Local 302. Finally, this report proposes several amendments to the Labor-Management Reporting and Disclosure Act (LMRDA). Without these specific changes to existing federal labor law, union elections cannot be adequately safeguarded and union democracy cannot be ensured to union members.

 

THE CASE OF EDGAR HANSON

 

Edgar Hanson filed suit on January 16, 2001 against Alexis Herman, then the Secretary of the United States Department of Labor (DOL). Generally, Hanson's suit alleges that the DOL intentionally failed to prosecute Local 302 of the IOUE when Hanson presented evidence showing Local 302 was involved in a conspiracy to conduct election fraud in the 1999 election of officers. Some of Hanson's evidence was taken directly from interviews conducted by the DOL's own investigators and later acquired by Hanson under a Freedom of Information Act request (FOIA). Hanson was a candidate for the office of

 

Page 1

 

 

business manager. He lost the e]ection by the closest margin in the history of Local 302. However, Hanson believes that but for the fraud, he actually won the election. Now, Hanson is suing the DOL for a new election and for damages.

 

Under the Federal Rules of Civil Procedure, DOL Secretary Herman had 60-days to respond to Hanson's January 16th complaint. On Monday, March 27, 2001, the day after the 60-day period had tolled, Hanson motioned the Court for a judgment by default. The Secretary had not yet answered the complaint, even though Hanson had provided several written notices to the Secretary's attorney regarding the March 26, 2001 deadline.

 

On Friday, March 30, 2001, the Secretary's attorney signed and mailed the answer and affirmative defense to Hanson. This was clearly four days after the answer was due. Undoubtedly, the Secretary's answer was prompted only by Hanson's motion for default, which was received by the Secretary's attorney prior to the Secretary's mailing of her answer.

 

The Court denied Hanson's motion for judgment by default, stating that the Secretary's answer was docketed by the Court prior to the docket assigned to Hanson's motion for default.

 

However, according to U.S. Postal Service records Hanson's motion arrived at the courthouse prior to the Secretary's answer. This fact is unmistakenly clear and supported by U.S. Postal Service documents acquired by Hanson.

 

 

Page 2

 

Hanson has other U.S. Postal Service records to support his contentions that he is not being treated fairly by the Court.

 

Presently, Hanson is still waiting for the Secretary's motion for summary judgment which the Secretary's attorney promised to expedite back in April. There seems to be no rush by the government to dismiss the case brought against it by Edgar Hanson.

 

THE JUDGE

 

The judge in the Hanson case is the Honorable Thomas S. Zilly. Zilly has gained familiarity of Local 302's problems by the cases brought by Hanson and his associates seeking fair union elections. Hanson and others filed suit in 1997 seeking judicial review of Secretary Herman's decision to dismiss their complaint alleging fraud and LMRDA violations in the 1996 election. Zilly dismissed that action.

 

In 1998, Hanson's associates filed two actions against Local 302 seeking damages for conspiracy, fraud, violations of the LMRDA and other charges. Hanson's associates brought those charges after the union illegally expelled them for bringing a 1996 suit to safeguard elections and prevent fraud. Zilly also dismissed those actions.

 

Judge Zilly granted a discovery continuance to the plaintiffs when they had evidence to show that a conspiracy existed between the incumbent officers of the union and the Election Committee Chairman. However, when the plaintiffs

 

 

Page 3

 

produced the telephone records of the election chairman, the union attorney motioned for a protective order which Judge Zilly granted. Later, the union attorney motioned for contempt charges against the plaintiffs after the chairman's phone records were published in the "Hanson Report." The "Hanson Report" provided evidence of the conspiracy. The judge allowed for a hearing in the matter, but dismissed the contempt charges.

 

After five years of pleading for a hearing into the matter of election fraud and conspiracy at Local 302, Judge Zilly has yet to set a hearing date.

 

THE UNITED STATES DEPARTMENT OF LABOR

 

Edgar Hanson and his associates have been providing the Department of Labor (DOL) with evidence of election fraud and Title IV violations since 1990. In each instance the Department has dismissed the complaints, stating that the DOL found no evidence of election fraud.

 

After the 1990 special election of officers, in which business manager Val Albert unwittingly agreed to conduct, Albert submitted evidence to the DOL of election fraud. Albert's personal secretary saw a man walk out of Albert's office with the membership list. The list included the addresses and other information about each member. That man was named Ken Allen, and he was sent from President Hanley's office in Washington, DC to coordinate the special election. Allen became the Election Committee Chairman. According to language in the bylaws, the

 

Page 4

 

chairman, or any member of the Committee, must be a member of Local 302. Allen was never a member of Local 302. Still, the Department of Labor dismissed Albert's complaint.

 

In 1993, Ed Hanson ran for Corresponding-Recording Financial Secretary. He was a candidate on the Albert slate. The Albert Team lost and again a complaint was filed with the DOL. This time, investigator Donald Logsdon with the Office of Labor-Management Standards (OL-MS) assured Albert and Hanson that election fraud could be detected by using a sample survey of the membership and examining it against the election results.

 

But this survey was never conducted by the Department, or at least Albert and Hanson were never informed of the results.

 

Instead, the DOL dismissed the complaint lodged by Albert and Hanson. The District Director of OL-MS, Suzanne Kirchner, finally informed Albert that a sample survey of the membership could not be conducted. This information was directly contradictory to what investigator Logsdon had earlier told Albert. In fact, Logsdon told Albert that the survey was an investigation tool that was regularily used to detect election fraud. Now, Albert and Hanson were faced with two contradictory versions of the DOL's investigation policies.

 

When Albert pressed Kirchner for answers, the Regional Director of the OL-MS, C. Russell Rock, called Albert at his home and cursed at Albert for pressing Kirchner.

 

The DOL dismissed Albert's complaint.

 

Albert and Hanson decided to conduct their own

 

Page 5

 

investigation. Using an older membership list, they sent out a survey letter to approximately six thousand members who were eligible to vote. About 5000 of these letters were returned as undeliverable because of old addresses. However, over 400 survey letters were filled out and signed by members who stated that they had voted for Albert in 1993. The election results, as stated by the union in 1993, showed Albert receiving only 160 votes. This was a huge discrepancy in member's support for Albert. Moreover, Albert's survey reached only a portion of the voting members.

 

Albert continued to press Kirchner, but Kirchner was reassigned to the Atlanta Office. John Heaney became the new District Director for OL-MS in Seattle's office.

 

One month prior to the 1996 election, in which Albert and Hanson were once again candidates against the incumbents, Albert filed an injunctive suit against the union. The objective of the suit was to get the court to safeguard the election from election fraud by the incumbents. The union attorney fought the suit, arguing that the court and the DOL had no jurisdiction regarding union elections until after the election. To Albert, this meant that the union could go ahead and conduct election fraud and violate Title IV of the LMRDA in order to maintain their power. Then, they could spend the membership's resources fighting post-election lawsuits. This is exactly what happened.

 

After the 1996 election, the incumbents and the union attorney put together another scheme. This time they employed

 

Page 6

 

the 1996 election committee chairman to file union charges against Albert for the purpose of expelling him from the union. On November 1, 1996, Albert was expelled in a kangaroo union trial engineered by the incumbents. Albert had paid union dues for over 40-years. The purpose of the expulsion was to eliminate Albert as a future candidate. For his part in the conspiracy, the election committee chairman was rewarded with numerous positions in the union, including Vice-president, to which he was appointed without a vote by the members.

 

Again Albert and Hanson filed a complaint with the DOL. This time, the complaint alleged that the incumbents had violated Title IV by illegally using the union newspaper and by employing Dave Clements to serve as election superviser. Clements also served as the union accountant and auditor, thereby setting up a huge conflict of interest.

 

Again, the DOL dismissed the complaint.

 

In 1999, Edgar Hanson ran for business manager of Local 302. He put together an expensive campaign with his slate of candidates. Meanwhile, Albert was conducting discovery in his lawsuit against Local 302. His discovery produced the telephone records of the 1996 election committee chairman, the ballot printer, and the union attorney. These records undeniably showed a conspiracy had taken place by the incumbents to violate Title IV of the LMRDA for the purpose of committing election fraud. Albert filed a motion with the court attempting to disqualify certain incumbents for being "false to their

 

Page 7

 

trust." Albert's motion was denied by Judge Zilly and Hanson and his entire slate lost the election. The loss, however, was by the narrowest margin in the union's history.

 

Hanson also had evidence of election fraud in 1999. During the ballot counting, Dave Clements, decided to trim some of the ballots before he fed them into the electronic vote tallying machine. One of Hanson's astute observers retained some of the trimmings from the trash recepticle. Close analysis of the trimmings revealed that intentional fraud had been committed. This conclusion was supported by expert opinion, from the King County Election Division as well as from the engineering division of the corporation that manufactured the vote counting machine. Based on this evidence, as well as from evidence obtained from Albert's discovery, Hanson filed a complaint and election protest with the DOL.

 

Hanson also produced a booklet titled, "the Hanson Report." He showed it to a few union members who were too afraid to take possession of a copy, fearing reprisals by the incumbent officers.

 

However, OL-MS investigator Don Logsdon received a copy of the report, to which he commented, 'that's a damn good bit of investigation."

 

Hanson also showed OL-MS Director John Heaney the actual ballot trimmings retained from election day. Their meeting took place at the Old Country Buffet in Federal Way, Washington. Hanson believed that he produced the "smoking gun"

 

Page 8

 

that Heaney needed to prosecute Local 302. Heaney promised Hanson that he would place an addendum in his report to his DOL supervisers in Washington, DC.

 

The DOL dismissed Hanson's case.

 

THE EVIDENCE

 

How much evidence is enough? Over the years, Hanson and Albert have been producing evidence of election fraud, conspiracy, and LMRDA violations committed by incumbent officers at Local 302. All of this evidence has been turned over to the DOL. Yet, the Department has done nothing. Some of the evidence even comes from the Department's own investigative reports, which were obtained by Hanson under a FOIA request. Here is a list of the evidentiary material, which can be examined in the HAC REPORT I and HAC REPORT II:

 

1. Ballot trimmings from the 1999 election, demonstrating intentional acts of election fraud, as well as violations of the union bylaws.

 

2. Direct contradiction of testimony from interviews of the union's ballot printer and the Superintendent of Elections for King County. The interviews were taken by DOL investigators.

 

3. Telephone records of the union's ballot printer, demonstrating activity consistent with election fraud.

 

4. Telephone records of the 1996 election committee chairman, demonstrating activity consistent with election fraud.

 

Page 9

 

 

5. Telephone records of the union attorney, demonstrating activity consistent with assisting the entrenched incumbents for purposes of election fraud.

 

6. Back-issues of the union newspaper demonstrating impermissable misuse of the publication for the purpose of excessive political publicity in favor of the incumbents.

 

7. Examination of the behavior of the entrenched incumbent officers:

 

a. Larry Johnson --- business manager from 1990 to 1997. Faced Val Albert in three elections (90,93,96). Suddenly resigned from office in 1997, only eight months into his new term. A defendant in the Albert lawsuits.

 

b. Clyde Wilson --- served as President during Val Albert's union trial. Personally ordered the punishment of expulsion for Albert. Appointed as business manager in 1997. Opposed Edgar Hanson in the 1999 election and won by the narrowest margin in the union's history. Suddenly resigned in late 2000 after the "Hanson Report" was published. A defendant in the Albert lawsuits.

 

c. Jack Jakubiec --Corresponding-Financial-Recording Secretary since 1990. Served as prosecutor in the expulsion trial of Val Albert. Suddenly resigned in late 1999, after the publication of the "Hanson Report." Served only four months of new term. A defendant in the Albert lawsuits.

 

d. Ron Knight --- Vice-president and long-time Larry Johnson supporter. Suddenly resigned in 1997, shortly after winning office in 1996.

 

e. Barry Riedesel --- rank-and-file member until becoming chairman of the election committee in 1996. Brought charges against Val Albert immediately after the 1996 election. Was appointed as business agent and Vice-president in 1997. Became Trustee of the union's $2.5 billion pension fund in 1998. Became editor of the union's newspaper in 2000. Ran for office for the first time in 1999, and was elected as Vice-president by 30 votes more than his opponent. Evidence shows that Riedesel was false to his trust to the members of Local 302 because: 1) he lied under sworn oath in his deposition, 2) he engaged in a conspiracy with the incumbents while serving as election chairman, and 3) he brought false charges against Val Albert.

 

Page 10

 

 

His positions with the union are evidence of his rewards for participation in corrupt activities. A defendant in the Albert lawsuits. -

 

f. Allan Darr --- Appointed as business manager on January 2001. He was not elected to this position. Served as the editor of the union newspaper since 1990. Also served as trustee of the union. Left the union in 1998 to work in Washington State politics. Was involved in conspiracy of 1996 election (received late evening phone calls to his home from the union's ballot printer on eve of the ballot mailout). Extremely nervous and jumpy. Made false and misleading statements under oath during his deposition in the Albert lawsuits.

 

g. Charles Barton --- served as Secretary from 1990 through 1993. Resigned four months after winning the 1993 election for that position. Made statements to a third-party that "because Local 302 is so corrupt, it is sitting on a ticking time bomb."

 

8. Signed affidavits by three of the 1996 Election Committee members, including the Committee Secretary. The Committee was comprised of five members including Chairman Riedesel. When shown Riedesel's phone records and his involvement in conspiracy and election fraud, three of the five members denounced Riedesel as being "false to his trust" and signed affidavits stating such. These affidavits were presented to the Court.

 

9. Examination of the union's service providers:

 

a. Russell J. Reid --- union attorney at Local 302 since the 1960's. Was fired by Val Albert when Albert was elected as business manager in 1988. Reid was immediately rehired by newly-elected business manager Larry Johnson in 1990. Evidence from Albert lawsuits shows Reid to be a highly nervous man and very deceptive. Phone records of Reid are consistent with some role he played in 1996 election fraud. Behavior of Reid is consistent with an individual who has something BIG to hide.

 

Page 11

 

 

b. Dave Clements --- partner in Lockitch, Clements & Rice, accounting firm contracted by Local 302 to perform accounting procedures and internal audits. Also serves as Local 302's election superviser. Hanson and Albert have claimed this is a severe conflict of interest. Clements tried to overcharge Local 302 after the 1990 election. Clements is a personal friend of Russell J. Reid. Clements has been supervising Local 302 elections, as well as serving as the union accountant and auditor for over 30 years.

 

c. Chris Gianelli --- owner of Service Printing. Contracted to serve as the union's ballot printer. Also contracted to print the union's newspaper and has printed campaign brochures for the incumbents. Gianelli has worked with Dave Clements in past elections of Local 302 and Clements has always recommended Gianelli's service to the incumbents. Gianelli's telephone records reveal conversations with incumbent Allan Darr immediately prior to the mail-out of ballots in 1996. Darr was a candidate in 1996 and won the position of Trustee. Gianelli was purposely evasive during his deposition in the Albert lawsuits. When Gianelli was shown a copy of his telephone records, in which he made calls to incumbent Darr's home during the printing of ballots, Gianelli hired his own attorney.

 

10. Examination of other key players:

 

a. Russell Conlon --- former business manager of Local 302 and adversary of Val Albert. Albert cut Conlon out of union business activities in 1988, even though Conlon was already retired. Albert's brother, Joe Albert, heard Conlon say to him, "I'll get even with you Alberts if it's the last thing I do." Conlon is an emeritus member of the IUOE and served as a Vice-president of the International.

 

b. Michael Conlon --- son of Russell Conlon. Served as Assistant to the business manager, prior to 1988. Was fired by Albert in 1988 and replaced by an Albert supporter. Albert claims that Michael Conlon had a reputation for reading comic books on the job. Young Conlon wed Sherry Tippy, a secretary at Local 302. Sherry Tippy Conlon was rehired by Larry Johnson and among other things, served as a screener to the union hall on election days. Currently, Michael Conlon is employed as a financial manager for an independent firm. He manages a large portion of the union's $2.5 billion Pension Fund.

 

c. Ken Allen --- Sent by IUOE's General President in Washington, DC to Seattle to help run the 1990 special election of officers. Was provided an office at the union hall. Was heard to say that he was a "numbers cruncher specialist." Allen became the election committe chairman, a position which

 

Page 12

 

 

according to the bylaws, requires Local 302 membership . Allen was not a member. Albert's personal secretary spotted Allen walking out of the union hall with a copy of the membership list. After Albert lost the election, Allen returned to Washington, DC and was later rewarded with a higher position in the IUOE.

 

d. Lary Yud --- The Department of Labor's Chief of the Division of Enforcement. Yud dismissed Hanson's 1999 complaint of election fraud. Yud also dismissed Albert's 1996 complaint of election fraud. In each complaint, the evidence of election fraud and Title IV violations were overwhelming.

 

e. C. Russell Rock --- Regional Director of the Department's OL-MS Office in San Francisco. Rock called Albert at his home in 1995 and cursed at Albert for pushing the issue of a new investigation into election fraud.

 

f. Suzanne Rirchner --- former District Director of OL-MS in Seattle. Albert pressed Kirchner in 1994 and 1995 to provide him with the results of the Department's sample survey of the 1993 election. Kirchner finally responded stating that a sample survey violated the member's constitutional right. Kirchner was soon reassigned to Atlanta's office.

 

g. John Heaney --- replaced Suzanne Kirchner as the District Director. Told Ed Hanson and Val Albert to bring him the smoking gun evidence if they wanted to end election fraud at Loca1 302. In February 2000, Heaney called Ed Hanson at his home and requested that Hanson meet him at a restaurant to view Hanson's smoking gun evidence. When Heany saw the evidence his eyes widened and he promised Hanson that he would forward an addendum to his previous report which was already sent to Washington, DC. Several days later, Heaney called Hanson to inform him that Hanson's complaint was dismissed.

 

h. Dan Farry --- OL-MS investigator in Seattle. When Albert and Hanson presented Ferry with the results of their independent investigation of election fraud, Farry commented, "we also use that type of investigative technique to determine if fraud is likely." Farry was refering to the sample survey which his boss, Suzanne Kirchner, had previously stated was unconstitutional.

 

i. Donald Logsdon --- OL-MS investigator in Seattle. Assisted Albert and Hanson during the 1993 investigation into election fraud. When shown the "Hanson Report" in 1999, he stated, "that's a damn good bit of investigation."

 

Page 13

 

 

HAC's RECOMMENDATION TO CONGRESS

 

In the spirit of continued cooperation with the U.S. House Committee on Education and the Workforce, HAC recommends the following remedies in order to restore lawful order at Local 302, as well as restore union member's confidence in the U.S. Department of Labor:

 

1. Continue a congressional investigation into the unlawful activities of Local 302 of the IUOE.

 

2. Continue a congressional investigation into the contradictory practices and apparent cover-ups within the Enforcement Division at the U.S. Department of Labor.

 

3. Amend Title IV of the LMRDA (29 U.S.C. §411), especially in these two areas:

 

a. Election Procedures

 

"Adequate safeguards to insure a fair election shall be provided, including the right of any candidate to have an observer at the polls and at the counting of the ballots."

 

The "adequate safeguards" provision needs to be highly specific. Presently, the union incumbents at Local 302 and their highly paid service providers determine what constitutes adequate safeguards. This is the old fox guarding the henhouse. The incumbents at Local 302 believe that "adequate safeguards" are whatever they deem necessary to win, and what their attorney may later argue in Court after the election. Adequate safeguards must be defined specifically either through amendments in Title IV, or in the departmental regulations. Adequate safeguards must include language addressing the area

 

Page 14

 

 

of conflicts of interest and impermissable misuse of the union newspaper to provide excess publicity to incumbent candidates.

 

b. Enforcement "May have affected the outcome of the election..."

 

The DOL relies on these words to make a decision as to whether or not there is a basis for a complaint by a candidate running for union office. This language is far too broad and doesn't provide specificity in the standards required to detect election fraud. Presently, the Secretary and DOL enforcement officers have far too much discretion to make a ruling in election fraud and Title IV violation cases. Their discretion and apparent lack of enforcement leads complainants to believe that a political cover-up has occured and that corruption exists within the DOL. In the case of Edgar Hanson, there is compelling evidence to show that Local 302 incumbents committed election fraud. Hanson lost by less than two percent of the total votes cast. Hanson's evidence demonstrates that election fraud may have affected the outcome of the election. But the Department refused to act.

 

CONCLUSION

 

There can only be one conclusion: The case of Edgar Hanson proves that a new election must be held immediately at Local 302 of the IUOE, in order to make Edgar Hanson whole and in order to restore the democratic voice of the members.

 

 

 


Return to Laborers.org

(c) All orginal work Copyright Laborers.org 1998. All rights reserved..