Probe Clears Teamster Secretary-Treasurer Ken Hall, but Issues Linger

Ken Hall is breathing easier.  But his union, the International Brotherhood of Teamsters, isn’t quite out of the woods yet.  On February 17, former federal prosecutor Joseph diGenova, the union’s special independent investigator, withdrew obstruction charges against Hall, the IBT’s general secretary-treasurer and number two man behind General President James P. Hoffa.  In a letter to the union general counsel, diGenova wrote that Hall “did not play a personal role” in withholding over 32,000 documents, including emails, related to corruption probes.  The Teamsters, which had finalized a settlement with the Justice Department in January 2015 to phase out over two decades of tight federal supervision, remains under scrutiny.  That’s not good news for Northern California Teamster leader Rome Aloise.

Union Corruption Update examined this issue in detail last November.  The Teamsters for many years had been trying to extricate themselves from the terms of a March 1989 civil racketeering settlement with the Department of Justice (DOJ).  There was good reason for the lawsuit.  Since the Fifties, union leadership and organized crime had gone hand in hand.  The government’s consent decree placed the union under the supervision of Chief U.S. District Judge Loretta Preska, Southern District of New York.  Three years later, in 1992, the court approved the formation of a three-member body, the Independent Review Board (IRB), that would investigate allegations of Teamster corruption and impose appropriate sanctions.  The union chafed under what amounted to a receivership.  Current General President James P. Hoffa, who took office in 1999, fought constantly to lift IRB oversight, but his union’s self-cleanup effort proved insufficient to the task.

A little over two years ago, the situation suddenly changed.  On January 14, 2015, the Teamsters and the DOJ announced they had come to terms on an agreement that would phase in autonomy for the union over a five-year period.  The plan would include anti-corruption safeguards.  The following month, Judge Preska approved the plan.  President Hoffa was jubilant.  “This is an historic agreement that returns our great union to our 1.4 million Teamster members,” he said.  “Our union is committed to the democratic process, and we can proudly declare that corrupt elements have been driven from the Teamsters and that government oversight can come to an end.”  The Independent Review Board, however, was still around, and with a substantial workload.  That October the IRB issued a report accusing the Ohio Conference of Teamsters of patronage on a grand scale; the board called upon Hoffa to put the conference into trusteeship.  And in February 2016, the board issued a report charging San Francisco Bay Area Teamster boss Rome Aloise with a variety of illegal activities, including racketeering and influence-peddling.

The task of investigating corruption allegations now rests on the shoulders of the union’s Independent Investigations Officer (IIO), Joseph diGenova, an experienced litigator and Reagan-era U.S. Attorney for the District of Columbia.  Hoffa and diGenova went way back.  In 1996 and its aftermath, diGenova helped Hoffa expose a money-laundering scheme hatched by campaign operatives of incumbent IBT President Ron Carey, then running for re-election against Hoffa.  Carey won, but IRB, upon reviewing the allegations, vacated the result and mandated a new election for 1998.  This time, Hoffa won, defeating opponent Tom Leedham by a large margin.  A few years later, in 2001, Hoffa rewarded diGenova with a seat on the IRB.  And following the January 2015 settlement, Hoffa appointed him IIO.

The findings relating to Ken Hall, the number two man in the international union and the head of a West Virginia local, is testing the oversight phase-out.  In a 42-page letter dated October 31, 2016, diGenova asked Hoffa to take action against Hall, claiming that Hall hid over 17,000 documents, including emails, related to possible corruption.  The report concluded:  “The Independent Investigations Officer recommends to the general President that a charge be filed against Ken Hall, the general Secretary-Treasurer, for bringing reproach upon the IBT and violating its and his legal obligations by engaging in conduct that violated the permanent injunction entered in United States v. International Brotherhood of Teamsters.”

General President Hoffa was not happy about this, especially as he was up for re-election last fall, with Hall on his slate, against Louisville leader Fred Zuckerman.  Hoffa won, but by an uncomfortably close 102,401 to 96,377 margin.  And the union now was locked in battle with diGenova.  On November 3, the IBT filed papers in federal court accusing diGenova of launching a “nuclear missile” in a “surprise attack” that “interferes with the ongoing election.”  IBT spokesman Bret Caldwell called the charges “baseless, without merit and politically motivated,” adding that diGenova privately had admitted that the dispute revolved around 50 emails that could be resolved through discussions.  But the accusations were hard to dismiss when U.S. Attorney Preet Bharara got into the act.  Early in November, Bharara, who in 2014 publicly had opposed releasing the union from its 1989 consent decree (“corrupt…practices persist at all levels”), filed charges based on the diGenova letter.  He asked Judge Preska to order the IBT to turn over 17,334 emails and documents allegedly withheld by Hall and other top Teamster officials.  Apparently, that was on the low side.  On December 27, 2016 Judge Preska ordered Hoffa and his aides to hand over more than 32,000 documents.

Much of the focus is on Rome Aloise, whose case NLPC covered last March.  The IRB the month before had charged Aloise with racketeering and violating member rights, among other abuses of power.  Yet even while this going on, Hoffa and Hall nominated him for another five-year term as an IBT vice president.  Aloise is set for a hearing before Independent Review Officer Barbara Jones on March 14.  And Hoffa executive assistant Willie Smith has a corruption hearing before Jones scheduled for March 21.  Hall, however, appears off the hook.  In a February 17 letter to Bradley Raymond, Teamster general counsel, diGenova indicated that, based on a letter and accompanying sworn declarations from Raymond ten days earlier, Hall did not obstruct justice.  DiGenova wrote:

Based on the representations in your letter, and the affidavits of counsel executed under penalty of perjury, I am persuaded that Mr. Hall did not play a personal role in the International Brotherhood of Teamsters’ (“IBT”) noncompliance with my March 4 and 11, 2016 document requests.  In particular, I accept your representation that Mr. Hall “did not participate in the IBT’s legal strategy, did not review any documents, and did not decide whether to withhold any documents or categories of documents.”  Accordingly, I am withdrawing my October 31, 2016 recommendation of charges against Mr. Hall.

But the withdrawal, di Genova emphasized, was not carte blanche:

…(A)s a condition of my withdrawal of the charges against Mr. Hall, the Union agrees to designate an individual officer at the IBT personally responsible for ensuring document requests of the Independent Disciplinary Officers (“IDOs”) for International Union records under the Final Agreement and Order are fully complied with.  As you know, the General President and General Secretary-Treasurer are responsible under federal law for maintaining and ensuring there are records to support the IBT’s Forms LM-2 filed with the Department of Labor…Therefore, it is consistent with their existing legal obligations that one of them…should be responsible for fulfilling the IDOs’ requests.  The Union must identify to the IDOs which one of the two aforementioned officers will be responsible on an ongoing basis.  If the Union fails to do so promptly, whomever of the two officers the IDOs designate on a document request will be held responsible for complying with the Union’s and his obligations under the Final Agreement to make the required records available.

A dissenting anti-Hoffa group within the IBT, Teamsters for a Democratic Union (TDU), thinks the Hall settlement leaves unanswered questions.  TDU posted the following message on its website on February 21:

The fact remains that the Hoffa-Hall administration spent millions of dollars in members’ dues money to stonewall corruption investigators until after the election. If Hall did not play a personal role in the obstruction, then who did?  Are members supposed to believe that General President Hoffa was out of the loop, too – and that the decision to obstruct corruption investigators for over six months was made by rogue lawyers with no input from Hoffa or Hall?  Didn’t Hoffa and Hall sign the checks to pay the high-dollar attorneys they hired to pursue the obstruction?

These questions may well come up in the Independent Review Board hearings of Rome Aloise and Willie Smith.  If they do, Hoffa and other top Teamster officials might not like the answers.