6-21-2013 Guy Petrillo REPLY MEMORANDUM OF LAW in support of Billelo Doc. 1337

7/28/2019 6-21-2013 Guy Petrillo REPLY MEMORANDUM OF LAW in support of Billelo Doc. 1337

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Case 1:90-cv-05722-RMB-THK Document 1337 Filed 06/21/13 Page 1 of 14

UNITED STATES DISTRICT COURTSOUTHERN DISTRICT OF NEW YORK------------------------------------XUNITED STATES OF AMERICA,

Plaintiff,-against-

DISTRICT COUNCIL OF NEW YORK CITYAND VICINITY OF THE UNITEDBROTHERHOOD OF CARPENTERS ANDJOINERS OF AMERICA, et al.,

Defendants.

90 Civ. 5722 (RMB)

------------------------------------X

REPLY MEMORANDUM OF LAW OF MICHAEL BILELLO IN SUPPORT OF HISPETITION TO VACATE THE VETO OF THE REVIEW OFFICER

New York, New YorkJune 21, 2013

PETRILLO KLEIN & BOXER LLP655 Third Avenue, 2211d FloorNew York, NY 10017(212) 370-0330Attorneys for Petitioner Michael Bilello


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TABLE OF CONTENTSPage

PRELIMINARY STATEMENT ..................................................................................................... 1ARGUMENT .......................................................................................................... ......................... !

1. Mr. Bilello's Affirmation is Appropriately Before the Court to Complete the RecordAvailable to the RO at the Time of the Veto ........................... ............................................ 12. The By-Laws Specifications are Capricious and Unreasonable ........................................... 33. The Cross Training Specification Flouts the Order and is Unreasonable ........................... .44. Specification 2 -As a Matter ofLaw- Cannot Serve as the Basis for Veto ....................... 65. Specification 5 is Wholly Unreasonable ............................. ................................................. 9

CONCLUSION ............................................................................................................................. II

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TABLE OF AUTHORITIESCases PageAmerican Farm Bureau Federation v. US. E.P.A., No. 11 Civ. 0067 (SHR), 2011 WL

6826539 (M.D.Pa. Dec. 28, 2011 ) ............................................................................... ................ 3Asarco, Inc. v. US.E.P.A., 616 F.2d 1153 (9th Cir. 1980) ........................................................... ... 2Capital Ventures Intern. v. Republic ofArgentina, 552 F.3d 289 (2d Cir. 2009) .......................... 4Flores-Figueroa v. United States, 556 U.S. 646 (2009) .......................................................... ........ 4Grove Fresh Distributors, Inc. v. John Labatt Ltd., 888 F.Supp. 1427 (N.D.Ill. 1995) ........ ......... 5Miami Nation of ndians v. Babbitt, 979 F.Supp. (N.D. Ind. 1996) ................................................ 3Ohio Valley Environmental Coalition v. Whitman, No. 02 Civ. 0059 (JRG), 2003 WL 43377

(S.D.W.Va. Jan. 6, 2003) ............................................................................................................ . 2S.E.C. v. Reynolds, No. 08 Civ. 438,2011 WL 903395 (N.D.Tex. Mar. 16, 2011) ....................... .4Sportsmen's Wildltfe Defense Fund v. Romer, 29 F. Supp. 2d 1199 (D. Colo. 1998) .................... 2

United States v. District Council ofNew York City, 941 F.Supp. 349 (S.D.N.Y. 1996) ................. 8United States v. District Council ofNew York City, No. 90 Civ. 5722 (RMB), 2013 WL

2451737 (S.D.N.Y. June 5, 2013) ................................................................... ............................ 9Walter 0. Boswell Memorial Hasp. v. Heckler, 749 F.2d 788 (D.C. Cir. 1984) ............................. 3Statutes18 U.S.C. 1001 ............................................................................................................................ 1029 U.S.C. 158(b)(2) .................................................... .................................................... .............. 85 U.S.C. 706 (1982) ............................................ .............................................. ............................ 3New York Civil Service Law 201 (2)(b ) ...................... ........................ ........................ ................. 6

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The RO contends that the Bilello Affirmation should not be considered because the Vetoshould be judged by reference only to information that was before the RO at the time of veto.First, all of the information in the Affirmation was not simply available to the RO, but knownand understood by the RO by virtue of his participation, personally or through his agents, in thematters addressed in that Affirmation, and in the case of the March 22 events, through Mr.Bilel lo's initial interview. Second, Mr. Bilello's counsel re-capped these facts for the RO indiscussions with the RO on April 12. Third, counsel and Mr. Bilello, at the pre-actionconference ("PAC") on April 26, again discussed these facts? Indeed, the RO admits he

considered the "statements and arguments made by Mr. Bilello and his counsel at the PAC" priorto issuing the Veto. See Opp. Br. at 6. Finally, the RO does not dispute the material facts setforth in the Affirmation.3

Accordingly, the Bilello Affirmation properly completes the record. See, e.g, Ohio ValleyEnvironmental Coalition v. Whitman, No. 02 Civ. 0059 (JRG), 2003 WL 43377, at *2(S.D.W.Va. Jan. 6, 2003) ("plaintiffs do not seek to supplement the administrative record in thesense of adding documents to the record that were neither before the agency nor considered inthe decision-making process [but rather] contend that the EPA has not submitted to the court all2 The general information about Mr. Bilello set forth in Paragraphs 2 through 10 isproperly before this Court as background information. See Asarco, Inc. v. US.E.P.A., 616 F.2d1153, 1160 (9th Cir. 1980) (reviewing court can go outside of the administrative record for"background information"); Sportsmen's Wildl(/e Defense Fund v. Romer, 29 F. Supp. 2d 1199,1212 (D. Colo. 1998) (same).3

Nor could the RO contest such facts. For example, among others, there is no opening forthe RO to dispute that the CCO and the IG completed a comprehensive review of compliancewith the By-Laws and failed to note any issue concerning Section 10 and Section 21, on whichthe RO now, in part, bases the Veto; nor can the RO argue that he does not attend all delegatebody meetings and does not know what was and was not voted on at such meetings, or that thedelegate body affirmed nunc pro tunc the benefit fund allocations made in the first instance byMr. Bilello and a fellow officer; and the RO knows that the Communications Director tookcharge of and carried forward the CT Program in late Fall2012, by assignment from Mr. Bilello.

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of the materials that properly constitute the complete administrative record"); Miami Nation ofIndians v. Babbitt, 979 F.Supp. 771,777,781 (N.D. Ind. 1996); see also Walter 0. BoswellMemorial Hasp. v. Heckler, 749 F.2d 788, 792 (D.C. Cir. 1984) ("[t]o review less than the fulladministrative record might allow a party to withhold evidence unfavorable to its case");Environmental Defense Fund, Inc. v. Blum, 458 F.Supp. 650, 661 (D.C. Cir. 1978) ("agency maynot ... skew the 'record' for review in its favor by excluding from that 'record' information in itsown files which has great pertinence to the proceeding in question"); 5 U.S.C. 706 ( 1982)(reviewing court "shall review the whole record or those parts of it cited by a party") (emphasis

added).4

2. The By-Laws Specifications are Capricious and UnreasonableThe RO mistakenly argues, see Opp. Br. at 18, that Mr. Bilello seeks to blame others for the

two By-Laws process deficiencies that we addressed in our opening brief. He misses the point.In arguing that the veto is unreasonable and capricious to the extent that it relies on theseSpecifications, Mr. Bilello pointed to the commonali ty of good faith error among the RO, legalcounsel, the IG, the CCO and himself. See Br. at 7-13. The point is obvious- the RO'sselection of only one of these parties for veto based on these shared and understandableoversights is a quintessential example of whimsical decision making. The arbitrary anddisproportionate nature of the decision was only enhanced by (a) the utter failure of the RO to

4"[S]upplementation of the administrative record implies either: 1) the addition of newlycreated evidence, such as through the collection of direct testimony from agency decision

makers, typically requested by the court to explain part of the record or 2) the addition ofdocuments or other information that were not before the agency when the decision was made,such as post-decision comments or studies. By contrast, completion of the record implies theaddition of only those relevant documents that were actually available to, and considered by theagency at the time the decision was made and, therefore, should have been part of the record butwere improperly excluded." American Farm Bureau Federation v. US. E.P.A., No. 11 Civ. 0067(SHR), 2011 WL 6826539, at *4 (M.D.Pa. Dec. 28, 2011) (internal citation omitted).

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provide any notice or opportunity to cure prior to veto, and (b) the fact that both process errors,once finally observed by the relevant gatekeepers including Mr. Bilello, were immediatelycorrected without any discernible prejudice.

3. The Cross Training Specification Flouts the Order and is UnreasonableAs explained in our opening brief, see Br. at 15, the Order expressly directs how the RO

should address circumstances in which he recommends a training program that the DC fails toadopt to his satisfaction. Specifically, the Order requires the RO, on notice to the DC andGovernment, to bring such matter to this Court for hearing and decision. The RO's complaint

(poorly founded - see below) that the DC under Mr. Bilello did not implement the CT programwith the urgency demanded by the RO, on its face, falls within the scope o f ~ 5 h . Accordingly, inproceeding with the Veto based on Specification 3, the RO did not follow the Order's terms.

The RO argues ipse dixit that his power to veto somehow supersedes or can be asubstitute for this express provision of the Order. See Opp Br. at 23. His position violates theestablished tenet that every provision of organic legal authority (statutes, court orders, etc.)should be given meaning where possible. E.g., Flores-Figueroa v. United States, 556 U.S. 646,654 (2009) ("We should not interpret a statute in a manner that makes some of its languagesuperfluous"); Capital Ventures Intern. v. Republic ofArgentina, 552 F.3d 289, 294 (2d Cir.2009) ("lfthe Republic's interpretation of subsection 4 were adopted, this last sentence insubsection 3 would render subsection 4 superfluous, a result that should be avoided."); S.E. C. v.

Reynolds, No. 08 Civ. 438,2011 WL 903395, at *6 (N.D.Tex. Mar. 16, 2011) ("Reynolds'interpretation of the Court's asset freeze is tortured and would render the Court's asset freeze anullity, in addition to violating the spirit of the asset freeze."); Grove Fresh Distributors, Inc. v.John Labatt Ltd., 888 F.Supp. 1427, 1438 (N.D.Ill. 1995) ("[A] court order is issued to be

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obeyed. In effectuating this purpose, a court should not interpret the order in such a way as torender it a nullity.").

The Order wisely foresaw the possibility of policy differences over training between the ROand the DC and established a mechanism in for resolving such differences. The RO -whosays it was "expeditious" for him to act outside the specific mandate of the Order, even after hisbrief summarizes exactly the type of difference of opinion that would require resolution underthe process, see Opp. Br. at 23 - is not free unilaterally to ignore the requirements of theOrder. The Veto, to the extent of its reliance on Specification 3, must be overturned on this

ground alone.Additionally, as explained in our opening brief, see Br. at 13-14, and now conceded by the

RO in his Sixth Interim Report to the Court (filed in June, after the Veto), the CT Program mademuch more progress during Mr. Bilello's tenure than claimed by the RO at the time ofVeto. Inhis latest Report, the RO praises the progress of the CT program and acknowledges that onlythree weeks after the Veto, mirabile dictu, it was available for use in training businessrepresentatives. See Sixth Interim Report at 19. As the RO would presumably concede, the CTProgram was not created and readied for use in a mere three weeks. 5 Yet, the principalDeclaration on which the Veto relied deliberately reported nothing about the Program'sdevelopment after October 2012. Such an intentional omission of relevant facts is a commonhallmark of arbitrary and capricious decision-making, and renders Specification 3 unreliable and

weightless.4. Specification 2 -As a Matter of Law- Cannot Serve as the Basis for VetoEven more troubling than the RO's position that he may unilaterally set aside ,[5h of the

5 Should the RO not so concede, witnesses are available to provide the Court withadditional facts on this matter.5


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Order in the interest of expedition, is his breathtaking position- contrary to law- that the JavitsCBA, on March 22, was properly being enforced by business representatives who attempted toblock the Suspended Member, who was in arrears on his dues, from working for one day, asrequested by Javits, without any reasonable period afforded the SM to pay his arrears, anddespite the steps he had taken to boiTow money to pay his dues. In response, the RO terms thelegal discussion in our brief that demonstrates the unlawfulness of this conduct "byzantine,"addresses none of the cases or statutes cited, fails even to mention the applicable Taylor Law,cites no probative authority to support his position, and cites a policy, which if it exists as

claimed, would plainly run afoul oflaw. See Opp. Br. at 13-16.Even if the RO views the law as "byzantine," one would not expect him to lead the Court

into legal error. In sum, the Court will recall that (1) the union security clause of the Javits CBAdoes not specifically address the circumstances presented by SM on March 22, but states that theclause in all events is to be conformed to law where necessary; (2) the Taylor Law applies to DCmembers working at Javits; (3) this law is clear that a union operating in a Taylor Law-settingmay only enforce union security clauses through dues checkoff or collection of an agency shopfee, i.e., where an employer deducts from the salary of a non-member employee "an amountequivalent to the amount of dues payable by a member"6; and (4) under the NLRA, it is an unfairlabor practice to block members from working based on dues arrearages without, inter alia,notice to and a reasonable opportunity for such members to come current. See Br. at 20-26.

Further, on March 22,2012, Mr. Bilello, who was not apprised of any other members on the

6 See Civil Service Law 201 (2)(b).

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Javits site who had been prevented from working because of late dues,7 and who had had noexpectation that he would be fielding a call from the SM until the call arrived, recognized, whenapprised of the SM's circumstances, that it would be neither prudent nor fair to prevent the SMfrom working for an exceptionally brief period pending imminent payment of his dues, because,in a similar prior episode, the DC had been forced to settle a claim that the DC had unlawfullyprevented a member from working. Mr. Bilello also believed that it was reasonable to grant ashort grace period; and he did not know of, let alone approve of any Javits "policy" of the kindthat the RO now asserts was in force. Accordingly, as one would expect from an EST of Mr.

Bilello's experience, he exercised reasonable judgment and directed that the SM be permitted towork briefly pending payment of his dues. As explained in our brief, this decision, in contrast tothe action that the RO deems "proper," was in conformity with law.

Accordingly, Specification 2 collapses at the starting gate: Mr. Bilello did not interferewith the proper enforcement of the CBA but prevented a violation of law through his action.The Javits CBA expressly provides that enforcement of its union security clause must be in amanner that comports with law. The efforts of the business representatives on March 22 to blockthe SM from working, even if in good faith, were not in conformity with the Taylor Law (orNLRA), see Br. at 20-26.

The RO alleges favoritism, but this is a red-herring: Mr. Bilello did not know of anyoneelse in the SM's position (or of the so-called Javits "policy"). He also did not know that the SM

would be telephoning him on March 22, and the RO does not allege otherwise. Although not a

7 While the RO relies on the email attached as Exhibit E to the Veto, which indicates thatthree members were instructed that they could not work at Javits pending payment of their dues,see Opp. Br. at 13, the RO does not claim, nor could he, that Mr. Bilello ever saw that emailprior to the Veto.

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lawyer, Mr. Bilello, drawing on his experience and that of the DC, simply made a maturemanagement decision in the instance presented.

The RO's sole and half-hearted attempt to deal with the law is to cite generic languagefrom United States v. District Council ofNew York City, 941 F.Supp. 349, 378 (S.D.N.Y. 1996)that states that the NLRA permits "union-induced discrimination" for failure to pay dues, anuncontroversial proposition that is derived directly from the language of the statute. See Opp Br.at 16; see also 29 U.S.C. 158(b)(2). But this generic principle is not the issue here. As theNLRA cases make clear, see Br. at 20-22, a union member, who is owed fiduciary duties by the

union, must be afforded, among other things, clear notice of the amount of dues owed and givena reasonable opportunity to make payment. If afler being provided with such protections, henevertheless fails to pay his dues, then all would agree that, under the NLRA, his employmentmay be terminated. Here, however, but for Mr. Bilello's decision, there would have been nograce period whatsoever afforded the SM.

Finally, although not essential to the disposition of the black letter law issue presented,we respond briefly to the RO's claim of a "policy" at Javits. The RO apparently concedes thatno written policy existed at the time of the Veto; that neither the DC Executive Committee northe Delegate Body approved any such policy; and that no one ever informed Mr. Bilello thatbusiness representatives, in Mr. Capurso's words, "for six months," were enforcing such a"policy." The Sixth Interim Report attaches a letter from an officer of the DC that says nothing

about a policy. Rather, in listing eight members who have failed to maintain membership, theofficer cites the CBA, not any policy. Moreover, the letter does not say one way or the otherwhether these members were afforded a reasonable opportunity to come current in their dues,and thus lacks any probative value whatsoever as to a DC "policy." See Sixth Interim Report at

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Ex. 14. Suffice it to say that "policy" may be too strong a word for what some businessrepresentatives, acting in good faith, may have been doing at Javits on March 22. And, no one isblaming them- they have a supervisor who could have consulted with legal counsel or theExecutive Committee before causing his subordinates to generate litigation exposure for the DC.

As a matter of law, Specification 2 is meritless.5. Specification 5 is Wholly UnreasonableThe illogic of Specification 5 (and empty quality to the RO 's argument on this point), solely

requires reference to the uncontested facts. At the conclusion of his very brief call with Mr.

Mucaria, Mr. Bilello directed that the SM be allowed to work and given a brief grace period topay his dues arrearages. He then met briefly with VP Cavanaugh, who is very familiar with duesissues, and confirmed with him that his (Mr. Bilello's) decision was consistent with DC policy.See Br. 18-19. 8 Later that day, when interviewed by the RO, Mr. Bilello affirmed that he hadmade the decision and his belief that he was within his rights in making it. The RO's fixation onwhether Mr. Bilello misstated his recollection of Mr. Mucaria's comments earlier that day hasgenerated a controversy in search of both a motive and a meaningful dispute. Mr. Bilello, at thetime he was interviewed, believed (correctly, see above) that he had acted properly. Why wouldthere be any reason to misstate what a junior business representative said in a fleeting telephonecall?9 This is a not a situation where Mr. Bilello thought he had made a mistake. He believed he

8 Notably, the RO offers no affirmation of Mr. Cavanaugh, let alone indicates that he evenspoke with Mr. Cavanaugh prior to issuing the Veto.9 The RO quotes the principle cited in United States v. District Council ofNew York City,No. 90 Civ. 5722 (RMB), 2013 WL 2451737, at *2 (S.D.N.Y. June 5, 2013), that "the substantialevidence standard may be met despite the possibility of drawing two inconsistent conclusionsfrom the evidence." This principle finds no application where, as here, there is no nonspeculative reason to conclude that Mr. Bilello deliberately misstated the contents of hisconversation with Mr. Mucaria. If it were otherwise, any recollection reported to the RO that isinconsistent with the recollection of another would per se constitute a ground for veto.

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made the right call (and did). In other words, it is only by improperly assuming guilt that the ROreaches the conclusion that Mr. Bilello intentionally misstated what he recalled Mr. Mucariasaying.

But there is a more fundamental point to be made here: In broader perspective, the RO hasgrounded this basis for the Veto on Mr. Bilello's description of the minute-by-minute microdetails underlying a decision he made that was both (1) rational and reflective of good and fairjudgment; and (2) met the requirements oflaw. Given the soundness of Mr. Bilello's decision, acharge focused on his description of one of the inputs to this decision, is a singularly misguidedquest and overreaching in the extreme.

Finally, the RO's suggestion that we may be trying to import to the analysis the materialitystandard of 18 U.S.C. 1001, is wide ofthe mark. Our point is that arbitrary and capriciousreview looks at among other things, whether a finding is unreasonable and/or imposes a remedythat is grossly disproportionate in context. See Br. at 7. Where, as here, the crux of the RO'sVeto ground is, in effect, that Mr. Bilello, after making a sound, lawful and well warranteddetermination, misstated, after the fact, what he heard in a one minute or shorter conversationwith Mr. Mucaria, the Veto breaches the boundaries of any reasonable proportion, let alone goodsense.

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CONCLUSIONFor the reasons set forth above and in his opening memorandum, Mr. Bilello respectfully

requests this Court vacate the Veto and enter such further relief as it may deem just and proper.Dated: June 21, 2013

New York, NY

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Respectfully submitted,PETRILLO KLEIN & BOXER LLP

By: Guy PetrilloDaniel Goldman655 Third Avenue, 22"d FloorNew York, New York 10017Telephone: (212) 370-0330Attorneys for Petitioner Michael Bilello

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6-21-2013 Guy Petrillo REPLY MEMORANDUM OF LAW in support of Billelo Doc. 1337