Case 14-3506, Document 47, 12/11/2014, 1391198, Page1 of 16

UNITED STATES COURT OF APPEALS

FOR THE SECOND CIRCUIT
-------------------------------------------------- x
UNITED STATES v. DISTRICT
COUNCIL OF N.Y.C. & VICINITY OF
THE UNITED BROTHERHOOD OF
CARPENTERS
-------------------------------------------------- x

Dkt. No. 14-3506

Opposition to Motion for Stay

Plaintiff-appellee the United States submits this opposition to the application
by non-party appellants Patrick Nee and Levy Messinetti for a stay of the entry of a
consent decree agreed to by the parties (and already entered by the district court),
while their appeal of a previous matter is pending. The application should be
denied. First, Nee and Messinetti seek to challenge an order of the district court
from which they never appealed, and accordingly this Court lacks jurisdiction.
Second, their challenge rests on a misconstruction of the district courts order, and
a misreading of a passing remark by the district judge, and is accordingly meritless.
Procedural History
A. The Governments Action Against the District Council, from 1994 to 2010
The governments supplemental complaint in this action alleged that the
defendant, the District Council of New York City and Vicinity of the United
Brotherhood of Carpenters, and its constituent local unions had become infiltrated
by corrupt individuals and organized crime figures who exploited their control over

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the District Council for personal gain. (R. Doc. 106).1 In 1994, the parties agreed
to a consent decree, which implemented a number of anti-corruption measures
against the District Council and its constituent locals, including oversight by a
court-appointed officer. (R. Doc. 410); see United States v. District Council, No.
90 Civ. 5722, 1999 WL 494121, at *4 n.4 (S.D.N.Y. July 12, 1999).
However, at the end of that officers tenure, corruption continued, and the
district court appointed a new investigatory officer. See United States v. District
Council, No. 90 Civ. 5722, 2002 WL 31873460, at *3-5 (S.D.N.Y. Dec. 24, 2002).
The newly appointed officer uncovered extensive evidence of labor racketeering,
United States v. District Council, 571 F. Supp. 2d 571, 577 n.8 (S.D.N.Y. 2008);
United States v. District Council, 571 F. Supp. 2d 555, 562-63, 568-69 (S.D.N.Y.
2008), and several contempt citations and criminal convictions followed, United
States v. District Council, 618 F. Supp. 2d 326, 329-30 (S.D.N.Y. 2009); District
Council, 571 F. Supp. 2d at 568-69; United States v. District Council, No. 90 Civ.
5722, 2007 WL 2697135 (S.D.N.Y. Sept. 17, 2007); United States v. District
Council, 229 F. Appx 14 (2d Cir. 2007).
In 2009, an indictment was unsealed, charging numerous high-ranking union
officials and others connected to the union with criminal RICO violations and

Citations to Record Documents refer to the ECF number of the filing in the district
court.
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other offenses; all were convicted. See United States v. Forde, No. 08 Cr. 828
(S.D.N.Y.). Immediately after the indictment was unsealed, the international union
placed the District Council into trusteeship. United States v. District Council, No.
90 Civ. 5722, 2010 WL 2287008, at *2 (S.D.N.Y. June 3, 2010).
In June 2010, the parties agreed to a Stipulation and Order, which designated
a new court-appointed officer, known as the Review Officer. Id. The Review
Officer was given authority with the goal of eradicat[ing] corruption and
racketeering as they affect union carpenters and union employers, and ensuring
that the interests of the unions members will be honestly and democratically
represented. (R. Doc. 991, at 3-14). In particular, the Review Officer was
empowered to require compliance with the injunctions set forth in the 1994
Consent Decree; to investigate the operations of the District Council, including
but not limited to investigating allegations of corruption and wrongdoing by
officers, representatives, agents, employees, members, and trustees; and to bring
disciplinary charges against any District Council officers, representatives, agents,
employees, or members. (R. Doc. 991, at 4 5.a). As did the 1994 consent decree,
the 2010 stipulation and order reached both the District Council and its constituent
local unions. (R. Doc. 991, at 2, 3 1.b).
Of particular relevance here, the Review Officer was given review and
oversight authority, including the authority to review the persons currently
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holding office or employment within the District Council or its constituent local
unions. (R. Doc. 991, at 5-6 5.b.i.1, 5.b.i.3). In his review, the Review Officer
could determine that a matter, among other things, (c) is contrary to or violates
any law or Court order entered in this case; or (d) is contrary to any fiduciary
responsibility imposed by 29 U.S.C. 501 . . . ; or (e) is inconsistent with the
objectives of this Stipulation and Order. (R. Doc. 991, at 6 5.b.iii). Should he
make any of those determinations, the Review Officer could veto or require the
District Council to rescind its action, proposed action, or lack of action. (R. Doc.
991, at 6 5.b.iii). If the Review Officer exercised this power, any aggrieved
person could seek review of his decision in the district court, under the deferential
standard that is applied to final agency action under the Administrative Procedure
Act. (R. Doc. 991, at 18 11).
B. The Review Officers Action Against Nee and Messinetti
As further detailed in the governments brief to this Court in the prior appeal
(No. 12-4883), the Review Officer exercised his veto authority to remove Nee and
Messinetti from their positions at Local 157, a constituent union of the District
Council, having determinedafter giving Nee, Messinetti, and other affected
union personnel notice of the potential action and an opportunity to be heard both
in writing and in personthat their actions were contrary to their fiduciary
obligations, the orders of the district court, and the objectives of the 2010
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stipulation and order. Nee and Messinetti sought review before the district court,
which upheld the Review Officers actions. United States v. District Council, No.
90 Civ. 5722, 2012 WL 5236577 (S.D.N.Y. Oct. 23, 2012).
Nee and Messinetti then appealed to this Court, which vacated the district
courts ruling, and remanded for the district court to determine whether the Review
Officers veto authority encompassed the authority to remove Nee and Messinetti
from their positions. United States v. Nee, 573 F. Appx 37 (2d Cir. 2014). On
remand, the district court held that the matter was moot, as Nees and Messinettis
terms of office had expired during the pendency of their appeal, and they had run
for and been elected to new offices at Local 157 without any action by the Review
Officer to attempt to stop them. (R. Doc. 1569). The district court further held that
even if the action were not moot, extrinsic evidence demonstrated that the parties
intended in the 2010 stipulation to give the Review Officer the authority to remove
officers such as Nee and Messinetti. (R. Doc. 1569).
Nee and Messinetti then filed the instant appeal in September 2014.
C. Entry of the 2014 Stipulation and Order
The June 2010 stipulation was set to expire on June 3, 2014. (R. Docs. 991,
1198). In May 2014, the parties submitted to the district court a proposed
replacement stipulation, naming a new court-appointed officer with somewhat
diminished authority. (R. Docs. 1512-1516, 1522-1528). The district court entered
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an interim order extending the Review Officers tenure until it could consider the
proposed stipulation. (R. Doc. 1521). Following a conference and several
exchanges with the district court, the parties submitted a slightly revised
stipulation, which the district court entered on November 18, 2014. (R. Doc. 1595).
Nee and Messinetti objected to the entry of the stipulation, which the district court
overruled without comment. (R. Doc. 1596). Nee and Messinetti now seek to stay
the entry of that 2014 stipulation.
ARGUMENT
A. Standard of Review
In determining whether to issue a stay, this Court considers (1) whether the
stay applicant has made a strong showing that he is likely to succeed on the merits;
(2) whether the applicant will be irreparably injured absent a stay; (3) whether
issuance of the stay will substantially injure the other parties interested in the
proceeding; and (4) where the public interest lies. SEC v. Citigroup Global
Markets, Inc., 673 F.3d 158, 162 (2d Cir. 2012) (quotation marks omitted). The
last two factors merge when the Government is the opposing party. Nken v.
Holder, 556 U.S. 418, 435 (2009).
As Nee and Messinetti fail on all four factors, their application should be
denied.

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B. This Court Lacks Jurisdiction to Review the 2014 Stipulation and Order
First, Nee and Messinetti cannot show a likelihood of success, because this
Court lacks jurisdiction over their stay application. See Munaf v. Geren, 553 U.S.
674, 690 (2008) (jurisdictional question makes success more unlikely due to
potential impediments to even reaching the merits).
Nee and Messinettis stay application is effectively a challenge to the 2014
stipulation. But Nee and Messinetti never appealed from the district courts entry
of that stipulation. Federal Rule of Appellate Procedure 3(c) provides that the
notice of appeal must . . . designate the judgment, order or part thereof being
appealed. Fed. R. App. P. 3(c)(1)(B). The Courts jurisdiction is limited by the
wording of the notice, and depends on whether the intent to appeal [the decision
at issue] is clear on the face of, or can be inferred from, the notice[] of appeal.
New Phone Co. v. City of New York, 498 F.3d 127, 130-31 (2d Cir. 2007).
In this case, Nee and Messinettis notice of appeal was filed on September 12,
2014over two months before the district courts entry of the stipulation and
order in November 2014. (R. Doc. 1573). The notice of appeal on its face makes
clear that Nee and Messinetti seek review only of the district courts September 10,
2014, order deeming their grievance moot and alternatively holding that the
Review Officer had the authority to end their tenures in Local 157 office. (R. Doc.
1573 (hereby jointly appeal to the United States Court of Appeals for the Second
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Circuit from an order of the District Court dismissing our appeal as moot and
denying our application to find the Review Officer had exceeded his authority,
entered in this action on 9/10/2014)). This Court, therefore, has no jurisdiction to
review or stay the entry of the November 2014 stipulation entered by the district
court.
C. The Stay Application Lacks Merit
Even if this Court had jurisdiction, it should deny the application. Nee and
Messinettis argument appears to be that the entry of the 2014 stipulation and order
somehow converts the Review Officers action in 2012 from a veto, exercised
pursuant to his authority granted in the 2010 stipulation, into some more onerous
form of disciplinary action. That contention is illogical, founded on a
misunderstanding of the 2014 stipulation and on a distorted reading of a passing
remark by the district judge.
As Nee and Messinetti note in their application, the Review Officer, the
government, and the district court have all stated that the Review Officers veto of
their continued officeholding in 2012 was not a form of disciplinary action, in the
sense that term was used in the 2010 stipulation and order. Nee and Messinetti lost
no union rights, including the right to run for elective office, going forward. Cf.
United States v. International Brotherhood of Teamsters (Carey & Hamilton),
247 F.3d 370, 374-78 (2d Cir. 2001) (referring to disciplinary sanctions
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consisting of permanent bar of union officers from membership or holding office).

And indeed, they have since run for and been elected to offices within Local 157.
To begin with, whether the Review Officers action was disciplinary is not
central to the appeal now before the Court. Whether the Review Officers action
was proper depends on his authority under paragraph 5.b of the 2010
stipulationwhich granted him the power to review those persons holding union
office, and further granted him the power to veto certain union actions (in the
governments and the district courts view, including the continued officeholding
of local union officers) if they met the criteria spelled out in the stipulation. That
question does not turn on whether or not the Review Officers action can be
characterized as disciplinary. The Review Officer, the government, and the
district court have stated (and the government continues to maintain) it was not
disciplinary as a means of explaining the consequences and scope of the Review
Officers action, and to distinguish it from the separate authority the Review
Officer has to bring union charges under paragraph 5.f of the 2010 stipulation. See
District Council, 2012 WL 5236577, at *6 n.5; Govts Br., No. 12-4883, at 32 n.9;
see also Nee, 573 F. Appx at 40-41 (suggesting that, on remand, district court may
wish to determine if there are differences between disciplinary actions and those
taken against Nee and Messinetti). In short, while the question of whether the
Review Officers action was disciplinary may be relevant to interpreting the 2010
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stipulation, it is not dispositiveand the allegations Nee and Messinetti now make
about the district courts views fall far short of establishing that they are likely to
succeed on the merits.
In any event, Nee and Messinettis theory holds no water. They seem to argue
that the district judge, at a September 30, 2014, conference to consider the newly
proposed 2014 stipulation, changed his view, and now believes that the vetoes of
Nees and Messinettis officeholding was disciplinary. At that conference, as
quoted by Nee and Messinetti, the district judge asked the parties for metrics by
which to judge the progress of the anticorruption measures that had been put in
place; the court suggested that the frequency with which the Review Officer
exercises the veto could serve as such a metric, and the fact that the Review
Officer had not utilized that power in the preceding year was encouraging. (R.
Doc. 1583, at 11-12). In doing so, the district judge referred to the vetoes as at
least some snapshot of some form of discipline. (Id.).
This comment cannot bear the weight Nee and Messinetti place on it. The
qualified commentsome snapshot of some form of disciplineis best, or at
least plausibly, read as referring not to discipline in the sense of punitive action,
but in the sense of adherence to rules and authority, see Am. Heritage Dict. of the
English Lang. (5th ed.)i.e., the district judge was saying that the lack of recent
vetoes showed that the union was in compliance with the law and the courts
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orders, rather than saying the lack of vetoes showed that no one was being
punished.
In sum, this passing comment by the district judgemade in an entirely
different context, with no direct reference to Nee or Messinetti or anyone similarly
situateddoes not demonstrate anything about the character of the particular veto
at issue, which is not dispositive of Nee and Messinettis claims in any event. Nee
and Messinetti have therefore showed no likelihood of success on the merits.
Nor can Nee and Messinetti establish likelihood of success based on their
contention that the District Council has no authority over the affairs of local
unions. (Mem. in Support of Injunction or Stay at 9-11). While the local unions are
not parties to this action eo nomine, the local unions have affiliated [themselves]
into an organization known as the District Council, and the District Council is
the central governing body over and shall have legislative and executive powers
on all matters relating to the general interest and welfare of affiliated Local Unions
and their members. District Council By-Laws at 1, 2 4.A; 2 see also
Constitution, United Bhd. of Carpenters & Joiners of America, 26.B
(empowering district councils to make applicable laws). More generally,
intermediate bodies such as the District Council supervise[] the local unions that
2

Available at http://www.nycdistrictcouncil.com/data/sites/1/pdf/NYC%
20DISTRICT%20COUNCIL%20BYLAW%20DRAFT%20AS%20OF%
20AUGUST%205%202011-1.pdf.
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constitute them, and the locals are subordinate to the councils. Harrington v.
Chao, 372 F.3d 52, 57 (1st Cir. 2004) (describing relationship of council and local
in United Brotherhood of Carpenters); see id. at 61 n.8 (noting commentators
view that the district councils of the Carpenters are the real governing and
bargaining bodies of the union). The 2010 and 2014 stipulations, the 1994
consent decree, and the 1990 complaint in this action all make clear that the local
unions that constitute the District Council are subject to the district courts
authority in this action, and neither the locals nor the District Council has ever
objected to that principle.
D. Nee and Messinetti Will Suffer No Injury Absent a Stay
Nee and Messinetti do not claim that they will suffer any injury if the 2014
stipulation remains in effect. Nor could they. Whether the Review Officers 2012
action was proper or improper, that question is unaffected by the entry of the 2014
stipulation, which simply extends and modifies the monitorship that has been in
place since 2010. Whatever consequences flow from the Review Officers 2012
action are also unaffected by the 2014 stipulation.
Nee and Messinetti suggest that they will be barred from running for elected
office (Mem. in Support of Injunction or Stay at 8)despite the undisputed fact
that they were not barred when they ran successfully for office after the Review
Officers veto of their continued tenures in their prior positions, and despite the
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lack of any change in the pertinent language between the 2010 and 2014
stipulations. In a prior version of the stipulationbut not in the version entered by
the district court in November 2014the parties had agreed that a person
previously vetoed by the Review Officer from holding office in a local union
would be presumptively prohibited from running for District Council office (but
not local-union office), but that the court-appointed officer could still permit such a
person to run if he found the person had been rehabilitated. This is not a bar to
running for anythingfirst of all, because it is not in the stipulation and order the
district court actually entered; second, because even as drafted it was merely a
presumption. In any event, Nee and Messinetti have incurred no injury from any
impediment that may exist to a candidacy for District Council office, as they have
never even alleged that they have any intention of running for District Council
office (as opposed to the local-union offices they have in fact successfully run for).
E. The Government and the Public Interest Will Be Harmed by a Stay
In contrast, the government and the public interest will be badly damaged by a
stay of the 2014 stipulation and order. That order, effectively a consent decree, is
entitled to significant deference from the courts, and should be permitted to remain
in place, as ordered by the district court. See SEC v. Citigroup Global Markets,
Inc., 752 F.3d 285, 293-98 (2d Cir. 2014).

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As described above, the stipulation and order keeps in place a system of

oversight by the district courtoversight that has achieved significant progress in
recent years in rooting out the corruption that has plagued the District Council for
decades. (R. Doc. 1522 (2014 memo of law explaining recent gains)). The parties
have agreed, and the district court has directed by the 2014 stipulation, that that
oversight continue in slightly modified form. There is no question that achieving
the objectives of that consent decreeeradicating the corruption within, and the
corrupt influences upon, the District Councilis a matter of paramount public
importance. To enter the stay requested by Nee and Messinetti would suspend the
operations of the district courts oversight through its appointed monitor, leaving
uncertainty and the possibility of re-opening the doors to the types of racketeers
who have deprived New York Citys carpenters of honest representation for so
long.

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Conclusion
The application for a stay should be denied.
Respectfully Submitted
PREET BHARARA
United States Attorney for the
Southern District of New York,
Attorney for Plaintiff-Appellee
/s/ Benjamin H. Torrance
BENJAMIN H. TORRANCE
Assistant United States Attorney
Telephone: (212) 637-2703
E-mail: benjamin.torrance@usdoj.gov

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UNITED STATES COURT OF APPEALS

FOR THE SECOND CIRCUIT
-------------------------------------------------- x
UNITED STATES v. DISTRICT
COUNCIL OF CARPENTERS
-------------------------------------------------- x

Dkt. No. 14-3506

I, Benjamin H. Torrance, an Assistant United States Attorney for the Southern

District of New York, hereby certify that on December 11, 2014, I caused a copy
of the Opposition to Motion for Stay to be served, by mail, upon Appellants
Patrick Nee and Levy Messinetti.
Dated:

New York, New York

December 11, 2014

/s/ Benjamin H. Torrance

Benjamin H. Torrance