The Teamsters union has filed a civil suit against ousted President Ron Carey and nine other individuals and groups.
The union alleges racketeering, embezzlement, breach of fiduciary duties and legal malpractice in what it calls "a wide-ranging plot to loot the union treasury in order to bolster the 1996 re-election campaign of disgraced former Teamster General President Ron Carey."
If successful, the union stands to recover more than $9 million.
"Honest hard-working men and women were cheated out of millions of dollars," declared Teamsters General Secretary-Treasurer C. Thomas Keegel. "I'm determined to see them repaid."
The lawsuit was filed this week in the U.S. District Court for Manhattan. It includes counts filed under the Racketeer-Influenced and Corrupt Organizations (RICO) Act. Named in the lawsuit along with Carey are: former IBT Government Affairs Director William Hamilton, who was recently convicted on criminal charges for his part in the election scandal, and Carey campaign consultants Martin Davis, Jere Nash and Michael Ansara, who have already pleaded guilty to criminal charges for their roles in the scheme. Also named are Barbara Arnold (Ansara's wife), fundraiser Charles Blitz, Citizen Action (a non-profit advocacy group which participated in the Carey campaign's machinations), and two of Citizen Action's officers, Ira Arlook and Rochelle Davis.
A final group of defendants includes the law firm of Cohen, Weiss and Simon and its former associate, Nathaniel Charny. Charny and his former employers stand accused of legal malpractice for taking actions directly adverse to the interests of the IBT and its members while simultaneously representing the union and the Carey campaign.
The suit contends that the defendants defrauded the IBT of at least $885,000 in a complicated scheme where union funds were swapped with advocacy groups in exchange for contributions to Carey's campaign. When the scheme was uncovered, the Teamsters' 1996 election was overturned.
A new election had to be held in 1998, at a cost to the IBT of $2.2 million. The RICO Act provides for tripling of damages against defendants convicted under its provisions.
"These individuals and groups participated in and profited from the biggest embezzlement scheme in our union's history," said Keegel. "We have a fiduciary responsibility to make them accountable for their illegal acts."