(b) The Trusteeship Hearing: Evidence presented at the CLDC trusteeship hearing demonstrated that no less than 14 members and associates of organized crime in Chicago have at various times served as officers of or delegates to the CLDC and/or as trustees, officers or employees of the CLDC affiliated employee benefit funds. In addition, at least 11 other individuals who are close relatives of Chicago organized crime members or associates were then serving or had previously served as officers of or delegates to the CLDC and/or as trustees, officers or

60


employees of the CLDC affiliated employee benefit funds.
(c) Pilotto and Caporale: Co-conspirator Alfred Pilotto, a made member of the Chicago LCN and boss of the Chicago Heights crew, served as vice-president of the CLDC and a trustee of an affiliated fund until 1982 when he resigned following his conviction for participating in a conspiracy to loot millions of dollars from the affiliated welfare fund on which he served as a trustee. James Caporale, an associate of the Chicago LCN, served as business manager and secretary-treasurer of the CLDC and as a trustee to two affiliated funds until 1987 when, after a lengthy appeal process, he was incarcerated for participating in a conspiracy together with coconspirator Alfred Pilotto and others to loot millions of dollars from the affiliated welfare fund on which he also served as a trustee. Caporale was replaced as business manager by then CLDC President Ernest Kumerow, the son-in-law of co-conspirator Anthony Accardo, the boss of the Chicago LCN family, and as secretary treasurer by Joseph Lombardo, Jr., the son of co-conspirator and Chicago LCN capo Joseph A. Lombardo, Sr. Caporale's son-in-law, Vincent

61

DiVarco, the son of Joe "Ceasar" DiVarco, a convicted felon and member of the Chicago LCN North Side crew, until recently served as a delegate to the CLDC from Local 2. In addition, Joe Gilloran, the step son of Vince DiVarco and grandson of Caporale, has been employed as a field representative for the CLDC employee benefit funds since 1990.
(d) The Palermos*. Dominick Palermo, a high level member or associate of the Chicago Heights crew under co-conspirator Alfred Pilotto and business agent for Local 5, and Frank DeMonte, a made member of the Chicago LCN and an officer in Local 1, served as delegates to the CLDC. In addition, positions with the CLDC or its affiliated funds were held at various times by Chicago LCN members or associates including Dominick DiMaggio, a nephew of Chicago Outfit boss Sam Carlisi, Salvatore Gruttadauro, Joseph Mazza, Nicholas Guzzino and Michael Palermo, the brother of Dominick Palermo and son-in-law of former Chicago Outfit boss Anthony Accardo.

b. Cronyism and Nepotism in the CLDC: one objective of the LCN in perpetuating its control of labor organizations is to ensure that its members, associates and relatives have ostensibly legitimate employment, either as a source
62

of actual income or as a cover for work done on behalf of the LCN. More importantly, however, nepotism and cronyism in the selection of officials and the hiring of employees ensures that "cooperative" individuals are in positions of authority to make hiring, promotion and operational decisions of benefit to the LCN. The creation and continuation of such "divided loyalties" is essential to maintaining and perpetuating the illicit control of a labor organization by the LCN. As recognized by the court in United States v. International Brotherhood of Teamstezs, Chauffeurs, Warehousemen & Helpers, 792 F. Supp. 1346, 1353 (S.D.N.Y.), aff1d, 981 F-2d 1362 (2d Cir. 1992): "In any given situation, an officer with ties to LCN will be tempted to place the interests of organized crime ahead of the welfare of the general membership." The following examples illustrate the use of nepotism and cronyism to achieve those objectives in the CLDC:
(1) The Kumerows: Ernest Kumerow is a past president and business manager of the Chicago Laborers District Council and, until his retirement in 1994, was the president and business manager of LIUNA Local 1001, the County and Municipal Employees', Supervisors' and Foremen's Union, which represents the city of Chicago Streets and Sanitation waste collectors, asphalt workers and other laborers. Kumerow is the son-in-law of co-conspirator and late Chicago LCN boss, Anthony
63

Joseph Accardo. Craig Kumerow, the son of Ernest Kumerow and the grandson of co-conspirator Anthony Joseph Accardo, is a field representative for Local 1001 and has served as a delegate to the CLDC since 1989. Michael Palermo, another son-in-law of coconspirator Anthony Accardo, is the vice-president of Local 1001 and has served as a delegate to the CLDC since 1984. Gorton Lund, who recently retired as supervisor of field representatives of the CLDC employee benefit funds, is Ernest Kumerow's brother in-law.
(2) Joseph A. Lombardo, Jr.: Joseph A. Lombardo, Jr., the son of co-conspirator Joseph A. Lombardo Sr., a capo in the Chicago Outfit, was the pre-trusteeship secretary-treasurer of the Chicago Laborers District Council and a trustee of four funds affiliated with the CLDC. Lombardo, Jr. also served as a business agent for the CLDC from at least 1983 until his appointment as CLDC secretary-treasurer in 1987, succeeding James Caporale, who went to prison. Lombardo's "election" to succeed Caporale was unanimous even though he was ineligible to hold the position since he was not then a delegate to the CLDC as required by Article VI of the Uniform District Council Constitution. Since the imposition of the CLDC trusteeship, Lombardo has been elected unopposed

64

to the position of vice president and CLDC delegate from Local 1, even though he again may have been ineligible to hold such office under Article V, section 4 of the LIUNA Uniform Local Union Constitution.
(3) The Carusos: As referred to above, the Caruso family has a long tradition of mixing CLDC employment with Mob ties. Both of former Chicago LCN capo Frank "Skids" Caruso's sons, Bruno and Frank "Toots" Caruso, have held important officer positions with the CLDC and its affiliated employee benefit funds as well as with Locals 1001 and 1006. The cousin of Bruno and Frank, Leo Caruso, an officer of Local 1006, took the place of Frank Caruso as CLDC sergeant-at-arms when "Toots" needed to escape the limelight of the CLDC for the safety of an administrative position on the CLDC pension fund. Another cousin of Bruno's and Frank's, Nicholas Gironda, has been a CLDC delegate since 1993. and has held positions at Local 1001 for many years. (4) John "Pudgy" Matassa: As referred to above, another cousin of the Carusos', John "Pudgy" Matassa, served as the vice president of the CLDC and president/business manager of Local 2. Matassa's father-in-law, Maurice "Moll Tallon was employed from 1991 until his recent retirement on July 1, 1999, as

65


a field representatives for the CLDC employee benefit funds.
(5) The Solanos; In 1987, co-conspirator Vincent Solano, a capo in the Chicago LCN family and long-time president and business agent of LIUNA Local 1, used his influence to establish the Construction and General Laborers' District Council of Chicago and vicinity Training Fund and to appoint his son Anthony Solano as administrator of the Chicago Laborers' Training Center in Carol Stream, Illinois. At the time of his son's appointment by the Training Fund trustees, Vincent Solano had been publicly identified by the President's Commission on organized Crime as a territorial boss of the Chicago Outfit and as the man who ordered the ill-fated murder attempt on organized crime associate Ken Eto.

(6) The DiMaggios: Nicholas DiMaggio, referred to in sub-paragraph c. (1)) of this paragraph below, was, at the time of his death in October 1994, the chief instructor of the Chicago Laborers' District Council Training Center, Carol Stream, Illinois, and a former business agent and vice president of Chicago Local 225. DiMaggio's chief assistant at the training center was his brother-in-law, Tony Hocin, who held that position until his death in January 1993. Dominick DiMaggio, Nicholas' brother, served as vice

66

president of LIUNA Local 2 and a delegate to the CLDC until the recent imposition of an emergency trusteeship over Local 2. DiMaggio was initially employed as a field representative for Local 2 in 1990 on the recommendation of business manager John Matassa and officials of the CLDC. The DiMaggios are the nephews of co-conspirator Samuel Carlisi, who was the boss of the Chicago LCN family at the time the Dimaggios obtained their various positions with the CLDC and its affiliated local unions and funds.
(7) Vincent DiVarco: Vincent DiVarco was a CLDC delegate and recording secretary of Local 2 until the recent imposition of an emergency trusteeship over Local 2. He also held the position of business representative of Local 2 during 1988 and 1989. Vincent DiVarco is the son of convicted felon Joe "Cesar" DiVarco, a crew boss under Vincent Solano in the 1970s and 1980s. Vincent DiVarco is also the son in-law of LCN associate and former Chicago Laborers' District Council official James Caporale. In addition, DiVarco's step son, Joe Gilloran, has been employed as a field representative for the CLDC employee benefit funds since 1990.

(8) John Galioto: John Galioto was the business manager for Local 225 and a delegate to the CLDC between 1995 and 1998, when he was removed from his

67

position by virtue of a trusteeship imposed upon Local 225 in March 1998. (See Exhibit 1) . Internal disciplinary charges were subsequently brought against Galioto charging a number of violations including embezzlement of union funds, which resulted in Galioto agreeing to permanently terminate his membership rights in LIUNA. He is the nephew of co-conspirator James Marcello who served as an underboss in the Chicago outfit reporting to then Mob boss Sam Carlisi. (9) The Foscos: Prior to becoming General President of LIUNA, co-conspirator Angelo Fosco had been an International vice president and the regional manager of the Chicago Regional Office of LIUNA. In 1975, Angelo Fosco was succeeded as Chicago regional manager by his son, Peter J. Fosco, who occupied this office from 1975 to 1985, when he resigned. He was later appointed by his father to be the regional manager for the New Orleans Region. Peter J. Fosco was succeeded as regional manager for the Chicago Region by Joseph Mazza, Angelo Fosco's chauffeur, who was controlled with respect to his LIUNA duties by co-conspirator Vincent Solano, a capo in the Chicago LCN family. In 1993, Joseph Mazza was named to be assistant director of the Hazardous Waste Division of LIUNA. He was replaced as regional manager for the Chicago Region of LIUNA by Terrence Healy, the son-in-law of Angelo
68

Fosco, who previously had been the assistant regional manager. Angelo Fosco's stepson, Bruce Monaco is a LIUNA international representative and his grandson Peter A. Fosco also holds a position with LIUNA. Peter J. Fosco, now an International vice president and regional manager of the South Central Region, is currently charged under the LIUNA Ethics and Disciplinary Code with financial misconduct, breach of fiduciary duty and obstruction of the reform process.
c;. Appointment and Retention of Corrupt Individuals to Control the CLDC: Persons with known criminal histories or organized crime ties have repeatedly been appointed to union offices and union employment and corrupt officials have been allowed to remain in office, as is illustrated by the following examples:
(1) Nicholas DiMaggio: In 1986, in the case of United States v. Nicholas Dimaggio, No. Cr. 85-00067 01, in the United States District Court for the Western District of New York, Nicholas DiMaggio, then training director of LIUNA Local 210 in Buffalo, New York, was convicted of willfully subscribing false income tax returns, in violation of Title 26, United States Code, Section 7206(l). On August 25, 1986, DiMaggio was sentenced to serve one year and one day in prison, with the sentence suspended and the

69

defendant placed on probation for one year. After moving to Chicago, Illinois, DiMaggio, a nephew of then Chicago organized crime boss Sam Carlisi, was hired as a business agent of LIUNA Local 225 and, until his death in October 1994, was the chief instructor at the Chicago Laborers' District Council Training Center, Carol Stream, Illinois. Nicholas Dimaggio also is the nephew of Roy Carlisi, a former capo of the Buffalo family of the LCN.
(2) Francis J. DeMonte: In 1982, the late Francis J. DeMonte, also known as "Babe," then an assistant business agent of LIUNA Local 1 in Chicago, Illinois and an associate of the Chicago LCN family, was incarcerated for contempt of court for failing to respond to questions concerning gambling and loan sharking activities before a special grand jury empanelled in the United States District Court for the Northern District of Illinois. Co-conspirator Vincent Solano, then president of LIUNA Local 1, permitted DeMonte to retain his position in Local 1. Following his release from custody upon the expiration of the grand jury in March 1983, DeMonte assumed the positions of recording secretary for Local I and delegate to the CLDC, which he held until his death in 1992. DeMonte also served as a LIUNA special international representative. DeMonte held these

70

positions despite his indictment in December 1963, along with Joseph "Caesar" DiVarco, a high-ranking Chicago LCN family member and a close associate of coconspirator, Vincent Solano, and John Matassa, Jr., the pre-trusteeship president of LIUNA Local 2 and vice president of the Chicago Laborers' District Council, for extortion and conspiracy to extort monthly "protection" payments from near north side Chicago bar and lounge owners and his public identification in both a 1983 Senate Subcommittee Report and the 1995 PCOC Report as a member of the North Side Crew of the Chicago Outfit. (3) James Caporale and Alfred Pilotto: In 1982, in the case of United States v. Anthony Accardo, et al., No. 81-230 CR-JWK, in the United States District Court for the Southern District of Florida, James Caporale, secretary-treasurer of the LIUNA Chicago District council, a special international representative of LIUNA, and an associate of the Chicago LCN family, was convicted with Chicago Outfit capo Alfred Pilotto of RICO conspiracy and receiving welfare plan kickbacks, in violation of Title 18, United States Code, Sections 1954, 1962(d), and 1963. On September 14, 1982, Caporale was sentenced to serve twelve years in prison. Caporale's conviction was affirmed in United States v. Caporale, 806 F.2d 1487 (11th Cir. 1986),
71



cert. denied, 483 U.S. 1021 (1987). After being convicted, Caporale was permitted to retain his position as secretary-treasurer of the CLDC and was further appointed as business manager, positions he held until 1987, when he entered prison. Caporale was replaced as CLDC business manager on his own recommendation by Ernest Kumerow, the son-in-law of Chicago outfit boss Anthony Accardo, and as secretary treasurer by Joseph A. Lombardo, Jr., the son of Chicago LCN family capo, Joseph A. Lombardo, Sr.
d. Lack of Democratic Practices: The Chicago Outfit has been able to control the Chicago Laborers' District Council on many levels. Over at least the past 25 years, the significant leadership positions in the CLDC have been held exclusively by delegates from only six of the 21 local unions within the CLDC. As demonstrated in paragraphs 17 and 21 above, each of these CLDC officials have had discernible ties to organized crime in Chicago. Significantly, over this time period there has never been a contested election for any of these leadership positions. Instead, the principal offices of the CLDC have been held by and transferred to members or associates of organized crime or their close relatives through uncontested nominations and unanimous appointments. These transfers of power are clearly illustrated in the CLDC time line chart and events listing submitted by the GEB Attorney during the
72
course of the trusteeship hearings, copies of which are attached as Exhibit L and incorporated by reference herein. Retirements or other departures from the CLDC Executive Board have occurred only mid-term in the election cycle, thereby enabling a series of LCN-dominated executive boards to appoint replacement officers "acceptable" to organized crime. These practices were never challenged by the other members of the CLDC Executive Board or by any of the CLDC delegates despite their constitutional authority and responsibility to do so. This pattern of abuse coupled with the longstanding failure of CLDC officers and delegates to address allegations of organized crime domination of the CLDC, its constituent locals and affiliated funds has enabled the Chicago LCN family to maintain a virtual stranglehold on the CLDC and its affiliated funds for almost three decades. The following examples, among others, illustrate the pattern of undemocratic practices within the CLDC:
(1) Appointment of Ernest Kumerow (1982): On June On June 31,1981, co-conspirator Anthony Accardo, then the boss of the Chicago LCN family, was indicted along with CLDC officials James Caporale and co-conspirator Alfred Pilotto and others for RICO conspiracy involving the looting of millions of dollars in illegal kickbacks from the CLDC's welfare fund, a portion of which was alleged to have been received by Accardo as payment
73

for supporting the kickback scheme. While this indictment was pending, Anthony Accardo' s son-in-law, Ernest Kumerow, was unanimously appointed, between elections, as both president of the CLDC and as a trustee of the CLDC's welfare fund, the very fund that was the subject of the indictment, to replace Joseph Spingola, who previously had been placed in office due to the intervention of Anthony Accardo.
(2) Retention and Promotion of James Caporale(1982): On June 29, 1982, CLDC secretary-treasurer James Caporale was convicted along with co-conspirator Alfred Pilotto and others of looting millions of dollars in illegal kickbacks from the CLDC's welfare fund. Despite an order by the trial court forfeiting Caporale's union offices, the CLDC unanimously promoted Caporale to the position of business manager, replacing the retiring Joseph Spingola, who himself had been appointed in the late 1960's to fill a CLDC vacancy on the instructions of then Chicago LCN boss Anthony Accardo, and permitted him to retain the position of secretary-treasurer of the CLDC, offices he held until his incarceration in 1987.

(3) Appointment of Frank Caruso (1982): On On December 161 1982, Frank Caruso was indicted on charges that he participated in the collection of an extortionate extension of credit or "juice loan" made by the

74

Chicago LCN. Caruso was identified in the indictment as a member of organized crime. While under indictment on the charges, Frank Caruso was unanimously selected by the delegates to be the sergeant-at-arms of the CLDC, a position that he held until April 1995, when he resigned rather than be deposed by LIUNA's internal reform officers.
(4) Operation of the CLDC (1983-1987): From 1983 to 1987, delegates and officers of the CLDC, including Bruno Caruso, Frank Caruso, John Matassa, Jr. and Ernest Kumerow, permitted James Caporale to retain the offices of business manager and secretary-treasurer, the CLDC's top two elected positions, and collect over $500,000 in salary despite his felon conviction for conspiring to loot the CLDC's welfare fund on which he had served as a trustee. During this period, Caporale participated in the selection and appointment of a number of high ranking CLDC officials with ties to organized crime, including Chicago LCN member Frank Caruso as CLDC sergeant-at-arms and Dominick DiMaggio, the nephew of co-conspirator Sam Carlisi, as a CLDC field representative. In addition, in 1987, shortly before his incarceration on his 1982 RICO conspiracy conviction, Caporale resigned his positions with the CLDC and orchestrated the selection of his successors to the CLDC's top two elected offices. At a special

75

executive board meeting, Caporale, exercising the historical prerogative of the business manager to name his successor, sought the appointment of Ernest Kumerow, the son-in-law of Chicago LCN boss Anthony Accardo, as business manager, which was unanimously approved by the executive board. Kumerow, in turn, then made a motion to appoint Joseph Lombardo, Jr., the son of convicted Chicago LCN street crew boss Joseph Lombardo, Sr., as secretary-treasurer, who despite being ineligible to hold this position, was unanimously approved by the CLDC executive board. Kumerow ultimately served as a trustee on three of the affiliated funds and Lombardo, Jr. served as a trustee on four of the affiliated funds.

(5) Transfer of Coordinator Of Committees Position (1992-1997): The position of "Coordinator of Committees' of the CLDC by tradition has been a designated organized crime position which over the years has been transferred from one member of the Chicago Outfit to another. Co-conspirator Vincent Solano, street boss of the North Side crew, held this position from at least 1972 until his death in 1992. Solano was succeeded as coordinator of committees by John Matassa, Jr., a made member of the Chicago LCN fami1y who replaced Solano as a street boss for the North side crew. In 1994, when Matassa was appointed


76

to the position of vice-president of the CLDC, he resigned as coordinator of committees and was replaced by James DiForti, another member of the Chicago LCN, who was later forced to resign from this position in July 1997 following his indictment for an organized crime related murder. Following the resignation of James DiForti, the CLDC, through secretary-treasurer Joseph Lombardo Jr., sought to have DiForti replaced in this position with Frank Colianni, a long-time Local 1 official and close associate of former Local 1 business manager /president and Chicago LCN street crew boss Vincent Solano. In view of Colianni's background, LIUNA's GEB Attorney refused to approve this appointment on the grounds that it would be inconsistent with the purposes of the Ethics and Disciplinary Procedure and the Ethical Practices Code.
(6) Appointment of John Matassa, Jr. (1992-1994): During John Matassa's ascension in the Chicago LCN family leadership following the death of coconspirator Vincent Solano Matassa was unanimously appointed to fill vacancies in the following positions in the CLDC: CLDC coordinator of committees; CLDC vice-president; and trustee of the CLDC's affiliated pension fund, political league and training fund.

(7) Appointment of Bruno Caruso (1994): In August 1994, Ernest Kumerow's nomination to continue as
77

president and business manager of the CLDC was uncontested and he was unanimously approved for another f our year term. However, approximately one month into his new tern of office, Kumerow retired. This resignation coincided with the death of his father-in-law Anthony Accardo. Kumerow thereafter nominated Chicago LCN associate Bruno Caruso to succeed him as president and business manager of the CLDC, and Caruso was then unanimously appointed outside the election process to hold those offices for the balance of the four year term. After taking office as CLDC president and business manager, Bruno Caruso also was unanimously appointed as a trustee to both the CLDC welfare fund and the Laborers I political league.
(8) Resignation of Frank Caruso and Appointment of Leo Caruso (1995): In 1995, Frank Caruso, the son of former Chicago LCN capo Frank "Skids" Caruso and himself a member of the 26th Street crew of the Chicago LCN, "retired" from his positions as president and business manager of Local 1006, CLDC delegate and sergeant-at-arms and trustee of the CLDC pension f und, the day following his receipt of notice from the LIUNA GEB Attorney to take his sworn deposition concerning his affiliation with organized crime in Chicago. Caruso, however, retained his position as a paid

78
employee of the affiliated pension fund and held that position for an extended period of tine despite repeated efforts by the GEB Attorney to convince the trustees of that fund to remove him. Frank Caruso's cousin, Leo Caruso, identified during the CLDC trusteeship hearings as an associate of the 26th Street crew, took over Frank Caruso's positions at Local 1006 and was unanimously appointed by the CLDC to replace Frank Caruso as sergeant-at-arms and as a trustee of the CLDC's affiliated pension fund.
(9) Pre-Scripted Minutes of CLDC Meetings: As demonstrated at the CLDC trusteeship hearings, minutes of CLDC meetings often have been prepared in advance of scheduled meetings. CLDC order at 79. These "prescripted" minutes contain the substance of motions with blanks left for the names of the individuals purportedly making these motions, along with the notation that the motions passed unanimously. For example, minutes of the special meeting of the CLDC held on October 5, 1995, to consider a severance package for departing CLDC president and business manager Ernest Kumerow reflect that the motion to ratify and approve the executive board's recommendation of this favorable severance package was passed by "unanimous vote of the entire body" of delegates, despite the fact that the minutes were

79
prepared at least two days before this meeting. Such a procedure offers a clear illustration the lack of true, open democracy within the CLDC.
(10) Improper Appointment of Trustees to CLDC Affiliated Funds: under the governing trust agreements of the various affiliated funds, the CLDC appoints the employee side trustees to each of the affiliated funds. The following individuals with organized crime affiliations at various times have been unanimously placed in trustee positions by the organized crime dominated CLDC: Chicago LCN members Alfred Pilotto, John Matassa, Jr. and Frank Caruso; Chicago LCN associates James Caporale, Bruno Caruso and Leo Caruso; and Ernest Kumerow and Joseph Lombardo, Jr., close relatives of high-level Chicago organized crime figures. Such unanimous appointments gave these individuals significant control over the $1.5 billion CLDC affiliated benefit funds.

(11) Absence of Discussion or Dissent: Testimony presented by the CLDC at the trusteeship hearing clearly established the total lack of discussion about organized crime infiltration of or influence over the CLDC and its officials at any CLDC meeting or during any CLDC election. Not one of the CLDC witnesses presented could recall even a single discussion over the prior 25 years about possible organized influence

80

over the CLDC or its constituent locals or affiliated benefit funds despite: public reports by two Senate Subcommittees and the President's Commission on Organized crime exposing direct connections between CLDC officials and the Chicago LCN family; no less than ten indictments of delegates or officers of the CLDC; the conviction of two high level CLDC officials and affiliated fund trustees for participating in an organized crime related kickback scheme to loot millions of dollars from the CLDC's welfare fund; and widespread media reporting of organized crime activity in the Chicago area alleging direct links between Chicago organized crime members and CLDC officials. CLDC Order at 73-74. The complete lack of discussion, challenge or dissent by any of the CLDC' s officers and delegates in the face of these widespread allegations of organized crime influence over the CLDC and its constituent locals and affiliated funds clearly demonstrates the incredible chilling effect the presence of organized crime has had over CLDC delegates and the complete lack of democratic opportunity which existed within the Chicago Laborers District Council.
X
FIRST CLAIM FOR RELIEF:
CONSPIRACY TO VIOLATE 18 U.S.C. S 1962(b)

81
IN VIOLATION OF 18 U.S.C. q 1962(d)
25. Paragraphs 1 through 23 above are repeated, realleged and incorporated by reference as if fully set forth herein,

26. Conspiracy to Acquire and Maintain Control of CLDC: From at least the mid-1970 ' s, and continuing up to and including the date of the filing of this complaint, in the Northern District of Illinois and elsewhere, defendant herein, the Chicago District Council, by and through its officers, members, agents and representatives, did unlawfully, knowingly and intentionally combine, conspire, confederate and agree together with the coconspirators identified in paragraph 21 above, and with others, including members and associates of the LCN, whose names are both known and unknown, to commit an offense against the United States, to Witt to violate Title 18, United States Code, Section 1962(b), that is, to acquire and maintain, directly and indirectly, an interest in and control of the Chicago Laborers' District Council Enterprise as defined in paragraph 27 below, which was engaged in and the activities of which affected interstate and foreign commerce, through a pattern of racketeering activity, as that term is defined in Title 18, United States Code, Section 1961, said pattern of racketeering activity consisting of multiple acts indictable under Title 18, United States Code, Section 1951 involving Hobbs Act extortion, that is, wrongfully obstructing and attempting to obstruct, delay and affect commerce, as that term is defined by Title 18, United States Code, Section 1951(b)(3), and the movement of articles and commodities in commerce, by extortion,

82

as that term is defined in Title is, United States Code, Section 1951 (b) (2) , and conspiracy to do so, in violation of Title is, United States Code, Sections 1951.


27. The Chicago Laborers' District Council Enterprise: At all times material to this complaint, the Chicago Laborers District council, and its constituent local unions and affiliated employee benefit funds, collectively, have constituted an "enterprise," as that term is defined in Title 18, United States Code, Section 1961(4), that is, a group of individuals associated in fact, which enterprise was engaged in, and the activities of which affected, interstate and foreign commerce. The enterprise has been, and continues to be, a captive labor organization which has been continuously and systematically controlled, exploited, and dominated in the conduct of its affairs by the LCN and its members and associates in the manner and means which are described herein.

28. Manner and Means: Paragraph 24 above is incorporated by reference and realleged as if fully set forth herein.

29. It was part of the conspiracy that the defendant, the Chicago Laborers' District Council, by and through its officers, members, agents and representatives, together with the coconspirators identified in paragraph 21 above, and with others known and unknown, each agreed to acquire and maintain, directly and indirectly, an interest in and control of the Chicago Laborers, District Council enterprise's affairs through the commission of multiple acts of racketeering.
83

30. It was further part of the conspiracy that the defendant, the Chicago Laborers' District Council, by and through its officers, members, agents and representatives, together with the co-conspirators identified in paragraph 21 above, and with others known and unknown would obtain and attempt and conspire to obtain property from the delegates of the Chicago Laborers' District Council and the membership of its twenty-one constituent local unions, said property consisting of the right of union members to free speech and democratic participation in internal union affairs, as guaranteed by the Labor Management Reporting and Disclosure Act, as amended, Title 29, United States Code, Section 411.

31. It was further part of the conspiracy that the defendant, the Chicago Laborers' District Council, by and through its officers, members, agents and representatives, together with the co-conspirators identified in paragraph 21 above, and with others known and unknown would obtain and attempt and conspire to obtain property from the delegates of the Chicago Laborers' District Council and the membership of its twenty-one constituent local unions, said property consisting of the right of union members to be candidates for and to hold union office and to support the candidate or candidates of their choice as guaranteed by Title 29, United States Code, Section 481(e).

32. It was further part of the conspiracy that the defendant, the Chicago Laborers' District Council, by and through its officers, members, agents and representatives, together with the co-conspirators. identified in paragraph 21 above, and with others
84

known and unknown would obtain and attempt and conspire to obtain property from the delegates of the Chicago laborers' District Council and the membership of its twenty-one constituent local unions, said property consisting of the right of union members to loyal and faithful representation by their union officers, agents, shop stewards and other representatives, as guaranteed by Title 29, United States Code, Section 501(a).

33. It was further part of the conspiracy that the defendant, the Chicago Laborers' District Council, by and through its officers, members, agents and representatives, together with the co-conspirators identified in paragraph 21 above, and with others known and unknown would obtain and attempt and conspire to obtain property from the delegates of the Chicago Laborers' District Council and the membership of its twenty-one constituent local unions, said property consisting of the right of union members as participants in the various employee welfare benefit and pension benefit plans affiliated with LIUNA to loyal and responsible representation by the fiduciaries of such employee welfare benefit plans and pension benefit plans, as guaranteed by the Employee Retirement Income Security Act of 1974, as amended, Title 29, United States Code, Sections 1104 and 1106.

34. It was further part of the conspiracy that the defendant, the Chicago Laborers' District Council, by and through its officers, members, agents and representatives, together with the co-conspirators identified in paragraph 21 above, and with others known and unknown employed the wrongful use of actual and

85

threatened force, violence and fear of physical and economic injury in order to create a climate of intimidation and fear within the enterprise to induce, and to attempt and conspire to induce, the members of the CLDC and the rank and file members of the CLDC's constituent local unions to consent to the surrender of property as described above by various means including, but not limited to, the allegations set forth in paragraphs 23 and 24 above, which are incorporated by reference and realleged as if fully set forth herein.

35 . It was further part of the conspiracy that the defendant, the Chicago Laborers' District Council, by and through its officers, members, agents, and representatives, together with the co-conspirators identified in paragraph 21 above, and with others known and unknown did misrepresent, conceal, and hide, and cause to be misrepresented, concealed, and hidden, acts done in furtherance of the conspiracy and the purpose of those acts.

36. It was further part of the conspiracy that the defendant Chicago Laborers' District Council, by and through its officers, members, agents and representatives, together with the coconspirators identified in paragraph 21 above, and with others known and unknown, agreed that a conspirator would acquire and maintain, directly or indirectly, an interest in and control of the enterprise through the commission of at least two acts of racketeering.
37. Overt Acts: In furtherance of the conspiracy and to effect the objects thereof, the following overt acts, among others,
86


were committed by the co-conspirators. within the Northern District of Illinois and elsewhere
a. From at least the mid-1970's through the imposition of the trusteeship in February 1999, not a single contested election of officers of the CLDC was held. All principal offices of the CLDC have been held either by members or associates of the Chicago outfit or their relatives. No vacancy has ever occurred at the end of a candidate's term; all vacancies occur by resignation immediately before each scheduled election, and the vacancies are then filed by a unanimous vote of the Executive Board. CLDC Order at 73.

b. During this same time period, no opposition candidate has ever been nominated to run against an incumbent officer of the CLDC. Nor has any process been established by which a delegate to the CLDC could bring himself to the attention of the Executive Board as a potential candidate for a vacancy on the Board, even though the Executive Board has filed approximately 20 vacancies over the last 20 years. Id. at 73-74.

c. On or about February 11, 1982, Joseph Spingola resigned as pres i dent/ secretary-treasurer of the CLDC. Spingola, who in the late 1960's had himself been selected by the LCN to fill the vacant CLDC offices of president and secretary-treasurer on the "instructions" of then Chicago Outfit boss Anthony Accardo, "recommended" that Ernest Kumerow, the son-in-law of Anthony Accardo, be appointed president and James Caporale, who at that time was under indictment for allegedly participating in a scheme
87

with Acrcardo and others to defraud the CLDC health and welfare fund, be appointed business manager in addition to the position of secretary-treasurer which he already held. The Executive Board voted unanimously to appoint Caporale and Kumerow as recommended by Spingola. Id. at 74-75.
d. On or about February 22, 1982, Spingola also resigned his position as trustee on the CLDC employee benefit funds and was replaced as trustee by Ernest Kumerow, the son-in-law of Chicago Outfit boss Anthony Accardo. _Id.
e. On or about October 5, 1982, following Caporale's conviction and sentencing for RICO conspiracy for looting over $2 million from the CLDC health and welfare fund, the CLDC, in defiance of an order by the sentencing court forfeiting all of his union positions, promptly and unanimously reappointed Caporale by a "standing vote of applause', as secretary-treasurer and business manager of the CLDC, positions which he held unchallenged until July 1987, when he was incarcerated after his 1982 conviction was upheld by the appellate court. Id.
f. On or about August 3, 1983, the regularly scheduled CLDC elections were held. The nominations of all current officers, including Business Manager James Caporale and President Ernest Kumerow who had replaced the retiring Joseph Spingola in February 1982 as well as Joseph Neroni (Local 5) who had replaced Alfred Pilotto (Local 5) as vice president following Pilotto's racketeering conviction in 1982, were uncontested and all officers retained their previously held positions.
88
g. In approximately the summer of 1986, an election of CLDC officers was inexplicably held a year earlier than the scheduled August 1987 elections. Among others, James Caporale, whose appeal from his RICO conspiracy conviction was still pending, was re-elected as business manager / secretary-treasurer. _Td. at 76.
h. On or about December 31, 1986, the appellate court affirmed Caporale's RICO conspiracy conviction. No action was taken by the CLDC Executive Board at that time to remove Caporale from office. Id. at 77.
I . On or about July 22, 1987, following the United States Supreme Court's denial of Caporale's petition for certiorari, Caporale resigned his CLDC offices and moved the Executive Board to appoint Ernest Kumerow, the son-in-law of Anthony Accardo, as his successor as business manager, which passed unanimously. Kumerow then moved to appoint Joseph Lombardo, Jr., the son of coconspirator and Chicago Outfit street boss, Joseph Lombardo, Sr., as secretary-treasurer surer. This motion also passed unanimously, even though Lombardo was not a delegate to the district council at that time as required by Uniform District Council Constitution and therefore not qualified to hold this or any other elected position. That same day, the CLDC unanimously accepted the Executive Board's appointments. Id.
j. The regularly scheduled August 3, 1987, CLDC elections did not occur having purportedly taken place one year previously during which all current officers, including Business Manager/
89

Secretary-Treasurer James Caporale, were nominated and retained without opposition.
k. On or about August 15, 1990, the regularly scheduled CLDC elections were held. Again, the nominations of all current officers were uncontested and all officers retained their previously held positions, including President/ Business Manager Ernest Kumerow and Secretary-Treasurer Joseph Lombardo, Jr., who had replaced the incarcerated James Caporale.
1. In or about November 1992, Chicago Outfit capo Vincent Solano died, leaving vacancies in the positions of trustee to the CLDC pension fund and coordinator of the committees. On November 18J. 1992, the Executive Board voted unanimously to appoint John "Pudgy" Matassa, Jr. , who replaced Solano as boss of the North Side crew, to both of these positions. Id. at 78.
m. On or about March 9, 1994, Matassa resigned his position as coordinator of committees and thereafter on March 16, 1994, following the resignation of Joseph Neroni, on the nomination of Joseph Lombardo, Jr., was appointed vice president of the CLDC. At the same time, the Executive Board also approved the appointment of co-conspirator and Chicago Outfit member or associate James DiForti as coordinator of committees replacing Matassa. Td.
n. on or about August 17, 1994, the regularly scheduled CLDC elections were held. The nominations of all current officers, including John Matassa, Jr., who had recently replaced the retiring Joseph Neroni as vice president, were uncontested and all officers retained their previously held positions.
90

o. On or about September 27, 1994, Ernest Kumerow, following the death of his father-in-law, Chicago Outfit boss Anthony Accardo, and approximately one month after being reelected, resigned as president/business manager of the CLDC and trustee of the health and welfare fund and the Executive Board, based on the "recommendation" of Kumerow, appointed co-conspirator Bruno Caruso to replace Kumerow in all of these positions. Id.
p. On or about October 1, 1994, co-conspirator Frank "Toots" Caruso resigned as trustee of the pension fund and was replaced by his cousin and co-conspirator Leo Caruso. Id.
q. On or about October 18, 1994, Bruno Caruso resigned as trustee of the CLDC Training Fund and the Executive Board thereafter appointed John Matassa, Jr. as his replacement. Td. at 79.
r. On April 10, 1995, Frank Caruso was served with a notice of deposition by the GEB Attorney in connection with the GEB Attorney's investigation of organized crime influence over the CLDC. On or about April 11, 1995, Frank Caruso resigned all of his union positions and gave up his membership in LIUNA, but retained his recently obtained employment as director of the CLDC pension fund. Id.
All in violation of Title 18, United States Code, Section 1962 (d).
XI



SECOND CLAIM FOR RELIEF:


91

CONSPIRACY TO VIOLATE 18 U.S.C. S 1962(c)
IN VIOLATION OF 18 U.S.C, q 1962(d)


38. Paragraphs I through 25 above are repeated, realleged. and incorporated by reference as if fully set forth herein.
39. Conspiracy to Conduct the Affairs of the Enterprise Through a Pattern of Racketeering Activity: From at least the mid1970's up to and including the date of the filing of this complaint, in the Northern District of Illinois and elsewhere, defendant, the Chicago Laborers' District Council, by and through its officers, members, agents and representatives, being a person employed by and associated with an enterprise, that is, the Chicago Laborers' District Council/La Cosa Nostra Enterprise as defined in paragraph 40 below, which enterprise engaged in and the activities of which affected interstate and foreign commerce, did unlawfully, knowingly and intentionally combine, conspire, confederate, and agree together and with the co-conspirators. identified in paragraph 21 above, and with others whose names are both known and unknown, to commit an offense against the United States, to wit, to violate Title 18, United States Code, Section 1962(o), that is, to conduct and to participate, directly and indirectly, in the conduct of the affairs of the aforementioned enterprise through a pattern of racketeering activity, as that term is defined in Title 18, United States Code, Section 1961, said pattern of racketeering activity consisting of multiple acts indictable under Title 18, United States Code, Section 1951 involving Hobbs Act extortion, that is, wrongfully obstructing and attempting to obstruct, delay and affect
92

commerce, as that term is defined by Title 18, United States Code, Section 1951 (b) (3) , and the movement of articles and commodities in commerce, by extortion, as that term is defined in Title 18, United States Code, Section 1951 (b) (2) , and conspiring to do so, all in
violation of Title 16, United States Code, Sections 1951.
40. The Chicago District Council/La Cosa Nostra Enterprise: At all times material to this complaint, the Chicago Laborers District Council, by and through its officers, members, agents and representatives, together with the LCN member and associate co-conspirators identified in paragraph 21 above, and others known and unknown, have constituted an "enterprise, 11 as that term is defined in Title 18, United States Code, Section 1961(4), that is, a group of individuals associated in fact, which enterprise was engaged in, and the activities of which affected, interstate and foreign commerce..'' The enterprise consists of the captive labor organization as well as the LCN and its members and associates who have continuously and systematically controlled, exploited, and dominated the conduct of the affairs of the CLDC and its constituent local unions and affiliated employee benefit funds in the manner and means which are described herein.
41. Manner and Means: Paragraph 24 above is incorporated by reference and realleged as if fully set forth herein.

42. It was part of the conspiracy that the defendant, the Chicago Laborers' District Council, by and through its officers, members, agents and representatives, together with the coconspirators identified in paragraph 21 above, and with others
93

known and unknown, each agreed to conduct and to participate in the conduct of the Chicago District Council/La Cosa Nostra enterprise's affairs through the commission of multiple acts of racketeering indictable under Title 18, United States Code, Section 1961.
43. It was further part of the conspiracy that the defendant, the Chicago Laborers' District Council, by and through its officers, members, agents and representatives, together with the co-conspirators identified in paragraph 21 above, and with others known and unknown would obtain and attempt and conspire to obtain property from the delegates of the Chicago Laborers, District council and the membership of its twenty-one constituent local unions, as set forth in paragraphs 30 through 33 above which are incorporated by reference and realleged as if fully set forth herein.
44. It was further part of the conspiracy that the defendant, the Chicago Laborers' District Council, by and through its officers, members, agents and representatives, together with the co-conspirators identified in paragraph 21 above, and with others known and unknown employed the wrongful use of actual and threatened force, violence and fear of physical and economic injury in order to create a climate of intimidation and fear within the enterprise to induce, and to attempt and conspire to induce, the members of CLDC and the rank and file members of the constituent local unions to consent to the surrender of property as described above by various means including, but not limited to, the
94

allegations set forth in paragraphs 23 and 24 above, which are incorporated by reference and realleged as if fully set forth herein.
45. It was further part of the conspiracy that the defendant, the Chicago Laborers' District Council, by and through its officers, members, agents and representatives, together with the co-conspirators identified in paragraph 21 above, and with others known and unknown did misrepresent, conceal, and hide, and cause to be misrepresented, concealed, and hidden, acts done in furtherance of the conspiracy and the purpose of those acts.
46. It was further part of the conspiracy that the defendant Chicago Laborers' District Council, by and through its officers, members, agents and representatives, together with the co-conspirators identified in paragraph 21 above, and with others known and unknown, agreed that a conspirator would commit at least two acts of racketeering in the conduct of the affairs of the enterprise.
47. Overt Acts: In furtherance of the conspiracy and to effect the objects thereof, the overt acts, among others, set forth in paragraph 37 above, which are repeated, realleged and incorporated by reference herein, were committed by the conspirators within the Northern District of Illinois and elsewhere.
All in violation of Title 18, United States Code, Section 1962 (d).