In the U.S. District Court for the Eastern District of New York, in resentencing a defendant, Judge Charles P. Sifton reduced the original term of incarceration by 60 months–and discussed the weight to be given the U.S. Sentencing Commission Guidelines in light of the Supreme Court’s recent decision in United States v. Booker, 125 SCt 738 (2005). Judge John Gleeson imposed an injunction on Local 530 of the Operative Plasters’ and Cement Masons’ International Association, AFL-CIO, following 25 years of corruption and contempt, barring the union from performing drywall work in New York City without clear specifications requiring a "skimcoat." Judge David G. Trager denied an insurer’s motion for summary judgment in an action alleging breach of an insurance contract.
In Simon v. United States, 90 CR 216 (EDNY, March 17, 2005), Judge Sifton, imposing a sentence for a "crack" offense, held that the Sentencing Guidelines, now merely advisory after the Supreme Court’s decision in Booker, 125 SCt 738 (2005), are "entitled to the same weight accorded to each other factor that the Court is instructed to consider by [18 USC] 3553(a).’
In 1990, petitioner Simon was convicted of conspiring to distribute more than 50 grams of cocaine base and using a firearm in that conspiracy. Judge Sifton sentenced him under the guidelines to 322 months’ imprisonment. Since then, this case has had a long and tortuous history. Eventually, on the government’s consent, the court granted Mr. Simon’s habeas petition to vacate the weapons conviction and have a sentencing de novo on the drug conspiracy charge. At this resentencing, in March 2005, the decision in Booker gave petitioner an added basis for leniency. Accordingly, Judge Sifton sentenced Mr. Simon to 262 months’ imprisonment, a 60-month reduction of the original term of incarceration.
The instant decision explaining that result is significant precedent as to the degree of consideration to be given to the guidelines after Booker.
As Judge Sifton observed, Booker held that the mandatory nature of the guidelines violated the Sixth Amendment. The Supreme Court thus severed 18 USC § 3553(b)(1), which had rendered the guidelines binding. This left in effect § 3553(a), which details a whole array of factors for a sentencing court to consider, relating to the offense, the defendant and the purposes of sentencing.
District courts have differed as to the weight to be given to the guidelines in light of Booker. Judge Sifton cited three reasons for limiting the weight of the guidelines to that of each of the many other factors listed in § 3553(a):
First, § 3553(a) does not distinguish between the listed factors in terms of weight.
"Second, the greater the weight given to the Guidelines, the closer the Court draws to committing the act that Booker forbids–a Guideline sentence based on facts found by a preponderance of the evidence by a judge….’
Third, giving heavy weight to the guidelines–which permit downward departures for offender-specific factors only in "exceptional cases’–may create "tension, if not conflict, with § 3553(a)’s command to consider a multitude of factors.’
In sentencing Mr. Simon, Judge Sifton determined that the applicable guidelines range would be 324 to 405 months, and that none of Mr. Simon’s arguments presented factors so extraordinary as to call for a "traditional" downward departure. The court then turned to the factors listed in § 3553(a), which did warrant deviating from the recommended range.
For example, while Mr. Simon’s health problems, under the old regime, would not justify a departure, the court could now consider that Mr. Simon’s health is substantially more impaired than that of other defendants.
Moreover, there has been a growing recognition that the 100 to 1 ratio in sentences for "crack" offenses, as opposed to powder cocaine offenses, is disproportionate and unduly harsh. Though there were no guidelines amendments on this point, the commission’s 2002 report recommended reducing the ratio to 20 to 1, and the Clinton administration proposed a 10 to 1 ratio.
After applying the factors in § 3553(a), Judge Sifton summarized the reasons for leniency:
…the recommended Guidelines sentencing range of 324 to 405 months substantially overstates the seriousness of the offense, particularly when compared with offenses involving comparable quantities of powder cocaine. Imposition of a sentence within that range would create unjust sentencing disparities greater than that necessary to protect the public. In addition, a sentence within the Guidelines range would not give appropriate consideration to defendant’s medical condition, his age at the time of release, and the amount of time he has lived with a lack of finality as to the length of time he would have to serve in prison. The particular sentence of 262 months is imposed because it is within, albeit at the top of, the range of sentences that would exist if either a 10:1 or 20:1 ratio of crack to powder cocaine were adopted and avoids disparity with the sentence imposed on Simon’s co-defendant….
Injunction – Local 530
In Drywall Tapers and Pointers of Greater New York, Local 1974 of I.B.P.A.T., AFL-CIO v. Local 530 of the Operative Plasters’ and Cement Masons’ International Association, AFL-CIO, 93 CV 0154 (EDNY, March 17, 2005), Judge Gleeson imposed an injunction on Local 530 in the latest installment of a 25- year jurisdictional dispute in the drywall business between Local 1974 and Local 530.
The injunction prohibits Local 530 from performing "any drywall finishing in the City of New York unless the owner of the site, through architect’s specifications, requires that the drywall surfaces at issue are to receive plaster, acoustical or imitation acoustical finishes." Conceding that the injunction might put Local 530 out of business, Judge Gleeson believed that the result was justified because of "Local 530’s ‘long and deplorable history’ of stealing work belonging to Local 1974 and evading injunctions prohibiting it from doing so."
Both Local 1974 and Local 530 prepare newly constructed interior walls for painting on construction jobs in New York City. Local 530 claims that by "skimcoating," rather than simply taping and pointing, it performs a more sophisticated process. But as Judge Gleeson observed, Local 530 has over the past 25 years bullied and bribed its way into a large majority of the taping jobs in New York, and has edged Local 1974 out. Beginning in 1975, Local 1974 sought to have the dispute over jurisdiction mediated through union procedures. In 1978, a Hearings Panel issued a decision setting forth the jurisdiction of each of the locals based on the final finishing of the walls.
As a result of Local 530’s refusal to abide by decisions through the union process, Judge Eugene H. Nickerson issued multiple injunctions prohibiting Local 530 from performing work on numerous jobs, but denied requests by Local 1974 for an area-wide injunction on the ground that the union procedures were the best way to determine whether Local 530 had wrongfully asserted jurisdiction at any particular job. Finally, on Dec. 18, 1990, Judge Nickerson issued an areawide injunction governing all future job sites, prohibiting Local 530 from working on any job site unless the architect’s specifications require a skimcoat. Following the December 1990 injunction, Local 1974 filed numerous actions claiming that Local 530 acted in contempt of that injunction. In November 2002, Judge Gleeson found Local 530 in contempt with respect to 20 job sites, emphasizing Local 530’s cynical contempt for Judge Nickerson’s 1990 injunction.
In April 2004, a grand jury in the Southern District of New York charged 22 defendants with racketeering and various other offenses arising out of their control, on behalf of the Genovese family, of the drywall industry in New York City. The indictment charged that the principal means of controlling the drywall industry was Local 530. Local 530’s founder and two-thirds of its leadership were named defendants. Former President Louis Moscatiello pleaded guilty. Though he had been ejected from local 530 for bribing a labor official in 1991, he made it clear in connection with his guilty plea that he never stopped controlling Local 530, and "he used that corrupt control to sell out Local 530 members by allowing Local 530 contractors to use nonunion workers and to file false reports regarding contributions to the local’s welfare, benefit and pension plans." Slip op. 15.
In granting the broad injunction here, Judge Gleeson pointed to Local 530’s corrupt foundations and continuing contempt for Judge Nickerson’s injunction. Judge Gleeson rejected Local 530’s argument that the New York Plan should be responsible for overseeing jurisdiction. The court cited colloquy during arbitration proceedings under the New York Plan in which the lawyer for Local 1974 read from Judge Nickerson’s order and the arbitrator replied, "Fuck him. Put that on the record, please." Finding that statement revealing, Judge Gleeson stated: "An adjudicative body that, upon being informed of one of Judge Nickerson’s key orders, responds ‘Fuck him,’ does not strike me as the right forum for resolving disputes over the application of Judge Nickerson’s injunction." Slip op. 21-22.
Finally, refusing to stay the effect of the injunction pending appeal, Judge Gleeson found that: (1) Local 1974 would be harmed by having to police every contract awarded to Local 530 to protect its jurisdiction; (2) Local 530 has demonstrated no more than a slim chance for success on appeal because its corrupt leadership is committed to making any injunction fail; (3) the public would be served by removing Local 530 from the drywall finishing business; and (4) putting Local 530 out of business would not be a bad thing.
In Staten Island Supply Co., Inc. v. Lumbermens Mutual Casualty Co., 02 CV 6390 (EDNY, March 29, 2005), an action for breach of insurance contract, Judge Trager denied defendant’s motion for summary judgment, which was based on its claim that plaintiff concealed and misrepresented material information and refused to answer questions during a claim investigation.
In January 2001, property owned by plaintiff and insured by Lumbermens flooded as a result of a burst sprinkler pipe. At the beginning of the investigation into the claim, an independent adjuster interviewed plaintiff’s principal, Mr. Schwimer. The adjuster prepared a handwritten statement, which Mr. Schwimer signed even though he could not read the handwriting. In March and July 2002, Lumbermens’ counsel examined Mr. Schwimer under oath.
Lumbermens contended here that Mr. Schwimer made false statements and refused to answer questions during the examination, breaching the insurance contract and negating coverage. Specifically, Lumbermens asserted: that Mr. Schwimer lied about who wrote the premium check, why the check was written on his wife’s account and not the company account, and about his marital status; that Mr. Schwimer refused to answer questions about whether he was trying to hide assets from his ex-wife or his creditors, which his attorney instructed him not to answer as irrelevant and immaterial; and that he refused to answer a question concerning his knowledge of the sprinkler system when it was asked for the third time.
Judge Trager concluded that whether Mr. Schwimer had "willfully made a false and material statement under oath with the intent to defraud the insurer’–the requirement in New York to void an insurance contract on the basis of fraud– was a question of credibility for the jury to decide.
Concerning defendant’s claim that Mr. Schwimer had failed to cooperate under the policy, an insurer must show that the insured willfully refused to answer material and relevant questions and to supply material and relevant documentation. Generally, courts in New York find a willful failure to cooperate only when an insured refuses to answer questions about personal finances or to turn over personal tax records. Judge Trager found that the questions that Mr. Schwimer refused to answer were not material as a matter of law. As Judge Trager stated:
Forfeiture of the right to recover on an insurance contract is an extreme remedy for the court to impose. Therefore, the insurer may not point only to a "technical or unimportant omission" as proof that the insured willfully failed to cooperate with its investigation. Slip op. 17.
Mr. Schwimer had apparently produced both plaintiff’s corporate tax returns and his personal tax returns, and he was very open about his company’s and his own financial difficulties. Thus, Mr. Schwimer had provided sufficient financial information. Judge Trager also found that Mr. Schwimer had not willfully failed to cooperate with the investigation, despite his refusal to answer questions about the sprinkler system after he already had answered the questions twice.
Harvey M. Stone and Richard H. Dolan are partners at Schlam Stone & Dolan. Bennette D. Kramer, a partner of the firm, assisted in the preparation of the article.
[This article is reprinted with permission from the April 8, 2005, issue of the New York Law Journal. Copyright © 2007 ALM Properties, Inc. All rights reserved. Further duplication without permission is prohibited.]