United States of America v. International Union, United Automobile, Aerospace, and Agricultural Implement Workers of America
OPINION AND ORDER Denying 12 , 13 Motion to Intervene. Signed by District Judge David M. Lawson. (See image for amicus filing deadline.) (SPin)
Case 2:20-cv-13293-DML-RSW ECF No. 32, PageID.359 Filed 04/27/21 Page 1 of 13
UNITED STATES DISTRICT COURT
EASTERN DISTRICT OF MICHIGAN
UNITED STATES OF AMERICA,
Case Number 20-13293
Honorable David M. Lawson
INTERNATIONAL UNION, UNITED
AUTOMOBILE, AEROSPACE, AND
WORKERS OF AMERICA,
OPINION AND ORDER DENYING MOTION BY UNITE ALL WORKERS
FOR DEMOCRACY AND SCOTT HOULDIESON TO INTERVENE
More than two months after this lawsuit was commenced and approximately three weeks
after the Court entered a consent decree in this case, Unite All Workers for Democracy (UAWD)
and Scott Houldieson filed a motion to intervene for legal reasons that they have found difficult to
articulate. Their stated intention is to join the lawsuit, presumably as a defendant, so that they can
“identif[y] key weaknesses in the consent decree” and propose modifications; “provide
membership feedback” in proceedings to enforce the consent decree; and participate in an “appeal”
— although at this stage of the proceedings it is not apparent on what grounds any appeal might
The motion is untimely because it was submitted more than two months after the suit was
commenced and the original joint motion for entry of a consent decree was filed; more than six
weeks after counsel for the proposed intervenors appeared in the case, and after the second motion
for entry of a consent decree was presented, which clearly spelled out the terms of the proposed
decree; and more than three weeks after the matter was closed by issuance of the consent decree.
The proposed intervenors also have not identified a tangible legal interest that they hold in dictating
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who will be selected to serve in the position of Monitor under the consent decree, or in mandating
the adoption of a particular method for electing union officers. Moreover, any generalized interest
in “fair elections” and “union integrity” that the movants may have adequately will be guarded by
the government as the plaintiff in this case. Contrary to the proposed intervenors’ position, the
consent decree does not “cede to the union” any undue influence over the selection of the Monitor,
since the candidates for the position must be first vetted by the government, and then reviewed and
formally appointed by the Court. Finally, the proposed intervenors can voice an interest in any
formal action the Court might take to enforce the consent decree by seeking to file a brief as amicus
curiae when a party files a motion for enforcement or seeks approval under the decree. The motion
to intervene will be denied.
The parties stipulated to the accuracy of the allegations pleaded in the government’s
complaint filed December 14, 2020 under the Labor-Management Relations Reporting and
Disclosure Act of 1959, 29 U.S.C. § 401 et seq.
The defendant in this matter is the International Union, United Automobile, Aerospace,
and Agricultural Implement Workers of America (UAW). It represents hundreds of thousands of
non-managerial workers in automobile manufacturing and other industries throughout Michigan
and the United States, and in other countries. The UAW’s International Executive Board is the
managing body of the UAW, which is comprised of a president, secretary, three vice presidents,
and eight regional directors. The board governs the union’s affairs by, among other things,
imposing discipline, approving or suspending by-laws of local bargaining units, and interpreting
and enforcing the UAW’s constitution. UAW locals, aided and overseen by the umbrella authority
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of the international union, negotiate collective bargaining agreements on behalf of members in
workplaces around the country and the world, according to local circumstances.
According to the complaint, since 2010, certain members of the executive board have
engaged in fraudulent and illegal transactions that included money laundering, receipt and payment
of union funds for goods and services that never actually were delivered, and receipt and payment
of kickbacks and bribes by certain employers of union members. Among other things, members
of the executive board accepted bribes and kickbacks for steering contracts that were awarded by
the UAW-GM Center for Human Resources, which was a member training center jointly operated
by the Union and General Motors Corporation and its successor (GM). Other union executives
conspired over several years to embezzle for their personal use more than $1.5 million in union
funds, by subterfuges such as submitting vouchers for travel and lodging expenses that never were
incurred. Also, union executives accepted payments from employers, including FCA, LLC
(Chrysler) in exchange for compromising negotiations over bargaining agreements in ways that
favored the employer over union members. Still other executive board members were aware of
the fraud, embezzlement, and bribery crimes, but took no action to stop them, contrary to their
obligations under federal law to investigate and redress any violations of applicable federal laws
by union officials. To conceal the proceeds of their schemes, union executives also made, or
caused the union to make, deceptive representations to the Department of Labor and the Internal
Revenue Service (IRS) in various financial reports and disclosures.
The complaint enumerates in exhaustive detail these and other fraudulent and illegal
schemes and identifies the former union officials who conspired to carry them out. In 2019 and
2020, more than a dozen executives who were involved in the schemes pleaded guilty to a variety
of federal crimes including wire fraud, mail fraud, embezzlement, violations of the Employee
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Retirement Income Security Act of 1974 (ERISA), 29 U.S.C. §§ 1001, et seq., and violations of
the Labor-Management Relations Reporting and Disclosure Act of 1959, 29 U.S.C. §§ 401 et seq.
On December 14, 2020, the government filed its complaint alleging various violations of
federal law and seeking injunctive relief prohibiting the union and its elected officers from
committing future similar violations of federal law. On the same date, the parties jointly filed a
motion for entry of a consent decree embodying terms of an agreement that they had reached,
before the suit was filed, which provides for injunctive restrictions against the union and its
officers, and also for the appointment of a Monitor and other officials to keep tabs on the union’s
activities and report on the defendant’s compliance with the consent decree and applicable federal
laws. The Court struck the proposed consent decree that had been attached as an exhibit of the
motion because it was filed in violation of procedural rules.
On January 5, 2021, the parties filed a revised joint motion with a brief that included more
expansive details on the terms of the proposed consent decree. On January 7, 2021, counsel for
the proposed intervenors file a notice of appearance. On January 29, 2021, after it had received
no opposition to the motion for entry of the consent decree, the Court entered the proposed consent
decree. On February 22, 2021, more than three weeks after the matter was closed by entry of the
consent decree, the proposed intervenors filed their motion to intervene.
Proposed intervenors UAWD and Scott Houldieson assert in their motion that they stand
for the interests of a caucus of union members that has tried unsuccessfully in the past to have
candidates elected to the UAW executive board, and that they oppose the “Administration Caucus”
of incumbent officers, who they say historically have been elected and re-elected with no
significant opposition. They assert that they want to intervene in this case to “protect their interest
in bringing democratic governance to the UAW” in the ways mentioned above.
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The proposed intervenors contend that the consent decree that was entered by the Court is
“flawed” in various ways, but the principal concerns emphasized in their motion are (1) the
intervenors’ belief that fair elections of union officers only can be achieved via a “one member,
one vote” method of voting, and their disappointment that the consent decree does not mandate
such a method for elections, and (2) their apprehension that if the Monitor and other positions
which the consent decree provides for are filled by persons nominated initially by the UAW, then
those watchdogs merely will become “foxes guarding the henhouse,” since they believe that the
union, which is the subject of the consent decree’s strictures, will seek to nominate only candidates
that would turn a blind eye to any future misdeeds.
The government and the UAW each oppose the motion, arguing that it is untimely, and the
movants seek relief that the Court cannot grant. For example, they assert the Court is not
empowered to modify the terms of any consent decree upon the motion of an interested person,
but only either to grant or withhold approval for terms that the parties to the case have proposed.
They also argue that they would be prejudiced by interference with the enforcement of the decree
at this late date, because they must comply with the deadline to submit candidates for the monitor
position for the Court’s approval. They also insist that there is no significant concern of
“collusion” between the United States and the defendant, and the government is able adequately
to represent the proposed interest in ensuring the integrity of union elections. The union also points
out that the proposed intervenors can direct their concerns to the independent monitor, who will
be charged with ensuring that the defendant respects the terms of the decree, and they can do so
without the need to complicate the proceedings by allowing every union member who disagrees
with particulars of the decree to become a party to this litigation.
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Federal Rule of Civil Procedure 24 provides two procedural avenues for a person or entity
that was not named as a party to a lawsuit to seek to insert itself into the proceedings. Those are
designated under the rule as “intervention of right,” Fed. R. Civ. P. 24(a), and “permissive
intervention,” Fed. R. Civ. P. 24(b).
“To intervene as a matter of right in a lawsuit under Federal Rule of Civil Procedure 24(a),
a proposed party must establish that: ‘(1) the motion to intervene is timely; (2) the proposed
intervenor has a substantial legal interest in the subject matter of the case; (3) the proposed
intervenor’s ability to protect that interest may be impaired in the absence of intervention; and (4)
the parties already before the court may not adequately represent the proposed intervenor’s
interest.’” Kirsch v. Dean, 733 F. App’x 268, 274 (6th Cir. 2018).
Federal Rule of Civil Procedure 24(b)(1), on the other hand, allows for “permissive”
intervention under more relaxed conditions: “‘On timely motion, the court may permit anyone to
intervene who . . . has a claim or defense that shares with the main action a common question of
law or fact.’” League of Women Voters of Michigan v. Johnson, 902 F.3d 572, 577 (6th Cir. 2018).
In deciding whether to allow a party to intervene [on a permissive basis], ‘the court must consider
whether the intervention will unduly delay or prejudice the adjudication of the original parties’
rights.’” Ibid. (quoting Fed. R. Civ. P. 24(b)(3)). “‘So long as the motion for intervention is timely
and there is at least one common question of law or fact, the balancing of undue delay, prejudice
to the original parties, and any other relevant factors is reviewed for an abuse of discretion.’” Ibid.
(quoting Michigan State AFL-CIO v. Miller, 103 F.3d 1240, 1248 (6th Cir. 1997)).
Timeliness of the motion is evaluated “in the context of all relevant circumstances [by
consideration of] the following five factors: ‘(1) the point to which the suit has progressed; (2) the
purpose for which intervention is sought; (3) the length of time preceding the application during
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which the proposed intervenors knew or should have known of their interest in the case; (4) the
prejudice to the original parties due to the proposed intervenors’ failure to promptly intervene after
they knew or reasonably should have known of their interest in the case; and (5) the existence of
unusual circumstances militating against or in favor of intervention.’” Kirsch, 733 F. App’x at
274-75 (quoting Jansen v. City of Cincinnati, 904 F.2d 336, 340 (6th Cir. 1990)).
The proposed intervenors’ motion is not timely. The proceedings have terminated by entry
of the final consent decree. It is widely acknowledged that post-judgment attempts to intervene
are untimely. See Jordan v. Michigan Conf. of Teamsters Welfare Fund, 207 F.3d 854, 862 (6th
Cir. 2000) (“The IBT did not file its motion for intervention until after the district court issued its
final judgment concerning the attorney’s fees and costs award. We find that the IBT’s failure to
intervene before final judgment was entered renders the motion untimely.”).
The putative purpose for the intervention is improper, because the intervenors assert that
the primary goal of the intervention is to move the Court to reconsider its decision to approve the
decree. But the time for seeking reconsideration of that decision had long passed when the motion
to intervene was filed. See E.D. Mich. LR 7.1(h). Moreover, as the government points out, the
Court is not authorized to alter the terms of a negotiated compromise at the suggestion of a nonparty to the litigation; rather, its role is to consider and either approve or reject the proposed
resolution. Officers for Justice v. Civil Service Comm’n San Francisco, 688 F.2d 615, 630 (9th
Cir. 1982) (“Neither the district court nor this court is empowered to rewrite the settlement agreed
upon by the parties. We may not delete, modify, or substitute certain provisions of the consent
decree. Of course, the district court may suggest modifications, but ultimately, it must consider the
proposal as a whole and as submitted. Approval must then be given or withheld.”). The proposed
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intervenors have not suggested any factual basis or legal authority for a conclusion that the Court’s
discretionary decision to accept the proposed consent decree was made improvidently.
The proposed intervenors argue that they had no “advance opportunity” to review any of
the filings in this case that were docketed last December, they were not solicited to “sign off” on
the proposed decree, and the specimen of the decree that was docketed was stricken from the public
record. However, there was ample time during which the motion to intervene could have been
presented, but the proposed intervenors waited until weeks after the case was closed to file their
request. The intervenors have not rebutted the government’s representations that the negotiations
preceding the filing of the case occurred over months and were publicized widely. The movants
also affirmatively represent that they personally were consulted by government counsel about the
proposed resolution of the government’s claims against the union at least six months before this
case was filed. The complaint and motion for approval of the consent decree were made a matter
of public record in mid-December 2020. Proposed intervenors’ counsel appeared in the matter in
early January, two days after a revised and more thoroughly briefed motion for approval was filed.
The consent decree was entered three weeks later, after no opposition was presented by anyone.
The proposed intervenors waited a further three weeks before filing their motion. No excuse has
been presented for the delay, and the undisputed information presented shows that the proposed
intervenors were well aware of the litigation and any interest they might have in it for months
before the case was closed.
The proposed intervention at this late stage materially would prejudice the interests of the
parties — and the union’s entire membership — in securing prompt compliance with the terms of
the consent decree, including by the timely appointment of a qualified independent monitor to
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audit the union’s affairs, and by the timely commencement of plans to hold a member referendum
to decide whether the method of electing union officers should be changed prospectively.
Finally, there are no extraordinary circumstances that otherwise mitigate in favor of
indulging the tardy intervention.
The proposed intervenors also have not identified any substantial legal interest that they
hold in the subject matter of the case, see Fed. R. Civ. P. 24(a), nor have they identified any legal
claim or defense sharing a common nucleus of fact with the claims pleaded in the complaint, see
Fed. R. Civ. P 24(b). The sole claim brought in this case was filed by the government under the
authority of the Anti-Fraud Injunction Act, 18 U.S.C. § 1345. That statute, however, confers a
right to sue solely on the Attorney General, and does not authorize any private right of action for
union members or any other aggrieved individual. Bush v. Chancery Court of Knox County, No.
15-524, 2016 WL 1737096, at *2 (E.D. Tenn. May 2, 2016) (“[T]he complaint relies on 18 U.S.C.
§ 1345 — a criminal statute authorizing the Attorney General to enjoin certain fraudulent conduct
— as the private cause of action. However, numerous courts have held that 18 U.S.C. § 1345 does
not confer a private cause of action and, as a result, cannot serve as a basis for federal question
jurisdiction.”) (collecting cases). Thus, the proposed intervenors have no tangible legal interest in
the adjudication of the pleaded claims, and there is no legally recognized claim or defense that
they could assert having any overlapping facts with the pleaded claims. The intervenors’ mere
desire to advocate for what they view as more suitable terms for a compromise between the parties
is not a substantial legal interest that warrants allowing their interjection into the litigation as a
party. Cuyahoga Valley Railway Co. v. Tracy, 6 F.3d 389, 396 (6th Cir. 1993) (“[The proposed
intervenors] [are not] entitled to . . . enter the proceedings after the case has been fully resolved,
in an attempt to achieve a more satisfactory resolution.”).
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The proposed intervenors’ expressed desire to see the union adopt what they view as a
more desirable method of electing officers is not founded in any recognized legal right that is not
already adequately vindicated by these proceedings, because the federal statutes on point do not
mandate the adoption of the particular method for electing offices which the movants endorse.
See 29 U.S.C. § 481(a) (“Every national or international labor organization, except a federation of
national or international labor organizations, shall elect its officers not less often than once every
five years either by secret ballot among the members in good standing or at a convention of
delegates chosen by secret ballot.”) (emphasis added); 29 U.S.C. § 481(e) (“The election shall be
conducted in accordance with the constitution and bylaws of such organization insofar as they are
not inconsistent with the provisions of this title.”). Moreover, the consent decree expressly
mandates that a question promptly must be put to a democratic vote by all union members, to
decide whether the “one member, one vote” procedure should be adopted. The requirement that
the union poll a fresh ballot to determine the method of its elections goes beyond the rights
guaranteed by federal law, and the decree already guarantees that a fulsome deliberation on exactly
the question that the movants urge will be afforded and will involve all of the UAW’s members.
Moreover, any generalized interest in union election integrity and the union’s compliance
with all applicable federal laws likely will be protected by the government. The movants have not
identified any circumstances suggesting that the government unfairly has compromised its duty
diligently to enforce the federal laws at issue in this case. The government’s role as the principal
enforcer of those regulations in which the suit is grounded is sufficient assurance that the interests
of union members in “fair elections” and “union integrity” will not be overlooked. United States
v. City of Miami, 614 F.2d 1322, 1332 (5th Cir. 1980) (“[T]he plaintiff here is a department of the
United States government. Unlike the situations in which we fear that a party may be attempting
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to profit at the expense of unrepresented individuals, e.g., class actions and shareholder derivative
suits, we here have as plaintiff the government department charged with seeing that the laws are
enforced. We therefore need not fear that the pecuniary interests of the plaintiff and defendant
will tempt them to agree to a settlement unfair to unrepresented persons, but can safely assume
that the interests of all affected have been considered.”).
The motion also is founded on factual misapprehensions which are belied by the actual
provisions of the decree. First, the decree does not cede “sole authority” to the union to dictate
who will be appointed as the Monitor. The decree vests the ultimate authority to appoint the
Monitor with the Court, which is equipped to examine independently any nominee’s qualifications
and background and to ensure that he or she will be both free of any potential conflict of interest
and sufficiently experienced to diligently discharge the duty of supervising the defendant’s
conduct and publicizing any transgressions. Second, the decree does not deprive the movants —
or any other individual union members — of established rights that they have to present any
complaints about the fairness of any union election or referendum. The movants may, just like
any other member, present any such complaints to the OLMS, which is obligated fully and fairly
to review and adjudicate their grievances. See 29 U.S.C. § 482(A). If they are unsatisfied with
the agency’s resolution of the grievance, then they may seek judicial review of the administrative
ruling via the usual process under the Administrative Procedure Act. See 29 U.S.C. § 526. Those
robust procedures for administrative and judicial review are supplemented, not obstructed, by the
additional scrutiny and review that will be provided through the office of the Monitor that will be
appointed under the consent decree. And, as the defendant points out, nothing stands in the way
of the movants presenting any grievances they may have to the Monitor as well, who may follow
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up on them under the auspices of the broad supplemental enforcement authority that the decree
vests in that position.
Last, although the intervenors have given reasons for their concern over the manner in
which the consent decree may be enforced, and they have attempted to identify ways that the
intended purpose of the decree might be foiled, they have not offered a valid reason why they
should be allowed to appear as a party in this case. As a caucus within the UAW, the UAWD will
have ample opportunity to participate in the union’s democratic procedures. The UAWD also will
have the opportunity to seek the ear of the Monitor. And when either party to the case seeks relief
from or approval by the Court to carry out the terms of the consent decree, the UAWD can ask
permission to file a submission as amicus curiae to let its voice be heard. The proposed
intervenors, however, have not made a convincing case that their interest in good and honest union
governance cannot be protected by government monitoring and court oversight. See Jordan v.
Michigan Conf. of Teamsters Welfare Fund, 207 F.3d 854, 863 (6th Cir. 2000) (affirming denial
of a motion to intervene as of right, because the motion was untimely and the proposed
intervenor's interests were adequately represented); see also Stupak‐Thrall v. Glickman, 226 F.3d
467, 472 (6th Cir. 2000) (citing Bradley v. Milliken, 828 F.2d 1186, 1194 (6th Cir. 1987) (affirming
denial of motions to intervene permissively and as of right, in part because “the district court has
already taken steps to protect the proposed intervenors’ interests by inviting [their counsel] to
appear as amicus curiae in the case”).
The only proposed action on the table at the moment is a motion to approve the selection
of a Monitor. At oral argument, counsel for the intervenors did not voice a clear opposition to the
parties’ recommendation. But based on the concerns expressed in the briefs and at oral argument,
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the Court anticipates that they may want to take a position on that motion. However, they may not
intervene as a party by right or by permission.
Accordingly, it is ORDERED that the motion by Unite All Workers for Democracy
(UAWD) and Scott Houldieson to intervene (ECF No. 12) is DENIED.
It is further ORDERED that if Unite All Workers for Democracy (UAWD) or Scott
Houldieson wishes to file a brief as amicus curiae addressing the motion for appointment of a
Monitor (ECF No. 28), they may do so on or before May 11, 2021. The brief may not exceed ten
s/David M. Lawson
DAVID M. LAWSON
United States District Judge
Date: April 27, 2021
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