San Francisco Business Times: U.S. jury orders damages

NewsApril 12, 2010

By Chris Rauber

UPDATE: Late Friday night, the National Union of Healthcare Workers sent out a “correction,” claiming that the jury’s award appears to show that the legal doctrine of joint and several liability is in effect, making NUHW’s total liability less than half that of the original $1.5 million tally, or $737,850. It’s not clear, however, if NUHW’s analysis is the same that the judge in the case will use.

The Service Employees International Union’s Oakland-based United Healthcare Workers West local said Friday that its ousted longtime leader, Sal Rosselli, and 15 other former officials have been ordered by a federal jury to pay more than $1.5 million in damages to the union.

The verdict in the civil lawsuit is a legal victory for SEIU, although the awards totaled far less than the $25 million in damages SEIU had sought and some observers believe that David pulled off an upset, or close to it, in this David vs. Goliath legal skirmish.

SEIU officials said the U.S. District Court jury found Rosselli and the other former SEIU-UHW officials “liable for their scheme to sabotage the union and use the resources of SEIU-UHW members to start their own rival organization,” referring to the National Union of Healthcare Workers.

Rosselli’s National Union of Healthcare Workers, meanwhile, counters that most of the claims against it were thrown out, and that the damages it’s been ordered to pay are just a fraction of what SEIU had demanded.

“SEIU’s central claims (were) abandoned, twelve defendants cleared of all charges, and a judgment for less than one-sixth of SEIU’s own legal costs (made),” NUHW said in its April 9 response. It said its attorneys will ask the judge to set aside the jury’s verdict, and — if the judge does not — will appeal the decision to the Court of Appeals.

SEIU won more than $1.5 million in civil judgments, including $724,000 from the National Union of Healthcare Workers, and awards ranging from $30,000 to $74,000 from other defendants, according to a jury tally sheet, reflecting salaries and benefits paid to the defendants and union assets used by them in January 2009, before their ouster from SEIU.

Rosselli and other former leaders of the Oakland local immediately formed the rival union and began working to attract UHW members to their banner.

The SEIU statement said the verdict came after 10 days of testimony in U.S. District Court in San Francisco; District Court Judge William Alsup presided. The parent SEIU union, based in Washington, D.C., and its Oakland-based local filed the suit.

SEIU said Rosselli and other top officials were removed from office on Jan. 27, 2009, when the local was placed in trusteeship, after the parent union determined they had “misused millions in members’ dues money” and violated members’ rights. The following day, SEIU said, they formed the new union and began trying to convince SEIU-UHW members to switch to their new group.

“So far,” SEIU said, “more than 95 percent of SEIU-UHW members have chosen to stay in their current union.”

UHW represents about 150,000 health care workers in California; nationally, SEIU has about 2.2 million members.

NUHW claims that SEIU’s national office made a “hostile takeover” of UHW, its most successful California affiliate, in January 2009. It says more than 100,000 UHW members have petitioned for elections to quit SEIU and join the new rival, and that “SEIU responded with a lawsuit against the new union.”

But the mixed result can be read as a victory for Rosselli and NUHW, according to some labor insiders. “If these guys got crushed, no one could even think about leaving SEIU,” said one close observer of the inter-union feud.

Source: San Francisco Business Times