A health care system based in Ontario, California filed a lawsuit on August 25, 2014 under the Racketeer Influenced and Corrupt Organizations Act (RICO) against the Service Employees International Union (SEIU). It cites a labor-management partnership used to funnel money to the SEIU’s corporate campaign against health care systems.
As stated in an August 25, 2014 press release, “the lawsuit accuses the defendants of conspiring to extort, threaten and force Prime Healthcare to enter into a “neutrality agreement” that would enable SEIU to force all employees into the union regardless of employee choice. Among other unlawful conduct, the defendants have issued malicious and false statements, funded operations with money unlawfully received in violation of federal law, coerced the California Hospital Association to impose neutrality agreements on its members including Prime Healthcare, and threatened to prevent acquisitions of hospitals by Prime Healthcare unless it concedes to the defendants’ demands and provide them control of all Prime Healthcare hospitals.
The press release adds that “The defendants’ campaign of extortion against Prime Healthcare has been ongoing for years. The defendants’ actions and plans are based on SEIU’s Contract Campaign Manual, its playbook for waging such extortionate campaigns (“Corporate Campaign”).”
Read the lawsuit here: August 25, 2014 Prime Healthcare Services RICO Lawsuit v SEIU
The lawsuit goes into some detail about the “labor-management partnership” that funds this alleged criminal conspiracy:
In addition, Kaiser Permanente and the SEIU-controlled Coalition of Kaiser Permanente Unions have developed an elaborate scheme to make payments in the tens of millions of dollars from Kaiser Permanente to SEIU and UHW, as well as other unions. Specifically, under their Labor Management Partnership (“LMP”), Kaiser Permanente pays approximately $20 million a year to the Labor Management Partnership Trust (the “Partnership Trust”), a trust fund ostensibly established for the purpose of carrying out activities under the LMP; the payments from Kaiser Permanente constitute more than 97% of all revenue received by the Partnership Trust. The Partnership Trust then turns around and transfers tens of millions of dollars – more than $7 million in 2011 alone – to the SEIU-controlled Coalition; the payments from the Partnership Trust constitute more than 93% of all revenue received by the Coalition.
Since 2004, the earliest year for which tax documents were available, Kaiser Permanente has paid over $150 million to the Partnership Trust, and the “trust,” using money it almost exclusively receives from Kaiser Permanente, has paid over $51.5 million to the Coalition – money to Defendants’ control. The Coalition also pays money directly to SEIU and UHW: over the past ten years, the Coalition has made almost $3 million in such payments. These payments are made on a regular basis and, at a minimum, annually. The Partnership Trust and the Coalition are run by Kaiser Permanente and Defendants: the current President of the Coalition is Mary Kay Henry and the prior President, from at least 2002 to mid-2010, was Andy Stern, then President of SEIU; the current Coalition Executive Director, Hal Ruddick, is a former UHW official, and the prior Executive Director, John August, is a former SEIU official; and for each of the years for which there are publicly available tax documents for the Partnership Trust, the overwhelming majority of the trustees were employed by or affiliated with Defendants and Kaiser Permanente.