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Demian D. Schroeder14 Meadow StreetBrooklyn, NY 11206April 11, 2012

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BY BAND ( I e ~ k \ . ,l.c,ltttThe Honorable Richard M. Berman SO ORDERED:United States District JudgeDaniel Patrick Moynihan ---_t"'________United States Courthouse RICHARD M. BERMAN U.S.D.J.500 Pearl StreetNew York, NY 10007-1312 'f/,,/'}Re: United States ofAmerica v. New York City District Council of Carpenters

("NYCDCC") et al.; Case 1:90-cv-05722-RMB-THK Dear Judge Berman:

We write in reply to: NYCDCC Counsel James M. Murphy's March 29, 2013 letter (Doc. 1290) and Review Officer Dennis M. Walsh Counsel Bridget M. Rohde's April 4, 2013 letter (Doc. 1293) answering Your Honor's March 21, 2013 Memo Order (Doc. 1281) and March 13,2013 Order (Doc. 1255). In his March 29, 2013 submission to the Court, Counsel Murphy states:"1 understand your request to be whether an approved memorandum of

understanding or agreement (here, "MOU") that modifies an expired collective bargaining agreement is materially the same as the fully executed successor collective bargaining agreement ("CBA It ), which merges the terms and conditions of the expired CBA with those of the MOV. The answer is yes." That is not what the court asked for; the Court's request was very clear: "Mr.

Walsh + Mr. Murphy are requested to supply authorities fo r the proposition that this Court can approve a collective bargaining agreement where only a MOU has been approved by a delegate body. t It is clear Mr. Murphy has failed to do so. Since it is clear Mr. Murphy erred in his interoperation ofthe Court's request, his case references and his entire response are moot.

The new Wall-Ceiling & Carpentry CBA is so substantially different from the expired CBA that to declare the August 22, 2012 MOU modifies the expired CBA is not acceptable, i.e. the change to a new compliance program, grievance procedures, 9A contract, 100% employer hiring ratio ("Fun Mobility") an d several others exemplify the core differences. Further, the position that a four page MOU constitutes an entire CBA has not been supported by case reference. The Aug. 22,2012 MOU does not in any way modify the expired CBA but instead is merely a letter of intent that the NYCDCC

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and WC&C Association negotiate a new and completely different CBA from. A cursorycomparison of the expired CBA and the CBA presented to the Court on March 12, 2013will confmn this fact. We would also like to remind You Honor that we have contestedthe Aug. 22,2012 approval of the MOU as binding. There is overwhelming evidence theCouncil Delegate Body ("COB") is a dysfunctional mess and that the Aug. 22 approval,or any other approval by this COB must be suspect until the severe deficiencies areaddressed and corrected. (TRANSCRIPT of Proceedings rei CONFERENCEheld on 4/3/2013 before Judee Richard M. Berman.)

The supporting case reference Counsel Murphy included has nothing to do withthis issue of the Court's power to approve a four page MOU as if it were a completeCBA. I t is quite clear Counsel Murphy could not find any relevant case reference anddecided to present the Court with the equivalent of a second year Business Law contractprimer with supporting case reference. In desperation to present something (and in ouropinion willfully mislead the Court) Counsel Murphy has actually presented casereference that disputes his own arguments. We contend the same to be true for thesubmission of Counsel Bridget Rohdes to the Court dated April 2, 2013. In each caseboth Counsel Murphy and Counsel Rohdes have failed to provide the relevant casereference requested.

As Your Honor is aware, a Memorandum of Understanding is defined as a "letterolintent" (Black's Law, 8th Ed. at 1006.) Black's Law defines letter of intent as:

A written statement detailing the preliminary understanding of parties whoplan to enter into a contract or some other agreement; a noncommittalwriting preliminary to a contract *A letter of intent is not meant to bebinding and does not hinder the parties from bargaining with a third party ..(Blacks Law, 8th Ed. at 924.)We must argue that the 4 page MOU presented on August 22, 2012 is nothingmore than a noncommittal writing preliminary to a contract, and was never presented tothe Delegate Body as the complete WC&C collective bargaining agreement. Historically,NYCDCC contracts are in writing and signed; never (to our knowledge) has a MOU beenpresented or accepted as a completed CBA. New York State Law is clear on this point:New York State LawThe law on this point is well settled. Under New York law, ifparties do not intend

to be bound by an agreement until it is in writing and signed, then there is no contractuntil that event occurs. This rule holds even if the parties have orally agreed upon all theterms of the proposed contract. Scheck v. Francis. 26 N.Y.2d 466, 311 N.Y.S.2d 841,843, 260 N.E.2d 493, 494 (1970).

Thanks to Counsel Rohdes, we have case reference: Pr"dentaIIns"rance Co. o fAmerica v.HUton Hotels Corp et al1996 Dist. which is an attempt to tell the Court thisMOU has now magically evolved into a Type 1 preliminary agreement. This is also due

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to Counsel Rohdes failure to find any relevant case reference of a (4 page) MOU being acomplete CBA. Yet the courts have clearly ruled that a Type I preliminary a g r e e m ~ n t isbinding only if "the substantial terms of a contract have been agreed on, and there ISnothing left for future settlement" :Pisken v. Herter, 73 N. Y. App. Div. 453, 77 N. Y.Supp. 300, arrd without opinion, 175 N. Y. (1903) 480,67. That is not the case here;the substantial terms of the WC&C CBA had not been presented in the MOU, and onlyafter the Aug. 22, 2012 vote were the substantial terms negotiated.

As we can see in: Consarc Corp. v. Marintt Midland Bank, N.A.., 996 E2d 568,575 (2d Cir.1993).

In considering whether parties intended to be bound only be a written agreement,courts look at a list of four factors, wherein "[n]o single factor is decisive, buteach provides significant guidance." Id. at 75. Specifically, [p]ursuant to NewYork law, the Court must balance four factors to determine whether a partycommunicated an intent to be bound only by a signed agreement: (a) whether theparties expressly reserved the right to be bound only be a signed writing; (b)whether either party has partially performed under the agreement; (c) whether theparties agreed on all the terms of the alleged contract, and (d) whether the type ofcontract involved is usually put in writing. The first factor is the most important,and has in some cases found to be dispositive.And again in: FaragoAdver., Inc. v. Hollinger Intern., Inc., 157 ESupp.2d252,258-159 (S.D.N.Y. 2001) (citations an d internal quotation marks omitted).[626

F.Supp.2d 364.Expressed another way, [i]f the court can see from the writings or correspondencethat the minds of the parties have met, that a proposal has been submitted by oneparty which has been accepted by the other, and that the terms of the contracthave been in all respects definitely a eed upon, one of the parties cannot evadeor escape from his obligation by re ing to sign the formal contract, which theparties understood was subsequentl to be drawn and executed.As well as: BoG. Group, Inc. v. Ho & Hardart Co., 751 E ld 69, 74 (ld Cir.1984) (citations omitted). On the other hand, where there is no understanding that an agreement should notbe binding until reduced to writing and formally executed, and where all thesubstantial terms of a contract have been agreed on, and there is nothing left forfuture settlement, then an informal agreement can be binding even though theparties contemplate memorializing their contract in a formal document. The pointof these rules is to give parties the power to contract as they please, so that theymay, if they like, bind themselves orally or by informal letters, or that they maymaintain 'complete immunity from all obligation' until a written agreement isexecuted. What matters are the parties' expressed intentions, the words and deedswhich constitute objective signs in a given set of circumstances.

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It is again clear that the Court intended to allow preliminary agreements to bebinding ONLY if "all the substantial terms of a contract have been agreed on," and "thereis nothing left for future settlement." That is not the case in regards to the WC&C or anyother contract that comes before the NYCDCC delegate body for approval. All contractsof the NYCDCC have been non binding until they are signed by all parties. AllNYCDCC CBAs are put in writing, and the parties had NOT agreed to all terms of thiscontract. Under NY Law alone the MOU was and is not a binding contract.

As Your Honor is aware, the contracts are complex legal documents effectingmembers rights. The executed contract (CBA) was not properly or timely submitted tothe Council Delegate Body (COB), Executive Committee, or rank-and-file Membership,for proper dissemination, review, debate, or contract ratification, per the past practiceunder new (2011) District Council bylaws as established by the COB and follow-throughMarch 27, 2012 vote by the rank-and-file on five (5) CBAs, supervised and counted bythe American Arbitration Association (AAA). Neither Counsel Murphy or CounselRohdes have supplied any case reference that proves this honorable Court can approve acompleted CBA when only a 4 page MOU was presented for Delegate Body approval.We respectfully contend that a completed CBA has not been submitted to the delegatesfor approval for therefore Your Honor must withhold approval until it has been presentedfor vote.

We further ask Your Honor to consider the substantial problems and failures of thedelegate body as have been presented before this Court in both members submissions,and Review Officer Walsh. At the hearing ofmember Daniel Franco on April 3, 2013Your honor was advised as to serious violations at the District Council and duringdelegate meetings: falsified minutes; lack of decorum and delegate abuse; discord anddissension facilitated by ignorance ofExecutive Board members and/or selectiveknowledge and application of the rules and procedure that MUST be followed to allowdelegates a fair and honest vote; blatant attempts to withhold information from membersand delegates, which the RO has declared a "stranglehold on transparency"; a failedSection 52 trial system; and, the "Notice(s) ofPossible Action" by the RO for the formerPresident, and current Executive Secretary-Treasurer. We ask Your Honor to considerwhat approvals of this delegate body can be binding, considering the undemocratic andunfair operation of the NYCDCC; the delegate meetings with many actions taken inviolation of the bylaws, UBC Constitution, and possibly State and Federal statutes.

We find i t very unsettling that Counsel Murphy would attempt dictate to YourHonor as to what the Court's powers and rights are. It was rather audacious for CounselMurphy to let Your Honor know "he would be remiss in not pointing out the following.The authority of the U.S. District Courts to determine questions of contract formationunder LMRA Section 301 (a) were severely curtailed by the Supreme Court's ruling [ .. ]"Perhaps Mr. Murphy has forgotten or has chosen to ignore that your Court has fulljurisdiction and oversight powers over the entire NYCDCC during the term of thisConsent Decree.

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"Because consent decrees 'have attributes both of contracts and judicialdecrees,' they are treated differently fo r different purposes." UnjtedStqtes l { l ITContinental BaJd713 Co.. 420 U.S. 223,236, n. 10,95 S.Ct. 926,934, n. 10,43 L.Ed.2d148 (1975). See also Firefighters v. Cleveland, 478 U.S., at 519, 106 S.Ct, at 3074.

"For example, because the content of a consent decree is generally a productof negotiations between the parties, decrees ar e construed for enforcement purposesas contracts." See: l IT Continental a k i n ~ Co.. supra, 420 U.S., at 238, 95 S.Ct, at 935;Stotts v. Memphis Fire Dept., 679 F.2d 541, 557 (CA6 1982), rev'd on other grounds, 467U.S. 561, 104 S.Ct 2576, 81 L.Ed.2d 483 (1984).

While the Supreme Court may have curtailed U.S. Distr ict court rights in TextronLycomin&: Reciprocatin&: Eu&:ine Div". Avco Corp. v. UAW, 523 U.S. 653, 118 S.Ct. 1626(1998) that reference has no bearing here since Your Honor is operating under theauspices of a consent decree. The membership would be well served if Your Honor wouldremind Counsel Murphy of such conditions.

We respectfully request that Your Honor refuse to sign the WC&C CBA until acomplete and final draft has been presented to the Membership or at the very least theDelegate Body for vote. If it is to be a delegate vote we respectfully ask that Your Honorsign an Order for the NYCDCC to present this final draft for the delegates to review atthe very minimum of four weeks prior any vote so they may properly execute their dutiesas delegates representing the Local Union membership. We ask that all future contracts begiven the same accommodation as required by the NYCDCC bylaws. We ask that theCourt issue an Order directing that no part of the WC&C CBA be implemented untilYour Honor has signed a final draft that was voted on and approved by the Membershipor Council Delegate Body.

We pray Your Honor wi ll also review and docket the attached letters whichreiterate our contentions on the legality of Full Mobility and the legality of an MOU.They further explore how full mobility violates the Consent Decree, argues thecompliance program will not be sufficient for combating the corruption that 100%employer control will bring and argues for our rights as Members to a hiring halLRespectfully submitted,I J ~ I J . ~Demian D. SchroederMemberLU 45Certified Steward

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cc: BY E-MAILBenjamin H. TorranceAssistant United States AttorneyCivil DivisionOffice of the United States Attorneyfor the Southern District of New York86 Chambers StreetNew York, NY 10007Dennis M. Walsh, Esq.Review OfficerThe Law Office of Dennis M. Walsh415 Madison Avenue, 11th FloorNew York, NY 10017Bridget M. Rhode, Esq.Counsel to the Review OfficerMintz, Levitz, Cohn, Ferris, Glovsky & Popeo, P.e.666 Third AvenueNew York, NY 10017New York City & Vicinity Distr ict Council of Carpenters Executive Secretary-Treasurer Michael Bilello 395 Hudson Street New York, NY 10014 James M. Murphy, Esq. Counsel for the New York City & Vicinity District Council of Carpenters Spivak Lipton, LLP 1700 Broadway New York, NY 10019 John DeLollis Executive Director Association of Wall-Ceiling & Carpentry Industries of New York, Inc. 125 Jericho Turnpike, Suite 301 Jericho, NY 11753-1022 Mark A. Rosen, Esq.Counsel for the Association of Wall-v Ceiling & Carpentry Industries of New York, Inc.McElroy, Deutsch, Mulvaney, & Carpenter, LLP1300 Mount Kemble AvenueMorristown, NJ 07962-2075

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ADDITIONAL SERVICE via E-Mail:Robert F. Makowski,Sterling Dadone,Norman Saul,Raynier Gamboa,Veronica Session

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