Full opinion text
OPINION GRIESA, District Judge. This opinion constitutes the court’s findings of fact and conclusions of law following the trial of the union defendants in this action. This action was commenced on October 15, 1987. It is brought under the civil provisions of the Racketeer Influenced and Corrupt Organizations Act (RICO), 18 U.S. C. §§ 1961 et seq. The Government claims organized crime control and RICO violations in the operation of New York’s Fulton Fish Market. The original complaint named several groups of defendants. The first group was the “union defendants” — i.e., Local 359, United Seafood Workers, Smoked Fish and Cannery Union, and certain officers of Local 359. Although there were six officer defendants named in the complaint, and a seventh later named in the amended complaint, the Government withdrew its claim against five of them following trial. The only officer defendants remaining in the action are: Anthony Cirillo, President Dennis Faicco, Secretary-Treasurer The next group of defendants was the union welfare and pension funds — the Fulton Fish Market Welfare Fund and the Fulton Fish Market Pension Fund — and Anthony Cirillo and Dennis Faicco, in their capacities as trustees of those funds. Nina Andrew, Executive Administrator of the funds, was also named as a defendant. The third group of defendants were the “Genovese Organized Crime Family of La Cosa Nostra” and 29 persons allegedly connected with the Genovese crime family, including Thomas Contaldo (said to be a “capo” of the family), Carmine Romano (allegedly a “made member” of the family) and Carmine Romano’s brothers, Vincent and Peter Romano (allegedly “associates” of the Genovese family). The final defendant named in the complaint was the Fulton Market Employers Association and Associated Purveyors. The original complaint alleged that the Genovese crime family has controlled the Fulton Fish Market and Local 359 since the 1930’s and that commencing in the 1970’s, Carmine Romano, an officer of Local 359, acted for the Genovese family in controlling the Market. The complaint alleged that in 1981 Carmine Romano and Peter Romano were convicted of criminal RICO violations and were given prison sentences, and that Local 359 was also convicted under RICO and was fined. The complaint alleged that, despite these criminal convictions, the influence of the Genovese crime family in the Fulton Fish Market continued, and that Vincent Romano succeeded his brother Carmine as the principal Ge-novese representative in the Market. The complaint contained various allegations of criminal activities by the Genovese family in the Fulton Fish Market — extortion, loansharking, gambling and theft. The complaint alleged that Local 359 is controlled by the Genovese family and that this union “is a vital part” of Genovese control of the Fulton Fish Market, since the union can be used to threaten labor problems. It was also alleged that Anthony Cirillo is merely the “nominal” president of Local 359, and that he was handpicked by the Genovese family for this office. Vincent Romano is said to be the actual head of Local 359. The complaint requested injunctive relief to prevent further violations of law, and also requested the appointment of a trustee for Local 359 and an administrator for the Fulton Fish Market. The complaint requested election of new Local 359 officers sometime in the future. Disposition of Non-Union Defendants On December 1, 1987 the Government stipulated to dismiss the complaint as to the Welfare Fund, the Pension Fund and Nina Andrew. This stipulation also provided that the claims in the complaint against Anthony Cirillo and Dennis Faicco, in their capacity as trustees of the funds, would be dismissed. On April 15, 1988 a default judgment was entered against the Genovese Organized Crime Family and against three of the defendants allegedly connected therewith — Thomas Contaldo, Colombo Saggese and Robert Gillio. Under the terms of the default judgment, these defendants are enjoined from having any dealings with Local 359 and from having any business dealings in the Fulton Fish Market or in any commercial seafood business in the Southern District of New York or elsewhere. On the same day, April 15, 1988, the other 25 individual defendants named as being connected with the Genovese crime family entered into a consent judgment. Under this judgment, defendants Carmine Romano and Vincent Romano are enjoined from having any dealings with Local 359 and from having any business dealings in the Fulton Fish Market. Certain other defendants are enjoined from having dealings with Local 359, but are not prevented from engaging in business in the Market. All defendants are made subject to injunctive provisions forbidding extortion, gambling and loansharking, and also forbidding them from dealing with Local 359 in any illegal manner. The consent judgment provides for the appointment of an administrator for the Fulton Fish Market whose duty it is to ensure compliance with the consent judgment and the default judgment. The action was dismissed as to the Fulton Market Employers Association and Associated Purveyors by order dated July 6, 1988, consented to by the Government. Amended, Complaint Against Union Defendants On June 4, 1988 the Government filed an amended complaint. It is directed solely against the union defendants — Local 359 and, as now limited, to two of its officers, Cirillo and Faicco. Although only the union and certain of its officers are named as defendants in the amended complaint, it basically repeats the lengthy allegations in the original complaint about the control of the Fulton Fish Market by the Genovese crime family and about Genovese criminal activities in the Market. As to the union defendants, the essence of the allegations of racketeering in violation of RICO are the same in the amended complaint as they were in the original complaint — Genovese control of Local 359 and use of the union for criminal activities. The amended complaint requests, as did the original complaint, that certain officers of Local 359 be removed, that a trustee be appointed for the union and that election of new officers be held sometime in the future. As already indicated, the request for removal of officers has now been limited to Cirillo and Faicco. The amended complaint alleges various types of criminal activity committed by Cir-illo and Faicco, acting in conjunction with the Genovese crime family. The only allegation of crime against the union itself is the claim of illegal receipt of money, in violation of the Taft-Hartley Act, for which the union was convicted in 1981. As the issues are now defined, the Government does not contend that this matter is of any relevance to the question of whether Cirillo and Faicco should be replaced by a trustee and later by newly elected officers. However, the union remains as a defendant in the case because it would be affected by the relief the Government requests against Cirillo and Faicco. Following the trial held August 1-17,1988 the Government’s claims of criminal acts committed by Cirillo and Faicco were refined and limited in the Government’s post-trial briefs, in its presentation at the oral argument held August 25, 1988, and in a letter dated September 19, 1988. The Issues To Be Decided The Government contends that it is entitled to civil RICO remedies under 18 U.S.C. § 1964 as a result of violations of 18 U.S.C. § 1962(c), which provides: (c) It shall be unlawful for any person employed by or associated with any enterprise engaged in ... interstate or foreign commerce, to conduct or participate, directly or indirectly, in the conduct of such enterprise’s affairs through a pattern of racketeering activity.... The statute provides for a number of possible equitable remedies to prevent and restrain violations of § 1962. It is conceded that removal of Cirillo and Faicco from their union offices would be authorized by the statute if they were found to have violated § 1962 and if such a remedy were necessary to prevent further violations. A “pattern of racketeering activity,” within the meaning of § 1962(c), means at least two “acts of racketeering activity” committed within certain specified periods of time. 18 U.S.C. § 1961(5). An act of racketeering activity is one of the federal or state crimes listed in § 1961(1). The parties concede that, in a civil RICO action, the Government may prevail if it proves the necessary elements by a preponderance of the evidence. It is agreed that the Fulton Fish Market is an “enterprise” within the meaning of the statute. Moreover, there appears to be no question but that the Genovese crime family was, at least in the past, heavily involved in criminal activity in the Fulton Fish Market, including the use of Local 359 to further the Genovese family’s criminal objectives. However, the union defendants contend that following the criminal convictions of 1981, the union was effectively purged of Genovese control and influence. The union’s International established a trusteeship of Local 359 which lasted from 1981 until 1983. A new slate of officers headed by Anthony Cirillo was elected in 1983 with the concurrence of the International. Faic-co came to the union thereafter, first as an employee and then as an officer. The union defendants concede that Vincent Romano was involved in the Fulton Fish Market following the conviction of his brother Carmine in 1981. They concede that this involvement lasted until the time of the present litigation. Moreover, they have not attempted to rebut thé Government's evidence that Vincent Romano was connected to the Genovese crime family, particularly through a close association with one of the leaders of the family, Thomas Contaldo; that Vincent Romano was involved in certain criminal activities in the Fulton Fish Market; and that these activities occurred at various times subsequent to the 1981 criminal convictions of Carmine and Peter Romano. However, the union defendants contend that any crimes of Vincent Romano, at least in recent years, were carried on outside the union and did not involve collaboration with Local 359 or its officers. It is appropriate at this point to emphasize one overriding factor. The essential theme of the Government’s case against the union defendants is that the union is controlled by the Genovese crime family and that the various crimes committed by Cirillo and Faicco resulted from Genovese control. This alleged control is the essential nexus which is said to make the crimes a “pattern of racketeering activity” in violation of RICO, rather than several separate, independent criminal acts. The Government’s case is not built upon the theory of crimes committed by Cirillo and Faicco as independent individuals. The essential element of the Government’s case is that the union and these two officers are tools of the Genovese crime family. The Government seeks to have Cirillo and Faic-co removed in order to end Genovese control over the union. The Government’s allegations of criminal conduct — acts of racketeering — on the part of Cirillo and Faicco, as specified in its post-trial submissions, are as follows: 1.Wire Fraud in 1985 Contract Negotiations. The Government alleges that Cirillo and representatives of the Genovese family carried out a wire fraud scheme to defraud the membership of Local 359 of money and property in connection with the negotiation of the 1985 collective bargaining agreement. According to the Government, the scheme resulted in the following: (a) The right to strike was relinquished and an inadequate wage increase was agreed to. (b) A concession was made by the union to a class of employers called “purveyors,” which included Intercity Fish, a company owned by a relative of Vincent Romano. (c) Confidential information about the negotiations (which information is, in the Government’s view, property) was conveyed by Cirillo to Vincent Romano. 2. Wire Fraud in Aiding Steve Melfi. The Government alleges a second wire fraud scheme in which Cirillo is said to have assisted Carmine Romano’s son-in-law, Steve Melfi, to obtain a job at the Fulton Fish Market. It is the Government’s theory that Cirillo had a fiduciary duty to fairly and impartially assist the members of Local 359 in obtaining jobs and that he violated this duty in giving assistance to Melfi. 3. Taft-Hartley Act Violations. The Government alleges that out of the union membership of 600, there are 20 who are owners, managers or supervisors of seafood businesses. The same problem appears to have existed with one or two other persons in the recent past. It is said that the receipt of dues by the union from these persons violates 29 U.S.C. § 186(b)(1), which makes it unlawful for a union to receive payments from an employer or any person who acts in the interest of an employer. 4. Extortion of Employers. The Government alleges that on certain occasions Cirillo and Faicco extorted payments of money from employers for the union. (a) It is alleged that Faicco committed extortion in connection with obtaining union memberships at Ocean of Europe Seafood, Ideal Fish and Seafood and Tsukiji Seafood. It is alleged that Cirillo participated in the extortion of Tsukiji. (b) It is alleged that Cirillo extorted payments from Americana Transport, a company which hauled fish from Maine to the Fulton Fish Market. The Government contends that these instances of extortion also involved Taft-Hartley violations — i.e., improper payments by employers to a union or an officer thereof. Findings and Conclusions The Fulton Fish Market The Fulton Fish Market is located on the lower east side of Manhattan near the Brooklyn Bridge. It is a wholesale market. There are 70 to 80 wholesale businesses, most of them consisting of the owner or owners and three or four employees. There are other businesses in the Market mainly designed to serve the wholesalers and their employees, such as an ice business, small trucking companies and eating places. The Market operates almost entirely at night — from about 10:00 p.m. to 8:00 a.m. The Market is open five nights a week— Sunday night/Monday morning through Thursday night/Friday morning. Fish are brought to the Market from all parts of the United States and from Canada, and indeed from foreign points such as Norway, South America and the Orient. Fish from Long Island, New England and other points on the Atlantic and Gulf coasts are trucked directly to the market. Fish from distant places are flown into Kennedy Airport and trucked from there to the Market. The total sales volume in the Market amounts to several hundred million dollars per year. More precise figures are not available. It appears that the quantity of fish handled in the Fulton Fish Market has declined somewhat over recent years, although one wholesaler testified at the trial that the quantity is now stabilized. The price of fish has risen sharply in recent times contributing to a high dollar volume in the Market. The first phase of the nightly market operation is the arrival of the trucks bringing in the fish to be distributed to the wholesalers. These trucks proceed to certain “unloading zones.” These zones are not owned by any entity in the Market, but are simply city streets which are largely unused at night except for the purposes of the Market. There are unloading crews which take the boxes of fish (100-125 lbs.) off the trucks. Employers of the wholesalers, known as journeymen, then put the boxes onto handcarts and take them to the premises of the wholesalers, where the fish is set out for sale. Sometime after midnight the buyers begin to arrive — fish retailers and restaurant operators. They usually arrive in vans or small trucks and proceed to “loading zones.” Again, these zones are not owned by anyone in the Market, but are city streets, including some of the roadway under the elevated East Side Drive. The retailers and restaurant operators will leave their vehicles in the loading zones and make the rounds of the wholesalers. When they make purchases of fish, it is often the case that some of their purchases will be taken to their vehicles while they are making other purchases in the Market. Members of “loading crews” will put the fish into the vehicles and keep a watch until the owners come back and drive away. The incoming truckers pay a fee to the unloading crews. The retailers and restaurant operators pay a fee to the loading crews. The author of this opinion has visited the Market during its active hours in the middle of the night. It is difficult to overstate the tremendous amount of fast-paced hard work which goes on in the Market — the movement of hand trucks with 400-500 pounds of fish from the incoming trucks to precise locations among the 70-80 wholesalers; the bargaining activity between the wholesalers and hundreds of retailers and restaurant operators; the delivery of the fish to the vans and trucks of the purchasers. The Union Local 359 has a membership of about 600 persons, about 450 of whom work in the Fulton Fish Market. Some of the members are employed in other locations in New York City, and in New Jersey. The decline in the volume of fish in the Market in recent years has led to a decline in the number of jobs available and also a decline in union membership. At the present time, the dues of union members are $26 per month and are usually deducted from the paychecks. The initiation fee for new members is $150. Contributions to the pension and welfare funds are made by the employers at the rate of $94 per week for each employee who is a union member. Not all the workers in the Market who are eligible for union membership are in fact members. For instance, the unloading crews and the loading crews have never been unionized, and some employees of wholesalers are not. It appears well established that the Ge-novese crime family was at one time in control of Local 359. Carmine Romano, a “made member” of the Genovese family, was the chief executive officer of Local 359 from 1974 to 1980. He was succeeded in this capacity by his brother, Peter Romano, who served until the time of the criminal convictions of himself and Carmine Romano in 1981, at which time the International established a trusteeship for Local 359. Both these Romanos went to prison. Peter has been released. Carmine is still in prison but will be released shortly. The trusteeship of Local 359 functioned from August 21, 1981 until December 1, 1983. Cirillo and Faicco Anthony Cirillo started working in the Fulton Fish Market in 1972. He spent about 6 years working as a journeyman and about another 4 years as a salesman. He joined Local 359 shortly after he started working in the Market. He became a member of the board of the union in 1980. In 1982, while the union was under the trusteeship, Cirillo was appointed business agent. Cirillo was elected president of Local 359 in October 1983, a position he still holds. This is his full-time employment. He holds no other job in the Market or elsewhere. A major function of Cirillo as union president is to help members obtain work. Each night some union members will “shape up” — i.e., seek employment in the Market for that night. Cirillo helps place these men and also helps members in finding more permanent employment. Cir-illo takes various steps to protect the safety of the employees in the Market. He watches out for unsafe conditions and seeks to have them remedied. Cirillo is also responsible for collecting delinquent dues and pension and welfare contributions. Cirillo exercises some supervision over Faicco, and also supervises the two office employees at the union who process claims against the pension and welfare funds. Cirillo’s salary is about $32,000 per year. Dennis Faicco has never had any other employment in the Market except with the union. He started in June 1984 as business representative. He was appointed by the board to be secretary-treasurer in September 1985 and was elected to that office, which he still holds, in September 1986. His main duties are organizing — i.e., obtaining new members — and handling grievances. His work day for the union is from about 6:00 a.m. until noon. His salary is about $30,000 per year. He has a second job as groundskeeper for the Town of Hempstead. His hours on that job are 1:00 p.m. to 7:00 p.m. Operation Seaprobe Commencing in October 1984 there was an investigation of the Fulton Fish Market conducted jointly by the FBI and the New York City Police Department. This investigation was called “Operation Seaprobe.” The investigation is still going on to some extent, although apparently the most active phase was concluded in the fall of 1987. Until that time Operation Seaprobe regularly employed a staff of 24 law enforcement officers — 12 FBI agents and 12 New York City policemen. The investigation included surveillances in the Market and also in Brooklyn, Queens and Staten Island. One of the reasons for the surveillances outside the Market was to determine whether persons involved in the Market were meeting organized crime figures elsewhere. The investigation also involved a number of court-ordered telephone wiretaps. In addition, there were numerous interviews. As to interviews directed at the union, these focused mainly on retired members. There was little or no attempt to interview active members. Certain aspects of the investigative results as to the union and its officers should be noted here, particularly in view of the Government’s repeated allegations that the Genovese family, through its control of the union and through the threat of labor problems, has been able to dominate the entire Fulton Fish Market. John Marley, the Government’s principal witness regarding Operation Seaprobe, has testified that the investigation uncovered no evidence of work stoppages or threats of work stoppages in the Fulton Fish Market during the time of the Seaprobe investigation. Neither Cirillo nor Faicco was ever observed committing any illegal act. Although certain telephone wiretaps were used, apparently none was placed upon the telephone of Cirillo or the telephone of Faicco. At least no evidence of such wiretaps was introduced at the trial. The alleged instrument of Genovese control of Local 359 during the time of the Seaprobe investigation was Vincent Romano. There is a substantial amount of evidence of contacts between Romano and the Genovese family capo Thomas Contaldo, mostly outside the Market. Prior to the time of the consent judgment of April 1988, Romano was frequently present in the Market and also continually in communication with various persons in the Market. The Seaprobe investigation uncovered evidence that Romano was involved in criminal activity in the Market at the behest of the Genovese family, including some extortion of wholesalers. However, the evidence indicates that the degree of criminality in the Fulton Fish Market following the 1981 convictions of Carmine and Peter Romano has been considerably less than it was prior to 1981. As to criminal activity by Vincent Romano involving the union, even the Government’s claims are of a limited nature. These claims will be dealt with hereafter. The Government introduced photographs showing meetings of Vincent Romano with Contaldo and two of Contaldo’s subordinates, Alfonso Malangone and Gerard Guadagno. There is no evidence of any contact by Cirillo or Faicco with Contaldo, Malangone or Guadagno either inside or outside the Market. As far as Vincent Romano’s communications with Cirillo are concerned, Romano’s telephone was tapped for about one year, from August 1985 to July 1986. He placed calls on a daily basis to the public telephone at Carmine’s Bar and Grill, a popular eating place in the Market, and asked for various people in the Market. In none of these calls did he ever ask for Cirillo. The only recorded telephone conversations between Vincent Romano and Cirillo occurred in late 1985, at the time of collective bargaining negotiations involving Local 359. These are the subject of a claim by the Government which will be discussed hereafter. During Operation Seaprobe, Vincent Romano and Cirillo were observed talking about 100 times in or near Carmine’s Bar and Grill. These 100 occasions occurred over a period of about three years. There is no evidence of what was said in these conversations. There is no specific evidence connecting any of these conversations with any illegal activities. Nothing was ever observed being passed between the two men in any of these meetings. Wire Fraud Claim — 1985 Contract Negotiations The Government contends that Cirillo committed acts of racketeering consisting of wire fraud in violation of 18 U.S.C. § 1343. The statute provides: Whoever, having devised or intending to devise any scheme or artifice to defraud, or for obtaining money or property by means of false or fraudulent pretenses, representations, or promises, transmits or causes to be transmitted by means of wire, radio, or television communication in interstate or foreign commerce, any writings, signs, signals, pictures, or sounds for the purpose of executing such scheme or artifice, shall be [guilty of a crime]. As already described, the Government claims wire fraud in connection with the 1985 collective bargaining negotiations involving Local 359. The Government contends that Cirillo and Genovese family representatives engaged in a scheme to defraud the union, and that the union (1) relinquished the right to strike and obtained an inadequate wage increase; (2) made a concession to a class of employers called "purveyors,” which benefited the family of Vincent Romano; and (3) betrayed confidential information. The Government contends that the fraud was perpetrated by concealing the above activities from the union membership. The Government relies upon certain telephone calls to bring the alleged scheme within the wire fraud statute. The three-year collective bargaining contract between Local 359 and the employers, most of whom were represented by the Fulton Market Employers Association and Associated Purveyors, expired November 30, 1985. Negotiations for a new contract took place in the fall of 1985 and were not concluded until almost the deadline — midnight November 30. At that time a new contract was agreed upon and was subsequently ratified by the union. It is nothing short of astonishing that the Government would claim that the union settled for an inadequate wage increase — “ridiculously low” as the Government put it at the oral argument. The Government, in its case, introduced no testimony whatever about the course of the negotiations regarding wages. The Government introduced no evidence directed in any way toward the proposition that the wages under the new collective bargaining agreement were less than they should have been had the bargaining been conducted by the union representatives in some different manner. In the defense case, Cirillo testified that he had a goal of reaching $500 per week for the largest class of employees in the Market, the journeymen, and that he achieved that goal. The new collective bargaining agreement provided that journeymen would be paid $500 per week the first year of the contract, $520 the second year, and $542.50 the third year. This compared with the wages for journeymen under the previous contract — $432.52 for the first year, $452.52 for the second year, and $477.52 for the third year ending November 30, 1985. There is no basis for the claim that the wage rates achieved in the 1985 contract were somehow a fraud on the union membership. The next issue to be dealt with is the claim that Cirillo and the Genovese family defrauded the union membership in the 1985 collective bargaining negotiations by having the union make a concession to a class of employers called “purveyors.” This claim refers to Article IX, section 2 of the December 1, 1985 collective bargaining agreement. The provision was as follows: Sec. 2. Effective December 1,1985, new employees of purveyors may be paid a probationary rate as follows: start 50% of scale after 6 months 70% of scale after 12 months 80% of scale after 18 months 100% of scale The probationary rate shall not apply to those extras employed by the purveyor for six (6) months as of December 1,1985 or employed by the purveyor for 10 or more days in the month of November, 1985. Thus, new employees of purveyors were not paid the full wages of the employees of wholesalers, but were paid a percentage of those wages on a sliding scale for the first 18 months of their employment. A purveyor is generally a dealer who cuts the fillets out of the fish and sells the fillets to restaurants. A wholesaler usually sells the whole fish or, in the case of a variety such as swordfish, large sections. The collective bargaining agreement which expired November 30, 1985 contained no provision for the reduction of wages of new employees of purveyors. This provision was inserted for the first time in the agreement which became effective December 1, 1985. The Government contends that Cirillo made this concession to the purveyors at the behest of Vincent Romano, whose brother-in-law owned a purveying company, Intercity Fish. The facts are otherwise. The reason that the purveyor matter came up in the 1985 negotiations was that the purveyors learned that there was a wage concession contained in the separate collective bargaining agreement which Local 359 had with a purveyor, M. Slavin & Son. The other purveyors, represented by the Employers Association, insisted upon their right to have equal treatment under the “most favored nation” clause, which was routinely contained in the collective bargaining agreements over the years. The union at first resisted the Employers Association on this point, declining even to produce the Slavin agreement. The Association demanded arbitration, which resulted in a ruling on November 22, 1985 that the Slavin agreement should be produced to the Association. Thereafter it followed virtually as a matter of course that the provision regarding new employers of purveyors was inserted in the 1985 collective bargaining agreement pursuant to the most favored nation principle. It is true that Vincent Romano’s brother-in-law owned a purveying company, Intercity Fish, which was a member of the Employers Association. It is further true that Intercity Fish benefited from the provision for new employees of purveyors which was included in the 1985 collective bargaining agreement. However, there were at least four other purveyors in the Association. The spokesman for the purveyors in the negotiations was Robert Smith. He testified at the trial and denied any scheme instigated by Vincent Romano. The court credits this testimony. There is no basis for believing that Smith, Cirillo or any of the negotiators were acting at the behest of Vincent Romano in dealing with the provision regarding purveyors. The Government contends, however, that Vincent Romano’s control over the negotiations was evidenced by certain recorded telephone conversations. The Government goes so far as to contend that Vincent Romano was “dictating the outcome of the negotiations” (Transcript of August 25, 1988, p. 1528). In considering these telephone conversations, it should be recalled that negotiations on the new collective bargaining agreement were taking place until virtually the final hour, midnight November 30, 1985. Recorded telephone conversations occurred between Vincent Romano and Anthony Cirillo on the afternoon of November 28; the evening of November 29; the afternoon of November 30; and at 1:18 a.m. December 1, shortly after the new contract was agreed upon. Vincent Romano had a telephone conversation with Vincent Tattick, a member of the employers’ negotiating committee, on the morning of November 30. Vincent Romano had telephone conversations with Gerard Guadagno, the driver for Thomas Contaldo of the Genovese family, on the afternoon of November 29 and twice on the afternoon of November 30. It is obvious that Vincent Romano was interested in learning about the course of the collective bargaining negotiations and in learning about whether a contract was arrived at. Romano was about to become the owner of a trucking company in the Market. Although the trucking company was not unionized and did not have a direct stake in the Local 359 negotiations, it had an indirect interest since its business depended upon the functioning of the Market. It is also clear that Vincent Romano was passing on information regarding these subjects to the Genovese family via his conversations with Guadagno. It is now necessary to summarize the relevant portions of the recorded telephone conversations to determine if they indicate, as claimed by the Government, that Romano controlled the 1985 collective bargaining negotiations. In the conversation between Cirillo and Vincent Romano the afternoon of November 28, Cirillo remarked that “They’re still holding onto that ah, to that two-tier thing.” In his trial testimony Cirillo explained that the employers were constantly trying to get a two-tier wage scale involving different wages for new hires. This apparently was something that went substantially beyond what was involved in the concession to the purveyors. In the November 28 telephone conversation Romano replied that he thought that the employers were using the two-tier demand as a wedge to try to knock other terms down. Romano told Cirillo that he should tell the employers tomorrow to forget about the two-tier thing. Cirillo responded that he had already told the employers that. The two-tier approach was not adopted as part of the contract. There is no evidence that the discussion between Cirillo and Romano on November 28 had any influence on the outcome regarding that point. Romano spoke to Guadagno the afternoon of November 29. Neither Romano nor Guadagno testified at the trial to explain this conversation. What the transcript shows is that Guadagno had been waiting for a call from Romano. Romano agreed to give Guadagno word about the negotiations that night. Guadagno said something about having “those guys standing by.” Romano stated: No, no, it don’t look like it’s gonna be tomorrow, but we, I won’t know ‘till like 5:30, six o’clock. The Government contends that Guadag-no’s reference to having “those guys standing by” relates to the fact that the Ge-novese family intended to break a strike if one occurred. However, this meaning is not necessarily suggested by the conversation itself and there is certainly no other evidence to support the idea of a plan to break a strike. Romano called Cirillo the evening of November 29. Cirillo stated that no agreement had been reached, that a meeting was scheduled for the next day, and that “these guys go to the eleventh hour.” Cirillo then made the following comment: Ah, I threw in a few concessions, ah, that ah, you know, ah, you know, you know, with the mob, ah, ah, um, just let me leave it that ah, ah, we didn’t come to an agreement and I’ll call you in the morning. Cirillo did not tell Romano what the concessions were. At the trial Cirillo was asked what was meant by “the mob.” He denied that he was referring to organized crime and stated that he was referring to the men in the Market. Then he stated that he believed that Romano was relaying information to truckers in New Bedford and that maybe “the mob” referred to these truckers. Cirillo’s testimony on this point was evasive. On the other hand, the reference to “the mob” is so fragmentary and cryptic that, despite the common association of the phrase “the mob” with organized crime, it cannot be determined exactly what is being referred to in this conversation. It should be said at this point that one must assume that Cirillo knew the facts of life — i.e., knew that Vincent Romano had associations with the Genovese crime family. Moreover, it is certainly true, as the court stated emphatically at the trial, that, as a matter of good judgment, Cirillo should not have been in touch with Romano about union matters. On the other hand, it is a foundational principle of our law that there is no “guilt by association”. The Government’s claim that Cirillo participated in a scheme to have the negotiations carried out at the behest of, and for the advantage of, the Genovese family is not proved by the mere fact of conversations between Cirillo and Romano, including one isolated reference to “the mob.” There must be proof of the Genovese family dictating or directing or at least influencing Cirillo in the negotiations. It is fair to say that, at least through the time of the conversation held on the evening of November 29, there is no proof that this was occurring. Vincent Romano called Vincent Tattick of the employers’ negotiating group early in the morning of November 30. Romano wanted to know what was happening in the negotiations. Tattick replied that they would try again that day. There was no discussion of any particular issues and Tat-tick was entirely noncommittal on what he thought the prospects were for an agreement. The essence of what he communicated to Romano was contained in the remark, “So let’s see what happens.” Romano called Guadagno later in the afternoon of November 30 to say that the negotiators were still tied up in talks. Guadagno called Romano shortly thereafter, saying, “We got those guys standing by.” Romano said that he would know tomorrow one way or the other and that “the most they’re gonna do is maybe get a 24-hour extension.” Again, the Government argues that this conversation represents a plan to use “those guys” to break a strike if one occurred. However, the evidence is not sufficient to support such a claim. At about midnight November 30 an agreement was reached between the union and the employers. The first person notified by Cirillo was Vincent Romano. Cirillo telephoned Romano at 1:18 a.m. December 1. Cirillo stated in substance that a contract had been arrived at, except for M. Slavin & Sons, who negotiated separately. Romano asked what the settlement was and Cirillo replied that, “we hit it right on the head.” Cirillo added that it was a good medical package. He stated that there had been a few concessions for new hires for the purveyors. Romano stated: Yeah, now, in other words, it’s okay, they can start shipping in. Cirillo replied in the affirmative. On December 2 Vincent Romano called Phyllis Canino. She was Romano’s sister and was also the wife of Michael Canino, a co-owner of Intercity Fish, the seafood purveyor referred to earlier in this opinion. Romano and Phyllis Canino expressed satisfaction at the purveyor concession obtained by the purveyors. However, as already described, there is no evidence that Romano had any abnormal role in obtaining that concession. To return to the recorded conversations between Cirillo and Romano, it is important to understand what they do not show. Except for the rather minor point about the two-tier issue, these recorded conversations do not show that Romano gave any instructions or directions to Cirillo as to what he should or should not do in the negotiations. They do not provide proof that Romano was controlling the negotiations or that Cirillo was acting at the behest of Romano. This brings us to the final wire fraud claim relating to the 1985 negotiations — i.e., that confidential information, alleged by the Government to be property, was conveyed by Cirillo to Romano. This claim is without merit. The Government has given no precise definition of what it means by “confidential information.” However, it is certainly true that there are matters connected with labor negotiations which should be held in confidence by a negotiator such as Cirillo. Certainly, advance notice of union negotiating strategies should not be disclosed to the employers or to outsiders. Also, it might well be improper for a negotiator to predict the probable outcome of the negotiations to outsiders who could take advantage of this information in some way. Cirillo had no discussion with Romano about negotiating strategies he planned to use. Cirillo made no attempt to give Romano any prediction about the outcome of the negotiations or about whether there would or would not be a strike. The Government has not shown that Cirillo conveyed confidential information to Romano. Wire Fraud Claim — Aiding Steve Melfi The Government contends that Cirillo was party to another wire fraud scheme in assisting Carmine Romano’s son-in-law, Steve Melfi, to obtain a job at the Fulton Fish Market. The Government notes the statutory fiduciary duty Cirillo had to the union and its membership under 29 U.S.C. § 501(a) and asserts that Cirillo violated this duty by assisting Melfi, not then a union member, at a time when the union men were having difficulty obtaining jobs. The Government relies upon certain recorded telephone conversations as evidence of this alleged crime on the part of Cirillo. There is no merit to the Government’s claim. It is true that Steve Melfi was the son-in-law of Carmine Romano, who was in prison at the time in question. In March 1986 Carmine Romano telephoned Vincent Romano from prison and asked Vincent to help Melfi find a position in the Market. Carmine suggested that Vincent should talk to Cirillo, who might help. During the next few days there were two other recorded conversations between Carmine Romano and Vincent Romano and a recorded conversation between Vincent Romano and Melfi. Apparently Vincent assisted Melfi in getting a job. However, there is no evidence that Cirillo played any role whatever in obtaining the job for Melfi. After Carmine had suggested that Vincent talk to Cirillo, all that is said about Cirillo is that Cirillo “come down late,” and that Melfi was at some point waiting around and talking to Cirillo. These references are not explained in the evidence and do not add up to proof of a crime committed by Cirillo. Taft-Hartley Act Claim It was established at the trial that 20 of the members of Local 359 are owners, managers or supervisors of seafood businesses. The same situation appears to have existed for one or two other persons in the recent past. The Government contends that Cirillo and Faicco are guilty of criminal violations of the Taft-Hartley Act by virtue of the union’s receipt of dues from these owners, managers and supervisors. Several statutory provisions are relevant. We start with 29 U.S.C. § 186(a)(2), which provides: (a) It shall be unlawful for any employer ... or any person who ... acts in the interest of an employer to pay, lend, or deliver, or agree to pay, lend, or deliver, any money or other thing of value— (2) to any labor organization, or any officer or employee thereof, which represents, seeks to represent, or would admit to membership, any of the employees of such employer who are employed in an industry affecting commerce;.... Thus, it is unlawful for any employer or any person who acts in the interest of an employer to make a payment of money to any labor organization or to an officer thereof, where that labor organization represents the employees of such employer. A subsequent statutory section makes it unlawful for a union or a union officer to receive a payment made in violation of § 186(a)(2). This is the effect of § 186(b)(1), which provides: (b)(1) It shall be unlawful for any person to request, demand, receive, or accept, or agree to receive or accept, any payment, loan, or delivery of any money or other thing of value prohibited by subsection (a) of this section. The term “employer” is defined in § 152(2), although the definition is not particularly helpful on any issue in the present case. Of more interest is the definition of “employee” in § 152(3), which provides that this term does not include “any individual employed as a supervisor.” The term “supervisor” is defined in § 152(11) as follows: (11) The term “supervisor” means any individual having authority, in the interest of the employer, to hire, transfer, suspend, lay off, recall, promote, discharge, assign, reward, or discipline other employees, or responsibly to direct them, or to adjust their grievances, or effectively to recommend such action, if in connection with the foregoing the exercise of such authority is not of a merely routine or clerical nature, but requires the use of independent judgment. In arguing the distinction between supervisors and other employees, the Government points to the definition of “bargaining unit” contained in the Local 359 collective bargaining agreements. This definition is contained in Article I, Section 1, which provides: Bargaining Unit. This agreement sets forth the wages, hours and terms and conditions of employment of all present and future employees of the Wholesale Fish Industry, Fish Purveyor Industry, and Fish Filet Industry, employed by the Employer during the term of this agreement (“Employees”), except that it shall not apply to executives, office and clerical employees and/or any supervisory employees with authority to hire, promote, discharge, discipline or otherwise effect changes in the status of employees or effectively recommend such action. The Government argues, on the basis of all of these statutory provisions, that it was a criminal violation of the Taft-Hart-ley Act for the union to accept dues from any owners of seafood businesses and also from any managers or supervisors employed in these businesses. Prior to 1984, the relevant criminal penalty provision, 29 U.S.C. § 186(d), read: (d) Any person who willfully violates any of the provisions of this section shall, upon conviction thereof, be guilty of a misdemeanor and be subject to a fine of not more than $10,000 or to imprisonment for not more than one year, or both. In 1984 the provision was amended to deal with payments made to unions by way of dues or contributions to a benefit fund, or other types of payments not relevant here, where any of these payments were not made in accordance with certain detailed rules set forth in § 186(c). The new § 186(d) contains an initial paragraph providing that, with respect to payments of the kind referred to in subsection (c) and in violation of that subsection, (1) Any person who participates in a transaction involving a payment ... to a labor organization [contrary to the provisions of subsection (c) ] and willfully and with intent to benefit himself or to benefit other persons he knows are not permitted to receive a payment [under subsection (c) ], shall, upon conviction thereof, be guilty of a felony and be subject to a fine of not more than $15,000, or imprisoned for not more than five years, or both; but if the value of the amount of money or thing of value involved in any violation of the provisions of this section does not exceed $1,000, such person shall be guilty of a misdemeanor and be subject to a fine of not more than $10,000, or imprisoned for not more than one year, or both. The second paragraph of the amended § 186(d) provides: (2) Except for violations involving transactions covered by subsection (d)(1) of this section, any person who willfully violates this section shall, upon conviction thereof, be guilty of a felony and be subject to a fine of not more than $15,-000, or imprisoned for not more than five years, or both; but if the value of the amount of money or thing of value involved in any violation of the provisions of this section does not exceed $1,000, such person shall be guilty of a misdemeanor and be subject to a fine of not more than $10,000, or imprisoned for not more than one year, or both. The Government has offered no very precise analysis of which criminal provision is applicable. However, on the issue of when the alleged violations occurred, the evidence presented by the Government related to a membership list as of the time of the trial in 1988, and the Government appears to make no argument against applying the post-1984 criminal penalty provisions. Moreover, the category of Taft-Hartley violations claimed by the Government — ie., payment of dues, including contributions to benefit funds — would seem to fall within subsections (c) and (d)(1), so that the Government would need to prove that Ciril-lo and Faicco acted willfully and with intent to benefit themselves or other persons they know are not permitted to receive the payment. Cirillo and Faicco argue that the Government has failed to prove any criminal violation of the Taft-Hartley Act. They point to various parts of the statute as favoring their position. Specifically, they cite 29 U.S.C. § 164(a), which provides that nothing in the statute “shall prohibit any individual employed as a supervisor from becoming or remaining a member of a labor organization.” Defendants note that Arti-ele IV, Section C of the union By-laws provides that an owner-operator may be a nonactive member of the union. They also assert that, to the extent that the payments are made to benefit funds, they are legal under § 186(c)(5), which provides that the prohibitions of other portions of § 186 shall not be applicable with respect to money paid to a trust fund established by a union for the benefit of the employees. Cirillo and Faicco contend that the Government’s accusation of criminal conduct not only ignores relevant statutory provisions but flies in the face of the realities of the Market. They cite the uncontra-dicted evidence showing that people involved in the Market frequently move up and down between low level positions and management or ownership, and that people in ownership and managerial positions often do much the same manual labor as the lower level employees. Cirillo and Faicco argue that people who move in and out of these ownership and managerial positions often seek to obtain and retain union membership largely for the purpose of providing for themselves and their families the medical and other benefits accruing from membership. Defendants contend that these circumstances do not involve any Taft-Hartley violations at all, and, in any event involve only technical violations without the mens rea making such violations criminal. The Government urges that defendants are misinterpreting the statutory provisions they rely upon. With respect to § 164(a), the Government states that this provision is not applicable to supervisors in the Fulton Fish Market because they are not part of the bargaining unit, as defined by the collective bargaining agreement. As to § 186(c)(5), the Government urges that the statute only allows contributions to be made to benefit funds on behalf of employees. The Government also notes that the provision in § 186(c) dealing with dues—subdivision 4—provides that payments may be made with respect to money deducted from the wages of employees for the purpose of paying union dues. In ruling on the Government’s claim, it must be acknowledged that the various issues of statutory interpretation, and the application of the statutory provisions to the facts of this case, involve a number of very doubtful points. However, one thing is not doubtful. It is perfectly clear that the presence of the 22 persons in question on the rolls of Local 359 had nothing whatever to do with organized crime or the Genovese crime family. Even if it was a violation of the Taft-Hartley Act to carry these persons as union members and to collect dues and pension and welfare contributions from them, there is no showing that this was anything other than a technical violation, the degree of fault being negligence at most. The Government has made no showing that either Cirillo or Faic-co acted willfully and “with intent to benefit himself or to benefit other persons he knows are not permitted to receive a payment.” Thus, the Government has failed to make its case of criminal Taft-Hartley violations. Certainly the situation shown here does not provide any basis for the remedy of ousting Cirillo and Faicco from their union offices. If there is some correction to be made in union practices with regard to membership of owners, managers or supervisors, this can be done by the union in consultation with its attorney. Extortion Claims One of the principal devices of organized crime is extortion. In a RICO case charging organized crime control of the Fulton Fish Market, one would expect to see serious extortion allegations. This is exactly what occurred in the Government’s pleadings here. The amended complaint alleges that the Genovese family has been able to control the Fultcn Fish Market by means of various racketeering acts, including extortion of the businesses in the Market (par. 45). It is further alleged (par. 46): Through threats of labor problems, the Genovese family has dominated the Fulton Fish Market and profited illegally from its operations. The amended complaint alleges that Ge-novese family control of the Market, and also of Local 359, is exercised through Vincent Romano and that (par. 55): Vincent Romano’s control of Local 359 has allowed him and his associates to intimidate wholesalers with the threat of strikes and other labor disruptions. The amended complaint goes on to allege (par. 56) that Cirillo and Faicco, “together with and/or aided and abetted by the Ge-novese Family” and the defendants connected therewith, obtained “direct payoffs” from the various companies in the Market, which payoffs were ... induced by the wrongful use of actual and threatened force, violence and fear, including fear of physical and economic injury.... Defendants Anthony Cirillo and Dennis Faicco have each committed or aided and abetted two or more of these acts of extortion. Thus, the amended complaint gave promise of a full-scale case against the union defendants, including evidence of threatened labor disturbances, regular payoffs from businesses in the Market, and the channeling of extortion proceeds into the hands of the Genovese family. No such case was made out in court. As already described, FBI Agent Marley testified that the Seaprobe investigation, which commenced in October 1984, uncovered no evidence of work stoppages or threats of work stoppages. There was no evidence of any system of collecting money from businesses in the Market by threats of labor problems. There was no evidence of Cirillo or Faicco acting in any way to assist in obtaining payoffs for the benefit of Vincent Romano or the Genovese family. The Government did attempt to prove a case of extortion against Cirillo and Faicco, but it was a case which bore little resemblance to the aggravated charges in the pleadings. The Government sought to prove that Cirillo and Faicco committed extortion in connection with organizing efforts at three companies — Ocean of Europe Seafood, Ideal Fish and Seafood and Tsuki-ji Seafood. It is further alleged that Cirillo extorted payments from a trucker by the name of Americana Transport. The court will now deal with these claims. The relevant statute is the Hobbs Act, 18 U.S.C. § 1951, which, among other things, makes it a crime to obstruct commerce by means of extortion. The term “extortion” is defined as “the obtaining of property from another, with his consent, induced by wrongful use of actual or threatened force, violence, or fear.” 18 U.S.C. § 1951(b)(2). The Government contends that the alleged instances of extortion also involved Taft-Hartley violations — i.e., improper payments by employers to the union or to Cirillo. a. Ocean of Europe Ocean of Europe Seafood, Inc. is owned by Antonio Cunha and is located in Newark and Belleville, New Jersey. It does both a wholesale and retail business and buys from the Fulton Fish Market. In 1985 it had about 15 employees. The record is not clear as to how many were involved in the wholesale phase and how many in the retail phase. Cunha testified that in 1985 Faicco approached him and said that “a lot of the major distributors out in New Jersey were joining the union” and that Faicco would like to have Cunha’s company in the union also. Both Cunha and Faicco testified that Cunha complained that he could not afford to have all his employees join the union, obviously referring to the fact that the company would need to make pension and welfare fund contributions. Ocean entered into a collective bargaining agreement with the union, but with only three persons joining, and one of these was Cunha. The company paid the initiation fee for all three, a total of about $600, and thereafter the company paid the dues on behalf of the three persons amounting to about $78 per month. The record is not clear regarding pension and welfare contributions. The two employees other than Cunha left Ocean about a year before the trial. They were not removed as union members at that time. This matter was corrected during the trial. Faicco testified that he understood that if a company was incorporated and if the “boss” did the work of an employee, he could be a union member. Ocean of Europe was incorporated, and Faicco testified that Cunha drove a truck into the Market and thus did some work of an employee. There is no evidence that Faicco used threats, force or violence, or otherwise sought to induce fear in Cunha. There is no showing that any of the payments by Ocean went to Faicco or Cirillo personally, or to Vincent Romano or the Genovese family. The payments went to the union and also possibly to the benefit funds. It should be noted that the Government makes no claim in this case about a misapplication of the monies in the union treasury or in the benefit funds. Although the Government has introduced no evidence of threats, force or violence directed by Faicco against Cunha, the Government contends that the element of extortionate fear was present because Cunha, at the time of the negotiations, was aware that Fulton Lobster Company had been approached by representatives of Local 359 to unionize the employees and that there were negotiations with Fulton Lobster Company. Cunha testified that he had been told by Fulton that it was not going to have its employees in the union and that it was not going to send trucks into the Market anymore. Cunha testified that, before withdrawing from the Market, Fulton was having trouble getting its fish into the Market. No witness from Fulton Lobster Company testified at the trial. Faicco testified that Fulton Lobster Company was a purveyor in Newark which he tried to organize in 1984, that he talked to the employees and gave them literature, and that he received indications of interest from a couple of employees, one of whom was discharged. No collective bargaining agreement was reached with Fulton Lobster Company. The court rules that the evidence, including that relating to Fulton Lobster Company, does not provide a basis for holding Faicco or Cirillo guilty of extortion in respect to the Cunha matter. b. Ideal Fish and Seafood Ideal Fish and Seafood Company is a corporation doing both a wholesale and retail business in Newark, New Jersey. Ideal buys a substantial amount of its fish from the Fulton Fish Market. Ideal also sells imported Portugese fish to at least one wholesaler in the Market. The president of Ideal is Julio Pereira, who testified that in 1985 Faicco approached him about his employees joining the union. ... he come to me, tell me that you sell your fish to Fulton Fish Market, why you don’t join the union. At the time Ideal had about 7 employees. Faicco testified that Pereira said that it would be too costly to have all his employees in the union. A collective bargaining agreement was entered into. However, only Pereira, a bookkeeper and two other employees joined the union. Pereira paid the initiation fees and thereafter paid the dues on behalf of all four of these persons. The Government sought to prove that Faicco threatened Pereira or otherwise intimidated him. However, in questioning Pereira, the Government asked noth