Opinion ID: 6934831
Heading Depth: 2
Heading Rank: 1

Heading: The Administrator’s Imposition of Sanctions

Text: Following his appointment, the Administrator commenced an extensive investigation of the Market’s operations. A staff of investigators interviewed hundreds of truckers, wholesalers, and other suppliers. Virtually all of the truckers stated that they did not select the unloading crew to which they were assigned; some stated that they had tried to use a different crew but had been told that they could not. The investigators found only one trucker who stated that he had been able to change unloading crews of his own volition; and he stated that he was able to make that change only because one of his suppliers had gone out of business and because of the Administrator’s presence in the Market. The investigators also interviewed, to the extent that they would cooperate, loaders and unloaders. Fox stated that none of his customers had ever changed to another unloading crew and that he had never acquired any customers from any other crew. Giam-marino stated that he would not unload another crew’s regular trucks unless that crew asked him to. Albanese, Prisinzano, and La-tegano, and to an extent Giammarino, invoked their Fifth Amendment privileges against self-incrimination and refused to answer most questions as to how they obtained their customers or how incoming trucks came to be unloaded by particular crews. As a result of these investigations, the Administrator gave notice that he intended to recommend the imposition of sanctions against the unloader defendants for the collusive elimination of competition in unloading services. Those defendants requested an opportunity to oppose sanctions by showing the existence of such competition. The Administrator thereafter conducted seven days of evidentiary hearings, at which he received documentary evidence and the testimony of four government-affiliated witnesses involved in the Market investigations and one supplier witness, Silvio Catena, called by the unloader defendants. Catena testified that in February 1991 his employer had switched unload-ers by transferring its business from Fox to Albanese. The defense also presented four letters from truckers and wholesalers who stated that they, like Catena, had been able to switch unloaders without adverse consequences. Following the conclusion of the hearings, the Administrator issued a report finding overwhelming evidence that the unloader defendants had violated the Consent Judgment through their continued conspiracy to control the unloading market and to allocate individual truckers to particular unloading crews, and concluding that sanctions should be imposed. (Statement of Reasons Supporting Imposition of Sanctions dated June 18, 1992 (“Administrator’s Sanctions Decision”).) As proof of the existence of the market-allocation scheme, the Administrator found, inter alia, (1) a “prevailing understanding” in the Market that trucking companies were not free to determine which unloader’s services they would use (id. at 28), and the absence of any unloader solicitation of each others’ customers; (2) unwarranted delays inflicted on truckers, who were required to wait for the services of their assigned unloader even when other crews were available; (3) admissions by Giammarino, Fox, and others that they were the exclusive unloaders for certain suppliers and would not unload the trucks of other unloaders’ customers; (4) the lack of price competition, manifested in to-the-penny uniformity in the basic prices charged by all of the unloaders; and (5) the extraction by Giammarino, Prisinzano, and Lategano of unwarranted supplemental charges totaling approximately $100,000 a year. The Administrator rejected as not credible the unloader defendants’ evidence purporting to demonstrate that some customers had in fact switched unloaders. He noted that Catena’s testimony as to a switch by his employer was undercut by, inter alia, his testimony that the services of both Fox and Albanese had been used at the same time (id. at 30), and his prior statements to investigators that he would not attempt to change unloaders for fear that it would ‘“start a war’ ” with the current unloader (id. at 29). The Administrator concluded that “there was no ‘switch’ ” (id. at 30) by Catena’s employer, but that even if there had been, there was no credible evidence that any other customer had been able to switch unloaders. He found that the four letters introduced by the un-loader defendants were not credible, noting that (a) in interviews with the investigators, the owners of the companies supposedly authoring two of the letters stated that they had never changed unloaders; (b) the third company had indicated that while there had been a switch of unloaders, it occurred without the company’s request and without explanation; and (c) the company that purportedly sent the fourth letter gave no address or telephone number and could not be found. On the basis of his findings, the Administrator imposed fines ranging from $20,000 to $65,000 on Giammarino, Fox, Albanese, Pri-sinzano, and Lategano and ordered the suspensions of Giammarino, Albanese, and Late-gano for periods ranging from three to six months. The unloader defendants timely objected. The district court, in an opinion dated February 3, 1994, 1994 WL 38679 (“Sanctions Opinion”), affirmed the fines, concluding that “[t]he evidence overwhelmingly supports the factual findings of the Administrator.” Id. at 12. However, the court declined to enforce the suspensions of Albanese, Lategano, and Giammarino, because it was concerned that the suspensions might impair the legitimate unloading functions in the Market. Id. at 3-4, 14.