Racketeering suit claims extortion and sabotage as part of pattern of illegal activity
FORT LEE, N.J. – HealthBridge Management LLC and CareOne Management LLC today filed a RICO lawsuit against two SEIU local affiliates that claims the defendants have been engaged in a long-term pattern of criminal sabotage, intimidation and other acts of extortion in a coordinated illegal campaign in which the affiliates have threatened to put the two companies out of business if they do not yield to the union’s demands.
The suit was filed in United States District Court for the District of New Jersey against United Healthcare Workers East, SEIU 1199 and New England Health Care Employees Union, District 1199, SEIU. RICO is the acronym for the Racketeer Influenced and Corrupt Organization Act.
In a joint press release, the two companies stressed that they have worked cooperatively with unions in the past and fully respect and embrace the collective bargaining process. They said the suit is not about collective bargaining or other traditional labor activity but instead involves what is effectively economic terrorism, and that the suit seeks to end the campaign of extortionate demands and myriad unlawful tactics used against the companies by the two affiliates.
The suit cites the criminal sabotage that occurred at three of the five Connecticut HealthBridge facilities against which one of the defendants went out on strike on July 3, 2012, previously addressed in releases including those here, and states that the acts of sabotage put the lives of the elderly and frail patients at direct and immediate risk.
Additionally, the suit cites numerous instances of personal attacks against one of the indirect owners of the two companies, Daniel E. Straus, that the suit says are designed to seek to intimidate him by invading his privacy, harassing him and impeding business and philanthropic activities of his that are totally unrelated to the two companies.
The suit refers repeatedly to the actions against the two companies that the suit says are taken directly from the SEIU’s “Campaign Contract Manual,” available here. The manual was made public as an outgrowth of the 2011 suit against the SEIU filed by Sodexo USA. The SEIU eventually settled the suit.
HealthBridge and CareOne are separate independent but affiliated companies that operate long-term nursing care and assisted living healthcare facilities for the elderly. HealthBridge manages 34 facilities in New Jersey, Connecticut and Massachusetts; CareOne manages 17 facilities in New Jersey. Corporate offices for both companies are located in Fort Lee, New Jersey.
About the RICO Act:
The Racketeer Influenced and Corrupt Organizations Statute (“RICO”) is a federal law providing for extended criminal penalties and a civil cause of action for acts carried out as part of an ongoing criminal enterprise. It was enacted in 1970 as part of the Organized Crime Control Act of 1970. The purpose of the RICO statute is "the elimination of the infiltration of organized crime and racketeering into legitimate organizations operating in interstate commerce." S.Rep. No. 617, 91st Cong., 1st Sess. 76 (1969). However, the statute is sufficiently broad to encompass illegal activities relating to any enterprise affecting interstate or foreign commerce.
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