In the coming days, one of President Obama’s closest labor allies could take the stand in a fierce trial pitting the Service Employees International Union against a rebel breakaway.
But there’s a bit of a backstory between SEIU and the lawyer who would cross-examine SEIU President Andrew Stern.
Daniel Siegel, a politically active attorney with Siegel & Yee in Oakland, represents the National Union of Healthcare Workers. NUHW split off from SEIU last year, the culmination of a public struggle between Stern and NUHW President Sal Rosselli. Rosselli savaged Stern’s leadership, while Stern accused Rosselli’s local of financial improprieties, eventually imposing a trusteeship.
In trial before U.S. District Judge William Alsup in San Francisco, SEIU accuses Rosselli and his team of stealing documents and destroying property as they were setting up their competing union. Yet before this dispute reached blood feud proportions, SEIU had successfully sued Siegel over fees he collected while representing another one of its dissident locals.
In 2001, SEIU Local 87 — a janitor’s union — refused orders to merge with another local. The International threatened a trusteeship. So Local 87 paid Siegel a $50,000 retainer — nonrefundable (in case the trustees cut off its funds), though Siegel orally agreed to bill hourly and return any unused money, according to a 2003 opinion from San Francisco Superior Court Judge Ernest Goldsmith.
After taking over the local, SEIU sued Siegel to claw back the money. Goldsmith ruled that the SEIU had the authority to terminate Siegel after imposing the trusteeship, and Siegel had to return money earned after that event — $34,681.
Siegel belongs to a clique of lefty employment attorneys from around the country who represent clients taking on institutional unions. They often litigate against mainstream Democratic labor firms: In the health care workers dispute, SEIU brought in Bredhoff & Kaiser from Washington, D.C., to take the lead at the trial, after using Altshuler Berzon of San Francisco for motions work.
Rosselli and NUHW hired Siegel based on his history with Local 87 — and because the health care workers had already been using Siegel’s brother Jonathan, an employment attorney with Siegel & Lewitter in Oakland.
These days, Daniel Siegel said he bills $650 an hour when a fee-shifting stature is in play, $375 for representing individuals and $225 for unions. However, NUHW is paying a flat monthly amount, he said, which recently hasn’t been covering costs. He prefers to think of it as a kind of contingency.
“If they get the union on solid footing and begin to accumulate funds, perhaps they’ll be able to pay us a little more for our time,” Siegel said, adding that taking on this client wasn’t really about the money.
Stern is listed on SEIU’s witness list as a person they “expect” to call, though that is no guarantee. And even if Stern does take the stand, it is unclear just how hard Alsup will allow Siegel to push.
In a pretrial ruling on a series of motions in limine, Alsup deemed many of the NUHW grievances against SEIU to be out of bounds. For the purposes of trail, the trusteeships would be assumed as valid, Alsup ruled. The jury would only sort out whether Rosselli and his team broke their fiduciary duty to SEIU.
Those limitations were immediately demonstrated during Siegel’s opening statement Tuesday, as Bredhoff & Kaiser partner W. Gary Kohlman continuously objected. At one point, Siegel referenced a $150,000 payment to Stern for writing a book, authorized by the SEIU board.
Alsup sustained Kohlman’s objection. “If this is a smear campaign against Mr. Stern, you can’t get into it!” Alsup ordered Siegel.
Outside court, Siegel said he has now deposed Stern twice, once for Local 87, and once for NUHW. Stern is a composed and measured witness, he said.
“It’s going to be a tug of war if he is on the stand,” Siegel predicted.
