LP
cA9 52>2)l.ll3*'3l5
^
3vf'3r
Given By
u. s. siTPT. OF fXjcuMErrrs
3^
\^
INVESTIGATION OF IMPROPER ACTIVITIES IN THE
LABOR OR MANAGEMENT FIELD
^ HEARINGS
BEFORE THE
SELECT COMMITTEE
ON IMPEOPEE ACTIVITIES IN THE
LABOE OE MANAGEMENT EIELD
EIGHTY-FIFTH CONGRESS
SECOND SESSION
PURSUANT TO SENATE RESOLUTIONS 74 AND 221, 85TH CONGRESS
JULY 15, 16, 17, 18, AND 31, 1958
PART 34
Printed for the use of the Select Committee on Improper Activities in the
Labor or Management Field
INVESTIGATION OF IMPROPER ACTIVITIES IN THE
LABOR OR MANAGEMENT FIELD
HEARINGS
BEFORE THE
SELECT COMMITTEE
ON IMPROPER ACTIVITIES IN THE
LABOR OR MANAGEMENT EIELD
EIGHTY-FIFTH CONGRESS
SECOND SESSION
PURSUANT TO SENATE RESOLUTIONS 74 AND 221, 85TH CONGRESS
JULY 15, 16, 17, 18, AND 31, 1958
PART 34
Printed for the use of the Select Committee on Improper Activities in the
Labor or Management Field
UNITED STATES
GOVERNMENT PRINTING OFFICE
21243 WASHINGTON : 1958
oyij.
MO
Boston Public Library
ouperintendent of Documents
NW1-M958
SELECT COMMITTEE ON IMPROPER ACTIVITIES IN THE LABOR
OR MANAGEMENT FIELD
JOHN L. McCLELLAN, Arkansas, Chairman
IRVING M. IVES, New York, Vice Chairman
JOHN F. KENNEDY, Massachusetts KARL E. MUNDT, South Dakota
SAM J. ERVI.V, Jr., North Carolina BARRY GOLDWATER, Arizona
FRANK CHURCH, Idaho CARL T. CURTIS, Nebraska
Robert F. Kennedy, Chief Counsel
BuTH YouNn Watt, Chief Clerk
II
CONTENTS
The Restaurant Industry in the Chicago Area
(Hotel and Restaurant Employees and Bartenders International Union)
Testimony of — Page
Adler, Jay 12894, 12897
Aiuppa, J oseph 13100
Alex, Gussie 13118
Allgauer, Gustav 12949
Annes, George 1 2997
Christiansen, Mae 13048
DeMar, Jack A 13001
DeSantis, Anthony 12908
Erake, George T. 12887
Duffy, LaVern J __ 13030
Eberhart, Arthur 13008
Griffith, Merlin 12920
Gotsch, Gerald 12896, 13095
Hessberger, George 1 2902
Hoch, Charles 13046
Jansen, Richard 13012
Kellv, James P 13104
Kiesau, Donald F 12861, 12863
Kinner, Jack 12988
Kouba, Louis 13064, 13073
Lardino, Danny 1 303 1
Lardino, John 13022, 13030
Leonardi, Danny 13053
Madia, Louis 13084
McFarland, John 12977
Milas, Andrew 12968
Mundie, James F 12863, 12947, 13028
O'Connor, James 1 2939
Pechan, I\f arjorie 13044
Ricketts, Ashley U 12992
Scholl, Williaml 12927
Schwartz, Julian 12983
Segal, Ellis -- 12905
Sturdevant, Beverly 13048
Trungale, Frank 12933
Wilkos, Joseph 13039
IV
CONTENTS
EXHIBITS
Introduced Appears
27. Worksheet, Chicago Restaurant Association profit-and- on page on page
loss statement .^ 12863 (*)
28. Memorandum to Robert F. Kennedy from James F.
Mundie re employment of Abraham Teitelbaum, Chi-
cago Restaurant Association, Chicago, 111 12868 (*)
29. Letter dated March 2, 1951, addressed to Mr. Abraham
Teitelbaum, from D. F. Kiesau, executive vice presi-
dent, Chicago Restaurant Association 12869 (*)
30. Minutes of the board of directors meeting held October
3, 1952, signed by D. Kiesau, secretary of the meet-
ing 1 12874 (*)
31. Letter dated July 21, 1950, addressed to Abraham Teitel-
baum and signed by D. F. Kiesau, executive vice
president, Chicago Restaurant Association 12876 (*)
32. Minutes of the board of directors meeting held at the
association office, July 8, 1949, and signed by D.
Kiesau, secretary of the meeting 12881 (*)
33. List of fires in restaurants from January 1957 to May
1958 12979 (*)
34 A. Picture of the Allgauer Restaurant fire 12979 (*)
34B. Picture of the Allgauer Restaurant debris after the
fire 12979 (*)
35. Signature card No. 8393 of Hotel Whitmore, Dallas,
Tex., for Danny Lardino 13033 (*)
35A. Hotel Whitmore bill in the name of Danny Lardino and
Lon Schneider 13034 (*)
36. Compilation showing yearly savings to 27 restaurants
in the Chicago area from wages paid below union
scale 13096 (*)
Proceedings of —
July 15, 1958 12861
July 16, 1958 12949
July 17, 1958 13039
July 18, 1958 13093
July 31, 1958 13117
'May be found In the flies of the select committee.
INVESTIGATION OF I3IPR0PER ACTIVITIES IN THE
LABOR OR MANAGEMENT FIELD
TUESDAY, JULY 15, 1958
United States Senate,
Select Committee on Improper Activities
IN the Labor or Management Field,
Washington, I). O.
^ The select committee met at 10 a. m., pursuant to Senate Resolu-
tion 74, agreed to January 30, 1957, in the caucus room. United States
Senate, Senator John L. McClellan (chairman of the select com-
mittee) presiding.
Present: Senator John L. McClellan, Democrat, Arkansas; Senator
Sam J. Ervm, Jr., Democrat, North Carolina; Senator Barry Gold-
water, Republican, Arizona.
Also present : Robert F. Kennedy, chief counsel ; John J. McGovern,
assistant counsel; LaVern J. Duffy, investigator; James P. Kelly, in-
vestigator; James Mundie, investigator; Ruth Young Watt, chief
clerk.
(At the convening of the session, the following members were
present: Senators McClellan and Goldwater.)
The Chairman. The committee will come to order. Call the next
witness, Mr. Kennedy.
Mr. Kennedy. Mr. Donald F. Kiesau.
The Chairman. Mr. Kiesau, come forward, please. Be sworn.
You do solemnly swear the evidence you shall give before the Senate
select committee shall be the truth, the whole truth, and nothing but
the truth, so help you God ?
Mr. Kiesau. I do.
TESTIMONY OF DONALD F. KIESAU, ACCOMPANIED BY HIS
COUNSEL, THOMAS E. KEANE
The Chairman. Mr. Kiesau, will you state your name, your place
of residence, and your business or occupation, please, sir ?
Mr. Kiesau. My name is Donald F. Kiesau. I live at 624 Indian
Road, Glenview. I am employed as the executive vice president of
the Chicago Restaurant Association.
The Chairman. Thank you, sir. Do you have counsel ?
Mr. Kiesau. I do.
The Chairman. Counsel, identify yourself for the record, j)lease.
Mr. Keane. Thomas Keane, 111 West Washington Street, Chicago,
111., a member of the Illinois bar.
The Chairman. Proceed.
12861
12862 IMPROPER ACTIVITIES IN THE LABOR FIELD
Mr. Kennedy. How long have you been with the Chicago Restau-
rant Association ?
Mr.KiESAU. Twenty-two years. .•.:^„2
Mr Kennedy. Have you always held this position i
tr f rK^p."" m'a\ttrma^C°now of the Chicago Restaurant
''^'tZL'^Z'^LT^sl^^^:t''li:<.^^tion^^ today, I
would esdfuat;, in the ueighborliood of 700 members, 700 companies.
Tlmt would represent, probably, because of the multiple-unit organi-
T-nfimi some 1,800 or 2,000 units. . . ^,.
Mr 'KmNEDY. How many different restaurants are there m Chi-
ca^^' What percentage of the restaurant owners do you have m your
association ? ^^^ ^^^^ classified red book, it
wouM Lt, tlTe last time we counted them about 5,000 restauran s
listed in the red book. If you were to ask what we represented m the
way of volume, it would be a different figure, because of the fact that
we represent, probably, the larger restaurants, as a rule.
Mr^KENN^DY. On the 5,000 ; is that the owners, or is that units?
Mr KiESAU. Those are-I believe those are units listed m the red
book In other words, there would be the Marquis Co., for example,
and then underneath Marquis Co. would have their ^^''^''^^^T^^
Mr. Kennedy. So, you represent about 1,800 out of 5,000 units i
Mr. KiESAU. I would guess that. ^ i ^-p
Mr. Kennedy. But the imits you represent do a greater volume ot
business .
Mr KiESAU. Generally speaking, that is true. . u •
Mr.* Kennedy. What percentage of the volume of restaurant busi-
ness in Chicago do you believe you represent ?
Ml- KiESAU. I think it would be safe to say that we represent
somewhere between 60 and TO percent. ^ ; ,f ^^„
Mr Kennedy. Could you tell us what the makeup of the association
is? bo each of the restaurant owners pay a certain amount ot dues i
Mr Kiesau. Yes. Our membership dues are based upon the num-
ber of employees. I can tell you exactly, if you would like to know.
For example, the smallest restaurant with any number of employees up
to 5 would pLy $30 a year dues. From 6 to 10 would pay $35 From
11 to 15, $40, and so forth. When we get up into the higher brackets
of 300 employees, then it is prorated down ]ust a little bit. _
Mr. Kennedy. What is the income of the restaurant association each
year, approximately ? , i • i i.\ +^j-„i
Mr. KiESAU. The income from membership dues, or the total
budget? „ , 1 • 1
Mr Kennedy. The income from membership dues.
Mr Kiesau. Membership dues— last year, I believe, our audit shows,
and Mr Mundie, I believe, has all those figures, I believe showed in the
neighborhood of $35,000. ^- ,
Mr. Kennedy. Do you have any other sources ot income i
Mr. Kiesau. Yes, sir.
Mr Mr Kennedy. Could you tell us what they are i
Mr Kiesau. We have a monthly trade publication where we receive
revenue from advertising. We have an annual buyers' guide. V\ e
receive a certain amount of money from advertising.
IMPROPER ACTIVITIES IN THE LABOR FIELD 12863
^^resf^''''^''''' ^""^ '"'''"^ ^'"""^ '^'^' ^^ ^^°'^ • ^^ y«^ have those
Mr. IWu I am sorry. Mr. Mundie has all theose figures. I will
take whatever figures he states there and verify them
Mr. Kennedy. The buyers' guide
Mr. KiESAu. The buyers' guide, if I remember, the net revenue last
year was in the neighborhood of $28,000 or $29 000
,^^''^^^''''^''1 ^^^^i" ""^^h*- ^^^^^ ^28,000. The total income-
strn,M;. Sfrman.^''^^ ^^"^"^ '' "^^°"^- ^^^- ^^^^ ^^ ^een
TESTIMONY OF JAMES MUNDIE— Resumed
The Chairman. Mr. Mundie, you have examined the books of the
association. You may testify regarding the revenues of the associa-
tion and their source and amount.
Mr. Mundie. Yes, sir.
Mr. Kennedy. Just for the last year.
Mr. Mundie. Income from membership dues, $38,212.37: income
from interest earned, $7,996.34.
Mr. Kennedy. Just give the total income.
Mr. Mundie. Total income is $94,206.14.
Mr. I<j:nnedy. And give the main sources, Mr. Mundie.
Mr Mundie. The main sources are membership dues, buyers' guide,
and Midwest Restaurant News. , j s u«,
Mr. Kennedy. Wliat is the source of that ? What is the total ?
Mi\ Mundie. Membership dues are $38,212.37. Midwest Restau-
rant News IS $4,350.14. Buyers' guide is $27,904.32.
The Chairman. That sheet you are testifying from ; is that a perma-
nent record, or can it be made available for any exhibit ?
Mr. Mundie. This could be made available for an exhibit.
The Chairman. You have checked the accuracy of the figures on
that sheet, have you ?
Mr. Mundie. I have, sir.
The Chairman. It may be made exhibit No. 27, for reference.
(The document referred to was marked "Exhibit No. 27" for refer-
ence and may be found in the files of the select committee.)
TESTIMONY OF DONALD F. KIESAU, ACCOMPANIED BY
COUNSEL, THOMAS E. KEANE— Eesumed
Mr. Kennedy. Would those figures be about right, Mr. Kiesau?
Mr. KiESAu. All except the figures for the Midwest Restaurant
News, our monthly publication. I think the gross figures were larger
than that. b *= fe
Mr. Kennedy. Perhaps it is broken down further. I think all of
the figures, though, appear on the sheet. That is for 1957, I believe.
How do you operate the Chicago Restaurant Association? Do you
have a board of directors ?
Mr. Kiesau. Yes, sir ; we do.
Mr. Kennedy. How many are there ?
Mr. KiESAu. We have a board of directors totaling, I believe, about
23 people. They are made up of the officers who are ex officios of the
board of directors, and that is the president, 3 vice presidents, and the
12864 IMPROPER ACTIVITIES IN THE LABOR FIELD
treasurer, and then we have 12 board members of ^^^^J^^^^^^^^^^
4 new ones elected every year so there is a rotating board every 3 years
and in addition to that, all the past presidents who a^ purrenuy
ope^at^ng? active in the restaurant business, are also ex officios m the
'%"\tT^Z"m\ny of those individuals receive any salary or
expenses ?
Mr. IviESAU. They do not.
Mr. Kennedy. None of them?
Mr. KiESAu. None of them. _
Mr. I^NNEDY. None of the officers, either i
Mr. KiESAU. None of the officers.
Mr. Kennedy. Do you receive a salary ?
Mr. Kennedy. Are^you the only one that receives salaiy and ex-
^^M?!iviesau. We have a staff of six people in the office, all of which
receive a salary.
Mr. Kennedy. Wliat is your salary i
Mr. KiESAU. Do you mean currently ?
Mr. KiESAU^'^My 'current salary is $25,000 a jear, ^id in the past
year I received a bonus of $7,000, making a total of $32,000.
Mr.IvENNEDY. What was it the year prior to thaU
Mr. KiESAU. The year prior to that, I believe, the total was 30.
Mr. IvENNEDY. Who sets your salary ?
Mr. KiESAU. The board of directors. . n .- ._^9
Mr Kennedy. They are elected, are they, the board of directors^
Mr. KiESAU. I will repeat again. The board of directors— well, is
'^ mTkennedy. No ; it is not necessary. They are elected, are they ?
Mr. KiESAU. Yes, sir ; 12 of them are.
Mr. Kennedy. Periodically?
Mr KiESAU. Twelve of the officers are; yes, sir.
Mr' Kennedy. Out of the 700 or 800 restaurants that you have, not
units'but restaurant owners, and some 1,800 restaurants, what per-
centage are union and what percentage are nonunion ^
Mr KiESAU. This is purely an estimate, because we never tried to
differentiate and list them as such. We never have. But i would
guess— I think you will have to qualify that question by saying par-
tially union or all union. There is a difference.
Mr. Kennedy. How many are nonunion; how many are partially
union ; and how many are all union ? -r n ^i <-
Mr KiESAU. That is very difficult to answer. I would guess that,
out o*f the 700 members, probably 150 would Imve some sort of un-
ionized employees in their place of business. They would be either
all union or partially union. .
Mr. Kennedy. And all the rest have no unions at all i
Mr. KiSEAU. That would be my estimate.
Mr liJsNNEDY. Out of 150, could you give us any estimate as to how
many of those are completely union and how many are just partially
union ?
IMPROPER ACTIVITIES IN THE LABOR FIELD 12865
Mr. KiESAu. No ; I can't. "We never delve — I can tell you that the
hotels that are members, and most of the major ones are, are pretty
much completely unionized.
Mr. IvENNEDY. The restaurants, for the most part, are just partially
union. Are there many restaurants that are all union ?
Mr. KiESAu. Yes ; there is a substantial number that are.
Mr. Kennedy- Out of the 150, could you give us an estimate of how
many ?
Mr. KiESAtJ. I couldn't tell you.
Mr. Kennedy. You couldn't tell us at all ?
Mr. KiESAu. I am unable to tell you. We don't check. We don't
delve into that.
Mr. Kennedy. Mr. Kiesau, what about the voluntary fund ? What
is that?
Mr. Kiesatj. The voluntary contribution fund is something, if you
recall, that Mr. Marquis, I believe, told you about either yesterday or
Friday. It started, so I am told, at almost the origin of the Chicago
Restaurant Association, back in 1914, some 44 years ago, where res-
taurant folks got together and voluntarily contributed some money.
It has been in existence since I have been with the association, since
1936, and I believe, from what I hear, previous to that also.
Mr. Kennedy. Wlio contributes to the voluntary fund ?
Mr. Kiesau. Those who desire voluntarily contribute.
Mr. Kennedy. For what purpose do they contribute ?
Mr. Kiesau. They contribute to the voluntary contribution fund
for whatever help can be given to them in their labor relations
matters.
Mr. Kennedy. Primarily it was, in the past, to pay the salary and
expenses of the labor-relations consultant, is that right ?
Mr. Kiesau. That is correct. And/or help a restaurant out in case
of a strike where, in the opinion of the board of directors the majority
of the people were not organized.
Mr. Kennedy. The labor-relations consultant that you had up to
1953 was Mr. Teitelbaum ?
Mr. Kiesau. That is right.
Mr. I^nnedy. Could you tell us who suggested that you retain
Mr. Teitelbaum?
Mr. Kiesau. Yes. 1 believe it was Mr. Toffenetti.
Mr. Kennedy. What was the backgi^ound of Mr. Teitelbaum that
made him attractive to the Chicago Restaurant Association ?
Mr. Kiesau. I didn't inquire.
Mr. Kennedy. Wliat did Mr. Toffenetti have to say about him ?
Mr. Kiesau. If I remember the circumstances, and this is 20 years
ago
Mr. Kennedy. About 1938?
Mr. Kiesau. About 1938 or 1939. There was a strike at a restaurant
company in Chicago, Drakes Restaurant, and it had been going on for
a long period of time. They were having much difficulty m operating,
as you probably can imagine, from the testimony that was given here
all last week in similar situations. Mr. Toffenetti brought it to the
attention of— I don't recall whether it was a committee at that time
or directly to the board of directors that a person, a friend of his,
or a person that he knew, who had come to his restaurant on numerous
12866 IMPROPER ACTIVITIES IN THE LABOR FIELD
occasions as a customer, had indicated that he could possibly solve the
strike.
Mr. Kennedy. Did anything come to your attention that he had
had any experience whatsoever in labor-management relations?
Mr. KiESAU. I didn't inquire into that.
Mr. Kennedy. After he was retained in 1939, did you ever inquire
to find out ?
Mr. KiESAu. No, I felt that was a matter for our board of directors
to determine.
Mr. Kennedy. Did you ever hear anybody ever state that he had
any experience whatsoever in labor-management relations?
Mr. KiESAU. Not that I recall.
Mr. Kennedy. In 1942 or thereabouts, he retained to assist him Mr.
Louis Romano. Did you know anything about Mr. Romano's back-
ground ?
Mr. Kiesau. Only what I read in the papers.
Mr. Kennedy. Did you make any protest at that time or later on ?
Mr. KiESAU. No. I thought our board of directors would have
read anything that I might have read, and it was not my opportunity
or duty to tell. I was an employee of the association. Anything
that I might have known they would have known. They were the
ones that retained him.
Mr. Kennedy. You had Mr. Teitelbaum, who was associated with
all of the big gangsters in Chicago, and, of course, had been Al
Capone's attorney for a while. Mr. Louis Romano had been indicted
a number of times for murder, and had been kicked out of the restau-
rant union itself in 1940. He was put in there by the syndicate.
That is what the judge found. Then he goes to work and starts do-
ing work for the restaurant association. Was there any knowledge or
information about either one of these individuals discussed with the
membership of the association ?
Mr. KiESAU. Not that I recall.
Mr. Kennedy. Did you make any protest about it ?
_ Mr. KiESAU. You didn't say that Mr. Romano worked for the asso-
ciation, did you ?
Mr. Kennedy. He worked for Mr. Teitelbaum, as I understand it,
and Mr. Tietelbaum at that time was doing work for the association.
Mr. Kiesau. That is right.
Mr. Kennedy. He was an assistant to Mr. Teitelbaum during this
period of time.
Mr. Kiesau. Yes.
Senator Goldwater. May I ask, was he paid by the association?
Mr. Kiesau. No, sir.
Senator Goldwater. Mr. Teitelbaum paid him out of his own
moneys ?
Mr. Kiesau. Yes, sir.
Mr. Kennedy. Mr. Kiesau, when was it that you learned Mr.
Teitelbaum was making certain payoffs to union officials ?
Mr. Kiesau. I did not know of that, Mr. Kennedy, not until long
after it happened. If you will recall the testimony that has been
given here under oath, in the Les Johnson case, I don't believe that
Mr. Johnson told me anything about that until some 3 years subse-
quent to the time that Teitelbaum and him had settled the matter.
IMPROPER ACTIVITIES IN THE LABOR FIELD 12867
Mr. Kennedy. Did you know while Mr. Teitelbaum was working
for the association that he was making these payoffs to union officials ?
Mr. KiESAU. No, sir.
Mr. Kennedy. Let me state as an example the Nantucket Restau-
rant. We had some testimony before the committee from Mr. Reed
of the Nantucket Restaurant that Mr. Teitelbaum participated in
attempting to get $500 from him in order to pay to a union official.
Mr. Kiesau. Yes, sir. You will recall the testimony of that by Mr.
Reed. "\Ylien I learned of that through a telephone conversation be-
tween Mr. Reed and myself, I suggested that he come downtown, and
I immediately called Mr. Drake who was the president of the asso-
ciation at the time, and I think we set an appointment for the very
next day. I think that testimony that you already have tells you what
happened. It was something that we absolutely would not counte-
nance, have anything to do with, and we insisted on Mr. Teitelbaum
returning the money to Mr. Reed.
Mr. Kennedy. Did you fire Mr. Teitelbaum then?
Mr. Kiesau. No, sir.
Mr. Kennedy. You knew Mr. Teitelbaum had participated in a
bribe, extortion, whatever it might be, back in 1949 and 1950. These
facts were brought to your attention. Why didn't you take steps to
have him fired at that time ?
Mr. Kiesau. Again, Mr. Kennedy, that was not my prerogative to
do that.
The management committee and the board of directors
Mr. Kennedy. Whose prerogative was it, then ?
Mr. Kiesau. The board of directors.
Mr. Kennedy. And who were on the board of directors at that
time?
Mr. Kiesau. You have the minutes of the— all of our minutes, I
believe you have, and if you will give me that information, I will be
glad to tell you.
Mr. Kennedy. Did you bring to the attention of the board of
directors that Mr. Teitelbaum had been involved in this ?
Mr. Kiesau. Yes, sir.
Mr. Kennedy. You made a report to them ?
Mr. Kiesau. Yes, sir.
Mr. Kennedy. And the board of directors took no steps against Mr.
Teitelbaum at that time ?
Mr. Kiesau. No, sir.
Mr. Kennedy. Do we have a list of the board of directors at that
time?
Mr. Chairman, when we get that list, could we have that placed in
the record ?
The Chairman. Yes. "Wlio procured the list from the files ?
Mr. Kennedy. We will have to get the list, Mr. Chairman.
Mr. Kiesau. That may not be a complete list of the board of direc-
tors. That might be just those that were in attendance at that meet-
ing. I can give you the additional ones.
The Chairman. May I ask Mr. Mmidie if you have the hst of the
directors ?
Mr. Mundie. No, sir.
The Chairman. Mr. Duffy, did you procure it ?
12868 IMPROPER ACTIVITIES EST THE LABOR FIELD
Mr. Duffy. Senator, we have a list of the people in attendance at the
meeting, but we do not at this time have an actual list of the members.
But we have it in our files.
The Chairman. Where did you procure the list ?
Mr. Duffy, From the files of the Chicago Restaurant Association.
The Chairman. When it is produced, it may be placed in the record
at this point as exhibit 28.
(The document referred to was marked "Exhibit 28" for refer-
ence, and may be found in the files of the select committee.)
Mr. Keane. The minutes of the meeting will show who was present
at the meeting, also.
The Chairman. Mr. Duffy, do we have the minutes of that meet-
ing, showing who was present, showing the directors who were pres-
ent, and others who were present at the meeting ?
Mr. Duffy. Senator, my examination of the minutes of the Chicago
Restaurant Association, in that I did not find any minutes reflecting
this particular situation.
The Chairman. All right. The witness can testify to it. Proceed.
Mr. KiESAU. What was the question, sir ?
Mr. Kennedy. Mr. Duffy, I believe, stated that he did not find
anything in any of the minutes of the Chicago Restaurant Association
indicating that members of the board of directors were informed by
you that Mr. Teitelbaum was involved in this.
Mr, KiESAU. The board of directors was told, and they can be sub-
penaed to testify, I am sure of that.
Mr. Kennedy. Mr. Kiesau, that may very well be true. But what
I am stating is that, from an examination of the records, there is no
indication that was written down on paper.
Mr. KiESAU. That may be so.
Mr. Kennedy. That is the the point.
Senator Goldwater. Did you inform them of this in the formal
meeting, or did you inform them individually ?
Mr. Kiesau. No. In the formal meeting.
Mr. Kennedy. Wouldn't something like that be contained in the
minutes ordinarily? Something as serious as that?
Mr. KiESAu. Ordinarily it would be. But in the minutes of the
organization, such as ours, we could not cross every "t" or dot
every "i," But I can assure you that it was discussed and I am
telling you that it was.
Mr. Kennedy, Could you consider this the crossing of a "t" or dot-
ting of an "i" when somebody
Mr. KiESAu. No, I wasn't referring to it that way. What I meant
was that everyone is human. It was not left out intentionally.
There was no reason for it.
Mr. Kennedy. This was not just a small matter; this was a matter
where an employee of yours was involved in an extortion.
Mr. Ejesau, That is correct.
Mr, Kennedy, I would think that would be something that would
be kept in the minutes if they were kept accurate.
Mr. Kiesau. I understand Mr. Drake is to follow me, and he was
present at the time. He conducted the meeting, and I am sure you
can get him to testify on that same question.
IMPROPER ACTIVITIES IN THE LABOR FIELD 12869
Mr. Kennedy. I am sure what you say about being discussed is
correct. I am wondering why it was not put in the minutes. I
think that is of even more interest. I would like to have you identify
this letter.
The Chairman. The Chair hands you a photostatic copy of a letter
dated March 2, 1951, addressed to Mr. Teitelbaum, and it appears to
have been written by you as executive vice president of the Chicago
Kestaurant Association.
Will you examine that photostatic copy and state if you identify the
letter?
(The document was handed to the witness.)
(The witness conferred with his counsel.)
The Chairman. Do you identify the letter ?
Mr. KiESAu. Yes, sir.
The Chairman. It may be made exhibit No. 29.
(The document referred to was marked "Exhibit No. 29" for refer-
ence and may be found in the files of the select committee.)
Mr. Kennedy. This is a letter, Mr. Chairman, dated March 2, 1951,
addressed to Mr, Abraham Teitelbaum, Teitelbaum & Melnik, 20 East
Jackson, Chicago, 111. :
Deab Mr. Teitelbaum : This letter is to advise you that our board of directors
will not authorize the repayment of the $10,000 which you gave to the State's
attorney's investigator, Mr. Dan Gilbert in 1950. As we discussed, probably
the money was used in his political campaign for sheriff of Cook County. We
understand that you needed him to help remove the pickets from the Regent
Drugstore at the Sherman Hotel. Also, you told me that the demand by Mr,
Gilbert was on the association. It has been the policy of the Chicago Restaurant
Association, as you well know, that this expense, as well as expenses for union
periodicals, subscriptions, dues, travel expenses, entertainment of union repre-
sentatives and officials, strike expenses, hiring of additional attorneys, labor
experts and all other expenses, in connection with your position as our labor
counsel, are to be borne by you. These expenses are considered a part of your
annual retainer fee. Your request for reimbursement is regretfully declined.
Vei-y truly yours,
Chicago Restaurant Association,
D. F. Kiesau,
Executive Vice President.
This is a letter in 1951 that would indicate that Mr. Teitelbaum told
you that he had made a $10,000 payment to a city official. Is that
correct ?
Mr, Keane. County.
Mr. Kennedy. Comity, thank you. A county official. Is that cor-
rect, Mr. Kiesau ?
Mr. Kiesau. That is approximately it.
Mr. Kennedy, T\nien this matter was brought to your attention, did
you do anything other than protest or say that the restaurant associa-
tion would not pay it directly ?
Mr, Kiesau. I don't remember really too much about this particular
letter other than the fact that Mr, Teitelbaum said that this is approxi-
mately what happened.
It was presented to the board of directors, and the board of directors
authorized me to write the letter.
Mr, Kennedy. Why wasn't Mr. Teitelbaum's services dispensed with
immediately after you learned that he had made a $10,000 payment?
Mr. Kiesau. Again, that is something, Mr. Kennedy, that I had
no control over.
12870 IMPROPER ACTIVITIES IN THE LABOR FIELD
Mr. Kennedy. You mean once again it is the board of directors?
Mr. KiESAU. Yes, sir. . ^i u a
Mr. Kennedy. Mr. Chairman, could we have the names ol the board
of directors ?
They all knew about this? -,,.■,• .
Mr. Kiesau. Yes, sir. It was discussed at a board o± directors
meeting. It says right here.
Mr. Kennedy. These are Chicago restaurant owners that knew
about these situations and yet did nothing to dispense with the service
of Mr. Teitelbaum?
Mr. Kiesatj. Yes, sir. . j, i ^ .- ^
The Chaieman. Do we have copies of the minutes ot that particular
meetino* ?
Mr. Duffy. Again, Mr. Chairman, on these minutes they do not
reflect the people who were on the board of directors. They simply
state the members who were in attendance at meetings.
Mr. KiESAU. You can get that information at any time.
Mr. Duffy. This was not discussed either in the minutes.
Mr. KiESAu. It is in the letter.
Mr Duffy. It is in the letter, but it is not in the minutes.
Mr. KiESAU. Well, that proves the fact, then, that everything does
not get written in the minutes that actually happens.
Mr. Kennedy. It is very interesting, I think, that the two things
we have found thus far that have not been in the minutes is, one, a bribe
to a union official, and the other an alleged payoff to a county official.
Mr. KiESAU. I can't answer that. I am unable.
The Chairman. Who kept the minutes of these meetings?
Mr. Kiesau. I kept the minutes. I wrote the minutes.
The Chairman. You kept the minutes ?
Mr. Kiesau. Yes, sir.
The Chahiman. So then if there is any failure to record the pro-
ceedings of the meeting accurately, the failure was on your part, was
it not? . ...
Mr. Kiesau. Senator McClellan, all minutes were always given to
the president at the time to review. As far as I know, almost all of
them — I would say all of them — there might have been a miss m 20
years. Not until the last year or two have I had the president initial
the minutes which probably should have been done way back.
The Chairman. At any rate, you are the one that prepared the
minutes ?
Mr. Kiesau. Yes, sir.
The Chairman. Kept the notes and wrote up the minutes ?
Mr. Kiesau. Yes, sir.
The Chairman. So if there is anything omitted that should have
been in there, the initial failure would be on your part ?
Mr. Kiesau. Yes, sir.
The Chairman. And the next failure would be on the part of the
president or chairman of the board not to detect the omission and have
it inserted ; is that correct ?
Mr. Kiesau. Yes, sir.
The Chairman. Proceed.
Mr. Kennedy. Mr. Chairman, I would like to say in fairness to Mr.
Gilbert that this was looked into by the Internal Kevenue Service, and
IMPROPER ACTIVITIES IN THE LABOR FIELD 12871
certain other Government agencies. They found that although Mr.
Teitelbaum stated that he made this payment to Mr. Gilbert, they
found no evidence that he ever did make the payment, but that he was
just making a statement that he had made it. All the evidence was
that he kept the money himself.
The Chairman. As I understand you, now, from the information
the committee has, it does not necessarily mean that Mr. Teitelbaum's
report on the transaction that he actually paid the money is true.
Mr. Kennedy. That is correct.
The Chairman. In other words, it is indicated that it was not true,
and he was simply undertaking to shake down the restaurant associa-
tion that much further ?
Mr. Kennedy. That is correct.
The Chairman. Proceed.
Senator Goldwater. Was that determination made from Internal
Revenue reports? In other words, Mr. Gilbert didn't show $10,000
received ?
Mr. Kennedy, And the Internal Revenue Service and other Gov-
ernment agencies investigated, and they became convinced from a
review of their records that Mr. Teitelbaum actually was trying to
shake down the association.
Senator Goldwater. Did Teitelbaum report the $10,000 ?
Mr. Kennedy. He attempted to, and they investigated and found
•out from a review of his record that he had never made such a pay-
ment. The point, however, is that as far as the restaurant association
knew from their records, he had made such a payment. Still Mr.
Teitelbaum was kept on as the representative for them in labor-man-
agement relations.
The Chairman. In other words, the restaurant association, from the
information it had, was bound to conclude, if they believed their
■counsel, that he had made the payment, and I assume they did be-
lieve him at the time, although they declined to reimburse him for it,
stating that any such expenditures w'ould have to come out of his own
salary.
But notwithstanding that, knowing that he claimed he had made
such a payoff, still your association retained him as its labor-relations
■counsel ?
Mr. Kiesau. Yes, sir.
The Chairman. All right. Proceed.
Mr. Kennedy. I wanted to ask you also about a third matter, and
that is involving the London House, where Mr. Marienthal testified
that Mr, Teitelbaum took steps to once again make payments to
union officials, and he had discussed your problem and had come to
you and said that he had had a problem with Mr, Teitelbaum. Were
any steps taken after this was brought to your attention to dismiss
Mr. Teitelbaum?
Mr. Kiesau. That wasn't a matter — you mean Mr. Teitelbaum pay-
ing the dues as w^as testified ?
Mr. Kennedy. Yes.
Mr. Kiesau. That was never brought to my attention.
Mr. Kennedy. You never learned of that ?
Mr. Kiesau. I beg your pardon ?
Mr. Kennedy. You never learned of that ?
Mr. Kiesau. No. Mr. Marienthal testified to that, I believe.
12872 IMPROPER ACTIVITIES IN THE LABOR FIELD
Mr. KJENNEDY. He testified that he went to see you, but he wasn't
sure whether he discussed the matter with you or not.
Mr. KiESAU. He testified that he called me several times on the
phone, I believe.
Mr. Kennedy. But you say he never discussed the matter with
you?
Mr. Kjesau. He never discussed the matter. He so testified last
week.
Mr. Kennedy. My recollection was that his testimony was that he
discussed the fact that he had to see Mr. Teitelbaum, but he was not
sure as to whether he had discussed in detail the matter with you.
But as far as your testimony is concerned, he never did discuss this
with you ?
Mr. KiESAU. No, sir.
Mr. Kennedy. He never told you that Mr. Teitelbaum was paying
the dues for these employees ?
Mr. KiESAU. That is correct.
Mr. Kennedy. What about the Howard Johnson Restaurant, Mr.
Kiesau ? There we had a situation where the testimony was that some
$2,240 was used to pay the dues on certain of the employees of the
Howard Johnson Restaurant. Could you tell us what action you
took against Mr. Teitelbaum on that ?
Mr. Kiesau. I beg your pardon ?
Mr. Kennedy. Could you tell us what action was taken against Mr.
Teitelbaum for making any of those payments ?
Mr. Kiesau. That, Mr. Kennedy, was a case where Mr. Teitelbaum
was injecting himself in the Howard Johnson Restaurant matter. I
don't believe he was on the payroll at the time. He was trying to
settle the matter. I don't know that this is exactly the same as the
testimony that Mr. Strang gave, one of your first witnesses, but as
I recall it, Mr. Strang called one day, and I had been out to his place
on a number of occasions. I live not too far from the Howard John-
son Restaurant.
He called one day and said, "I am told that I can settle the strike
for approximately $2,000. What should I do?" I immediately got
in touch with the management committee by telephone, asked them
their opinions, and the essence or the gist of the conversation went
like this : "If that is what Mr. Strang wishes to do, and it will remove
the pickets, I think you ought to tell him that the association has no
objection, if that is what he wants to do."
It was a fee that he paid to Mr. Teitelbaum, that he paid to Mr.
Teitelbaum as an attorney fee.
Mr. Kennedy. You didn't know that that money in turn was being
given to the union officials?
Mr. Kiesau. No, sir.
Mr. Kennedy. Were you present when the money was handed over ?
Mr. Kiesau. I believe I was at the restuarant the evening that Mr.
Strang gave the check to Mr. Teitelbaum.
Mr. Kennedy. And that check was for $2,240, was it not ?
Mr. Kiesau. That is what I understand.
Mr. Kennedy. Were you present when Mr. Teitelbaum in turn en-
dorsed that check over to Mr. Kerr ?
Mr. Kiesau. No, sir.
IMPROPER ACTIVITIES IN THE LABOR FIELD 12873
Mr. Kennedy. Did you discuss this with Mr. Kerr ?
Mr, KiESATJ. No, sir.
Mr. Kennedy. You didn't go outside while the check was passed?
Mr. KiESATJ. One evening, earlier in the week or 2 weeks before that,
I don't remember exactly — I know what you are talking about — Mr.
Teitelbaum, the only time that I can remember of anything like this
happening, suggested that I meet Mr. Kerr. I was reluctant to do it.
I will never forget it, because it was dark, it was in the evening. I
think he was across the street, near a filling station. Pie begged and
pleaded that I go over.
I agreed to do it. I talked to Mr. Kerr, I think, for about 3 minutes,
3 or 4 minutes, and came back to the restaurant. That was the only
time I discussed anything with Mr. Kerr. That was previous to the
settlement.
Mr. Kennedy. You knew that the check for the $2,240 was being
made out to Mr. Teitelbaum ?
Mr. KiESAu. Yes, sir.
Mr. Kennedy. And you thought it was just for legal fees ?
Mr. KisEAu. As a retainer fee.
Mr. Kennedy. Did you know that these Howard Johnson Restau-
rant employees were being brought into the union ?
Mr. KiESAu. No, sir.
Mr. Kennedy. Wlien did you learn of that ?
Mr. KiESAu. I didn't find that out until Mr. Strang sometime later,
when it became a Treasury Department matter for him, told me of the
endorsement on the check.
Mr. Kennedy. That was in 1955 ?
Mr. KiESAu. To the best of my knowledge.
Mr. Kennedy. You never learned before that ?
Mr. KiESAu. Not that I can recall.
Mr. Kennedy. You never learned that these employees were brought
into the union ?
Mr. Kiesau. Well, I think I read in a publication, if you could say
this was knowing of it, in a publication of the Hotel and Restaurant
Employees Union, where they showed a picture of the strike and indi-
cated below the caption that they had joined the union.
Mr. Kennedy. Did you inquire into that, then ?
Mr. KiESAU. No, because it didn't mean anything to me. I don't
believe everything I read in a union publication. I don't believe
everything I read in a newspaper.
Mr. Kennedy. I see.
The Chairman. I present to you here what purports to be a photo-
static copy of minutes of the board of directors meeting held at the
association's offices Friday, October 3, 1952. It appears to bear your
signature as secretary of the meeting. I ask you to examine it and
state if you recognize that as a photostatic copy of the minutes of the
meeting which you prepared and sigiied.
(A document was handed to the witness.)
(Witness conferred with counsel.)
Mr. Kiesau. I just referred to this.
The Chairman. I just ask you if you identify that as a photostatic
copy of the minutes of the meeting at that time ?
Mr. KiESAU. Yes.
21243—58 — pt. 34 2
12874 IMPROPER ACTIVITIES IN THE LABOR FIELD
The Chairman. That copy may be made exhibit No. 30.
(Document referred to was marked "Exhibit No. 30" for reference
and may be found in the files of the select committee.)
Mr. Kennedy. I don't believe you referred to this, Mr. Kiesau. I
believe you said you read in some magazine they were brought into
the union.
This is in the minutes. Let's look back to the fact that we had in-
formation regarding a payoff to a union official that wasn't in the
minutes; that we had a supposed payoff to a county official which
didn't appear in the minutes and yet we have here in the minutes of
October 3, 1952 a statement "attention was called to the August 1952
issue of the Catering Industry Employee magazine which included an
article on the unionization of the Howard Johnson Restaurant."
Mr. Kiesau. That is just exactly what I was referring to, before
you showed me the letter. The magazine. I said that I don't recall
of hearing about it unless it w^ere in a union restaurant publication.
Mr. Kennedy. Well, not only was it in the union restaurant publi-
cation but it appeared in the minutes.
Mr. Kiesau. The minutes referred to the publication, Mr. Kennedy.
Mr. Kennedy. And these minutes are signed by you as secretary of
the meeting.
Mr. Kiesau. Yes sir.
Mr. Kennedy. As you had been present when the payment had been
made to Mr. Teitelbaum, and these employees were not supposed to be
in the union did you inquire into it then, to find out whether Mr.
Teitelbaum had made some payment to the union ?
Mr. Kiesau. Inquired into what?
Mr. Kennedy. When you found out that the Howard Johnson em-
ployees w^ere, in fact, unionized, did you then inquire into how they
became unionized ?
Mr. Kiesau. I assume that they had.
Mr. Kennedy. You were present when the payment of $2,240
Mr. Kiesau. It was definitely understood that it was a retainer fee.
Mr. Kennedy. Then how did they end up in the union ?
Mr. Kiesau. How did the restaurant employees? I don't think
they ever ended up in the union.
Mr. Kennedy. When you put this into the minutes, so tliat it would
appear as though the employees of the Howard Johnson Restaurants
were in the union, did you ever inquire as to what the situation was,
Mr. Kiesau ?
Mr. Kiesau. None other than what it indicates there.
Mr. Kennedy. Did you ever inquire into it any further to find out
what the situation was, as you had been kept advised ?
Mr. Kiesau. I brought 'it to the attention of the board of directors.
Mr. Kennedy. Did you ever go back to find out, to have any con-
versation with the Howard Johnson people?
Mr. Kiesau. Well, Howard Johnson— Mr. Strang was of exactly
the same opinion that I was, that it had nothing to do with putting
those employees into the union.
Mr. Kennedy. Did you discuss it with Mr. Teitelbaum ?
Mr. Kiesau. I don't recall. I may have.
Mr. Kennedy. Mr. Strang testified he didn't learn about it until
1955.
IMPROPER ACTIVITIES IN THE LABOR FIELD 12875
Mr. KiESAU. I may have. I don't recall.
Mr. Kennedy. What did he say ? What explanation-
Mr. KiESAu. If I did, it could have been at the time that I saw the
article in the Catering Industry Employee, or whatever the name of
it is, but I can't say for sure whether I did or not.
Mr. Kennedy. Mr. Kiesau, you understood that this was a practice
of Mr. Tietelbaum, did you not, to make payments to the union and
then make an arrangement to bring in a certain percentage of the
employees into the union ?
Mr. KiESAu. No, sir ; I did not.
Mr. Kennedy. You never knew about that ?
Mr. KiESAU. I did not know of it being a practice.
Mr. Kennedy. Did you know that he was doing it ?
Mr. KiESAu. No, sir.
Mr. Kennedy. You never knew he did that ?
Mr. KiESAu. Well, it depends upon when. I told you a little while
ago that Mr. Johnson reported it to me 3 years after he had done it.
Mr. Kennedy. That was 1955.
Mr. KiESAu. Whenever that was.
Mr. Kennedy. And you never learned prior to that time?
Mr. KiESAu. I believe, thinking back to the testimony of last week,
I believe I did know in the Esrig case that he had either suggested or
Mr. Esrig did put some of the people in the union, or they had been
unionized by the union, one of the two.
I am inclined to believe that it might be the latter because Esrig's
Coffee Shop, or whatever the name of it was, was down in the milli-
nery district, where they were highly unionized. If I am not mis-
taken, the union legitimately had some employees in the union.
Mr. Kennedy. Didn't you know that this was a practice by Mr.
Teitelbaum, and you knew that he was following this practice of
making certain payments to the union in order to bring in, maybe,
7 or 8 or a certain percentage ?
Mr. KiESAU. I can't answer that, Mr. Kennedy, knowing it was a
practice.
Mr. Kennedy. You knew it was going on, did you not ?
Mr. Kiesau. I didn't know. If I knew it was a practice, I would
know it was going on.
Mr. Kennedy. Did you know it was going on ?
Mr. KiESx\u. I didn't know. I told you that I didn't know it was
going on except that a couple of the situatioriS likely mentioned.
Mr. Kennedy. Did you take any steps then to dismiss Mr. Teitel-
baum when you found out about it ?
Mr. KiESAu. That was a matter for our board of directors. I work
for the board of directors.
Mr. Kennedy. Did you inform the board of directors that this type
of thing was going on ?
Mr. KiESAU. Usually an employee doesn't tell his board of directors.
Mr. Kennedy. You learned something about Mr. Teitelbaum's
practices.
Mr. KiESAU. So did they.
Mr. Kennedy. They knew about it ?
Mr. Kiesau. They knew everything that I knew.
12876 IMPROPER ACTIVITIES IN THE LABOR FIELD
Mr. Kennedy. Did you inform them?
Mr. KiESAu. Well, they testified
Mr. Kennedy. Just answer the question. Did you inform them?
Mr. KiESAU. Yes, sir.
Mr. Kennedy. You did ?
Mr. KiESAu. Yes.
Mr. Kennedy. Now I show you a letter of July 21, 1950.
The Chairman. The Chair presents to you a photostatic copy of
a letter of July 21, 1952, addressed to Mr. Teitelbaum. Apparently
the letter was written by you. Will you examine it and state if you
identify it?
(Document was handed to the witness.)
(Witness conferred with counsel.)
The Chairman. Did you identify the photostatic copy of the letter ?
Mr. KiESAU. Yes, Mr. Senator.
The Chairman. That may be made exhibit No. 31 for reference and
may be found in the files of the select committee.
Mr. Kennedy. I would like to read this letter into the record.
July 21, 1950, Mr. Abraham Teitelbaum, signed by D. F. Kiesau,
executive vice president of the Chicago Kestaurant Association.
Dear Mr. Teitelbaum : This is in reply to your inquiry as to the arrangements
made from time to time in the past concerning your retainer as counsel to the
Chicago Restaurant Association. Permit me to state the following facts : You
were retained as labor counsel for the Chicago Restaurant Association in 1939,
at which time your retainer fee was $15,000, plus $5,000 per year to be used as
out-of-pocket expenses in connection with traveling, union meetings, entertain-
ment, incidentals, et cetera. Subsequently, your retainer was raised to $20,000
per year, together with the additional $5,000 per year as expenses, et cetera. In
the past years, prior to 1949, you received sums of money at or about Christmas
each year, ranging from $2,000 to $8,000 in addition to the above retainer and
expenses allowed. While the latter was in the nature of a gift, it was intended
to augment your expense account as the pressure became greater due to union
contributions, hotel and traveling exi>enses necessitated when you moved to Cali-
fornia, and were required to make additional trips to and from California by
reason of the association's urgent demands for your services not originally con-
templated. You have always advised us that the expenses we gave you in
addition to the basic retainer was not sufficient. We know that unless you had
received tliese increases in expenses from time to time, you would not have been
able to carry on the splendid work performed by you for our association.
What is the "pressure became greater due to union contributions" ?
What does that refer to, Mr. Kiesau ?
Mr. Kiesau. As I recall in this entire letter
Mr. Kennedy. That is of July 21, 1950.
Mr. Kiesau. This was a matter that Mr. Teitelbaum had discussed
with me, and asked if we could give him a letter, the gist of which
is incorporated in here. I discussed it again with the manage-
ment committee. In this case, I do not recall whether it was by
telephone or at a meeting. I am inclined to believe that it was by
telephone. It was seeking authority to write this letter, and it was
given to me, and the letter was written accordingly.
The gist of the letter was in accordance with his conversation with
me.
Mr. Kennedy. It would appear very clear from this letter that as
far back as July 1950 you were aware that he was making these pay-
ments to these unions.
IMPROPER ACTIVITIES IN THE LABOR FIELD 12877
Mr. IviESAU. Well, I did not understand. As it looks now in
print "Due to the union contributions" — I might have assumed that
that was contributions for advertising and their publications, which
many of the locals have. They all get out their little dance book or pro-
gram book and go around to different restaurants and ask them for
advertising. I probably thought of it at the time that that was it.
I am not sure.
Mr. Kennedy. Did you think that Mr. Teitelbaum was making
payments in that connection ?
Mr. KiESAU. No, sir.
Mr. Kennedy. Well, then, this states clearly, "Pressure became
greater due to union contributions," and this is what Mr. Teitelbaum,
according to the sworn testimony before our committee, was doing all
this period of time. He was making the payments for the various
members of the restaurant association to the union.
Mr. Kiesau. In the one case he made a payment to Trungell that
we knew about, and then we stopped.
Mr. Kennedy. This was back in 1950. Did you draw this to the
attention of the restaurant association board of directors ?
Mr. IOesau. I am not sure about the board of directors in this
case, Mr. Kennedy, but the management committee knew about it.
The Chairman. Tell us about the management committee. Is that
a committee of the board of directors ?
Mr. Kiesau. The management committee is a sort of interim com-
mittee between the board of directors' meetings with power to act on
behalf of the board of directors.
The Chairman. That is what I assumed. But is it composed of
members of the board of directors ?
Mr. I^ESAU. Yes, sir.
The Chairman. In other words
Mr. Kiesau. It is a part of the board.
The Chairman. You have the board which has the overall man-
agements, and then it delegates authority to a committee, a manage-
ment committee, to act in the interim between board meetings?
Mr. Kiesau. That is right. And invariably. Senator McClellan,
it is the older members, the people who have either been past presi-
dents or active in the association for many years.
The Chairman. You said you had about 23 menibers of the board.
How many of them compose the management committee ?
Mr. Kjesau. Between 4 or 5.
The Chairman. Some 4 or 5 of them were designated as the man-
agement committee ?
Mr. Kiesau. That is correct.
The Chairman. All right. I am trying to get the structure of it.
Mr. Kiesau. Including the president, who is ex officio.
Mr. Kennedy. Then, of course, this other letter, Mr. Chairman,
exhibit 29, dated March 2, 1951, the last paragraph says-
It has been the policy of the Chicago Restaurant Association, as you well
know, that this expense, as well as expenses for union periodicals, subscrip-
tions, dues —
What does that refer to, dues ?
Mr. Kiesau. The same thing.
12878 IMPROPER ACTIVITIES IN THE LABOR FIELD
Mr. Kennedy. Dues of what?
Mr KiESATi. I don't know. , , ,i
Mr! Kennedy. You wrote the letter. I am asknig you about both
"" MfKit^IS' That was approximately the way he discussed it^with
me I don't know what dues he paid, unless it were the dues for
Sample that developed in testimony last week m the case of London
""S'Ch'ikC" W^^^^ that be paying dues into a local for a given
numbei of members so as to keep the plant or establishment from
beino-oro-anized? Is that what you mean ? .-p t ^ i .
M? KiEslu Senator McClellan, the case that was testified to last
week was the only case that I had ever heard of him paying any union
""The^CHAiRMAN. That is what happened in the Strang incident.
Mr.KiESAU. Whatisthat? . . .-, c. • -^ „f
The Chairman. That is what happened m the Strang incident.
Mr. KiESAU. That was not. Mr. Strang paid that and it was a re-
The Chairman. You saw the endorsement. You know how it was
handled. It went to the union.
Mr. KiESAU. At the time we did not. -^ , -r i -s^ .-u-
The Chairman. I am not saying you did. But I wonder it this
refers to similar transactions, where he was paying out this money ana
setting up a certain number of employees, designating them as union
members and paying their dues. You refer to dues. I can t under-
stand what else it would be except paying dues for some establish-
ment on a given number of employees to prevent unionization.
Mr. KiESAU. I don't know of any other. ^ ^.^ , i
The Chairman. Obviously that is the way the $2,240 check was
handled. You know that now.
Mr. KiESAU. Yes, sir. ^ ^t .-
The Chairman. This would indicate that you knew at the time
that he was also paying dues, that you were covering by the re-
tainer fee.
Mr. KiESAU. I knew at the time ?
The Chairman. Well, the letter indicates that. You refer to dues.
Have you any other explanation than that he was actually paying
dues on some people ? , • i • j.i, a.
Mr. KiESAU. It didn't even occur to my thinking at the time that
he was paying any union dues.
The Chairman. What did you have in mind when you used the
word "dues"?
Mr. KiESAU. That was an expression that he used, union publica-
tions, union dues, entertainment.
The Chairman. AVell, you don't call entertainment "dues." "Wliat
else is included
Mr. KiESAU. I think entertainment is included in here.
The Chairman. Well, yes, you covered a number of things, includ-
ing this. You specified entertainment and other things and then
you specified union dues.
Mr. KiESAU. I believe, Senator McClellan, they were his words.
IMPROPER ACTIVITIES IN THE LABOR FIELD 12879
The Chairman. They may have been his words. If lie said some-
thing to you about union dues, what do you think he meant «
Mr KiESAu. At the time I didn't think that it was like the Marien-
thai dues, 1 assure you.
The Chairman. You just didn't think It is bound to have made
some impression on you. Here is the director or manager or execu-
tive vice president of this association, and you are talking about union
dues. I can hardly conceive that it would not be clear in your mind
what was meant by union dues.
Mr. KiESAu. Many things that Mr. Teitelbaum said were never fully
explained or understood by me. Senator McClellan. I still only know
ot one case where there was payment for union dues, and I learned that
here.
The Chairman. I just don't quite understand. Union periodicals
subscriptions, dues, travel expenses, and so forth. I can't understand
wliy you wouldn t have, at the time, known what he meant by dues
Or what you meant when you used the term "dues." Do you know
now what you meant then ?
Mr. IviESAu. Based upon the one case involving the London House
I do. '
If that is what the reference was to. But I did not understand it
to be at the time.
The Chairman. All right, Mr. Kennedy, proceed.
Mr. Kennedy, Here is another letter, Mr. Chairman.
The Chairman. In this previous letter— well, the letter we have
been talking about was March 2, 1951. Back some 9 months earlier,
in July 1950, you used the term-
it was intended to augment your expense account as the pressure became greater
due to union contributions.
What did you mean by union contributions? It seems back there
then you knew he was making some kind of contributions to unions.
In the next letter, 9 months later, it refers to union dues.
Mr. KiESAiT. My answer to that would be exactly the same as it was
tor the union dues. That is, that we just discussed. It is exactly
the same situation.
The Chairman. Well, you were augmenting his expense account and
^^tT?^ T "^ ^^'^^^ ^^ ^^^^^' ^^^^^^ things, obviously. Isn't that correct?
Mr. KiESAu. I assume that is it.
The Chairman. Well, isn't that it ?
Mr. KiESAu. Yes, that is it.
The Chairman. Without assuming, that is a plain fact about it,
isn't it?
Well, when you go to increase a payment, either salary, retainer, or
tor expenses, you generally know, and I would think as an administra-
tive official of an association you would want to know, what expense
was included in the increase being granted. That is, unless you just
had a general understanding he was to go out and do anything, what-
ever is necessary, bribe or anything else, in order to handle the affairs
or the association.
You don't want to leave that implication, do you ?
_ Mr. KiESAu. Well, these matters of bonuses and/or gifts that were
given to Mr. Teitelbaum at the end of the year were determined by
the board of directors.
12880 IMPROPER ACTIVITIES, IN THE LABOR FIELD
The Chairman. I can appreciate that.
Mr. KiESAU. I had nothing to do with that.
The Chairman. But you had knowledge of it.
Mr. Kjesau. Yes, sir, I did have knowledge of it.
The Chairman. You are bound to have.
Mr. KiESAU. But whatever knowledge I had, it still would not
make any difference, because the board of directors acted upon it.
The Chairman. Maybe it didn't, but we want to know what that
knowledge was. It might make a little difference to us.
Mr. KiESAU. Well, whatever it was, the board of directors were
thoroughly acquainted with it. There was nothing ever done— —
The Chairman. In other words, if it was to be used for a bribe,
you would say they knew it?
Mr. KiESAU. If that were the facts.
The Chairman. If it was to be used to pay dues as a pay off, the
board of directors knew it, is that what you are saying?
Mr. KiESAU. I don't think so, no, sir.
The Chairman. You said they knew what it was for. We are
just trying to find out.
Mr. KiESAU. I said if they knew.
The Chairman. I thought you said— well, if you knew and it they
knew and if neither of you knew, then you were operating with pretty
loose management, were you not ?
Mr. KiESAU. I would still have to answer that this way, that these
matters were determined by a board of directors.
The Chairman. I understand they were. But I say that they cer-
tainly knew what was meant at the time they ordered the increased
payments. I would think they knew. Do you say they did know or
did not know? ^r r^^ ^
Mr. KiESAU. I don't know what you are thinking, benator McClei-
lan, that they are. How can you tell what I am thinking that they
are. I did not know. . . .
The Chairman. Well, if I have somebody employed— it is ]ust as
simple as this— and he comes in and says "I have to have more
money," and then I would say "What for?" I certainly would try
to find out. Any businessman would do that. I would think I knew,
at least, what the increases were being paid for, and if you used the
term "union dues" or "union contributions," I think before I would
grant the increase and pay out the money I would know what was
meant by it. I assume that men who run restaurants and who operate
restaurant associations, who serve on boards that operate it, and who
serve as executive vice presidents of such associations, I assume they
would know at the time, or I would think they knew.
All I am trying to find out is this, that these terms carry with them
an implication that there was a payoff of some nature to unions.
Mr. KiESAu. Senator McClellan, I never knew of any payoff. This
was approximately
The Chairman. All right. Proceed.
Mr. I^NNEDY. Mr. Chairman, the record shows that on July 8,
1949, the retainer was increased from $25,000 to $54,000.
The Chairman. I hand you here what purports to be photostatic
copies of minutes of the board of directors' meeting held at the asso-
ciation offices, Friday, July 8, 1949, at 10 : 30 a. m. It appears to be
IMPROPER ACTIVITIES IN THE LABOR FIELD 12881
signed by you as secretary of the meeting. Will you please examine
that?
Mr. Kennedy. He identified them.
Mr. Keane. They have the minutes and we know what is in them.
The Chairman. Then it may be made exhibit No. 32.
(The document referred to was marked "Exhibit No. 32" for refer-
ence and may be found in the files of the select committee. )
Mr. Kennedy. It is correct that that increased Mr. Teitelbaum's
retainer from $25,000 to $54,000 ?
Mr. KiESAu. Yes.
Mr. Kennedy. On April 6, 1950, he was increased again to $125,000?
Mr. Kiesau. Correct.
The Chairman. He started out at $25,000 a year. When was he
first employed ?
Mr. KiESAU. I think he started out at $20,000 in 1938 or 1939.
The Chairman. $20,000 in 1938 or 1939 ?
Mr. Kiesau. I believe so.
The Chairman. Now we find here — what was the date it was raised
from $25,000 to $54,000 ?
Mr. Kennedy. 1949.
The Chairman. In 1949 his retainer was raised from $25,000 to
$54,000. Is that correct ?
Mr. Kiesau. That is correct.
The Chairman. And then in April 1956, a few months later
Mr. Keane. 1950.
The Chairman. 1940. I am sorry. A few months later, he was
raised from $54,000 to $125,000 ; is that correct ?
Mr. Kiesau. That is correct.
The Chairman. He must have really been a performer to get such
substantial increases as that.
All right. Proceed.
Mr. Kennedy. Were Mr. Teitelbaum's services dispensed with be-
cause of any of these activities, any of these kinds of payments.
Mr. Kiesau. I don't understand your question.
Mr. Kennedy. Were Mr. Teitelbaum's services dispensed with be-
cause of any of these kind of activities, any payments to unions ?
Mr. Kiesau. They were dispensed with in the case of a strike.
Mr. Kennedy. Was it because he was unable to stop a picket line at
the Marquis Restaurant ?
Mr. Kiesau. It was generally understood that the attorney was
retained to prevent a strike in those situations where the union was
coercively picketing.
Mr. Kennedy. So where he was unable to stop a picket line, that was
the reason that his services were dispensed with ?
Mr. KisEAu. That was generally the case with all the attorneys.
Mr. Kennedy. As far as Mr. Teitelbaum, and we are just talking
about him at this time, his services were dispensed with because he was
unable to stop a picket line at the Marquis Restaurant ?
Mr. Kiesau. That's correct.
Mr. Kennedy. Then the Chicago Restaurant Association hired Mr.
Champagne, is that correct ?
Mr. Kiesau. That is correct.
12882 IMPROPER ACTIVITIES IN THE LABOR FIELD
Mr. Kennedy. What did you know about Mr. Champagne's back-
ground as far as labor-management experience ?
Mr. KiESAu. I did not know anything about Mr. Champagne's
labor-management background. I believe that Mr. Drake is to follow
me on the stand
Mr. Kennedy. I am just asking you.
Mr. KiESATT. I knew nothing.
Mr. Kennedy. Did anybody ever tell you that he had any expe-
rience in labor-management relations ?
Mr. KiESAU. No ; they did not.
Mr. Kennedy. What were you told as to his experience ?
Mr. Kiesau. Nothing was told to me about his experience.
Mr. Kennedy. Did you know that he, like ]VIr. Teitelbaum and Mr.
Komano had many associates in the underworld in Chicago?
Mr. KiESAu. I did not know that.
Mr. Kennedy. Ultimately, Mr. Champagne resigned some 7 or 8
months later ?
Mr. Kiesau. That is correct.
Mr. Kennedy. He was able to settle the Marquis strike within about
a week after he was retained ?
Mr. Kiesau. Yes, sir.
Mr. Kennedy. Do you know how he was able to do that if he had no
experience ?
Mr. Kiesau. No ; I don't.
Mr. Kennedy. Then following him was Mr. Teitelbaiun brought
back for a short period of time ?
Mr. Kiesau. I think so.
Mr. Kennedy. And subsequently you retained Mr. Gutgsell ?
Mr. Kiesau. That is right.
Mr. Kennedy. And Mr. Gutgsell's services were dispensed with
when he was unable to prevent a picket line ?
Mr. Kiesau. That is correct.
Mr. Kennedy. Wliat restaurant was that ?
Mr. Kiesau. That was the Nantucket.
Mr. Kennedy. That was despite the fact that Mr. Gutgsell had
found that the employees at the Nantucket Restaurant were inter-
ested in joining the union ?
Mr. Kiesau. I beg your pardon.
Mr. Kennedy. That was despite the fact that Mr. Gutgsell had
found that the employees at Nantucket were interested in joining the
union ?
Mr. Kiesau. I believe that is not a correct statement.
Mr. Kennedy. That is Mr. Gutgsell's testimony.
^ Mr. Kiesau. I don't believe that he said that he had checked any
signatures. He said that Mr. — I believe, and I stand corrected — that
he had been informed by the union that they had 19 cards.
Mr. Kennedy. Eight, and he had seen the cards.
Mr. Kiesau. He said he had looked at them, but I don't believe that
he indicated that he had verified the signatures or anything, as counsel
for Mr. Reed.
Mr. Kennedy. He said that the union was prepared to have an exam-
ination made of the cards.
Mr. Kiesau. That is right.
IMPROPER ACTIVITIES IN THE LABOR FIELD 12883
Mr. Kennedy. And yet no steps were taken either by the Nantucket
Kestaurant or the Chicago Eestaurant Association to have an exam-
ination made of the cards.
Mr. KiESAu. That is correct.
Mr. Kennedy. A strike was called by the miion.
Mr. KiESAU. That is right.
Mr. Kennedy. And when the picket line appeared, Mr. Gutgsell's
services were dispensed with ?
Mr. KiESAU. That is right. I think we ought to mention for the
sake of the record that only 13 employees went out on strike.
Mr. Kennedy. These individuals were all paid out of the volun-
tary fund, the labor relations consultants ?
Mr. KiESAU. To support the individual in the case of this type of
picketing, they were all paid
Mr. Kennedy. Just answer the question.
Mr. KiESAU. I misunderstood your question.
Mr. Kennedy. Were the counsels that were retained, Mr. Teitel-
baum, Mr. Champagne, and Mr. Gutgsell, paid out of the voluntary
fund?
Mr. KiESAu. The voluntary contribution fund.
Mr. Kennedy. Do the nonunion restaurants contribute more to the
voluntary fund ?
Mr. KiESAU. Yes, sir.
Mr. Kennedy. They contribute how much ?
Mr. KiESAU. Well, that has varied over the years.
Mr. Kennedy. IIow much are they contributing now ?
Mr. KiESAU. The nonunion restaurants are contributing $1 per
month per employee. Those that are voluntarily participating.
Mr. Kennedy. And how much for union ?
Mr. KiESAU. The union restaurants are, at this moment, since last
December, are not participating.
Mr. Kennedy. Well, how much were they contributing ?
Mr. KiESAU. They were contributing — I believe the ratio has always
been approximately 50 percent.
Mr. Kennedy. So the nonunion restaurants contribute twice as
much as the union restaurants ?
Mr. KiESAU. That is correct.
Mr. Kennedy. I would think that the union restaurants would have
far more to do with unions than nonunion restaurants.
Mr. KiESAU. No, Senator Kennedy
Mr. Kennedy. Mr. Kennedy.
Mr. KiESAU. Mr. Kennedy. I am sorry. I am very sorry. The
union restaurants use a counsel only when contracts expire, which
might have been anywhere from 12 months apart to 2 years apart, so
counsel is only used primarily for that, unless there was a local dis-
turbance of some kind or disagreement between management and the
union and so forth in the union houses. n • ?<.
Mr. Kennedy. And the nonunion might not use them at all ; isn t
that correct ?
Mr. KiESAu. That is very much correct.
Mr. Kennedy. It would appear, Mr. Kiesau, that certainly the as-
sociation is not in any better moral position than the unions them-
selves, in view of the retaining of Mr. Teitelbaum with his criminal
12884 IMPROPER ACTIVITIES IN THE LABOR FIELD
background and the retaining of Mr. Champagne with his criminal
background, the association with Mr. Romano, and then, of course,
Mr. Champagne's association with this number of individuals, in-
cluding his payments to Mr. English. And then also, the association
was aware back in 1950 that Mr. Teitelbaum was making payments
not only to union officials but allegedly to a county official, which would
have been a crime; and you wrote letters which would indicate that
you were aware of the fact then that he was making a practice of mak-
ing payments on these dues.
There are 6 or 7 matters there that would indicate that the position
of the restaurant association is certainly not any better than the posi-
tion of the union in all of these matters. You can make any com-
ment on that that you would like.
Mr. KiESAU. I would never agree to that.
Mr. Kennedy. Well, you would agree that you hired Mr. Teitel-
baum ; isn't that correct ?
Mr. KiESAU. Yes, sir ; the association did.
Mr. Kennedy. All right, the association hired Mr. Teitelbaum.
The association knew also that Mr. Teitelbaum was hiring Mr. Louis
Romano ; isn't that correct ?
Mr. KiESAU. Mr. Teitelbaum hired Mr. Romano.
Mr. Kennedy. And both Mr. Romano and Mr. Teitelbaum had
many criminal associates in the underworld in Chicago. You are
aware of that ?
Mr. KiESAU. I am not aware of the facts on that matter.
Mr. Kennedy. You were aware of it generally ?
Mr. Kiesau. I have read about it in the papers.
Mr. Kennedy. Then you knew, according to your own correspond-
ence, that Mr. Teitelbaum had said he was paying off a county official,
$10,000 ? You were aware of that ?
Mr. KiESAU. Whatever is in the letter.
Mr. Kennedy. And were you aware of the fact that in another
instance a payment of $150 extortion had been paid by Mr. Teitel-
baum, with his concurrence, and that was in 1949 ?
Mr. KiESAU. Yes, sir
Mr. Kennedy. Then the association hired Mr. Champagne ?
Mr. KiESAU. That is right.
Mr. Kennedy. And with all of his associations. Those are the
matters that I have mentioned. Then, of course, there are two other
letters that we have discussed that will have to speak for themselves.
The Chairman. Mr. Kiesau, how much of the $125,000 a year paid
as a retainer fee for attorneys was used or was to be used to pay off
these union officials, to prevent unionization of restaurants ?
Mr. Kiesau. I have no knowledge of that. Senator McClellan.
The Chairman. Well, isn't that the reason that the fee was made
so exorbitant ?
Mr. Kiesau. Not that I know of.
The Chairman. Did you ever get a report from Teitelbaum, Cham-
pagne, or Gutgsell that they were paying out this money for that
purpose ?
Mr. Kiesau. No, sir.
The Chairman. Was it ever discussed ? It may not appear in the
minutes, but was it discussed in your presence ?
IMPROPER ACTIVITIES IN THE LABOR FIELD 12885
Mr. KiESAU. No, sir ; never.
The Chairman. Did you require an explanation or a detailed ac-
counting of the expenses that they were out ?
Mr. KiESAu. No, sir.
The Chairman. In other words, they used their own conscience
and own judgment, "Here is a lump sum, you keep us from being
unionized, our members of this association, and as long as you do
that, you can take this money and handle it any way you want to."
Is that it ?
Mr. KiESAu. I don't think that is
The Chairman. Well, when they failed, you fired them.
Mr. KiESAU. That is correct.
The Chairman. That was the purpose of your hiring them.
Mr. KiESAu. The general understanding was that they were sup-
posed to prevent employers from putting people in the union.
The Chairman. Well, you found he did put some in and you didn't
fire him for that, because he kept down a strike.
Mr. KiESAu. I didn't have the determination for it.
The Chairman. Your association did not fire him for that?
Mr. KiESAu. That is correct.
The Chairman. Obviously, it approved that, so long as he got
results.
Mr. KiESAU. We didn't know that. Senator McClellan.
The Chairman. You knew it afterward.
Mr. KiESAU. Knew it afterward, a long time afterward. In the
Johnson case, it was 3 years.
The Chairman. You continued to retain him after you knew it;
your association did.
Mr. KiESAU. Afterward ; yes, sir.
The Chairman. And you did not fire him until he failed.
Mr. KiESAU. Well, I think 1953 would have been about the time
that he was let go, which was approximately 3 years after the Les
Johnson case.
The Chairman. All right.
Is there anything further ?
Mr. ICennedy. You had some financial transactions with Mr. Teitel-
baum yourself ?
Mr. KiESAU. Yes, sir.
Mr. Kennedy. You made loans to him ?
Mr. KiESAU. Yes, sir.
Mr. Kennedy. Starting in 1949 ?
aTt* Tvtesatt Y^gs sir
Mr'. Kennedy. $30,000 in 1949, was it? $25,000?
Mr. KiESAU. You have the figures.
Mr. Kennedy. $30,000 in 1949.
Mr. KJEANE. He has the figures.
Mr. Kennedy. Do you have the figures ?
Mr. KiESAU. I believe it was $25,000 in 1949.
Mr. Kennedy. How much in 1950 ?
Mr. KiESAU. In 1950, $25,000 on two different occasions.
Mr. Kennedy. Twice $25,000?
Mr. Kiesau. That is right.
Mr. Kennedy. And then 1951 ?
12886 IMPROPER ACTIVITIES IN THE LABOR FIELD
Mr. KiESAU. 1951, two different occasions.
Mr. Ki:NNEDY. How much? . inKi
Mr KiESAu. In 1951, $13,750, and $15,000 the second time m 1951.
Mr, Kennedy. You got a $5,000 interest payment on the loan m
1949?
Mr.KiESAU. $5,000 ; that IS cx)rrect.
Mr. Kennedy. And how long was the loan m existence «
Mr.* KiESAU. I believe it was in existence about 4 months.
Mr*. Kennedy. You got $5,000 interest on that loan ?
Mr. Kiesau. That is what he offered me for makmg the loan. 1 hat
is correct. n ^ ^ a
The Chairman. What was the amount of the loan <
Mr. Kiesau. $25,000.
The Chairman. $25,000 for how long?
Mr Kiesau. I believe it was about 4 months.
The Chairman. Four months; and you got $5,000 interest?
Mr. Kiesau. That is correct.
Mr. IvENNEDY. What did he use the money for ?
Mr. Kiesau. I don't have any idea. , .^j: ,
Mr. Kennedy. Did you ask him what he was going to use it tor i
Mr. Kiesau. No; I didn't. -n-, ^u.,
The Chairman. Do you know anyone else who will do that «
Mr Kiesau I know Mr. Teitelbaum borrowed money from many
people, many restaurant people, I believe he also made a loan from
the association once. I think the records so indicate. He made a loan
from some of the directors of the association.
Mr. Kennedy. How much did you get back on the loan that you
made for $25,000 on February 3, 1950 ?
Mr. Kiesau. $2,500.
Mr. Kennedy. How long was that out ?
Mr.KiESAU. That loan was about 5 or 6 months.
Mr. Kennedy. You did very well with Mr. Teitelbaum personally ^
Mr.KiESAU. No; I didn't.
The Chairman. Were you making these loans personally ?
Mr. Kiesau. No ; I did not— excuse me ?
The Chairman. Let me ask you. These were personal loans that
you made to Mr. Teitelbaum ?
Mr. Kiesau. Yes, sir ; they were personal loans.
The Chairman. All right. Go ahead. . , ^^t, o
Mr. Kennedy. Did you want to make some statement about them «
Mr. Kiesau. No ; that is all._
Mr. Kennedy. I guess that is all.
The Chairman. Are there any further questions ?
Mr Kiesau. I would like to mention, though, that the 2 loans
that were made in 1951 there was no interest rate or nothing offered
for making the loans. . .■,.<)
Mr. Kennedy. Wliy didn't you get any interest on that i
Mr.KiESAU. I beg your pardon? , . ^, ^ q
Mr Kennedy. Why didn't you get some interest on that one ?
Mr. Kiesau. Maybe I was trying to even out from what was paid
before. I can't tell you. , ^ ^ ^ ^<?
Mr. Keane. Mr. McClellan, may I make a short statement (
The Chairman. All right. We will hear you briefly.
IMPROPER ACTIVITIES IN THE LABOR FIELD 12887
Mr. Keane. I believe your staff can tell you that the association
has b^n fully cooperative m the investigation. We have turned over
our office to you, all of the files and records and minutes and financial
statements, everythmg they had. They had the complete run of the
ofhce and we have given them every bit of cooperation. I think that
ought to be on the record.
The Chairman. All right. We accept your statement and for the
cooperation and assistance you have given, the association and of-
ficials and anyone else, the committee is always grateful. We have a
tough assignment here, and when we get a little help instead of ob-
struction and hindrances, we are grateful for it. Stand aside.
Call the next witness.
Mr. Kennedy. Mr. George Drake.
The Chairman. Be sworn, please. You do solemnly swear the
evidence you shall give before this Senate select committee shall be
the truth, the whole truth, and nothing but the truth, so help you
God?
Mr. Drake. I do.
TESTIMONY OF GEORGE T. DRAKE, ACCOMPANIED BY
COUNSEL, WILLIAM J. LANCASTER
The Chairman. State your name, your place of residence, and busi-
ness or occupation.
Mr. Drake. My name is George T. Drake. I reside at 143 Sheridan
Road, Kenilworth, 111. I am a restaurateur in the city of Illinois,
and also in the village of Willamette, 111.
The Chairman. A restaurant owner and operator?
Mr. Drake. Yes, sir.
The Chairman. What are your connections with the Chicago
Restaurant Association ?
Mr. Drake. At the present time I am an ex-president and remain
a permanent member of the board.
The Chairman. You have counsel with you ?
Mr. Drake. Yes, sir ; I do.
The Chairman. Counsel, identify yourself for the record.
Mr. Lancaster. William J. Lancaster, 111 West Washington
Street, Chicago, 111., a member of the Illinois bar.
The Chairman. Proceed, Mr. Kennedy.
Mr. Kennedy. Mr. Drake, you were president of the association
during what period of time?
Mr. Drake. That is, I believe, from April of 1949 until April of
1954. ' 5 F F
Mr. Kennedy. Did you have any official position with the restau-
rant association prior to 1949 ?
Mr. Drake. I belonged to a couple of minor committees, I believe,
prior to that. I don't recall exactly what they were.
Mr. Kennedy. Could you tell the committee why the restaurant
association took no steps to dispense with the services of Mr. Teitel-
baum when it was brought to their attention that he was involved in
the extortion of the Nantucket Restaurant and you were president of
the association ?
12888 IMPROPER ACTIVITIES IN THE LABOR FIELD
Mr Drake. At that time we did take the one step that has been
testified to here, as far as forcing Mr. Teitelbaum to pay the money
back. I do recall that he was admonished by the board, and he more
or less promised and said that he would not enter mto that type of
arrangement again. ^ ^ , ji ^ u
Mr Kennedy. What about the $10,000 payment supposedly to be
paid to the county investigator, Mr. Dan Gilbert? ^^ , . „
Mr Drake. Could I look at that letter, please, Mr. Kennedy, again i
The Chair presents to the witness exhibit No. 29 for his examina-
tion.
(The document handed to the witness.)
(The witness conferred with his counsel.)
Mr. Drake. I believe as stated in that first paragraph, it was our
opinion that that had been a political contribution.
Mr. Kennedy. Let's make sure that you understand it. It says,
"We understand that you needed him to help remove the pickets
from the Regent Drugstore at the Sherman Hotel." -r j ^x
Mr. Drake. I don't recall that part of it, Mr. Kennedy. I don t
recall as to that part of the statement before the committee or whether
it was something that Mr. Kiesau had or that Mr. Teitelbaum had
talked about to Mr. Kiesau.
I could recall the $10,000 payment. I do recall that it was con-
sidered by us a political contribution. Many of us make political
contributions in the city of Chicago to public officials, and for their
campaigns. .^ , , , .^ j: ^^ ^ 4.
Mr. Kennedy. Mr. Kiesau just testified that he gave the lull tacts
to you and to the other members of. the board of directors, and this
was to get rid of a picket line, and you people were aware of that.
Mr. Drake. I do not accept that statement. No, it was not.
Mr. Kennedy. Mr. Kiesau just testified to that.
Mr. Drake. He wrote that letter, Mr. Kennedy.
Mr. Kennedy. He testified under oath that he told you all the
facts in this matter. -r u ^i, j.
Mr. Drake. I did not hear him. He may have. I told you that
I do not recall that part of it, sir.
Mr. Kennedy. You never saw this letter before ?
Mr. Drake. I wouldn't say "Yes" or "No." I do not recall. I
think it was written after our answer.
Mr. Kennedy. You say that you were unaware of the fact, then,
that the payment was for that purpose?
Mr. Drake. Yes, I am unaware of the fact that the payment was
for that purpose.
Mr. Kennedy. Wliy did you retain or have on the payroll some-
body such as Abraham Teitelbaum in the first place ?
Mr. Drake. Mr. Abraham Teitelbaum came to the association at
least 10 years prior to my entry in the association. The board of
directors maintained him there. I went along with the board of
directors.
Mr. Kennedy. Why did you have somebody like Louis Romano
on your payroll ?
Mr. Drake. We did not have Mr. Romano on our payroll.
Mr. KJENNEDY. Mr. Romano was associated and doing work for the
Chicago Restaurant Association. He was being paid out of the
retainer fee that was being paid to Mr. Teitelbaum.
IMPROPER ACTIVITIES IN THE LABOR FIELD 12889
Mr. Drake. That is correct.
Mr, Kennedy. Why did you have somebody like that around ?
Mr. Drake. What do you mean have him around? Because he
was retained by Mr. Teitelbaum.
Mr. Kennedy, Well, you knew of
Mr. Lancaster. Mr. Chairman, throughout this hearing, Mr. Ken-
nedy has referred to Mr. Romano as an employee of the association,
and has continued with that line of questioning. That is what the
witness is saying. He was not an employee of the restaurant associa-
tion,
I don't think it is fair for Mr, Kennedy to continually say "Why
did you have this man as an employee of the restaurant association?"
The Chairman. Just a moment, now, it is drawing a pretty fine line,
but if you employ a law firm to represent you, it is generally known
that many law firms have attorneys on their staff that assist them.
They may be salaried, and paying the firm covers the expense of such
help as they may employ. The point is here, and I think this is the
crux of it: Did the restaurant association know that Romano, as
an employee of Teitelbaum, was actually helping to do the work for
the association? And did they know of his character and his rep-
utation ?
Mr, Drake. I can tell you this, that I did not know of his back-
ground or his character or reputation at that time. The only thing
I did know about Mr. Louis Romano is that he had been a member
of the Bartenders' Union and had been the president of same. That
is all.
The Chairman, You knew nothing else about him ?
Mr, Drake, No, sir.
The Chairman, When you learned about his character and his
past, his record did you insist on his being discharged or not used for
the restaurant association business ?
Mr, Drake. Mr. McClellan, the first time I learned anything about
his criminal record was during these hearings.
The Chairman, Of course, I can appreciate you might employ
somebody without knowing. Here you didn't directly employ him,
but you did know that he was assisting
Mr, Drake, I don't remember Mr, Romano being that active, Mr.
McClellan,
The Chairman. I beg your pardon ?
Mr. Drake. I do not recall Mr. Romano as being that active. All
our dealings were directly with Mr. Teitelbaum.
The Chairman. Do you know of any work that he did for the as-
sociation ?
Mr. Drake. He didn't do the work for the association.
The Chairman. I beg your pardon ?
Mr. Drake. Any work he did, he did for Mr. Teitelbaum, and I
don't recall where we actively brought Mr. Romano as an employee
of the association, nor did we follow his work, in what he was doing,
and I don't think any of the board of directors know much about his
activities.
The Chairman. O. K., if that is the way you want to leave the
record. You have a situation here that raises eyebrows. You know
that as well as I do. You have this tie-up here. You get a lawyer,
21243— 58— pt. 34 3
12890 IMPROPER ACTIVITIES IN THE LABOR FIELD
and I am talking about the association and not you personally, you
hire a lawyer that is known to have underworld connections, repre-
senting possibly the top-ranking hoodlums in the area, and then he
employs to help him another man that has a terrible record. I just
can't believe that businessmen could be unaware of the situation, and
that they were innocent victims or innocent in the arrangements they
made here to have their business looked after by characters of tliis
sort.
Proceed, Mr. Kennedy.
Mr. Kennedy. Mr. Drake, did you play any role in the hiring of
Mr. Champagne?
Mr. Drake. Yes ; I did, sir.
Mr. Kennedy. What role did you play in that ?
Mr. Drake. I first went out, along with Mr. Cliff Marquis, and
with Mr. Marion Isbell, to see Mr. Champagne.
Mr. Kennedy. Who recommended Mr. Champagne to you ?
Mr. Drake. I do not remember.
I believe Mr. Champagne called me. I am not sure of that. I
think I got a call from Mr. Champagne. It is either that or his name
was given to me by someone in my restaurant. I cannot tell you for
sure.
Mr. Kennedy. You were the one that recommended Mr. Cham-
pagne to the restaurant association ?
Mr. Drake. I am the one that made the original contact, that is
correct, sir.
Mr. Kennedy. And you knew at that time about all of his criminal
associates ?
Mr. Drake. I did not know about his criminal association; no,
I did not, sir.
Mr. Kennedy. Did you investigate or look into them at all, Mr»
Drake?
Mr. Drake. I think that takes just a little bit more than a direct
answer. Will you give me a minute or two ?
Mr. Kennedy. Yes. But did you look into his background and
experiences ?
Mr. Drake. I have to answer that if you will allow me just a min-
ute. Will you allow me to do that ?
The Chairman. All right, but get to the answer.
Mr. Drake. All right. I will give you an answer, and you may be
interested in hearing this answer, sir. I think you will be.
The Chairman. All right. Proceed.
Mr. Drake. At the time that we hired Mr. Champagne, I was presi-
dent of the association. The Marquis had a strike around its 11 little
small units, this picket line had been placed by the unions that you
have so blackened here in these hearings.
The Chairman. You say we have blackened ?
Mr. Drake. Well, it has come out in testimony. We will put it
that way. I will retract that, sir.
The Chairman. I don't think this committee is interested in black-
ening. We are trying to develop facts. All right.
Mr. Drake. At the time they placed the picket line around this
chain of restaurants in order that the owners would coerce the em-
IMPROPER ACTIVITIES IN THE LABOR FIELD 12891
ployees, force them, into joining the union. A virtual stranglehold
had been placed upon this company. They could not get delivfries n
the normal method. We could not get the garbage out by the normal
scavengers. We had no laws to turn to There nrp n7lnw=^r.Ti.
statutes of the State of Illinois or in the code of the city of Ch Wo'
t^'oTsS"''- Thestrikewascostingusapproxim\4|^^S:o1S
This was coming out of the voluntary fund of the Chicago Res-
tauran Association, and this fund could not go on indefinite^ So
when the time came that Mr. Champagne's name came to mp nnri T
took Mr. Isabell and I took Mr. Marq^uif out with me to see Mr 'cTa J
pagne and I asked Mr. Champagne if he could assist us in this matter
he old me at that time that he would try. I said if he could success-
fully terminate this strike, I could almost assure him that he could
become the counsel for the Chicago Restaurant Association
1 repeat we had no place to turn. We had no local law that could
give us a free election by the employees. We had nothing that could
stop the secondary boycott, and according to your own statements, we
were guilty of three alternatives. No. 1, if we fought we were guiltv
of union busting and No. 2, if we made side deals we were extortiii
money, and No. 3, this is my own opinon, if we forced those employed
to go into the union that is a form of dictatorship.
That is all.
The Chairman. You haven't answered the question. Did you look
into the background of Mr. Champagne before you employed him?
Mr. Drake. 1 think my answer was clearly stated we did not.
1 he Chairman. You did not ?
Mr. Drake. No, sir.
The Chairman. That is the answer. Proceed.
Mr. Kennedy Did you find out how he was spending the monev ?
Mr. Drake. No, sir. & j
Mr. Kennedy. Did you ever make any determination or any investi-
him ?^ °"^ ^ ^^^ ^^^ ^^^^^ ^^^^ ^^^® money you were paying
Mr. Drake. No, sir.
• Jj^^' Kennedy. All you were interested in was that he got the results ;
IS that right ? & . >
Mr. Drake. Was there anyhere else we could go «
Mr. Kennedy. Mr. Drake, why don't you answer the question?
ri ht 2^ ^^^^ interested in was that he should get the results; is that
1 "^fi: P^^^- I think I made that clear, because there was no place
else that we could go.
Mr. Kennedy. The answer is "Yes" «
Mr. Drake. That is right.
Mr Kennedy. I think that your position is no better than the
union's.
Mr. Drake. That is your opinion.
The Chairman. Are there any further questions ?
Mr. Kennedy. That is all.
Mr. Drake. There is one thing else I would like to say, if I may
say so.
12892 IMPROPER ACTIVITIES IN THE LABOR FIELD
The Chairman. I am sorry, Mr. Drake, I had another matter here
to discuss.
Mr. Drake. I did want to state that in the sessions in 1955 and 1957
in the Illinois State Legislature, two bills were proposed that were
commonly called the antiracketeer picketing bills. We sent delega-
tions down, and attempted to have these bills passed and the legislature
saw fit to discard them both times.
There is one other point I believe should go in the record. Our
voluntary contribution fund has been called a union-busting fund. I
wish to make one statement on that. In 1951 I was an operator of
six nonunion restaurants and ready to open a seventh. Two days
prior to opening that restaurant, we had our complete crew organized,
and the unions came in to see me, and, by the way, the name of the
place was known as the Opera Club, and the unions came in to see
me and said, "We have the majority of your employees signed up,"
and I said, "Produce the cards." They produced the cards, and upon
checking the record they were right, and I signed a union contract
for that operation.
Here I was the president of the association and had the purse strings
of this fund on my side, and yet this is to prove that that voluntary
fund would not back up anyone that did not have the majority of his
employees that wanted to stay out of the union.
Mr. Kennedy. In view of that, how do you explain the Nantucket
case ?
Mr. Drake. I again don't believe that the union had the ma-
jority of the people.
Mr. Kennedy. They said that they had cards.
Mr. Drake. Did they verify it ?
Mr. Kennedy. They said they would be glad to have you verify the
' Mr. Drake. Mr. Gutgsell said that, and at no time did they tell
that to Mr. Reade, and I was very close to Mr. Reade throughout
the entire strike. .
Mr. Kennedy. Mr. Gutgsell was your representative and he made
a sworn statement here, before the committee, to that effect.
Mr. Drake. Did he verify the cards?
Mr. Kennedy. He said that he went and they showed him 19
cards, and the union would be glad to have the cards examined and
the signatures compared, and nobody from the association and no-
body from the Nantucket Restaurant were interested in having
the signatures compared. For that reason your position is far dif-
ferent than it would be otherwise.
You weren't interested at that time in having the signatures
compared?
Mr. Drake. I can't recall his sworn testimony word for word, Mr.
Kennedy. I was here at the time, and I think that there are a few
facts that are wrong.
Mr. Kennedy. Oh, no ; I know that they are not.
Mr. Drake. That is exactly what he said.
The Chairman. We have the record both ways, now. Is there
anything further ? .
Senator Gold water. I have just a few questions, Mr. Chairman,
before this witness leaves. I think this points up a fact that goes
IMPROPER ACTIVITIES IN THE LABOR FIELD 12893
across the country, that small-business people, whether they be res-
taurant people or merchants or whatever they be, are not able to
combat (1) the lack of interest of the State legislatures in these
matters when they refuse to pass legislation to cover these things,
and (2) the lack of interest of local governments when they refuse
or don't show enough interest to pass ordinances or legislation to
cover these no man's land cases, and (3) if we didn't have these
organizations, and I don't condone all of the activities of all of these
organizations, many small-business men would go out of business.
Mr. Drake. That is true.
Senator Goldwater. I think this points up very vividly the need for
State legislatures across this country to pay some attention to local
labor laws, and also for police departments and city governments
across the country to give some protection to both sides of the fence.
I know today in practically every city of any size in this country
what we have heard described in Chicago could exist and does exist
in many cases. These associations are a virtual necessity for the ex-
istence of small business regardless of what they are.
Now, they might be run one way in one town and another way
in another town, but they live across this country and they serve
a purpose. They will continue to live until our legislative bodies
at the local level assume their responsibilities. I think the States
should have laws to cover these areas. I don't like to see the Fed-
eral Government invade this no man's land with its power. I don't
like to see Federal Government extend its Taft-Hartley law down
into intrastate commerce. But if the local authorities don't do it, that
is the only source of enforcement that they are going to have.
Mr. Drake. I think your analysis is excellent.
The Chairman. The committee will stand in recess for 5 to 10
minutes. We want to proceed a little longer today into the noon hour
than usual, because we cannot reconvene this afternoon until 3 o'clock.
So we would like to run along as far as we can.
You may stand aside for the present and we will stand in recess for
5 or 10 minutes.
(A brief recess was taken.)
The Chairman. The committee will come to order.
Mr. Kennedy. We planned to put in the figures that we have on
the Chicago Restaurant Association but the witness is out of the room
at the present time, and so I would like to call someone else.
(At this time, members of the committee present are: Senators
McClellan and Goldwater.)
The Chairman. The Chair observes that a quorum is present.
Mr. Kennedy. We move into a new phase of the hearings, Mr.
Chairman, and we have been discussing the relationship between the
various unions and the Chicago Restaurant Association, where the
Chicago Restaurant Association made a role. Now we are going into
situations where the individual restaurants had to deal with the union,
and I would like to call as the first witness Mr. Jay Adler.
The Chairman. You do solemnly swear that the evidence, given
before this Senate select committee shall be the truth, the whole truth
and nothing but the truth, so help you God?
Mr. Adler. I do.
J2894 IMPROPER ACTIVITIES IN THE LABOR FIELD
TESTIMONY OF JAY ABLER
The Chairman. State your name, and your place of residence, and
your business or occupation.
Mr. Adler. Jay Adler, 9050 South Coyne, Chicago, restaurant
business.
The Chairman. How long have you been in the restaurant business?
Mr. Adler. Twenty-five years.
The Chairman. Do you waive counsel, Mr. Adler ?
Mr. Adler. Yes, sir.
The Chairman. All right, Mr. Kennedy.
Mr. Kennedy. Mr. Adler, were you approached in 1935 about hav-
ing certain of your employees made members of the union ?
Mr. Adler. I was approached in 1935 for having all of the em-
ployees in the union.
Mr. Kennedy. What restaurant did you own at that time?
Mr. Adler. Well, I was a partner of Mr. Mickelberry, in Mickel-
berry's Log Cabin Restaurant.
Mr. Kennedy. Is that the restaurant you have at the present time?
Mr. Adler. Yes, sir.
Mr. Kennedy. Do you own that ?
Mr. Adler. With Mrs. Mickelberry.
Mr. Kennedy. And that is M-i-c-k-e-1-b-e-r-r-y Log Cabin Restau-
rant?
Mr. Adler. Yes, sir.
Mr. Kennedy. Did you give the address ?
Mr. Adler. 2300 West 95th Street, Chicago, 111.
Mr. Kennedy. Did Mr. Blakely of local 593 have discussions with
you at that time ?
Mr. Adler. Well, there was quite a few, Mr. Kennedy, and I am
of the opinion that Mr. Blakely was in the group, but I don't remember
exactly.
Mr. Kennedy. AVliat was the proposition that was made to you?
Mr. Adler. They came in to see us and wanted us to join the union.
Mr. Kennedy. Would you tell us what you did then ?
Mr. Adler. AVell, we talked to them and nothing was done, and the
matter was left undecided and they said they would be back again
which they did, in I would say 4 or 5 times in 1935, and then in 1936.
Mr. Kennedy. Did you put a certain number of your employees in
the union ?
Mr. Adler. Well, Mr. Kennedy, may I tell you somethmg about it
before I say that? The arrangement they wanted was for the whole
place to be unionized but Mr. Mickelberry wouldn't put the girls in.
After every one of these meetings, it still was the same, Mr. Mick-
elbeiTy would not put the girls in. Then in 1936 there was a nian by
the name of Corky in the restaurant evenings late at night with his
wife, and he would sit around and talk, and both Mr. Mickelberry
and I got to know him although we never knew what business he did
or where he lived.
So one night he said to me, "Jay, Mr. Adler, what reason do you
and Charley have for not going in the union?" and I said to him,
"What miion," and he said, "The Hotel and Restaurant Union," and I
said, "Do you represent them," and he said, "Y^es." I said, "Y^ou know
IMPROPER ACTIVITIES IN THE LABOR FIELD 12895
why we won't go in, we won't put the girls in," and Mr. Cortney said
"Maybe that can be arranged." And so I told Mr. Mickelberry the
next day, and about I don't how much longer after that, but anyway
they came back, the whole bunch of them came out, and we had a meet-
ing, and we put the kitchen employees in and left the girls out.
Mr. E^ENNEDY. How many employees did you put in ?
Mr. Adler. About 10 or 12.
Mr. Kennedy. And subsequently
Mr. Adler. It was our total kitchen force.
Mr. Kennedy. Subsequently that has been raised to about 19; is
that right?
Mr. Adler. Yes, sir.
Mr. Kennedy. Were those employees ever informed that they were
in the union ?
Mr. Adler. At the start it is pretty hard for me to remember for
sure, 25 years ago, but I don't think they were told, but subsequently
within a month, sometime during the month, they all knew they were
in, because they all got letters of greetings from Cincinnati, informing
them that they were welcome to the union.
Mr. Kennedy. Did the union ever make any approach to them ?
Mr. Adler. Not that I know of.
Mr. Kennedy. Was there any wages or hours or conditions dis-
cussed ?
Mr. Adler. Not that I know of.
Mr. I^NNEDY. You continued to pay the dues on these 19 em-
ployees ?
Mr. Adler. Yes, sir; Mr. Kennedy. We were going to take the
dues out of the employees' wages after we got in there, but being in
1936 right at the time of the depression, we just didn't do it and we
have always been going to do it but we never have.
Mr. Kennedy. So you still pay on them, do you not ?
Mr. Adler. Yes, sir.
Mr. Kennedy. Some of the employees that you were paying on
were not even employed at your restaurant, is that right ?
Mr. Adler. Well, they were changed from time to time, Mr. Ken-
nedy, and that fact was brought out when Mr. Duffy and Mr. Kelly
came to see me.
Mr. Kennedy. Mr. Duffy, can you tell us what the record shows
as to that ?
Mr. Duffy. We examined the records of Mr. Mickelberry^s Kestau-
rant and we found he was paying dues on 19 employees without de-
ducting those dues from the employees' salaries. Checking those 19
names, we found that he was paying on 4 employees that had been
gone some as far back as 1956.
Mr. Adler. That is right, 2 years.
Mr. KJENNEDY. Two of the employees have been gone since 1954,
according to the records.
Mr. Adler. I suppose that is right.
Mr. Kennedy. Did the union representatives of local 593, Mr.
Blakely or Mr. Lardino ever check to determine whether you were
paying union scale ?
Mr. Adler. Well, I have never met Mr. Lardino, Mr. Kennedy, but
Mr. Blakely never checked.
12896 IMPROPER ACTIVITIES IN THE LABOR FIELD
Mr. Kennedy. He never did ?
Mr. Abler. No, sir.
Mr. I^nnedy. Did you ever sign any kind of a contract with the
union ?
Mr. Adler. I don't think that I did.
Mr. Kennedy. No welfare benefits for the employees? There
have been no welfare benefits, other than what you might give them
yourself ?
Mr. Adler. That is right.
Mr. Kennedy. How did you know what the union scale was for
any of the employees ?
Mr. Adler. I didn't know it up to that time, and I have a general
idea what it is now.
Mr. Kennedy. But as of the time we started our investigation ?
Mr. Adler. That is right, I know the girls get 67 cents.
Senator Goldwater. That is an 8-hour day ?
Mr. Adler. Well, the girls, Senator, are on part-time, and some
work 11 to 2, and some work 5 to 9.
Senator Goldwater. Sixty-seven cents is based on an 8-hour day ?
Mr. Adler. It is 67 cents an hour.
Senator Goldwater. Based on an 8-hour day ?
Mr. Adler. I don't think there is any hourly basis on it, and 1
don't think that there is any daily basis.
Senator Goldwater. Do you have any State law in Illinois that
limits the length of time a woman can work ?
Mr. Adler. That is right, 8 hours.
Senator Goldwater. Forty-eight hours a week, or 8 hours a day ?
Mr. Adler. An 8-hour day.
Senator Goldwater. No longer than 8 hours in 1 day ?
Mr. Adler. That is right.
Senator Goldwater. Nor 48 hours in 1 week ?
Mr. Adler. That is right.
Mr. Kennedy. They never spoke to you about finding out whether
any of your employees were being paid the union scale, that is the
union representatives ?
Mr. Adler. No, they didn't, but I talked to Mr. McCormack on 1 or
2 occasions, who was the man that came in to collect the dues, and I
asked about certain wages like if $75 was enough for the cook, and if
that was the wage scale, and he would say yes.
Mr. Kennedy. Was Mr. Blakely by there quite frequently ?
Mr. Adler. I wouldn't say quite frequently, and he comes in off
and on.
Mr. Kennedy. And he never discussed it with you himself ?
Mr. Adler. No.
Mr. Kennedy. We have Mr. Gotsch, who will testify as to how
many employees are being paid union and how many are not.
The Chairman. All right.
TESTIMONY OF GERALD GOTSCH— Resumed
Mr. GoTSCH. In the restaurant there are 77 employees, in the rest-
aurant category classification. Sixty-six are being paid below union
scale, and 11 are being paid above. The total annual savings to this
restaurant is $19,600 annually.
IMPROPER ACTIVITIES IN THE LABOR FIELD 12897
The Chairman. You mean if the regiihir union scale was paid, it
would cost that much more to operate the restaurant ?
Mr. GoTSCH. That is correct, Senator.
TESTIMONY OF JAY ADLEK— Resumed
The Chairman. Let me ask you a question or two, Mr. Adler. Wlien
did you first put your employees into the union ?
Mr. Adler. 1936.
The Chairman. It was in 1936 ?
Mr. Adler. Yes, sir.
The Chairman. For the past 22 years, do I understand, that the
management has paid the dues ?
Mr. Adler. Yes, sir.
The Chairman. There has never been any deduction of dues ?
Mr. Adler. No, sir.
The Chairman. Management has paid it ?
Mr. Adler. Yes, sir.
The Chairman. Were the employees or any of them consulted about
whether they should join the union or not ?
Mr. Adler. Well, I would say about for the last 10 years, every
time one of the employees is put into the union I tell them about it and
they sign a ticket, and the union application.
The Chairman. But the point I am making here is that in the
initial arrangement, the working people themselves had no choice.
They were not given the opportunity of the free exercise of their
choice as to what union they would like to belong to or prefer to belong
to, or if they preferred to belong to none.
Mr. Adler. You are referring back to the 22 years ago, back to
1936?
The Chairman. For all of those years, up to the last 10 years, you
say.
Mr. Adler. Yes, sir.
The Chairman. That would be correct ?
Mr. Adler. Yes, sir.
The Chairman. Now, what is the advantage to your employees of
having such an arrangement. What do they get out of it ?
Mr. Adler. Well, at the time. Senator, I didn't know what they got
except they did get $200 for death benefit.
The Chairman. They have to die to get anything out of it ; is that
right?
Mr. Adler. But since then I have learned that they have a hos-
pitalization plan.
The Chairman. Do you know what it is ?
Mr. Adler. Just if they are sick they go to the hospital, and the
union pays for it.
The Chairman. We all do that, if we can, I guess. Who pays the
bill and how much, do you know what the arrangements are ?
Mr. Adler. No.
The Chairman. Do you have any contract with the union at all
other than just this verbal understanding?
Mr. Adler. Not that I know of.
The Chairman. Does your arrangement include that they will not
undertake to organize your waitresses ?
12898 IMPROPER ACTIVITIES IN THE LABOR FIELD
Mr. Abler. Well, that is pretty hard for me to say.
The Chairman. That has been an implied understanding, hasn't
it ? Yon wouldn't put them there ?
Mr. Adler. ]Mr. Mickelberry wouldn't put them in.
The Chairman. And they settled on that basis ?
Mr. Adler. Yes, sir.
The Chairiman. That you would put in the kitchen help at that
time?
Mr. Adler. Yes, sir.
The Chairman. You put in 10 or 12 at that time, and they agreed
then not to molest or undertake to organize your waitresses?
Mr. Adler. AYell, they never mentioned anything about the wait-
resses after that.
The Chairman. Have they mentioned anything about trying to
organize them for the past 22 years ?
Mr. Adler. No.
The Chairman. So what you have actually done is kind of bought
labor peace ; haven't you ?
Mr. Adler. Well, I would say "Yes."
The Chairman. That is what it actually adds up to.
Mv. Adler. But Senator
The Chairman. I am not saying you haven't profited by it, but
that is what it actually amounts to. There has been no free exercise
of the right of the individual to join a union or not to join, has there?
Mr. Adler. Xo.
The Chairman. They haven't that right?
Mr. Adler, No.
The Chairman. Your agreement with the union took that privilege
away from them ?
Mr. Adler. Yes, sir.
The Chairman. That is what it amounts to; isn't it?
Mr. Adler. That is right.
The Chair^ian. And by reason of this arrangement, you have had
no strikes, and you have had no difficulty with the union in any way ?
Mr. Adler. Well, Senator, in the first place we never had any
threats, and there was never any argument and there was never any
coercion and there was never any smart aleckness or bulldozing. It
was just done on a gentle basis.
The Chairman. They treated you nicer than they have some others.
Mr. Adler. Well, I guess maybe they have.
The Chairman. I think that you know that, don't you ?
Mr. Adler. Yes, sir.
The Chairman. So you just as a matter of mutual arrangement, you
thought this was the best way to handle it, and we will put some of
them in, as few as we can, and settle with them, and satisfy them, and
then go on and operate.
Mr. Adler. Well, I wouldn't say exactly that, Mr. Senator. I
wouldn't say that we put as few as we could. We put in what we had
in the kitchen.
The Chairman. You put in the kitchen when they were demanding
all of your employees ?
Mr. Adler. That is right.
IMPROPER ACTIVITIES IN THE LABOR FIELD 12899
The Chairman. Now, during this period of time, have they ever
been concerned or carried on any negotiations with you or done any-
thing, the union I am speaking of, and its officials, toward improving
the working conditions of your employees, your hours of pay, and
your rate of pay or anything ?
Mr. Adler. Not that I know of.
The Chairman. So, so far as any benefits flowing to the union
members, those that you put in the union, all you know of is you
think they get $200 if they die, and they may get some kind of hospital
benefits if they go to the hospital.
Mr. Adler. Yes. But I would like to say. Senator, if I can, our
emplo3'ees are all very well satisfied. Of course, you hear this from
everybody. I suppose it is an old story. But my average kitchen
help, the average throughout the years of service, is 11 years. There
are 3 at 22 years, 1 at 25 years, 1 at 24 years, and the total of the
waitresses is 8 years. I am sure that even though Mr. Duffy brings
those figures out, when I get back home everybody is going to think
I am a Shylock and all that kind of stuff.
The Chairman. No ; the real purpose of this is, in the first instance,
to show that the union, professing to be concerned about the welfare of
the workers that it represents, certainly is not very vigilant or diligent
in looking after their interests when they simply get the money out of
management and then go off and pay no more attention to them.
When one joins a union, I don't mean they ought to start trouble every
time and call a strike and make unreasonable or improper demands. I
do think when you join a union, you join for the purpose of the collec-
tive benefit that comes to the members by reason of being in an organi-
zation that looks after their interests. I think this thing is another
demonstration. You say you get along with them very well and you
finally worked it out amicably, but it clearly demonstrates that a lot of
these union organizers and union heads are in it for nothing except to
get the money, primarily. They are making a racket out of it. I am
not being critical. I can appreciate I am critical to this extent: I
don't think any management has a right to put the members, the people
who work for them, into a union without their knowledeg and consent.
I think it is wrong. I think it is a practice that prevails in some areas,
and I think it should be strongly condemned. I think the practice of
unions going out and coercing and intimidating people, trying to put
them out of business, calling strikes to make management sign up the
employees, is also reprehensible. It is those practices we are looking
into, trying to find ways to remedy this and to bring the thing back into
its proper perspective, where the'individual worker has a right, where
he has some say-so about whether he belongs to a union or not, and, if
so, what union it is he wants to represent him.
We have cases where it has been thoroughly demonstrated before this
committee, where people get into unions, some against their will or
without their knowledge and consent. The union officials get corrupt.
They are indifferent about the welfare of the worker. They find they
can do nothing about it. They still have to go on paying dues if they
work. It is those conditions that need remedy.
Mr. Adler. In my particular case, not that I want to be an exception,
but at the end of what you had to say at least I didn't take the money
away from the people. I paid it myself.
The Chairman. No ; you didn't.
12900 IMPROPER ACTIVITIES IN THE LABOR FIELD
But the practice, in my judgment, is an improper practice. They
still ought to have a little liberty and freedom among the individuals
in this country. When management and labor leaders conspire or
enter into a collusive arrangement where it amounts simply to a payoff
without very much concern for the welfare of the workers — and I am
not saying you are not good to them, but there are many instances
where this operates this way — it keeps the employees depressed and
under a state of oppression. They are not free. They have a repre-
sentative of the union supposed to be looking after them, and the
union interest is to get a few dollars from the owners, the easiest way,
and let the workers go on. All they want is the dues.
]\Ir. Adler. Senator, may I ask Mr. Gotsch a question ?
The Chairman. Yes; any information you want.
Mr. Abler. In that total amount of moneys, have you got the wait-
resses figured in there ?
Mr. GoTSCii. Yes, of course.
Mr. Adler. They shouldn't be, should they ?
Mr. GoTscH. Your waitresses were being paid 60 cents an hour,
7 cents below union scale.
Mr. Adler. But they never Avere in the union and they never agreed
to be in the union.
Mr. GoTscH. If they were paid union scale.
Mr. Adler. I beg your pardon ?
Mr. Gotsch. If they were paid union scale.
The CiiAiRMAx. This is if they were paid union scale. It is the
difference between what you pay and what you would pay if a union
looking after the interests and welfare of its members, if they were
in the union, you would have to pay them, I assume, the established
scale.
Senator Goldwater.
Senator Goldwater. Mr. Adler, have your employees ever asked
for representation ?
]\Ir. Adler. No, sir.
Senator Goldwater. At any time, since this started in 1936 ?
Mr. Adler. No, sir.
Senator Goldwater. Have they ever since come to you and asked
that they be represented by a union ?
Mr. Adler. No, sir.
Senator Goldw^ater. You explained or told us about your low
turnover, which I think is a rather good rate of turnover compared
to the average restaurant. Do you account for this by virtue of any
bonuses that you might pay ? Do you pay, for example, a Christmas
bonus ?
Mr. Adler. Yes, sir.
Senator Goldwater. Do you have any idea how much that might
amount to ?
Mr. Adler. Yes, sir.
Senator Goldwater. How much ?
Mr. Adler. It amounted to $2,700 last year.
Senator Goldwater. Among 70 employees ?
Mr. Adler. That is right, sir. And we give them in cash.
Senator Goldwater. Do you pay other bonuses ?
Mr. Adler. No, sir.
Senator Goldwater. Do you have any retirement plan ?
Mr. Adler. No, sir.
IMPROPER ACTIVITIES IN THE LABOR FIELD 12901
Senator Goldwater. Do you have any fund from which they can
borrow when they need money ?
Mr. Adler. Well, I haven't got from which they borrow, but they
certainly get it.
Senator Goldwater. Do you mean if they come to you
Mr. Adler. I am buying automobiles, radios, televisions, divorces,
funerals, and all sorts of things.
My employees are into me about $700 or $800 all the time.
Senator Goldwater. As a total ?
Mr. Adler. The last one is an automobile I am buying for a boy.
His payments are $83 a month and he can't pay $83 so I take out $15
a week except for the first week, which amounts to $45 a week, and I
charge his account the balance. Then after the automobile gets paid
and he gets the automobile, then he will go on until I get my money
back. Some of them I take $2 a week out. Some of them I put every
school year, a lot of the women in the kitchen, the colored women in
the kitchen, borrow $100 or $150 to get clothes and shoes for their
children and I take it, $1 a week or $2 a week, whatever it takes. But
they are always into me. And I am glad to do it. Don't anybody get
the idea that I am not. I am glad to do it, because of no other reason
than I think these type of people need help, and they are at the mercy
of some of the darndest arrangements that you ever saw.
For instance, 2 years ago one of my employees came and she had
a garnishment for $176. So I said to her "Amie, what is it?" She
said "Well, Mr. Adler," she says, "I went down to this jeweler's place
and they had a diamond Cavalier watch, and he said I just ought to
have that, and I thought I would, but I had not paid up my other pay-
ment yet, so I told tliem I didn't want to. Then he says 'Well, I tell
you what you do. We are having a sales contest at Christmas time and
we get a prize, the salesmen get a prize. You just sign this slip and
then when Christmas is over the sales contest is over and you can
bring it back and you will get credit for it and I have a prize.' "
Well, that goes on all tlie time with the colored people. They are
always being taken. Some fellow slips up and sells one of them a
diamond ring for $150. He doesn't have to pay for it, but he gets a
little ticket that he signs, and he is stuck and I am stuck. And if
they should quit, I am stuck, I don't get the money back.
I have one fellow, he has been with me 25 years, but last year or 2
years ago he owed me $950 on a radio he bought 7 or 8 years ago and
it is busted and gone and broken down, but they caught up with him
and he still had to pay them. It is an injustice, I think. But I am
digressing from the restaurant business.
Senator Goldwater. That is all I had, Mr. Chairman.
The Chairman. I am sure there are many other operations of
rackets and abuses that possibly do not come within the jurisdiction
of this committee, and I think it is tragic when poor people like that
are imposed on. Yet I don't know how you can pass a law that would
prevent them from being suckers if they just want to be or will be.
So Ave can't do very much about that.
All right. Thank you very much.
Call the next witness.
Mr. Adler. Thank you, sir.
Mr. Kennedy. Mr. George Hessberger.
12902 IMPROPER ACTIVITIES IN THE LABOR FIELD
The Chairman. You do solemnly swear the evidence you shall give
before this Senate select committee shall be the truth, the whole truth,
and nothing but the truth, so help you God ?
Mr. Hessberger. I do.
TESTIMONY OF GEORGE HESSBERGER
The Chairman. State your name, your place of residence and your
business or occupation.
Mr. Hessberger. George Hessberger, 4300 North Lincoln, Chicago,
111., restaurateur.
The Chairman. You waive counsel, do you ?
Mr. Hessberger. Yes, sir.
The Chairman. Proceed.
Mr. Kennedy. You family owns a restaurant in Chicago ?
Mr. Hessberger. Yes.
Mr. Kennedy. "Wliat is the name of that ?
Mr. Hessberger. George Hessberger's Restaurant.
Mr. Kennedy. Is there a Heidelberger Fass?
Mr. Hessberger. Yes, sir.
Mr. Kennedy. Is that another name for it ?
Mr. Hessberger. Yes, sir, we are gradually dropping that.
Mr. Kennedy. You are dropping the name Heidelberger Fass and
it is going to be known as George Hessberger's Restaurant ?
Mr. Hessberger. Yes, sir.
Mr. Kennedy. And the address is 4300 North Lincoln Avenue,
Chicago.
Mr. Hessberger. Yes, sir.
Mr. Kennedy. How long have you been in the restaurant business ?
Mr. Hessberger. My father has been there 40 years and I have been
there 10 years.
Mr. Kennedy. 10 years?
Mr. Hessberger. Yes, sir.
Mr. Kennedy. You were in the service, were you ?
Mr. Hessberger. Yes, sir.
Mr. Kennedy. Wliat branch?
Mr. Hessberger. Parachute Infantry, 82d Airborne.
Mr. Kennedy. You were wounded, were you ?
Mr. Hessberger. Yes, sir.
Mr. Kennedy. After you got out of the service, you came back and
within a short time went into the restaurant business to help your
father and mother?
Mr. Hessberger. Yes, sir.
Mr. Kennedy. Mr. Hessberger, were you approached in 1955 about
having certain of your employees made members of the union ?
Mr. Hessberger. Yes, sir.
Mr. Kennedy. When was that? About December of 1955?
Mr. Hessberger. Yes, sir.
Mr. Kennedy. I understand you are not feeling too well now, is
that correct?
Mr. Hessberger. I feel fine now, thank you.
Mr. Kennedy. Certain union representatives of local 593 came, is
that right?
IMPROPER ACTIVITIES IN THE LABOR FIELD 12903
Mr. Hessberger. Yes, sir.
Mr. Kennedy. Do you know who they were ?
Mr. Hessberger. One of these gentlemen's name is Mr. Tempkins,
I believe.
Mr. Kennedy. T-e-m-p-k-i-n-s?
Mr. Hessberger. Yes, sir.
Mr. Kennedy. And he was a business agent?
Mr. Hessberger. Yes, sir.
Mr. Kennedy. For local 593, was it?
Mr. Hessberger. Yes, sir. There was one other gentleman with
him. I don't know his name.
Mr. Kennedy. What did they want from you at that time ?
Mr. Hessberger. They approached my father and I that they had
orders from someplace downtown, I believe was the term they used,
to get two members from our restaurant into their union, and at that
time we had asked them what part of the employees, and they said
dishwashers, I am pretty sure. And they asked what we paid them
and other benefits we may have. I told them.
Mr. Kennedy. Would you speak up a little louder, please?
Mr. Hessberger. Yes, sir, I told them the pay we paid to the em-
ployees and also the other benefits which we may have had at that
time. They said in view of that it would not do any good to talk to
the employees, to attempt to get them to sign up in the union, and,
therefore, they just wanted to have two members that we should more
or less take out of a hat, and that they should belong to the union. At
that time, I asked them what would happen if we did not put two
persons into the union, and they said they woidd picket our place of
business.
At that time I didn't think that was correct. We gave them the
right to unionize the restaurant if they wanted to, and they should
not picket our restaurant just because we don't want to put people
in that are not being represented by the union. He still insisted we
ought to have two members and in order to avoid a picket line around
the restaurant we decided to join the union.
Mr. Kennedy. Did you tell them at that time what you thought this
was?
Mr. Hessberger. Yes, sir ; I believe I told them I thought it was
blackmail, or words like that. There was no coercion on their part.
It was a nice friendly conversation, but they insisted that there be two
employees. We finally ended up with my mother joining and I joined.
Mr. Kennedy. How many employees did you have ?
Mr. Hessberger. At that time I believe we had 22 employees.
Mr. Kennedy. So you put in two of the owners, is that right, your
mother and yourself.
Mr. Hessberger. Yes, sir.
Mr. Kennedy. And you felt that if you did not make this payment,
make this arrangement, you would have a picket line there; is that
right?
Mr. Hessberger. Yes, sir. We did not have a picket line after.
Mr, Kennedy, Did you consider it blackmail and extortion ^^
Mr. Hessberger. I think after we thought it all over it didn't seem
quite that, although I always resented it.
12904 IMPROPER ACTIVITIES IN THE LABOR FIELD
Mr. Kennedy. How would you describe it at the present time, then,
if it was not blackmail and if it was not extortion ?
Mr. Hessberger. Well, after a number of months, it became a regu-
lar business expense, and we never paid until the man came to the
restaurant to pick it up.
Mr. Kennedy. You were told that you had to pay this money or
else, were you not?
Mr. Hessberger. Yes, sir.
Mr. Kennedy. Doesn't that amoimt to extortion ?
Mr. Hessberger. Yes, sir.
Mr. Kennedy. Isn't that what this was, in fact, extortion from you?
Mr. Hessberger. At that time; yes, sir.
Mr. Kennedy. We have found, Mr. Chairman, we went in to look
at the books and records and the salaries being paid to these employees.
As you point out, they are above union scale. There was not any
benefit that could possibly be accrued to the employees by this arrange-
ment, was there ?
Mr. Hessberger. The employees were never given an opportunity
to state one way or another, sir.
Mr. Kennedy. And you and your mother did not get any benefit
out of it ; did you ?
Mr. Hessberger. No, sir.
The Chairman. You did get this out of it, you avoided a picket
line.
Mr. Hessberger. Yes, sir.
The Chairman. In other words, they used that as a club over you.
"You either contribute to us" and that is what it amounted to "or
we are going to put up a picket line here and hurt your business."
Mr. Hessberger. Yes, sir.
The Chairman. You regarded it at the time as blackmail or
extortion.
]\Ir. Hessberger. Yes, sir.
The Chairman. As a result of this, have they ever undertaken to
organize your help since then ?
Mr. Hessberger. No, sir.
The Chairman. So you just bought labor peace with this small
contribution ? That is what it amounts to ?
Mr. Hessberger. Yes, sir.
The Chairman. And notwithstanding the fact that you were treat-
ing your employees all right, they were happy, they were satisfied,
you were paying them as much or more than the union could get for
them, you still had to join? That is, management actually joined,
the management of the business actually joined the union ?
Mr. Hessberger. Yes, sir.
The Chairman. Is there anything further ?
Mr. Kennedy. Do you have anything to say ?
Mr. Hessberger. No ; except since the time that I have been served
with a summons, we have dropped the union. We are no longer
paying, and we have not had any trouble to date.
The Chairman. You have had no trouble to date?
Mr, Hessberger. No, sir.
Mr. Kennedy. Mr. Hessberger has been very cooperative with the
committee, as has his restaurant, Mr. Chairman.
IMPROPER ACTIVITIES IN THE LABOR FIELD 12905
The Chairman. Counsel lias advised that you have been very co-
operative and we appreciate it. We are trying to explore these things
and find out what has been going on that should not be going on in
these relationships, both in labor and in management.
It is very helpful to us when management or labor or anyone else
cooperates with us. We are thankful to you for it.
Call the next witness.
Mr. Kennedy. Mr. Ellis Segal.
The Chairman, Do you solemnly swear the evidence you shall give
before this Senate select committee shall be the truth, the whole truth
and nothing but the truth, so help you God ?
Mr. Segal. I do.
TESTIMONY OF ELLIS SEGAL
The Chairman. State your name, your place of residence, and your
business or occupation.
Mr. Segal. My name is Ellis Segal. I reside at 8110 Louella,
Chicago, 111. I am a restaurant owner.
The Chairman. Do you waive counsel, Mr. Segal?
Mr. Segal. Yes, sir, I do.
The Chairman. All right, Mr. Kennedy.
Mr. Kennedy. You operate Segal's Kestaurant; is that right?
Mr, Segal. Yes, sir.
Mr. Kennedy. That is located at 8276 South Chicago Avenue, Chi-
cago, 111.
Mr, Segal. Yes, sir,
Mr. Kennedy. You have approximately how many employees?
Mr. Segal, I have approximately 28,
Mr, Kennedy. Were you approached sometime in 1949 by an official
of local 394 to have your employees join the union ?
Mr, Segal. That'is right.
Mr, Kennedy. Is that right ?
Mr, Segal, That is right,
Mr. Kennedy. Do you know who it was that approached you at
that time ?
Mr, Segal, Frank Trungell.
Mr, Kennedy. Trungell?
Mr, Segal, Trungell,
Mr. Kennedy, He is the business agent of local 394 ?
Mr, Segal, I think that is what he was at the time,
Mr. Kennedy. And he is also secretary-treasurer of that local, l ou
did not know that at the time ?
Mr, Segal. I did not know.
Mr. Kennedy, What did he say at that time ?
Mr, Segal. He asked me to install some of my employees ni the
union, • ^ ^i +9
Mr. Kennedy. Had he approached your employees prior to that f
Mr, Segal, Not at all. Not that I know of, at least.
Mr. Kennedy. Was there anything indicated that would happen it
you did not? ^ ^ , • i x v +
Mr. Segal, AVell, I was told that there would be a picket line put
around my place of business,
21243 — 58 — pt. 34 4
12906 IMPROPER ACTIVITIES IN THE LABOR FIELD
Mr. Kennedy. Did you install the employees ?
Mr. Segal. Well, after several meetings I figured it best.
Mr. Kennedy. I can't hear you very well.
Mr. Segal. After several meetings I figured it best that I do.
Mr. Kennedy. How many employees did you give them ?
Mr. Segal. Eight.
Mr. Kennedy. You gave them the amount of money for the equiva-
lent of eight employees!
Mr. Segal. Eight employees.
Mr. Kennedy. And you took eight names and gave them to the
local representative ?
Mr. Segal. That is right.
Mr. Kennedy. Did you tell the employees they were being placed
in the union ?
Mr. Segal. No, I did not.
Mr. Kennedy. How much money did you pay ?
Mr. Segal. I think it was $24 a month.
Mr, Kennedy. Have you ever told your employees that they are
members of the union ?
Mr. Segal. No, I have not.
Mr. Kennedy. Who collects the money from you, Mr. Segal ?
Mr. Segal. Now ?
Mr. Kennedy. Yes.
Mr. Segal. James O'Connor,
Mr. Kennedy. He is president of local 394 ?
Mr. Segal, I think that is his title,
Mr. Kennedy. He collects a $96 check every 2 months?
Mr. Segal. Every 3 months.
Mr. Kennedy. Do you deduct that as expenses ?
Mr. Segal. As expenses ; yes.
Mr. Kennedy. You have no contract with the union ?
Mr. Segal. No ; I haven't.
Mr, Kennedy, No health or welfare ?
Mr, Segal. No ; I have not.
Mr. Kennedy. Have they ever discussed the wages, hours, and con-
ditions of your employees ?
Mr. Segal. Never.
Mr. Kennedy. Does this benefit your employees at all, this arrange-
ment ?
Mr. Segal. I wouldn't say it does.
Mr. Kennedy. Of the eight that you were paying on, how many
are still in your employ ?
Mr. Segal. I don't know, I don't know what the original list was.
Mr, Kennedy, Mr, Gotsch, how many of the eight employees that he
is paying dues on
Mr. GoTSCH. None of the employees are there any more.
Mr. Kennedy. Just every 3 months you pay $96.
Mr. Segal. That is right.
Mr. Ivennedy. Actually, it amounts, once again, to a payoff; does
it not?
Mr. Segal. That is what you can call it.
Mr. Kennedy. That's what you would call it.
Mr. Segal. I guess so.
Mr. Kennedy. Do you know what union scale is ?
IMPROPER ACTIVITIES IN THE LABOR FIELD 12907
Mr. Segal. No, I don't.
Mr. Kennedy. It has never been discussed with you ?
Mr. Segal. Never been discussed with me.
Mr. Kennedy. He has 29 employees. How many are below union
scale ?
Mr. GoTSCH. Twenty-three are paid below union scale.
Mr. Kennedy. What is the saving, approximately 'i
Mr. GoTSCH. The saving is approximately $11,000 annually.
The Chairman. Mr. Segal, what is the real purpose of making
this payment?
Mr. Segal. Well, to avoid any sign of trouble that may happen or
anything that may harrass business.
The Chairman. In other words, you know they could put up a
picketline and give you trouble.
Mr. Segal. That is right.
The Chairman. So you are just paying it as a shakedown so that
you may have labor peace ; is that it ?
Mr. Segal. Well, by this investigation, it has been shown that way.
The Chairman. Do you know of any benefit at all that the union
provides for your employees ?
Mr. Segal. None at all.
The Chairman. These eight that you originally put in there are no
longer with you. Why haven't you changed it to some others?
Mr. Segal. Well, it was never brought to my attention.
The Chairman. It wasn't necessary. This was just a kind of
mutual arrangement so the union would get something, the union
officers would get something, and you would avoid something?
Mr. Segal. I'hat is right.
The Chairman. Is there anything further ?
Senator Goldwater. Mr. Segal, have any groups of your people
ever wanted to join a union ?
Mr. Segal. Never.
Senator Goldwater. Have you ever discussed this with them ?
Mr. Segal. No, I haven't. They have always been very satisfied.
Senator Goldwater. Do you know why they would not be interested
in joining a union ?
Mr. Segal. I don't know of anything they would benefit by it.
There has never been an agreement.
Senator Goldwater. What is the rate of turnover in your business,
from the employee standpoint ?
Mr. Segal. It is a tremendous turnover.
Senator Goldwater. Say in the kitchen, what is the average length
of service of your cook ?
Mr. Segal. Well, I haven't got that type of an operation. I have
more of a drive-in style, and in the delicatessen line. Mine is just
a shade different than the average restaurant. Mine are more so-called
as a grillman or counterman, and the turnover the greater. They
are known as floaters.
Senator Goldwater. That is all I have.
The Chairman. Is there anything else ?
If not, we thank you very much.
The committee will stand in recess until 2 : 30 o'clock.
(Whereupon, at 12 : 50 p. m., the committee recessed, to reconvene at
2: 30 p.m. of the same day.)
12908 IMPROPER ACTIVITIES IN THE LABOR FIELD
AFTERNOON SESSION
(At the reconvening of the session, the following members were
present : Senators McCIellan and Goldwater.)
The Chairman. The hearing will come to order. Call the next
witness.
Mr. Kennedy. Mr. Tony DeSantis.
The Chairman. Do you solemnly swear the evidence you shall give
before this Senate select committee shall be the truth, the whole truth,
and nothing but the truth, so help you God ?
Mr. DeSantis. I do.
TESTIMONY OF ANTHONY DeSANTIS
The Chairman. State your name, your place of residence, and your
business or occupation.
Mr. DeSantis. My name is Anthony DeSantis. My place of busi-
ness is the Martinique Restaurant, 2500 "West 94th Place, Evergreen
Park, 111.
The Chairman. You waive counsel, do you, Mr. DeSantis ?
Mr. DeSantis. Yes, sir.
The Chairman. All right, Mr. Kennedy, proceed.
Mr. Kennedy. Mr. DeSantis, your restaurant employs about what,
145 people ?
Mr. DeSantis. Yes, sir; approximately.
Mr. Kennedy. It is one of the biggest restaurants in Chicago, is it ?
Mr. DeSantis. It is out of Chicago. It now is one of the biggest;
yes, sir.
Mr. Kennedy, It is one of the biggest ?
Mr. DeSantis. Yes, sir.
The Chairman. Do you want to say it is one of the best, too, and
get in a plug ?
Mr. DeSantis. I certainly will.
Mr. Kennedy. Do you have a theater there also ?
Mr. DeSantis. Yes, sir; I operate the Drury Lane Summer The-
ater, in conjunction with my restaurant.
Mr. Kennedy. And you also have some of the biggest bands in the
country in the restaurant ?
Mr. DeSantis. I play all name bands ; yes, sir.
Mr. Kennedy. I thought you would like to get that into the record.
Mr. DeSantis. Some of the bands, sir ?
Mr. Kennedy. No ; just the fact that you have them.
Mr. DeSantis. I see.
Mr. Kennedy. Mr. DeSantis, you have 145 employees. How many
of them are members of the union ?
Mr. DeSantis. None are members of the union, other than the bands
and the bartenders ; yes, sir.
Mr. Kennedy. Were you ever approached about having your em-
ployees made members ?
Mr. DeSantis. I have been approached.
Mr. Kennedy. And by whom were you approached ?
Mr. DeSantis. I was approached by Mr. Trungale.
Mr. Kennedy. Of local 394?
Mr. DeSantis. Yes, sir.
IMPROPER ACTIVITIES IN THE LABOR FIELD 12909
Mr. Kennedy. And he wanted to organize your restaurant?
Mr. DeSantis. That is correct.
Mr. Kennedy. How long ago did he make the approach to you?
Mr. DeSantis. Maybe 8 or 9 years ago.
Mr. Kennedy. And wliat arrangements did you make at that time ?
Mr. DeSantis. I didn't make any arrangements. I told him that
it was his prerogative to go and organize the waitresses as he saw fit,
and I told him that I was in debt up to my neck. I did not think that
I could pay anything, and if he felt that the waitresses should belong
into the union, then he should go right ahead and organize them and
put them in.
My first 3 or 4 years in business represented a $35,000 loss, and I was
left alone, pretty well, through my early years in business.
Mr. Kennedy. But did he organize the waitresses ?
Mr. DeSantis. No, sir.
Mr. Kennedy. Did he organize anyone in the restaurant?
Mr. DeSantis. No, sir.
Mr. Kennedy, That was the end of it, then ?
Mr. DeSantis. That is right.
Mr. Kennedy. Nothing happened ?
Mr. DeSantis. No, sir ; other than I would say in the period of the
last 6, between the last 6 and 8 years when he approached me I have
given him $100 on different occasions. It might be 6 or 8 times.
Mr. Kennedy. You have given him $100 or about $100 about twice
a year ; is that it ?
Mr. DeSantis. No ; not that many times.
Mr. Kennedy. Approximately twice a year ?
Mr. DeSantis. No ; I would say about 9 months, or close to a year,
and I would always tell him that it was his prerogative to go in there
and organize the waitresses as he saw fit.
Mr. Kennedy. And you gave him that money in cash ; did you ?
Mr. DeSantis. Yes, sir.
Mr. Kennedy. And he would just take the money and leave then,
would he?
Mr. DeSantis. That is right.
Mr. Kennedy. When was the last time you paid him off like this ?
Mr. DeSantis. Eight or nine months ago.
Mr. Kennedy. Is he the only union official that you gave any
money to?
Mr. DeSantis. That is correct, sir.
Mr. Kennedy. Did you make any other gifts to him ?
Mr. DeSantis. A case of Scotch at Christmas time, and that is it.
Mr. Kennedy. What about O'Connor ?
Mr. DeSantis. O'Connor? This past Christmas was the first time
I ever gave him any money. I gave him a check for $30, and the
reason I gave him the check for $30 was sooner than give him some
liquor or it looks like that he could use the cash. I figured in my own
commonsense the best thing for me to do was to give him a little cash.
Kight in with that check that I gave Mr. O'Connor, I also gave $6,250
to all of my employees, and a few other people in there that have been
nice to me and I have given them gifts like that.
Mr. Kennedy. Did you make any other gifts to O'Connor ?
12910 IMPROPER ACTIVITIES IN THE LABOR FIELD
Mr. DeSantis. No, sir. Possibly the year before I might have gave
him 3 or 4 bottles of liquor, as far as I can recall.
Mr. Kennedy. Other than Trungale and O'Connor ?
Mr. DeSantis. No, sir.
Mr. Kennedy. "VAHiy did you make these payments to Trungale ?
Mr. DeSantis. Well, I tried to keep peace within my own res-
taurant.
Mr. Kennedy. Did he work for your restaurant ?
Mr. DeSantis. No, sir. No, sir.
Mr. Kennedy. Well, it was in order so that he would not attempt
to organize?
Mr. DeSantis. So that he would not attempt to possibly put a
picket line or attempt to come in and say, "Well, you got to do this.'^
I just did not want to take any
Mr. Kennedy. Did he ever say to you unless you would pay
Mr. DeSantis. I have heard of it, yes, sir.
Mr. Kennedy. Did he ever say "Unless you pay me, I will put a
picket line up" or did you just understand that you should pay him
and you might have a picket line if you did not ?
Mr. DeSantis. No; he would say that I would have a picket line
if I felt that I could not get within the realms of his organization. I
have told him at least 10 times in the last 10 years that any time he
sees fit to go in and organize my waitresses he was more than welcome
to.
Mr. Kennedy. You made the payment in order to keep him away
from the restaurant ?
Mr. DeSantis. The money I gave him, I would say yes.
Mr. Kennedy. Mr. DeSantis, you know that a number of the res-
taurants, particularly in the North Side of Chicago, have to make pay-
offs for protection, do you not ?
Mr. DeSantis. I have heard of it, sir, from this hearing.
Mr. Kennedy. No, I am not talking just about payments to any
union officials. I am talking about payments to certain of the under-
world in Chicago. You know that that goes on, do you not ?
Mr. DeSantis. I have heard that.
Mr. Kennedy. And you have heard that from other restaurant
owners ?
Mr. DeSantis. No, sir.
Mr. Kennedy. You have experienced it yourself, have you not, Mr.
DeSantis?
Mr. DeSantis. No, sir, never in the history of my business have I
ever been approached by anyone that has said "You have to give me
so much money so that you can do this and that."
Mr. Kennedy. No, but hasn't it been understood that amongst cer-
tain of the restaurants in Chicago, including yourself, that there is a
protective society that exists there, that certain kinds of payments
will have to be made ?
Mr. DeSantis. I have heard that. That is the restaurant asso-
ciation.
Mr. Kennedy. No, not just the restaurant association. I am talk-
ing about payments to underworld figures in order to prevent your
place being stinkbombed, or set on fire, and that kind of operation ?
IMPROPER ACTIVITIES IN THE LABOR FIELD 12911
Mr. DeSantis. That possibly is very true of a lot of business. But
in the case of my business, for the type of operation that I have, and
the type of clientele that I cater to, I have never been approached.
The reason for that is very, very simple. I don't have a 26 game in
my restaurant. I don't have a jukebox in my restaurant. I don't
have a cigarette girl in my restaurant. I don't have a girl that is
trying to sell you a doll. I have one of the cleanest establishments
in the entire country, let alone Chicago. And as long as I am that
clean, I believe they lay off of me.
That is my honest opinion.
Mr. Kennedy. You have heard it from other restaurant owners
that they have to make payments ?
Mr. DeSantis. No, sir.
Mr. Kennedy. Wliere have you heard it, then ?
Mr. DeSantis. I haven't heard that, Mr. Kennedy, and I might
have heard it hearsay. That I don't remember.
Mr. Kennedy. What was your answer when I asked you or dis-
cussed this with you yesterday, Mr. DeSantis ?
Mr. DeSantis. That I sensed that there was a payoff?
Mr. Kennedy. No. What was your answer to me, do you re-
member ?
Mr. DeSantis. Gentlemen, I don't remember.
Mr. Kennedy. Wlien we discussed whether certain restaurant own-
ers have to make liquor purchases from certain people ?
Mr. DeSantis. I said that I bought a minimum of liquor from
anybody that I thought had an affiliation.
Mr. Kennedy. Didn't you say that you did buy some liquor from
a gangster operation ?
Mr. DeSantis. No; I would not — oh, no, I would never say that.
We have one liquor house in Chicago that I have heard that had had
affiliations, and I buy less than 3 — I would say I buy less than 3 percent
of my liquor from this one said company. If I felt if they were
giving me pressure as the Chair seems to think on this thing, then you
would look in my purchases and you would find liquor purchases from
people that have affiliations, you would find meat purchases from
people
Mr. Kennedy. Why do you purchase even that 3 percent from that
one liquor company ?
Mr. DeSantis. Well, it is very, very simple. Some of those liquor
companies are exclusive on one line alone, and to keep a variation on
my bar and in my restaurant, I may be forced to buy a small percent.
That is No. 1.
The No. 2 reason that I buy off of that company at all is there
is a little salesman that calls on me that was born and raised in my
neighborhood, and I always feel that I would like to help him a little.
I have told him right to his face that the reason I don't do more busi-
ness with his company is the fact that I have heard that there were
affiliations with this company and as a result I kept my purchases
from his company at the minimum.
I will never buy from that company again.
Mr. Kennedy. Mr. DeSantis, what about when we had the talk
about a payment to some of these gangsters and hoodlums and I asked
12912 IMPROPER ACTIVITIES IN THE LABOR FIELD
you about some of these restaurants that had been stinkbombed, and
some of the ones that had been set on fire. Do you remember what
your answer to me about that was ?
Mr. DeSantis. Well, I have been confused, and I am not a lime-
light guy. I am a fellow that works in a T-shirt all day, but if you
will tell me what I said, I will verify it if I said it.
Mr. Kennedy. Do you remember about the fact that "You and I
could sit down here for hours and hours and I would tell you the an-
swers to these questions if I didn't have a family and didn't live at
my restaurant?"
Mr. DeSantis. Yes; I remember saying that to you, Mr. Ken-
nedy.
Mr. Kennedy. Isn't that the reason that this has not been broken
up in the past, because there are people such as yourself that have
information, that are scared to go to the police and go to the Govern-
ment officials ?
Isn't that the great problem ?
Mr. DeSantis. That seems the great problem.
Mr. Kennedy. I don't want to make you the scapegoat on it, but
we have established through other restaurant owners that they have
to make payments to this protective organization that operates in
Chicago. It is not just unions, but the gangsters and hoodlums that
operate this and say that, "Unless you do, you are going to get a
stinkbomb in your restaurant or it is going to be set on fire."
You know that that has been going on for many years, do you not,
Mr. DeSantis?
Mr. DeSantis. That is probably right.
Mr. Kennedy. Of course, if people such as yourself would just
come in and help, and give tliis information, then this thing could
be broken up.
Mr. DeSantis. There, again, Mr. Kennedy, you must sense that the
type of operation I have I don't invite that type of environment, and
I am not bothered by those types of people, as of now. There is one
more thing about all this. Anything that I might hear is hearsay,
and I feel that all these tilings that I hear might be true and might
be not true. I know you people have a major problem in correcting
this whole situation in Chicago. But you have got to let us little
people who have to live in that area, let us go home in peace and
pass some good laws here that will give us the protection. You will
see that every restaurant ow^ner in that area, in the whole country,
will fall in line.
The Chairman. Do you feel like you don't get protection from
your local law and local officials ?
Mr. DeSantis. No, sir ; I could very
The Chairman. You say we need to pass some good laws.
Mr. DeSantis. Yes, sir.
The Chairman. All right. Maybe we do. But what about your
local situation, your local authorities ?
Mr. DeSantis. Well, I am in a little village called Evergreen Park.
We only have 19 policemen on the entire police force. In my opinion,
it is the best police force in the country. They have been very good.
No one ever in the history of my being in business in that town has
ever approached me from the police force.
IMPROPER ACTIVITlr^S IN THE LABOR FIELD 12913
The Chairman. Do you feel that you need your Federal Govern-
ment to pass laws to protect you, then ?
Mr. DeSantis. In the case in the trouble we are having now, I do.
The Chairman. What trouble? What are you referring to, the
trouble you are having now ?
Mr. DeSantis. The trouble is you are stating, this committee is
stating, that a lot of these waitresses are underpaid, that we are subject
to payoffs, et cetera, et cetera.
The Chairman. In other words, extortion, coercion, the imposition
on you.
Mr. DeSantis. That is correct.
The Chairman. And you actually paid this fellow Trungale because
you wanted to keep peace, didn't you ?
Mr. DeSantis. That is correct. Senator.
The Chairman. This fellow O'Connor, you gave him a little hand-
out, too.
Mr. DeSantis. $30.
The Chairman. Yes. Did you know him that well, did you love
him that much, was he that kind of a friend ?
Mr. DeSantis. No, but I felt that Mr. O'Connor, being a union
agent, could have possibly been real rough to me, and he was pretty
nice. Come Christmas, I said, "All rightie, young man, here is a
check for you." I put it right in my books.
The Chairman. Now let me ask you : The $100 that you paid to
this Trungale, did that ever go into the union treasury?
Mr. DeSantis. Gee, I don't know. I don't belong to the union.
The Chairman. You seriously doubt it, don't you ?
Mr. DeSantis. I do.
The Chairman. So it is just a form of a shakedown. They come
around and say, "We can give you a picket line. What do you want
to do about it ? Do you want to take care of me ? "
Mr. DeSantis. I think that is right. i
The Chairman. It is j ust about that ?
Mr. DeSantis. Yes, sir.
Senator Goldwater. How long have you been in business?
Mr. DeSantis. Ten years.
Senator Goldwater. How old are you ?
Mr. DeSantis. Forty-four.
Senator Goldwater. How long do you expect to be in business ?
Mr. DeSantis. As long as God is willing to let me stay in business
and maintain my good health.
Senator Goldwater. As long as you can afford the payoffs?
Mr. DeSantis. Well, I have not been hit too hard from what I have
been hearing through this committee.
Senator Goldwater. Do you think you are pretty lucky, then i
Mr. DeSantis. I do, and I think I should be very thankful, because
it was only 12 years ago, 12 or 15 years ago, that I worked m a factory
and made 85 cents an hour.
Senator Goldwater. Do you know some of these hoodlums that
shake you down have never worked in their lives ?
Mr. DeSantis. I sense that. ,
Senator Goldwater. They live like big fat leeches that live off ot
people like you that wouldn't talk. What do you think we m the
rest of the country think of your great city ?
12914 IMPROPER ACTIVITIES IN THE LABOR FIELD
All I have heard about Chicago in the headlines is starting with
Al Capone and coming on down with the hoodlums of America, the
"Who's Who" in gangsterism, living in Chicago. Why can they
live there? They don't live in that kind of attention-getting lime-
light in the rest of this country, with the exception of a few cities.
Don't you think that if some of you people in Chicago in business were
willing to say "It might cost me a little bit, I might even get hurt
physically, I mi^ht lose my business, but it might be worth it to clean
•up the second biggest city in the United States," and to clean it up
not only for yourself but for your children and for the rest of the
people of this country ; don't you think you have some responsibility
there?
Mr. DeSantis. I certainly do, Senator Goldwater, but I feel as
small as I am, that the big decisions have to come here from Wash-
ington. Get in there and pass some good, honest-to-goodness laws,
with teeth in them. I have heard you speak up there before, where
you said, "Let's get some teeth into these laws and let's make this
thing run right."
I believe you are right, but there's nothing a little guy like myself
can do.
Senator Goldwater. Yes, there is. We are not going to put teeth
in laws until people like yourself are willing to come to Washing-
ton, or willing to go to Springfield, or willing to go before your
council in Chicago, and say, "Look, here is what is happening to me.
Here is why we need laws."
We have known about these hoodlums and gangsters in Washing-
ton, I guess, since Al Capone first beat somebody over the head with
a baseball bat, or since the St. Valentine's Day massacre, I don't know
how many years ago.
Wliat have we done about it? We have not done much about it
because most people wouldn't cooperate with law-enforcement agen-
cies. We can hold these hearings until all hell freezes over, and I
suggest we would not be able to pass laws until some people tell us
what it is about. You are giving Mr Trungale a case of Scotch for
Christmas or a hundred dollars or Mr. O'Connor $30. That is not
the kind of thing we are interested in and you know it. We are in-
terested in the racketeers who will not go out and work for themselves ;
who, ever since the repeal of prohibition have been allowed to live off
of the other people, like leeches. They can live oil of the people as
small as you. Your Government can't stop it unless you are willing
to help the Government stop it. That goes from the Chicago level to
where you are sitting now. I am serious about it. You have heard
me speak about putting teeth in laws. We had an opportunity re-
cently to put teeth in a law. We came out with a pretty soft gummed
effect. It will not help the workingman. If you are not willing to
talk, I don't think you can expect us to do more than listen to the
troubles you want to talk about.
Mr. DeSaxtis. Yes, sir.
Mr. Kennedy. The reason you won't talk is because you are scared,
is that right ?
Mr. DeSantis. I wouldn't say that. Actually I am scared. I feel
that every man — and don't misunderstand me, I am not saying that
I don't want to talk, or that I know anything that I should be telling
IMPROPER ACTIVITIES IN THE LABOR FIELD 12915
you. That isn't the story. I haven't been approached by anyone to
say "you buy this," or "you do this," but I feel in my case I don't
have that problem.
But where you have these other spots that have that problem, my
answer to that one might be that a lot of these people feel that there
will be reprisals.
Mr. Kennedy. I am talking about you, and you have some informa-
tion, some facts on these things, and the reason that you won't give
them to the committee is that you are frightened; isn't that right?
Mr. DeSantis. I don't have any.
Mr. Kennedy. Now, again we go back to the conversation that you
confirmed — and I asked you about these matters because we had it
from other sources — about these payments, as Senator Goldwater
stated, to gangsters and hoodlums beyond the payments to some union
officials that you have spoken about today.
There are payments by the owners of these restaurants to gangsters
and hoodlums, and if they continue to make the payments these restau-
rants are either stink-bombed or set on fire. That has been going on
for a number of years in Chicago ; isn't that right ?
Mr. DeSantis. That is correct.
Mr. Kennedy. I asked you about that, and you said, "Well, I would
give you the information, and we could talk for hours here, but I live
in the restaurant, and my children live there."
Mr. DeSantis. And I also stand a chance that something would
happen to my family.
Mr. Kennedy. That was the reason, and the reason you won't give
the information is that you are frightened ?
Mr. DeSantis. I don't have any information, and I haven't been
approached that way. The only information I have in that regard
is what I have heard right from this committee, all last week on TV.
I have that fright, and that is right. I haven't slept for months due to
some of the thnigs that have happened in our area, but you have got
to remember one thing. All of us are in that same boat.
We need help, but I don't know where to put my finger and say,
"this man did this, or did that," but when I pick up the paper and I
read this spot has been put on fire or bombed.
Mr. Kennedy. Has any place next to you been bombed or put on
fire?
Mr. DeSantis. Richard, I believe.
Mr. Kennedy. How far is that from you ?
Mr. DeSantis. Two blocks away.
Mr. Kennedy. What happened ?
Mr. DeSantis. All I remember is that I understand they had a
bomb thrown in the place, and there wasn't much damage, $4,000 or
$5,000.
Mr, Kennedy. How long ago was that ?
Mr. DeSantis. I honestly don't remember, and I think it is in the
neighborhood of 6 to 10 years.
Mr. Kennedy. Don't you know that this is still going on, Mr.
DeSantis, and that these restaurant owners have to pay so much
money each month to these gangsters ?
Mr. DeSantis. I have heard that last week.
12916 IMPROPER ACTIVITIES IN THE LABOR FIELD
Mr. Kennedy. Not only last week, and you knew it before that, Mr.
DeSantis.
Mr. DeSantis. Well, you might think so, Mr. Kennedy, but if you
will ask any one of your committee members the way I live, and what I
do, you would have that answer in a minute. I only say there, and I
never wear a suit but maybe once a month, and I don't mix with the
customers, and I stay in my own business and work 13 or 18 hours
a day, in a white shirt, and your committee has been in at 10 o'clock
at night and in the morning, and the only time they came in they found
me working. I have a philosophy "you stay at home and work hard
and mind your own business," and you will get by.
Mr. Kennedy. You were staying at home minding your own busi-
ness and you were paying Mr. Trungale $100 every 8 or 9 months, and
it is not a question of just staying at home. These people can come
to your liome. It wasn't a question yesterday of not having any infor-
mation, the question was "I could talk to you for hours, but I am afraid
for my family, we live in the restaurant."
I sympathize with you, and I say that we have restaurant owners
that come and give us this on a confidential basis, and none of you will
talk, and it makes an impossible situation for the law^-enforcement
officials. They can't do anything unless some of you give some infor-
mation on them. It can't be their fault, if no restaurant owner in
Chicago will cooperate one single bit with them.
Mr. DeSantis. I am doing the best I can within the power of my
heart and conscience.
The Chairman. Do you have some information that you would
be willing to give us in an executive session ?
Mr. DeSantis. No, Senator. I don't have. All I could possibly ever
say is I have heard this, or hearsay things. You have got to remember
that I am not in that area of Chicago. I don't belong to the restaurant
association.
The Chairman. But you are sufficiently convinced that you have
an apprehension about it, from what you have heard ?
Mr. DeSantis. Sir?
The Chairman. From what you have heard, you say all you can
say is what you have heard. I say out of what you have heard, by
reason of what you have heard, you have a serious apprehension about
what might happen to you ?
Mr. DeSantis. That is correct.
The Chairman. And I guess all of you live under that state of fear
and anxiety.
Mr. DeSantis. I believe every restaurant owner in the city of
Chicago feels the same way.
The Chairman. That is what I am saying.
Mr. DeSantis. You are right. Senator.
The Chairman. It is a state of atmosphere or a climate of fear that
is generated out of these gangsters and the shakedown artists and so
forth ; isn't that true ?
Mr. DeSantis. I think so.
The Chairman, And you have plenty of evidence that they will, and
they have in the past resorted to violence to enforce their will ?
Mr. DeSantis. From what I have read.
The Chairman. You have seen some evidence of it too, haven't you,
as well as what you have read ?
IMPROPER ACTIVITIES IN THE LABOR FIELD 12917
Mr. DeSantis. No, I don't think so.
The Chairman. You saw the restaurant 2 blocks away from you?
Mr. DeSantis. No. I am 2 blocks away from it now, and I was at
another location when that thing happened. I was about a mile away,
and now I am exactly 2 blocks away, and I have a new restaurant now.
The Chairman. Whether you have seen it or whether you have
heard it, you have information that causes you to be very appre-
hensive.
Mr. DeSantis. That is correct, Senator.
The Chairman. It has been convincing to that extent ?
Mr. DeSantis. Yes, sir.
The Chairman. All right, is there anything further?
Mr. Kennedy. We are going into your wage scales, and I think
that you have a statement that you wanted to make on the salaries ?
Mr. DeSantis. I don't have a statement that I want to make. It
so happens that all I have been hearing on this network in Chicago is
that all of the waitresses are underpaid. So when I received my call
Saturday morning to be here, I figured the only thing for me to do
was to supply all of the information that I can, so that I might have
a sensible answer to this committee as to why there are so many diver-
sions of what a waitress should be paid in the city of Chicago.
No. 1, the conventional type throughout the country is 10 percent.
The type that is being given today according to Emily Post in her
latest book is 15 percent.
The Chairman. How much is that ?
Mr. DeSantis. Fifteen percent. So I went ahead and just before
I left on Sunday morning, I gathered the guest checks of Saturday
night, of all of the customers that liave a credit card or diners'. Those
put the tip right on the guest check. I pulled all of those checks out,
and I brought them here to Washington.
I find that, if you will wait until I get this turned around, of the
24 checks that the customer put the tip right on the guest check, I
find that the average tip on these checks is 18 percent.
Senator Goldwater. What was the total of the tips ?
Mr. DeSantis. The total in amount of money ?
Senator Goldwater. Yes.
Mr. DeSantis. I didn't take that. I have it right here, though,
and I can read them off to you.
Senator Goldwater. Would you read off just a few.
The Chairman. Just a few and you don't have to identify your
customer, and just take the check and indicate the amount of the bill,
and what the tip was.
Mr. DeSantis. Here is a check for $23.45, and the tip was $4, and
it represents a 17-percent tip.
Mr. Kennedy. That must have been an expensive dinner?
Mr. DeSantis. Here is one for $76.50 and the tip was $15. Here
is a check for $15 and the tip was $5. That represents a 32-percent
tip.
Senator Goldwater. Mr. DeSantis, could you tell us, did one girl
enjoy more than one of those tips that evening?
Mr. DeSantis. Oh, surely.
Senator Goldwait:r. Just pick out by girl number, and do you
have your waitress numbers on there ?
12918 IMPROPER ACTIVITIES IN THE LABOR FIELD
Mr, DeSantis. I have waitress number on here.
Senator Goldwater. Shuffle through, and take a number, the first
number you con through, and see how many that girl waited on.
Mr. DeSantis. That is very interesting.
Here is 31, and that is waitress 31. One check was $15 and she re-
ceived $2.50, and liere is a good one, another check was $33.15, and
she received a $10 tip. Now let me see if that same waitress — here is
another check for that same waitress, and here is a check for $14.20,
and she received a $10 tip.
That one particular waitress as I add it up, right there has made
$22.50 plus her salary of 42.5 cents an hour for the amount of hours
she worked that niglit.
Senator Goldwater. There are tips in cash, too ; is that right ?
Mr. DeSantis. This is on their guest check.
Senator Goldwater. There are some that don't use that service ?
Mr. DeSantis. Naturally, a lot of customers just pay their tab and
then they give a tip. In the case of my restaurant, where I haven't
raised the price more than 5 percent in the last 10 years, and I sell a
complete 7-course chicken dinner, with these named bands for only
$2.25, you will find that every customer tliat comes in there feels that
he hasn't been taken, and so as a result he leaves a good tip. It is
the truth.
The Chairman. If that is a fair sample, a waitress might well pay
you for the privilege of working for you '(
Mr. DeSantis. Oh, no. But I do have, as I have heard this com-
mittee all last week, I resolved myself to one problem. We are all talk-
ing about this "sweetheart" contract business and what should we do
to solve it and how can it be solved, and how can we take all of these
different type of restaurants in the United States and put them all in
the same scale and say, "Here, you get 67 cents an hour."
It is impossible to do that. A waitress that may work in the May-
flower may make $22 a night in tips, like my waitress made, and the
girl that might work in one of the cafeterias down here might only
make $2 in tips. So it would be my suggestion that in the cases of the
waitresses, there should be a roving scale and every restaurant should
be put into a classification.
My bottom scale would be as low as 20 cents an hour for benefits and
improvements or health and welfare, and as high as not 67 cents an
hour but $1 an hour where they don't give a waitress a chance to make
a living wage.
If a girl waits on a millionaire, or she waits on a poor person, she
is entitled to a living wage. It shouldn't be that one girl should
get $22.50, and another girl should only get $6. Then we are really
doing somethin|^ for the waitresses of this country. But you can't do
it by just putting in 67 cents as a scale, and applying it to every
waitress. It won't work.
Senator Goldwater. What would you think of taking the practice
some restaurants use, of adding a gratuity to your total ?
Mr. DeSantis. That would be very improper. Tipping, every once
in a while you get a stiffer, that is a person that doesn't leave anything,
and when you are trying to build your business, you don't put no tips
on anything, and if the service is bad, then the waitress should suffer.
IMPROPER ACTIVITIES IN THE LABOR FIELD 12919
and she should get nothing, but if she does well, and takes care of her
job, she is entitled to every penny she gets.
The backbone of our whole business is still the waitresses, and they
are our immediate contact with the customer. We are all for it.
Senator Goldwater. Have you ever totaled up for a month's period
what your average girl might get on this type of check, where the tip
is indicated ?
Mr. DeSantis. Senator Goldwater, I never went into that, and I
wouldn't attempt to because they would never tell me the truth. It
would be just like trying to tell my wife how to bake.
Senator Goldwater. Wliere the tips are indicated like on a diner
card ?
Mr. DeSantis. I never do that, and the only thing I do is when I see
good tips, I feel that my customers are happy and I am very thankful
that a girl that has a problem is able to receive all of that money.
Senator Goldwater. Now, you have to give each girl a check for the
amount indicated on this at the end of the month ?
Mr. DeSantis. Oh, no ; she turns it in to the food checker, and if the
man leaves a $10 tip, then the cashier gives her $10, and in turn we
keep the check and at the end of the month we bill the customer. We
bill the customer at the end of the month, and we discount every bill
10 percent to everyone of our credit-card customers, and the basis of
my whole success in this business has been instead of raising prices, I
try to cut them.
Senator Goldwater. What is your address ?
Mr. DeSantis. 2300 West 94th Place.
The Chairman. Is there anything else ?
Mr. Kennedy. As long as we have discussed it, I Avill have Mr.
Gotsch put in the record how much more you would have had to pay if
your employees had been organized and the union had enforced the
union scale for your employees.
Mr. Gotsch. They have 112 persons employed at the restaurant and
of these 112 persons, 2 bartenders are union and the rest 110 persons
are nonunion. He has an annual saving from the 88 employees who
are paid below union scale, of $33,100 per year.
The Chairman. Is that what it would amount to if they were in the
union, and the union enforced its minimum-wage scale ?
Mr. Gotsch. That is correct.
Mr. Kennedy. Now possibly your explanation as to how it should
be done is correct. However, in some of these restaurants the union
scale is being enforced, and, of course, that gives a restaurant where
the owner is making a payoff to keep the union officials away a great
competitive advantage over the restaurant where the union scale is
being enforced. You recognize that, I suspect ?
Mr. DeSantis. Yes, Mr. Kennedy.
Mr. Kennedy. That is all.
The Chairman. Are there any further questions ?
Thank you, sir, and we appreciate your cooperation.
Mr, DeSantis. I thank you.
The Chairman. I don't think that you have hurt your business by
testifying here.
Mr. DeSantis. I don't think so either.
The Chairman. Call the next witness.
12920 IMPROPER ACTIVITIES IN THE LABOR FIELD
Mr. Kennedy. Mr. Merlin Griffith.
The Chairman. You solemnly swear that the evidence, given before
this Senate select committee, shall be the truth, the whole truth, and
nothini^ but the truth, so help you God?
Mr. Griffith. I do.
TESTIMONY OF MERLIN GRIFFITH
The Chairman. State your name, and your place of residence and
your business or occupation.
Mr. Griffith. My name is Merlin W. Griffith, and my residence is
8315 South Colfax Avenue, and I am presently unemployed.
The Chairman. Do you waive counsel i
Mr. Griffith. Yes, sir ; I do.
The Chairman. What is your former occupation ?
Mr. Griffith. I have been in the labor field for 15 years.
The Chairman. As a labor organizer?
Mr. Griffith. Yes, sir ; an officer of labor organizations.
The Chairman. An officer of labor organizations?
Mr. Grh'fith. Yes, sir.
The Chairman. Thank you.
Mr. Kennedy. Mr. Griffith, you came to work for the joint eco-
nomic board of the Restaurant Worker's Union in Chicago ?
Mr, Griffith. Yes ; in either August or September of 1955.
Mr. Kennedy. You worked there for how long?
Mr. Griffith. Until approximately a month before the strike
ended, which would be around the latter part of September of 1957.
Mr. Kennedy. So approximately 2 years; is that right?
Mr. Griffith. Yes, sir.
Mr. Kennedy. You were paid a salary ?
Mr. Griffith. Yes, sir.
Mr. Kennedy. What was your salary ?
Mr. Griffith. My salary was $90 per week, plus a $15-a-week ex-
pense accoimt.
Mr. Kennedy. Amounting to what?
Mr. Griffith. I have a correction. It is $90 a week plus $25 a week,
making $115 a week.
Mr. Kennedy. I w^ould like to go through some of the matters on
which you worked. You came as an organizer for the joint execu-
tive board, and were you ultimately assigned subsequently to work
on the Nantucket strike ?
Mr. Griffith. Yes, and after I was with the board for some 2
months, I would say, or maybe a week or two longer, then I was sent
to the Nantucket picket line on the morning that the strike started.
Mr. Kennedy. What w'ork did you do there ?
Mr. Griffith. I was a supervisor — I was a business agent to see
that the pickets walked properly, and the line was run properly, and
I wasn't entirely in charge. That was Mr. O'Connor, and Mr. Gun-
cerson and there were several others. Mr. Trungale was there from
time to time.
Mr. Kennedy. Did you have any arrangement for paying the pick-
ets, Mr. Griffith ?
IMPROPER ACTIVITIES IN THE LABOR FIELD 12921
Mr. Grutith. Yes. The pickets had to be paid. They walked 12
hours a day.
Mr. Kennedy. How much did you pay them ?
Mr. Griffith. $1 an hour.
Mr. Kennedy. So you paid them about $12 a day ?
Mr. Griffith. They walked half an hour and rested a half hour.
Mr. KJENNEDY. So they would get for the day's work about $12?
Mr. Griffith. $12 plus $1.50 for food.
Mr. Kennedy. That is $13.50 a day for the pickets?
Mr. Griffith. That is correct.
Mr. Kennedy. How many pickets did you have?
Mr. Griffith. Well, the pickets varied. At the start of the strike
the pickets were mixed up on when the strike was starting and so
we had just a few pickets to start with. As it w^ent on for the next
2 months, we had pickets covering every gate, and the back alley,
then they had to be interchanged because of the fact that they only
walked a half hour and it was cold weather and they rested a half
hour.
(At this point, the following members were present: Senators
McClellan, Ervin, and Gold water.)
Mr. Kennedy. Well, you had a greater number of pickets at the
beginning of the strike, generally, than you did as it moved along ; is
that right ?
Mr. Griffith. That is correct.
Mr. Kennedy. You were in charge of the pickets ?
Mr. Griffith. I say when I was there, and O'Connor was not
around there, I was mostly in charge, except my days off and the time
that I was not on the line.
(At this point. Senator Gold water withdrew from the hearing
room.)
Mr. Kennedy. Did you have anything to do with paying the
pickets ?
Mr. Griffith. Yes, I paid the pickets.
Mr. Kennedy. How would you make those arrangements for pay-
ing them $13.50 ? Would you submit their names, or submit the num-
ber of pickets to some of the union officials ?
Mr. Griffith. Well, at the start there was no arrangement made.
Right off the start they were paid and no record kept.
Then later the money was going too fast, so they wanted a daily
accounting.
Mr. Kennedy. So did you submit the number of pickets that were
walking the picket line ?
Mr. Griffith. The number that was walking the line.
Mr. Kennedy. Who did you submit the number to ?
Mr. Griffith. I made the daily sheet out and I give it to O'Connor
or Trungale.
Mr. Kennedy. Did you ever submit a false number of pickets, Mr.
Griffith?
Mr. Griffith. Well, if you wanted to call it that, it would be false,
in this respect, that they carried extra pickets for extra expense that
was incurred on the line. However, I am not sure that the name of
the picket was carried but the amount shown there would be any-
21243— 58— pt. 34 5
12922 IMPROPER ACTIVITIES IN THE LABOR FIELD
where from 2 to 4 ; on a Sunday it would be 4 because we would have
more pickets.
Mr. Kennedy. So what happened ? Just answer the question as to
what happened? Did you submit a greater number than actually
walked the picket line ?
Mr. Griffith. Yes, I did.
Mr. Kennedy. How many on the average walked the line after the
line got started ?
Mr. Griffith. Well, after we seen that Mr. Reed was going to be
stubborn, and not sign a contract, so we
Mr. Kennedy. Mr. Griffith, just answer the question. How many
pickets were walking the line?
Mr. Griffith. Well, there was anywhere from, at the start, from
12 and down to 8 and G and then 4, in 3 or 4 months.
Mr. Kennedy. You got to four and after how many months of the
strike ?
Mr. Griffith. I would say after 8 months.
Mr. Kennedy. About 8 months after the strike started ?
Mr. Griffith. Yes.
Mr. Kennedy. AVliat number were you submitting? How many
pickets were you stating there were at that time?
Mr. Griffith. I didn't keep a sheet after April.
Mr. Kennedy. Approximately how many were you submitting?
Mr. Griffith. I wasn't submitting any at that time. I didn't keep
a sheet after April 27, the week of April 27, 1957.
Mr. Kennedy. Was there any money collected for these people ? I
am talking about 1955, when the picket line started. You testified, that
you were submitting lists, submitting vouchers, for a greater number
of pickets than were actually walking ; isn't that right ?
Mr. Griffith. That is what the investigator told me. I submitted
a list of where we showed for the extra expense, where money went out.
It is impossible that you could keep an accounting of all the money.
Mr. Kennedy. Just answer the question. Actually, when there were
only 4 or 6 pickets, you were submitting lists for 8 or 10 pickets, were
you not ?
Mr. Griffith. Well, 4, I would say 6, and 6 pickets you would sub-
mit a list for 8.
Mr. Kennedy. Well, you would have two extra pickets each day.
So you would collect about $27 extra each day ?
Mr. Griffith. And Sunday a little more.
Mr. Kennedy. What would be done with that money ?
Mr. Griffith. That money, as I understood from Mr. O'Connor
Mr. Kennedy. On whose instructions did you do this? Was it on
your own ?
Mr. Griffith. No. I done this on Mr. Trungale's and O'Connor's
orders.
Mr. Kennedy. What did you do with the money ?
Mr. Griffith. I didn't have the money. The only amount of money
that was given to me was the actual amount of the pickets that were on
the line.
Mr. Kennedy. Do you know, what was done with the money,
actually ?
Mr. Griffith. All I know is that it went into a special fund for ex-
penses and went downtown.
IMPROPER ACTIVITIES IN THE LABOR FIELD 12923
Mr. KJENNEDY. Did they tell you it went downtown ?
Mr. Griffith. Yes.
Mr. Kentstedy. To whose office downtown ?
Mr. Griffith. Blakely and Lardino.
Mr. Kennedy. That money was to go down to them, this extra
money ?
Mr. Griffith. It was to go down to them for special expenses.
Mr. Kennedy. Why, if it was special, legitimate expenses, why
weren't legitimate vouchers submitted ? Do you know that ?
Mr. Griffith. I don't know. They bought a station wagon and
some things like that. I don't know where the money went.
Mr. Kennedy. You don't know how the money was used?
Mr. Griffith. No, I don't. I didn't get any of it.
Mr. Kennedy. But you know this practice was followed for how
long a period of time ?
Mr. Griffith. This practice was followed from approximately 4
months after the strike started until April 1957.
Mr. Kennedy. So that would be about a year and a half; is that
right?
Mr. Griffith. That was the time that I made the slip out. Now,
after that, I don't know where the money went.
Mr. Kennedy. But for at least 18 months, this practice
Mr. Griffith. I would assume it would be approximate.
Mr. Kennedy. This amounted to about $27 each day, with Sunday
getting a little bit more ?
Mr. Griffith. Well, I doubt if it would be 18 months. The strike
run 2' years. I would say it would probably be about 14 months,
something like that.
Mr. Kennedy. When you went around to organize, you did some
organizing work other than to handle these pickets ?
Mr. Griffith. Yes. During the strike the membership had dropped
in local 394, and Mr. O'Connor said he was going to see if I could not
go out and organize some members to help bring that quota up, and
I did. I was given permission from Mr. Trungale and O'Connor to get
the necessary equipment, such as contracts and that, and to go out and
organize.
Mr. Kennedy. Did you then go around to these various restaurants
in the area ?
Mr. Griffith. I did.
Mr. Kennedy. Did you go to see the employees ?
Mr. Griffith. I went to see the employer to get permission to
organize his establishment.
Mr. Kennedy. Would you make arrangements with the employer
to take in a certain percentage of his employees ?
Mr. Griffith. Mostly I would make an arrangement to take in his
steady help that he would state was steady.
Mr. Kennedy. And he would then give you a certain number of his
employees to place in the union ?
Mr. Griffith. He would.
Mr. Kennedy. And then he paid the initiation fees and dues on
those employees ?
Mr. Griffith. He would pay the initiation fee and dues.
Mr Kennedy. And what would you personally receive out of that 'i
12924 IMPROPER ACTIVITIES IN THE LABOR FIELD
Mr Griffith. The initiation fee; my only compensation was 50'
percent of the initiation fee.
Mr. Kennedy. You would get 50 percent of all the initiation fees ?
Mr. Griffith. I received nothing of the dues.
Mr. Kennedy. And what was the initiation fee ?
Mr. Griffith. The initiation fee, unless the place had a large
amount of people, was $20 per member.
Mr. Kennedy. It was not any fixed initiation fee?
Mr. Griffith. $20 was the general amount.
Mr. Kennedy. But you could change it as you saw fit ?
Mr. Griffith. Only by orders. I could not change it unless Mr.
O'Connor gave the approval, if there was enough to warrant a good
membership.
Mr. Kennedy. Then you could waive it ?
Mr, Griffith. Then I could waive it.
Mr. Kennedy. And you got 50 percent out of all those initiation
fees?
Mr. Griffith. That is correct.
Mr. Kennedy. Did the other organizers who were also working
also get 50 percent ? Was that a general arrangement ?
Mr. Griffith. That was not the arrangement in other locals.
Mr. Kennedy. The other organizers working out of your local ?
Mr. Griffith. There was no other organizer working.
Mr. Kennedy. You were the only one ?
Mr. Griffith. That is right.
Mr. Kennedy. What was the advantage, Mr. Griffith, for the em-
ployees for your making this arrangement ?
Mr. Griffith. Well, I couldn't see. The only advantage an em-
ployee got from the union was a $175 death benefit, and after he was
there a year, I think it goes up to $200. And that he would not get;
his relation would get it if he died.
Mr. Kennedy. Then was there any actual benefit for the employee ?
Mr. Griffith. Well, the only benefit that we might if they would
come to us and needed work, send them to a different establishment.
Mr. KJENNEDY. As a general proposition in the manner that you
operated, and as I understand you operated with the sanction of the
union official, there was no clear benefit as far as wages, hours, or
conditions for the employee.
Mr. Griffith. Well, they signed a contract, each one of these estab-
lishments. I never organized unless the owner signed a contract.
But most of them, as Mr. DeSantis stated, it is the flexibility of wages.
Mr. KJENNEDY. Well, would you answer the question? Was there
any benefit as far as wages, hours, or conditions for the employee?
Mr. Griffith. Well, there
Mr. KJENNEDY. Just auswcr that.
Mr. Griffith. No ; there was not that I know of.
The Chahiman. Did they ever enforce their contract after they
signed it?
Mr. Griffith. Well, we got so busy on the strike that we never had
time to enforce anything or follow up. I believe that some enforce-
ment should have been done.
The Chairman. Well, it should have been done. But the fact that
they may have signed up for 67 cents an hour for wages did not mean
necessarily that they had to pay it ?
IMPROPER ACTIVITIES IN THE LABOR FIELD 12925
Mr. Griffith. That is correct.
Mr. IvENNEDY. Did you have some conversations with Mr. William
Scholl, of thQ Wliite Mill Kestaurant ?
Mr. Griffith. I did.
Mr. IvENNEDY. Did you go to him to attempt to organize his em-
ployees ?
Mr. Griffith. I did.
Mr. Kennedy. Would you relate what happened ?
Mr. Griffith. When I went to Mr. Scholl, I made several calls on
his establishment called the White Mill, I believe, on West 95th Street,
and Mr. Scholl said that he thought that he was out of the union pic-
ture out there where he was. He just used the carhops, and he really
did not figure that he came under the union sanction, to be sanctioned
by a union. I said "Well, we are organizing. We need members,
and we want to build a big organization so that we can develop a health
and welfare benefit.
"The more members we have the easier it would be to do."
So he told me at that time that he did not want to join. I went
back again and after a couple or three calls Mr. Scholl — I left a con-
tract with him in a brown manila envelope, about this size [indicating],
with a clasp on it.
Mr. Scholl told me that I should go see O'Connor or Trungale and
take this contract back to them. There was some problems that he
was scared about in the contract that he would have to organize his
whole house which would include carhops, and I would say some of
those kids would not want to belong to the union.
So I took the contract back to O'Connor, and inside the contract was
$100. Immediately, Jim O'Connor became enraged, and said "Take
this money, this peanuts, back to him."
Mr. IvENNEDY. "Take the peanuts back to him" ?
Mr. Griffith. "And tell him we want every member in his place."
So I went back and I told Mr. Scholl, and 1 give him the contract
the same as he give it to me, and I said, "You have not got enough
money to buy this union," and "We want every member that you
have in your establishment." So after future negotiations, we ended
up with 5 members in that establishment and 5 members in the place
he owns known as The Village.
Mr. Kennedy. So how much money did he then pay ?
Mr. Griffith. As I recall, he was given an initiation rate of $10
per member by organizing 10 members which was $100.
Mr. Kennedy. And then he paid the dues ?
Mr. Griffith. I don't remember if he paid the dues at that time
or if it was collected later by O'Connor, who was the regular business
agent.
Mr. Kennedy. And he gave you 5 employees in each 1 of his estab-
lisliments ?
Mr. Griffith. That is correct.
Mr. Kjinnedy. Ten employees altogether ?
Mr. Griffith. That is correct.
Mr. Kennedy. You did not get all the employees like Mr. O Connor
said ?
Mr. Griffith. We did not get all the employees, because there
was a lot of kids that were hopping cars.
12926 IMPROPER ACTIVITIES IN THE LABOR FIELD
Mr. Kennedy. None of the employees were approached in this case
to see if they wanted to belong to the union ?
Mr. Griffith. No, I can't remember.
Mr. Kennedy. So the only difference between the $100 which was
paid, which was sent back with great outrage, was that there was a
greater amount of money paid at a later time, and periodic payments
in addition thereto ?
Mr. Griffith. Well, if 394 had 5 members, that would be $20 a
month ; quarterly would be $60. But the other 5 members went to 593.
Mr. Kennedy. You got quarterly payments of $60 a quarter?
Mr. Griffith. Every quarter.
Mr. K!ennedy. And you got $100 initiation fee?
Mr. Griffith. $50 for the 5 there, yes.
Mr. Kennedy. $50 there and $50 at the other place.
Mr. Griffith. And $50 for the Village.
Mr. Kennedy. You got those payments which, of course, were
periodic payments, and a greater initial payment.
Mr. Griffith. Well, it would be over a period of years it would
pay the union to take that amount of money, yes.
Mr. Kennedy. The employees were not consulted in this matter,
were they ?
Mr. Griffith. No, I can't say as they were.
Mr. Kennedy. There was no improvement of wages, hours, or
conditions for the employees ?
Mr. Griffith. Not unless Mr. Scholl give it to them without noti-
fying us.
Mr. Kennedy. Therefore, what happened was the $100 in cash
went back and what Mr. O'Connor and some of the others received
out of it was a greater amount of money.
Mr. Griffith. Well, the money went in on the files as initiation fee.
Mr. Kennedy. And then you split the initiation fee. Somebody got
50 percent of that. Then, of course, it was the money that went into
the Union that paid tlie salaries and expenses of union officials.
Mr. Griffith. I would say.
Mr. Kennedy. With no benefit for the membership, once again;
isn't that right ?
Mr. Griffith. Well, I would say that there was not any immediate
benefit.
Mr. Kennedy. Well, until he died. He would have to be dead, first.
Mr. Griffith. His heir would get a benefit, a death benefit.
Mr. Kennedy. Never a benefit that he would know about.
Mr. Griffith. No ; he would not know about it.
Mr. Kennedy. And you know that this was a practice that was fol-
lowed in other cases, of putting employees on, taking a percentage of
employees and putting them into the union and making payments ; do
you not ?
Mr. Griffith. Well, you would have them sign a contract for a
union house.
Mr. Kennedy. In Segal's restaurant, was that procedure followed?
Mr. Griffith. I never had any dealings with Mr. Segal. However,
I know him. But I never had any dealings with his establishment.
Mr. Kennedy. Mr. O'Connor told you about Segal's ?
Mr. Griffith. Well, I was with Mr. O'Connor when he collected in
there.
IMPROPER ACTIVITIES IN THE LABOR FIELD 12927
Mr, Kennedy. Did he make a statement after this investigation
began that he would have to get those names up to date?
Mr. Griffith. Well, there was a lot of places that they were lax
in getting the names up to date.
Mr. Kennedy. Was there a lot of discussion about that after the
committee started its investigation of hustling around to these various
restaurants and try to make it appear
Mr. Griffith. Well, he stated that because of the strike he had been
so busy he had not been able to get the books up to date on a lot of them.
Mr. Kennedy. Tell me this : Was there any discussion about John
Moore around your local, known as Claude Maddox ?
Mr. Griffith. Well, there was discussion about Moore when he
was convicted of some Federal charge and sent up, and later there was
a discussion, his name was brought up, from time to time through
various news topics that we talked about, Mr. O'Connor and myself.
Mr. Kennedy. Was there any discussion that he had any connection
at all with the union ?
Mr. Griffith. Well, I would not know of any connection that he
ever had.
Mr. Kennedy. What did Mr. O'Connor say about Moore?
Mr. Griffith. Well, Mr. O'Connor, all he said was that he some day
was going to take me out West and introduce me to him.
Mr. Kennedy. Take you out West and introduce you to him ?
Mr. Griffith. Yes.
Mr. Kennedy. How did he refer to John Moore ?
Mr. Griffith. Well, that he could — well, I don't know how you
mean.
Mr. Kennedy. What did he describe him as ?
Mr. Griffith. Well, he described him as the big man.
Mr. Kennedy. As the big man when he talked about him ?
Mr. Griffith. He said that he was with local 450 at one time, or
something like that.
Mr. Kennedy. In his conversations with you, he described him as
the big man ?
Mr. Griffith. Yes.
Mr. Kennedy. That is all.
Mr. Griffith. Do you have any questions. Senator ?
Senator Ervin. No.
The Chairman. Thank you very much.
Call the next witness.
Mr. Kennedy. Mr. Scholl.
The Chairman. Do you solemnly swear the evidence you shall give
before this Senate select committee will be the truth, the whole truth,
and nothing but the truth, so help you God ?
Mr. ScHOLL. I do.
TESTIMONY OF WILLIAM SCHOLL
The Chairman. State your name, your place of residence, and your
business or occupation.
Mr. ScHOLL. My name is William Scholl; 9232 South Trumble
is where I live. My place of business is 3422 West 95th Street, Ever-
green Park, 111. That is where the White Mill is. Village Ice Cream
is at 7814 South Ashland Avenue, Chicago, 111.
12928 IMPROPER ACTIVITIES IN THE LABOR FIELD
The Chairman. You are in the restaurant business ?
Mr. ScHOLL. I didn't hear you.
The Chairman. Are you in the restaurant business ?
Mr. ScHOLL. I am, and ice cream, both.
The Chairman. You waive counsel ?
Mr. Scholl. Yes, sir.
The Chairman. All right.
Mr. Ivennedy. Do you deal in any special product, Mr. Scholl ?
Mr. Scholl. Yes, I do, in a very high butterfat ice cream, one of
the outstanding ones in Chicago, in Evergreen Park, and we make
our own flavoring, chocolates, marslimallow, all of the different ones,
and then we put on good whipped cream, pure whipped cream.
Mr. Kennedy. You have two restaurants, the Village Restaurant
and the White Mill, the Village Ice Cream Shop ?
Mr. Scholl. Yes, sir.
Mr. Kennedy. During 1951 you were approached by representa-
tives of local 594 about organizing your employees ?
Mr. Scholl. I was.
Mr. Kennedy. Tliat was by whom ?
Mr. Scholl. By Mr. Trungale.
Mr. Kennedy. Was Mr. O'Connor with him ?
Mr. Scholl. Not the first time.
Mr. KJENNEDY. What did they state to you at that time ?
Mr. Scholl, Mr. Trungale told me that I had to become a union
house, and I would have to put some employees in the union. I told
him I didn't want to. I said I didn't see what benefits they would
get, or, "If you can tell me, enlighten me on what they would receive,
anything better than what they are getting," and he said, well, he
didn't seem to know just what the wages were, but to keep on working
under the same conditions, the same wages, which was far above the
union wage, and the conditions would be the same, but I would have
to put in about eight employees, which I did.
Mr. Kennedy. You did? You selected eight ?
Mr. Scholl. Eight employees.
Mr. Kennedy. Did he tell you there would be a picket line unless
you put in these employees ?
Mr. Scholl. Yes; all the waitresses. I only have about two car-
hops.
Mr. Kennedy. How much money did you pay him at that time ?
Mr. Scholl. At that time I paid him $65.
Mr. Kennedy. In check or cash ?
Mr. Scholl. Cash.
Mr. Kennedy. Did you make payments periodically after that?
Mr. Scholl. I did for dues every 3 months.
Mr. Kennedy. Always in cash ?
Mr. Scholl. Yes ; always in cash. I had to come
Mr. KJENNEDY. 'Wliy did you pay him in cash ?
Mr. Scholl. Well, they wanted it in cash.
Mr. Kennedy. Who wanted it in cash ?
Mr. Scholl. Mr. O'Connor.
Mr. Kennedy. Did you just make the payment to Mr. O'Connor?
Mr. Scholl. The dues were paid to Mr. O'Comior.
Mr. Kennedy. Did you make these payments back in 1951 in order
to avoid difficulties with the union ?
IMPROPER ACTIVITIES IN THE LABOR FIELD 12929
Mr. ScHOLL. Yes; I did. They would have a picket line out in
front.
Mr. KJENNEDY. Was it a form of extorition, in your estimation ?
Mr. ScHOLL. In my opinion, it was.
The Chairman. How much dues did you pay ?
Mr. ScHOLL. I paid dues on the 8 employees for about 5 or 6 months.
The Chairman. How much per month ?
Mr. ScHOLL. I was $4 per month for each employee.
The Chairman. That would be $32 a month for the 8 ?
Mr. ScHOLL. That is right.
The Chairman. And you paid for how many months ?
Mr. ScHOLL. For about 4 or 5.
The Chairman. And it was paid in cash, to Mr. O'Connor?
Mr. ScHOLL. That is right.
The Chairman. You have no knowledge or way of knowing
whether it ever entered the union treasury or not ?
Mr. Scholl. No. At that time I had no books, no nothing.
The Chairman. Do you know whether your eight employees, their
names, were ever carried on the record as union members ?
Mr. Scholl. I have no proof of it.
The Chairman. All right.
Mr. Kennedy. Then in 1956 you were again approached?
Mr. Scholl. Yes, sir.
Mr. Kennedy. We better finish this. They just stopped collecting
dues after a period of time ?
Mr. Scholl. They did stop in the 1951 deal ; yes.
Mr. Kennedy. Then in 1956 you were approached again?
Mr. Scholl. Yes.
The Chairman. Did they stop or did you stop ?
Mr. Scholl. They stopped coming around for it and I didn't send
it in.
Mr. Kennedy. What happened at that time? Who came to see
you?
Mr. Scholl. What do you mean?
Mr. Kennedy. In 1956?
Mr. Scholl. In 1956, Mr. Griffith and Mr. O'Connor came in a
few times to see me and told me it had to be a union house, and I told
them I joined back in 1951. I said, "How often do you have to join ?"
He said, "Well, you didn't pay any dues for quite a while. You have
to join over. You have to have five employees from each place, the
Village Ice Cream and the White Mill, to stop the picket line in
front."
They told me if I didn't pay, "We will put one around your place
like the man at Nantucket. That costs the union a lot of money and
their money runs out like anyone else's." I said, "Mine has run out,
too, because business is slow and I haven't got it." They said, "Well,
you have to put it in or we will put in pickets."
I said, "I can't pay that big initiation fee." I told Mr. Griffith,
"I will give you $50, for being in once before, and I will jom for $50.^^
They told me, "They tell us you are making your ice cream out here,
and I said, "That is right." They said, "Well, you should join, and
I said, "All right." I gave Mr. Griffith $50.
Mr. Kennedy. In cash ?
12930 IMPROPER ACTIVITIES IN THE LABOR FIELD
Mr. ScHOLL. In cash. He left and came back 2 or 3 hours later and
said that the board of directors turned down the $50, that he wanted
$100. I said, "$100 is a lot of money to me. It may not be to you. I
joined once,"
So after a lot of bickering around and arguing, I gave him the $100.
I said, "Now, Mr. Griffith, if I give you this $100 in cash, what is
stopping you from coming back and asking for $200 or $100 tomorrow ?
I have no proof whatsoever."
So I had him sign his name on a piece of paper, two witnesses were
standing in the store and heard me count out the money, and they
signed their names to the paper.
Mr. Kennedy. That was m about August of 1956 ?
Mr. Scroll. That is right. That was in August.
Mr. Kennedy. And did you submit any names of members at that
time?
Mr. ScHOLL. No, I did not.
Mr. Kennedy. You just gave him the $100 in cash ?
Mr. ScHOLL. I gave him the $100 with the understanding that I
would furnish the names later.
Mr. Kennedy. After you made that cash payment, did they come
back ; did anyone come back to see you again ?
Mr. SciiOLL. Yes, Mr. O'Connor.
Mr. Kennedy. In the meantime, when he said he had taken it up
with the executive board and they weren't satisfied, did Mr. Griffith
indicate who it was on the executive board that he discussed the matter
with ?
Mr. ScHOLL. No, he did not.
Mr. Kennedy. Did he mention any names at all ?
Mr. ScHOLL. None at all.
Mr. Kennedy. Approximately a month later who came back to
see you at that time ?
Mr. ScHOLL. Mr. O'Connor.
Mr. KJSNNEDY. He is president of local 394. What was his state-
ment ?
Mr. ScHOLL. His statement was that he wanted some money for
going back into the union. I promised him more or less — Mr. Griffith
was out there, and they made an agreement with me for the $100, and
he wanted a check, so I gave him the check.
Mr. KIennedy. How much money did you give him ?
Mr. ScHOLL. I think it was two-hundred-and-some dollars.
Mr. Kjennedy. How much did he want originally ?
Mr. ScHOLL. I think he wanted $500, and I just didn't have it.
Mr. Kennedy. So you finally gave him how much ?
Mr. ScHOLL. A check for $220.
Mr. Kennedy. What was that for ?
Mr. SciiOLL. That was a check for the White Mill, on 95th Street in
Evergreen Park.
Mr. Kennedy. It was for five employees ?
Mr. ScHOLL. For five employees.
Mr. Kennedy. At the White Mill?
Mr. Scroll. At the White Mill.
Mr, Kennedy. And you just selected those employees' names?
Mr. Scroll. That is right.
Mr. Kennedy. You never discussed it with them ?
IMPROPER ACTIVITIES IN THE LABOR FIELD 12931
Mr. ScHOLL. They didn't care who they were ; just any five.
Mr. Kennedy. No discussion for wages, hours, or conditions?
Mr. ScHOLL. No; I pay over $1 an hour, and those that don't get
that get 85 cents.
Mr. Kennedy. What about your other restaurant, the Village Ice
Cream ?
Mr. ScHOLL. That is a different local than the Chicago local.
Mr. Kennedy. That is local 593 of Mr. Lardino?
Mr. ScHOLL. I think so. I don't go into the numbers.
Mr. Kennedy. How much was that for?
Mr. ScHOLL. A check for $65 that I mailed down to him. I mailed
it down to him. It never was cashed. It came back to me quite a
while later.
Mr. Kennedy. That was February 15, 1957; is that right?
Mr. ScHOLL. When it was returned.
Mr. Kennedy. It was returned February 15, 1957?
Mr. ScHOLL. That is right.
Mr. K!ennedy. Do you know why it wasn't cashed ?
Mr. Scroll. Why it wasn't cashed ? They came out to me and told
me there was a little trouble ; they would have to straighten it up first
and they would be back for the check later.
Mr. Kennedy. Do you know what the trouble was ?
Mr. ScHOLL. They were being investigated. That is what I heard.
Mr. Kennedy. So they returned the money to you ?
Mr. ScHOLL. They returned the check.
Mr. Kennedy. Did you ever receive union dues books for the five
employees at the White Mill Restaurant ?
Mr. ScHOLL. Yes; I did.
Mr. Kennedy. But not for the Village Ice Cream Shop ?
Mr. Scroll. No. I started to take the money out for the Village
and the girls there refused to pay me and they refused to join the
union and they called the union and the union told them they were
not in the union. Then my check came back the following day.
Mr. Kennedy. I see. Did you tell the employees at the White Mill
they were in the union ?
Mr. Scroll. I did.
Mr. Kennedy. Were they satisfied ?
Mr. Scroll. They said they heard the trouble I had out there with
them, and they seen the trouble at Nantucket, and they are married
women and they can't afford to be out of work. They want to stay
there in the work. They have been there that many years.
Mr. Kennedy. So you started deducting from their wages ?
Mr. Scroll. I did.
Mr. Kennedy. They had no other choice ?
Mr. Scroll. They had to join.
Mr. Kennedy. WTiat?
Mr. Scroll. They had to join the union.
Mr. Kennedy. There was no improvement of wages, hours, or con-
ditions for them ?
Mr. Scroll. That is right.
Mr. Kennedy. They took a reduction in wages to belong to the
union, did they not ?
Mr. Scroll. They took a deduction in wages to belong to the union.
12932 IMPROPER ACTIVITIES IN THE LABOR FIELD
Mr. Kennedy. So it was a loss to them to belong to the union ?
Mr. ScHOLL. Well, they get $100, 1 think, when they die.
Mr. Kennedy. Did you ever give anybody else any money, any of
these other union officials ?
Mr. ScHOLL. No, nobody.
Mr. Kennedy. You never gave Mr. O'Connor ?
Mr. ScHOLL. Only what I stated.
Mr. Kenedy. The $50?
Mr. ScHOLL. The check.
Mr.IvENNEDY. The check for $220?
Mr. ScHOLL. Yes, and the first time I gave him money.
Mr. Kennedy. In October of 1957 did you give him some money
at that time, $50 in cash ?
Mr. ScHOLL. No, that was given to Mr. Griffith.
Mr. Kennedy. That we have already discussed.
Mr. ScHOLL. That is right.
Mr. Kennedy. All right.
That is it, Mr. Chairman.
The Chx\ir]man. You just regarded this as a shakedown, didn't you?
Mr. ScHOLL. Absolutely.
The Chairman. You did it just to buy peace ?
Mr. SciioLL. We have no choice in the matter. We got to or we
will be picketed. They will put us out of business. We are having
a hard time going now.
The Chairman. That would put you out of business ?
Mr. ScHOLL. That is right.
The Chairman. So if you lived, if you survived in your business,
you would have to pay this extortion money ?
Mr. Scholl. That is right. Senator.
The Chairman. Are there any further questions ?
If not, thank you very much.
Mr. Scholl. Has Mr. Gotsch got anything to say about the audit-
ing of the wages for me ?
The Chairman. I beg your pardon ?
Mr. Kennedy. You are doing very well there.
Mr. Scholl. You mean the help are doing well.
Mr. Kennedy. The help are doing well. They are all being paid
above union scale.
The Chairman. Thank you very much.
Call the next witness.
Mr. Kennedy. Mr. Chairman, I would like to point out, as I did
last week, that these kinds of payments of all of these individuals that
have testified today are violations of the law either for the employer
or for the union official, or possibly both, depending on whether it is
a payoff, extortion, or possibly collusion, under section 302 of the Taft-
Hartley law.
Now, I would like to call the union offiicals that we have had testi-
mony about today. That would include Mr. Frank Trungale, secre-
tary-treasurer of local 394. I will call him first.
The Chairman. Mr. Trungale, come forward, please.
Do you solemnly swear the evidence you shall give before this Sen-
ate select committee will be the truth, the whole truth, and nothing
but the truth, so help you God ?
Mr. Trungale. Yes, sir.
IMPROPER ACTIVITIES IN THE LABOR FIELD 12933
TESTIMONY OF FRANK TRUNGALE, ACCOMPANIED BY
EDWARD J. CALLAHAN, JR.
The Chairman. State your name, your place of residence, and your
business or occupation.
Mr, Trungale. My name is Frank Trungale. I live at 1901 North
77th Avenue, Ehnwood Park, and I am unemployed at the present
time.
The Chairman. You have counsel present ?
Mr. Trungale. I do.
The Chairman. Counsel, identify yourself for the record, please.
Mr. Callahan. My name is Edward J. Callahan, Jr. I practice in
Chicago, 111., at 105 West Adams Street. I am admitted to the Su-
preme Court of the State of Illinois and the Supreme Court of the
United States.
Mr. Chairman, I would like to make a statement at this time in
connection with my presence here before this committee.
The Chairman. Very good.
Mr. Callahan. Back in February of this year I was consulted by
certain representatives of local 583 in Chicago as to whether or not I
would undertake to represent these people in connection with this
investigation.
My practice is almost wholly Federal. I conferred with them and
also with Mr. Miller, who is the international president of the Hotel,
Restaurant Workers and Bartenders Union, and at that time it was
understood that if I did represent any of these i)eople it would be on
the basis of complete cooperation with this committee in the turning
over of documents and records and whatever the committee desired,
and we so operated in that fashion. In other words, Senator, I repre-
sent local 593, local 450 which came along later, and local 394 as
unions.
I might state in this matter, however, I have not accepted any fee
from local 394 because of their condition, and the same is true of local
450. I have been engaged in Chicago, 111., in a civil tax matter all
week, and when I came to Washington last night, at 2 o'clock in the
morning, I found that Mr. Trungale and O'Connor both had sub-
mitted their resignations. This placed me in an awkward position of
representing a union with no members to speak in their behalf. So
immediately at 9 o'clock this morning I contacted Mr. Kelly and Mr.
Duffy and Mr. Kennedy and told them of my problem, and indicated
that I thought these gentlemen ought to be represented by other
counsel.
However, the time element was involved. There are two lawyers
coming in. I had hoped they would be here by now, but they have
not yet arrived. Consequently, I am in this position. Senator, that
if you will continue until they do arrive they can go on. If this com-
mittee would permit me to stay here with them, and they do desire
counsel, I would be happy to do whatever I can to expedite this
hearing.
The Chairman. As I understand, you were first retained by the
union ?
Mr. Callahan. Yes.
The Chairman. To represent these officers ?
12934 IMPROPER ACTIVITIES IN THE LABOR FIELD
Mr. Callahan. Yes, sir.
The Chairman. Now you found last night that they had resigned
from the union ?
Mr. Callahan. Yes ; and it is also my belief, Your Honor, that they
■will claim the privilege. I think in view of the testimony that is a
matter of their own choice.
The Chairman. You had anticipated being paid by the union, or
have you been paid by the union ?
Mr. Callahan. No, sir. I think that the union is in such a financial
condition that I was not too worried about it. I have been paid by
local 593. I just went along on the basis that I would do whatever
I could for them in their cooperation with this committee. I have done
nothing other than facilitate the turning over of records and docu-
ments and whatever was required.
The Chairman. Are you willing, and are they willing to accept your
services, for you to remain here now and advise them as to their legal
rights as they testify ?
(The witness conferred with his counsel.)
Mr. Trungale. Yes ; I am.
The Chairman. Well, if they are willing
Mr. Call^vhan. I wanted to make it clear that I did not want to
get into a possible conflict. Senator.
The Chairman. I am sure your advice was acceptable to them before
they resigned, and I see no reason why it should not be acceptable to
them now.
Mr. Callahan. Thank you, Your Honor.
The Chairman. Proceed, Mr. Kennedy.
Mr. Kennedy. You say that you are unemployed at the present
time. Could you tell us where you were employed yesterday at 4
o'clock ?
Mr. Trungale. Yes. Not yesterday, but Saturday, with the Cooks,
Waiters, and Waitresses Union, Local 394.
Mr. Kennedy. How long had you been employed there ?
(The witness conferred with his counsel.)
Mr. Trungale. Approximately 20 years.
Mr. Kennedy. What work were you doing for local 394 ?
Mr. Trungale. Office work, mostly.
The Chairman. Office?
Mr. Trungale. In the office, mostly.
Mr. I^NNEDY. Did you go out and do any organizing work for
them ?
( The witness conferred with his counsel. )
Mr. Kennedy. If you can't answer that, let me try something else.
Mr. Trungale. Yes; I will answer that. Under the fifth amend-
ment to the Constitution of the United States, I must respectfully de-
cline to answer the question on the ground that it may tend to incrim-
inate me.
Mr. Kennedy. What about your salary and expenses ? Could you
tell us about that? What salary did you receive from that local ?
Mr. Trungale, I must respectfully decline to answer the question.
Mr. Kennedy. For what reason ?
Mr. Trungale. On the ground that it may tend to incriminate me.
IMPROPER ACTIVITIES IN THE LABOR FIELD 12935
The Chairman. What is there about this operating a union in Chi-
cago that so incriminates one who may engage in the organization or
work for a union ? What is there about it ? It gives a bad impression,
you know, to the public, to the working people, to other labor unions.
What is there about that kind of work that causes it to tend or that it
might tend to incriminate someone if he talked about it ?
Can you tell us ?
Mr. Trungale. Under the fifth amendment of the Constitution of
the United States, I must respectfully decline to answer the question
on the ground that it may tend to incriminate me.
The Chairman. Well, I will tell you what it does. Do you realize
what you are doing to working people of this country and to their
organization ?
It should be their organization, and they should have a right to
organize, to bargain collectively, and to take other proper activities for
improvement of their working conditions, wages, hours of employ-
ment, and so forth. Wlien you people who have been in a position of
trust, in an official position representing them, bargaining for them,
making contracts, organizing, strengthening the organization, when
you come in here and take the fifth amendment, can't you realize what
you are doing to the legitimate unionism ? You are hurting, you are
injuring the very thing you are supposed to have been honestly repre-
senting.
Don't you realize that ? Do you want to answer it ?
(The witness conferred with his counsel.)
Mr. Trungale. After what has been said here, I feel that the only
position that I can honestly take is then to decline to answer the ques-
tion on the ground that it may tend to incriminate me.
The Chairman. Well, it may. I don't know. Do you feel like you
have betrayed the men who placed their trust in you and whom you had
a duty and responsibility to represent ? Do you feel you have betrayed
that trust?
Mr. Trungale. No ; I don't.
The Chairman. You don't feel that you have ?
Mr. Trungale. No.
The Chairman. Well, if you have not betrayed that trust, then why
can't you answer without any possibility of self-incrimination, unless
you are implying that unionism of itself is engaged in improper activi-
ties and that you can't tell about it without possible self-incrimina-
tion ?
Mr. Trungale. I must respectfully decline to answer the question
on the ground that it may tend to incriminate me.
The Chairman. Proceed, Mr. Kennedy.
Mr. Kennedy. Could you tell us at all about the procedure that you
followed for organizing, Mr. Trungale ? We have had testimony be-
fore the committee that the way the organizing worked as far as you
were concerned was virtually an extortion or shakedown of some of
these employers, and that you just used to go by and pick up a sum of
money and then put maybe 5, 6, 8, or 10 employees into the union to
account for the money. Could you tell us whether you followed that
procedure ?
Mr. Trungale. I must respectfully decline to answer the question.
12936 IMPROPER ACTIVITIES IN THE LABOR FIELD
Mr. Kennedy. On what ground? Read the whole thing. And
then I wouldn't have to ask you.
Mr. Trungale. All right. On the ground it may tend to incrimi-
nate me.
Mr. Kennedy. One of the things you were tied up with, according
to the testimony, is the Segal Restaurant, where you came by and said
you wanted eight employees in the union. Did you do that, and then
receive a sum of money ?
Mr. Trungale. I must respectfully decline to answer the question
on the ground it may tend to incriminate me.
Mr. IvENNEDY. And the same situation, with seven employees, at
the Rupcich Restaurant ; is that right 'i
Mr. Trungale. I must respectfully decline to answer the question
on the ground that it may tend to incriminate me.
Mr. Kennedy. Were you ever interested in the wages, hours, or
conditions of any of the employees of any of the restaurants that you
tried to organize ?
Mr. Trungale. I respectfully decline to answer the question on the
grounds that it may tend to incriminate me.
Mr. Kennedy. It was just a question of collecting the money so
that you could have your salary and expenses paid ; is that right ?
Mr. Trungale. I respectfully decline to answer the question on the
grounds it may tend to incriminate me.
Mr. Kennedy. In fact, you failed to even notify the employees
whose names you received that they were in the union; isn't that
right?
Mr. Trungale. I respectfully decline to answer the question on the
ground that it may tend to incriminate me.
Mr. Kennedy. We have had testimony that you followed the same
kind of procedure with Segal, Rupcich, and the Inglenook Restau-
rants. Could you tell us about that ?
Mr. Trungale. I respectfully decline to answer the question on the
ground it may tend to incriminate me.
Mr. Kennedy. And that an arrangement was ultimately made be-
tween you and Mr. Romano. Do you know Mr. Romano ?
Mr. Trungale. I respectfully decline to answer the question on the
ground that it may tend to incriminate me.
Mr. Kennedy. Did you know him as a member of the Chicago
syndicate ?
Mr. Trungale. I respectfully decline to answer the question on the
grounds that it may tend to incriminate me.
Mr. Kennedy. He was in the hotel and restaurant workers union
up until 1940, and then he was a labor expert from 1940 to about 1953
or 1954. How many dealings did you have with him during that
period of time ?
Mr. Trungale. I respectfully decline to answer the question on the
grounds that it may tend to incriminate me.
Mr. Kennedy. Could you tell us about the Nantucket Restaurant,
and the pickets that were outside tlie Nantucket Restaurant ?
Mr. Trungale. I respectfully decline to answer the question on the
ground that it may tend to incriminate me.
Mr. Kennedy. Evidently more money was collected for the pickets
from the union than there were actually pickets, some $27 each day
IMPROPER ACTIVITIES IN THE LABOR FIELD 12937
for a period of approximately 14 months. Can you tell the commit-
tee or give them any ideas as to what happened to that money ?
Mr. Trungale. I respectfully decline to answer the question on
the gromids that it may tend to incriminate me.
IVlr. Kennedy. The total amount of money that was spent on the
strike, according to the union records, is $111,620.80. Could you tell
us how much of that was actually spent, how much was legitimate?
Mr. Trungale. I respectfully decline to answer the question on the
ground that it may tend to incriminate me.
Mr. Kennedy, Obviously, from the testimony we have had, a very
large, high percentage was not legitimate expense. Could you tell
us what happened to the money, Mr. Trungale ?
Mr. Trungale. I respectfully decline to answer the question on the
grounds it may tend to incriminate me.
The Chairman. Do you honestly believe that if you answered these
questions truthfully, that a truthful answer might tend to incriminate
you?
Mr. Trungale. Under the fifth amendment to the Constitution of
the United States, I must respectfully decline to answer the question
on the grounds that it may tend to incriminate me.
The Chairman. With the permission of the committee, the Chair
orders and directs you to answer that question. I just don't believe
that it was ever intended that people should take the fifth amend-
ment frivolously and just capriciously, and just for the sake of de-
clining to give testimony as to the actions of others.
I think one should be honest and sincere in taking the fifth amend-
ment to the extent that he is willing to state that he honestly believes
that if he told the truth, that a truthful answer might tend to in-
criminate him.
You are not expected to lie or perjure yourself. Laws don't
comitenance that. So unless you can state that you honestly believe
that a truthful answer might tend to incriminate you, I doubt seri-
ously, in my judgment at least, that you are privileged to invoke the
fifth amendment.
Mr. Trungale. I must respectfully decline to answer the question
on the ground that it may tend to incriminate me.
The Chairman. The order to the witness to answer the question,
with the approval of the committee, will stand during the time you
are on the witness stand.
There will be a continuing order for you to answer the questions
unless you can truthfully say, state, under oath that you honestly
believe that a truthful answer might tend to incriminate you.
Proceed, Mr. Kennedy.
Mr. Kennedy. On the pickets alone, it would appear that there
was some $12,000, if Mr. Griffith's testimony is to be believed, there
was some $12,000 extra that was paid for the pickets alone during
that Nantucket strike. Can you tell us what happened to that
money ?
Mr. Trungale. I respectfully decline to answer the question on the
grounds it may tend to incriminate me.
Mr. Kennedy. Mr. Tony DeSantis just appeared representing the
Martinique Restaurant and said he had to pay you about $100 in cash
21243—58 — pt. 34 6
12938 IMPROPER ACTIVITIES IN THE LABOR FIELD
every 9 months over a period of 5 or 6 years, and that you then agreed
not to organize or unionize the employees.
Can you tell us about that ?
Mr. Trungale. I respectfully decline to answer the question on the
ground that it may tend to incriminate me.
Mr. Kennedy. Mr. Chairman, I would like, if I may, to call Mr.
O'Connor. He was involved in this union. I would like to call him
forward.
The Chairman. Let me ask the witness a question or two. You are
a citizen of the United States, are you not ?
Mr. Trungale. Yes, sir.
The Chairman. Do you feel any sense of obligation to your Gov-
ernment to assist it when you can do so in giving information that it
may need to enable it, its Congi-ess, to enact laws to correct conditions
that may prevail or to improve the standards of management-labor
relations in this country ? Do you feel any sense of obligation as a
citizen to try to help your Government in that respect ?
(The witness conferred with his counsel.)
Mr. Trungale. Yes, I do.
The Chairman. All right. Are you willing to discharge that obli-
gation ?
Mr. Trungale. I must respectfully decline to answer the question
on the grounds that it may tend to incriminate me.
The Chairman. Do you mean that if you met that obligation, if
you undertook to cooperate and give the information that you have,
that the giving of the information or the information you would give
or could give might tend to incriminate you? Is that what you
mean?
Mr. Trungale. Yes, sir. I respectfully decline to answer the ques-
tion on the ground
The Chairman. Let me ask you this: Have you performed any
service as an officer of that union about which you can testify without
the risk of self-incrimination ?
Mr. Trungale. Under the fifth amendment to the Constitution of
the United States, I must respectfully decline to answer the question
on the ground that it may tend to incriminate me.
The Chairman. Well, I sincerely hope that some day we can de-
liver out of bondage the working people of this country who belong
to unions, out of bondage of officers who so conduct their affairs and
their responsibilities to union members that they can't testify about
it without the possibility of self-incrimination. I think we have a
great task ahead of use, and I think it is a noble task if we can ever
deliver these folks from the evil that attends them today in some
unions, under some leadership, where they are just pawns in the
hands of men who are greedy, who think solely of no one's interest
except their own personal grandiosement and financial profit.
Do you have any questions. Senator Ervin ?
Senator Er\t:n. Yes. How long were you secretary treasurer of
local 394?
Mr. Trungale. I respectfully decline to answer the question on the
ground it may tend to incriminate me.
Senator Ervin. Well, when were you first elected secretary-treas-
urer of local 394?
IMPROPER ACTIVITIES IN THE LABOR FIELD 12939
Mr. Trungale. I respectfully decline to answer the question on the
ground it may tend to incriminate me.
Senator Ervin. Did you get your election as secretary-treasurer of
local 394 by fraud and rascality ?
Mr. Trungale. I respectfully decline to answer the question on the
ground that it may tend to incriminate me.
Senator Ervin. You are swearing, you are stating to this com-
mittee under oath, that you cannot make a revelation of a single
activity that you ever performed as an officer of that local union which
would not tend to incriminate you in the violation of some law, is
that correct ?
Mr, Trungale. I must respectfully decline to answer the question
on the ground that it may tend to incriminate me.
The Chairman. Do you honestly believe that a truthful answer
to that question as to whether you had ever done anything that you
could testify to that would not tend to incriminate you, do you honestly
believe that a truthful answer to that question might tend to incrim-
inate you ?
Mr. Trungale. I must respectfully decline to answer the question
on the ground that it may tend to incriminate me.
The Chairman. The Chair, with the permission of the committee,
orders and directs you to answer the question.
Mr. Trungale. I respectfully decline to answer the question on the
ground that it may tend to incriminate me.
The Chairman. That order will stand during the time that you are
on the witness stand. It will be a continuing order. Proceed, Mr.
Kennedy.
Mr. Kennedy. I would like to ask, Mr. Chairman, that Mr. James
O'Connor come around.
The Chairman. Do you know Mr. James O'Connor ?
Mr. Trungale. Yes, sir.
The Chairman. Thank you very much.
Come forward, Mr. O'Connor.
Mr. O'Connor, be sworn, please.
You do solemnly swear the evidence you shall give shall be the truth,
the whole truth, and nothing but the truth, so help you God ?
Mr. O'Connor. Yes, sir.
. TESTIMONY OF JAMES O'CONNOR, ACCOMPANIED BY
COUNSEL, EDWARD J. CALLAHAN, JR.
The Chairman. State your name, your place of residence, and your
business or occupation.
Mr. O'Connor. My name is James F. O'Connor, 8820 Main Street,
Hometown, 111. I am unemployed.
The Chairman. Unemployed. Do you have counsel ?
Mr. O'Connor. Yes, sir.
The Chairman. The same counsel ?
Mr. Callahan. It is the same representation that I made with
reference to Mr. Trungale. I would like that to stand in the record
for Mr. O'Connor.
The Chairman. All right. Thank you very much.
You said, I believe, that you are unemployed ?
12940 IMPROPER ACTIVITIES IN THE LABOR FIELD
Mr. O'Connor. Yes, sir.
The Chairman. Since when?
(The witness conferred with his counsel.)
Mr. O'Connor. Saturday.
The Chairman. Since last Saturday. What was your employ-
ment prior to last Saturday ?
Mr. O'Connor. Under the fifth amendment of the Constitution of
the United States I must respectfully decline to answer the question
on the grounds that it may tend to incriminate me.
The Chairman. You were president of Local 394 of the Hotel and
Restaurant Workers Union, is that correct ?
Mr. O'Connor. I must decline to answer the question on the grounds
it may tend to incriminate me.
The Chairman. What is there about being president of a local union
that might incriminate you? Would you give us some idea of what
it is?
I thought it was an honor to represent working people in this
coimtry. Didn't you ?
Mr. O'Connor. Under the fifth amendment of the Constitution of
the United States, I must respectfully decline to answer the question
on the grounds it may tend to incriminate me.
The Chairman. Was your resignation asked for or did you resign
voluntarily ?
(The witness conferred with his counsel.)
Mr. O'Connor. I resigned voluntarily.
The Chairman. Was it because or in contemplation of your position
that you had and that you were being called here as witness that you
felt you could not give a proper accounting of your stewardship as
president of that union that caused you to resign ?
(The witness conferred with his counsel.)
Mr. O'Connor. Under the fifth amendment of the Constitution of
the United States, I respectfully decline to answer the question on
the grounds it may tend to incriminate me.
The Chairman. Did you have any other reason than that? That is,
since you resigned voluntarily ?
Mr. O'Connor. Under the fifth amendment of the Constitution of
the United States, I must respectfully decline to answer the question
on the grounds that it may tend to incriminate me.
The Chairman. Mr. Kennedy, proceed. I think you have another
one of the same stripe.
Mr. Kennedy. Once again I would like to know whether it was the
usual procedure as far as your union was concerned, Mr. O'Connor,
to go to an employer and exact a payment in return for not having a
picket line or not organizing the employees. Did you follow that
procedure ?
Mr. O'Connor. Under the fifth amendment of the Constitution of
the United States, I must respectfully decline to answer the question
on the grounds it may tend to incriminate me.
Mr. Kennedy. According to the testimony, you did follow that
procedure at the Eupnich Restaurant, the Beverly Woods Restaurant,
Inglenook Restaurant, and a number of others, and exacted a payment
from the owners of those restaurants. Can you tell us what were the
other ones where you did the same thing ?
IMPROPER ACTIVITIES IN THE LABOR FIELD 12941
Mr. O'Connor. Under the fifth amendment of the Constitution of
the United States, I must respectfully decline to answer the question
on the grounds it may tend to incriminate me.
Mr. Kennedy. This is a procedure that was followed by you, it was
a procedure, obviously, that took place in some of the other unions
in Chicago, the Hotel and Kestaurant Workers Unions, some of the
ones that we have discussed here, local 450 and others.
Was this all known to the higher union officials, such as Mr. Blakely,
who was the vice president ?
Mr. O'Connor. Under the fifth amendment of the Constitution of
the United States, I must respectfully decline to answer the question
on the grounds that it may tend to incriminate me.
Mr. Kennedy. Mr. Trungale had been there for 20 years, and you
have been there, with that local, for a long period of time also. Could
all of this have been going on during this period of time without any
of the higher officials, the international officials, knowing that this
situation existed in Chicago?
Mr. O'Connor. Under the fifth amendment of the Constitution of
the United States, I must respectfully decline to answer the question
on the grounds that it may tend to incriminate me.
Mr. Kennedy. You were never interested, were you, in the wages,
hours, or conditions of your employees, of the employees at any of
these restaurants, Mr. O'Connor?
Mr. O'Connor. Under the fifth amendment of the Constitution of
the United States, I must respectfully decline to answer the question
on the grounds that it may tend to incriminate me.
The Chairman. Who is Mr. Blakely ? Do you know who counsel
referred to when he asked you about Mr. Blakely ?
Mr. O'Conner. He is the international vice president.
The Chairjian. Of this union?
Mr. O'Connor. Of the Hotel, Eestaurant Employees and Bartend-
ers International Union.
The Chairman. Do you know him personally ?
Mr. O'Connor. Yes, sir.
The Chairman. You also know Mr. Trungale here ?
Mr. O'Connor. Yes, sir.
The Chairman. You know Mr. Trungale ?
Mr. O'Connor. Yes, sir.
The Chairman. You worked with him for many years, haven't you,
associated with him in the union as officials of this union, local 394?
Were you and him not associated together as officials of this union
for a number of years ?
Mr. O'Connor. Under the fifth amendment of the Constitution of
the United States, I must respectfully decline to answer the question
on the grounds that it may tend to incriminate me.
The Chairman. Is that because you know him, you think it might
tend to incriminate you, because you associated with him or because
of what you did while an official of the union that you think might
tend to incriminate you ? • £
Mr. O'Connor. Under the fifth amendment of the Constitution ot
the United States, I must respectfully decline to answer the question
on the grounds that it may tend to incriminate me.
(At this point. Senator Goldwater entered the hearing room.)
12942 IMPROPER ACTIVITIES IN THE LABOR FIELD
The Chairman. Mr. O'Connor, do you feel any obligation at all
to the working men and women whose money you took in as dues
and whose money you expended ? Do you feel under any obligation
whatsoever to them to give an accounting of your stewardship ?
Mr. O'Connor. Under the fifth amendment of the Constitution of
the United States, I must respectfully decline to answer the question
on the grounds that it may tend to incriminate me.
Tlie Chairman. You think if you said either yes or no, that it
might tend to incriminate you ?
Mr. O'Connor. Under the fifth amendment of the Constitution of
the United States, I must respectfully decline to answer the question
on the grounds it may tend to incriminate me.
The Chairman. Do you feel like you have betrayed their trust ?
Mr. O'Connor. Under the fifth amendment of the Constitution of
the United States, I must respectfully decline to answer the question
on the grounds it may tend to incriminate me.
The Chairman. You realize what you are doing, don't you? You
are either saying one of two things, in effect : That you have so con-
ducted your official duties that you cannot answer with respect thereto,
except at the possible risk of self-incrimination ; or that a union, this
union, by its nature, its functions, and its objectives, is engaged in prac-
tices that you cannot talk about without reflecting upon unionism, as
such. Don't you realize that ?
Mr. O'Connor. Under the fifth amendment of the Constitution of
the United States, I must respectfully decline to answer the question
on the grounds it may tend to incriminate me.
The Chairman. Don't you realize that if folks like you and Mr.
Trungale here would cooperate with this committee and come in here
and come clean and tell us what the facts are, that you would be render-
ing a great service to the working men and women of this country, some
of whom you have had the honor to represent ?
Mr. O'Connor. Under the fifth amendment of the Constitution of the
United States, I must respectfully decline to answer the question on
the grounds it may tend to incriminate me.
The Chairman. Don't you want to repent or relent a little and help
us out ?
Mr. O'Connor. Under the fifth amendment of the Constitution of
the United States, I must respectfully decline to answer the question
on the grounds it may tend to incriminate me.
The Chairman. Mr. Kennedy, proceed.
Mr. Kennedy. I would like to know if you know Claude Maddox,
Mr. O'Conner.
Mr. O'Connor. Under the fifth amendment of the Constitution of
the United States, I must respectfully decline to answer the question
on the grounds it may tend to incriminate me.
Mr. Kennedy. Mr. Griffith testified here under oath before the com-
mittee that you referred to Claude Maddox in conversations as the
big man ; that you were going to take him out and introduce Mr. Grif-
fith to Claude Maddox.
Can you tell us what the relationship has been of Claude Maddox
with this local ?
Mr. O'Connor. Under the fifth amendment of the Constitution of
the United States, I must respectfully decline to answer the question
on the grounds that it may tend to incriminate me.
IMPROPER ACTIVITIES IN THE LABOR FIELD 12943
Mr. Kennedy. Why should any of you have any association with
somebody like Claude Maddox, Mr. O'Connor ?
Mr. O'Connor. Under the fifth amendment of the Constitution of
the United States, I must respectfully decline to answer the question
on the grounds it may tend to incriminate me.
Mr. Kennedy. He is one of the most notorious hoodlums and gang-
sters in the Chicago area, or at least he was until he died just a few
weeks ago. Why should you, a union official, be saying that you would
take Mr. Griffith out to meet him ?
Mr. O'Connor. Under the fifth amendment of the Constitution of
the United States, I must respectfully decline to answer the question
on the grounds it may tend to incriminate me.
Mr. Kennedy. Mr. Chairman, these individuals had control for
many years over a great number of employees in the Chicago area.
We have uncovered some of the deals that they have made, and in-
stances where obviously the employees were made to suffer.
The fact that this has been going on for such a long period of time
is something that should be noted. We could only go back a few years,
but this has been going on for at least some 20 years. I think there
is at least some satisfaction that these men are finished with their
jobs and no longer have control over this union and the funds of the
union and the employees that were members of the local.
The Chairman. Mr. O'Connor, do you know Louis Romano? Do
you know him personally ?
Mr. O'Connor. Under the fifth amendment of the Constitution of
the United States, I must respectfully decline to answer the question
on the grounds that the answer may tend to incriminate me.
The Chairman. Do you honestly believe that if you gave a truthful
answer to that question that a truthful answer thereto might tend to
incriminate you ?'
Mr. O'Connor. Under the fifth amendment of the Constitution of
the United States, I must respectfully decline to answer the question
on the grounds it may tend to incriminate me.
The Chairman. I do not believe that that is a valid use of the fifth
amendment privilege, unless a witness can state under oath that he
honestly believes that if he gave a truthful answer to the question,
that a truthful answer might tend to incriminate him.
Therefore, with the permission of the committee, the Chair would
order and does order and direct you, as the witness, to answer the
question of whether you believe that if you gave a truthful answer
to the question, "Do you know Louis Romano ?" that a truthful answer
thereto might tend to incriminate you. That is an order and direction
of the Chair.
Mr. O'Connor. Under the fifth amendment of the Constitution of
the United States, I must respectfully decline to answer the question
on the grounds that it may tend to incriminate me.
The Chairman. Do you know Claude Maddox ?
Mr. O'Connor. Under the fifth amendment of the Constitution of
the United States, I must respectfully decline to answer the question
on the grounds it may tend to incriminate me.
The Chairman. Do you honestly believe that if you gave a truth-
ful answer to that question, a truthful answer thereto might tend to
incriminate you ?
12944 IMPROPER ACTIVITIES IN THE LABOR FIELD
Mr. O'Connor. Under the fifth amendment of the Constitution of
the United States, I must respectfully decline to answer the question
on the (grounds it may tend to incriminate me.
The Chairman. The Chair, with the approval of the committee,
orders and directs the witness to answer the last question of whether
he honestly believes that if he gave a truthful answer to the question
of whether he knows Louis Romano, that a truthful answer thereto
might tend to incriminate him.
Mr. O'Connor. Under the fifth amendment of the Constitution of
the United States, I must respectfully decline to answer the question
on the grounds it may tend to incriminate me.
The Chairman. Do you know Abe Teitelbaum, or Abraham Teitel-
baum ?
Mr. O'Connor, Under the fifth amendment of the Constitution of
the United States, I must respectfully decline to answer the question
on the grounds it may tend to incriminate me.
The Chairman. Do you know Anthony Champagne? Both of
them are lawyers.
Mr. O'Connor. Under the fifth amendment of the Constitution of
the United States, I must respectfully decline to answer the question
on the grounds it may tend to incriminate me.
The Chairman. Do you honestly believe that if you gave a truth-
ful answer to the questions of whether you know Abraham Teitelbaum
or whether you know Anthony Champagne, that a truthful answer
thereto might tend to incriminate you ?
Mr. O'Connor. Under the fifth amendment of the Constitution of
the United States, I must respectfully decline to answer the question
on the grounds it may tend to incriminate me.
The Chairman. The Chair, with the approval of the committee,
orders and directs you to answer the question as to whether you hon-
estly believe that if you gave a truthful answer to the question of
whether you know Abraham Teitelbaum or Anthony Champagne, or
either of them, that a truthful answer thereto might tend to incrim-
inate you.
Mr. O'Connor. Under the fifth amendment of the Constitution of
the United States, I must respectfully decline to answer the ques-
tion on the grounds it may tend to incriminate me.
The Chairman. The order of the Chair will be a continuing order
throughout your testimony and while you remain on the stand.
All right. Are there any questions ? Senator Ervin.
Senator Ervin. We are here for the purpose of determining whether
any legislation ought to be enacted in the labor-management field. I
ask you this question as a Federal legislator, of a citizen of the United
States :
Don't you think that Congress ought to pass a law making it a crime
for any officer of any union covered by the Taft-Hartley law to prac-
tice extortion upon people by abusing his powers as a labor official,
and to embezzle funds of the union ?
(The witness conferred with his counsel.)
Mr. O'Connor. Yes.
Senator Ervin. That is all.
The Chairman. Do you have any questions ?
Senator Gold water. No questions.
The Chairman. Are there any further questions ?
IMPROPER ACTIVITIES IN THE LABOR FIELD 12945
Mr. Kennedy. Have you used the union or your position as a union
official, have you used that position to extort money from any em-
ployer ?
Mr. O'Connor. Under the fifth amendment of the Constitution of
the United States, I must respectfully refuse to answer that question
on the grounds of self-incrimination.
Mr. Kennedy. Have you taken any money unlawfully, embezzled
any money from the union ?
Mr. O'Connor. Under the fifth amendment of the Constitution of
the United States, I must respectfully decline to answer the question
on the grounds of self-incrimination.
Mr. Kennedy. What about you, Mr. Trungale; have you used the
union for the purpose of extortion ?
Mr. Trungale. I decline to answer the question on the grounds it
may tend to incriminate me.
Mr. Kennedy. Have you taken or embezzled any money from the
union ?
Mr. Trungale. I respectfully decline to answer the question.
Mr. Kennedy. On what grounds ?
Mr. Trungale. On the grounds it may tend to incriminate me.
The Chairman. The Chair will ask each of you this question. You
may answer, each of you. It is directed to each of you.
Were you present here in this Chamber, and did you hear other
witnesses' testimony as to your business and methods of operation ?
Mr. Trungale. I have only been here part of the time, sir.
The Chair]\ian. You have heard part of it, have you? You have
heard part of the derogatoiy testimony against you?
Mr. Trungale. Yes,
The Chairman. Have you, Mr, O'Connor ?
Mr. O'Connor. Yes.
The Chairman. You have heard some of it, at least.
Do you wish to make any statement here denying or explaining
any of this derogatory testimony that you liave heard against you?
That question is directed to each of you, and you may answer it.
(The witnesses conferred with their counsel.)
Mr, Trungale, No, I — just no.
The Chairman, You want to let the record stand as it is ?
Mr, Trungale, Yes,
The Chairman, We want to be fair. If there is anything said
here against you that is wrong, if you want to correct it, if you think
it ought to be corrected so a wrong impression will not go out, we want
to give you a chance to correct it,
I am giving you that chance now. Do you wish to correct any of
this derogatory testimony you have heard against yourself?
Mr. Trungale. I decline to answ^er that question, sir.
The Chairman. You don't have to decline. Just say, "No." That
is the same thing. Wouldn't you think "no" would be just as em-
phatic as declining to answer ?
Mr. Trungale. I am not a lawyer.
The Chairman. I didn't say you were a lawyer. You know the
meaning of the word "no," don't you ?
Mr. Trungale. I decline to answer that question, sir, on the grounds
it may tend to incriminate me.
The Chairman. All right.
12946 IMPROPER ACTIVITIES IN THE LABOR FIELD
Mr. O'Connor, do you want to take advantage of this opportunity
to correct any derogatory testimony you have heard against your-
self?
Mr. O'Connor. Under the fifth amendment of the Constitution of
the United States, I respectfully decline to answer the question on
the grounds it may tend to incriminate me.
The Chairman. You will certainly agree to answer this: You
agree it is very fair on the part of the committee to give you the
opportunity? You agree we are being fair with you?
Mr. O'Connor. Yes.
The Chairman. In spite of our effort to be more than fair, you
still decline to answer ?
Mr. O'Connor. Yes, sir.
The Chairman. Are there any other questions ?
Mr. Kennedy. That is all, Mr. Chairman.
The Chairman. These gentlemen will remain under continuing
subpena.
You will be under recognizance to reappear at such time as the
committee may desire further testimony from you, upon reasonable
notice being given to you of the time when your further testimony
will be required.
Do you agree?
Mr. Trungale. Yes.
Mr. O'Connor. Yes.
Mr. Kennedy. Do you have your personal books and records ?
Mr. O'Connor. Right here.
Mr. Kennedy. Will you turn them over to the committee ?
Mr. O'Connor. No, sir.
Mr. Kennedy. On what grounds ?
Mr. O'Connor. Under the fifth amendment of the Constitution of
the United States, I must respectfully decline.
Mr. Kennedy. You decline to turn them over ?
Mr. O'Connor. I decline to turn them over.
Mr. Kennedy. ^Miat about you, Mr. Trungale ?
Mr. Trungale. I was never asked to bring any personal records
and books.
Mr. Kennedy. Well, we will take care of that.
Mr. Cali^vhan. I might state for the record that I asked either Mr.
Duffy or Mr. Kelly if they wanted records from Mr. Trungale, and
I was advised that they did not. I imagine you will get the same
answer.
Mr. Kennedy. Will you turn them over ?
Mr. Trungale. No ; I won't.
The Chairman. If requested by the committee, or if they are sub-
penaed, will you still decline to turn over your personal records?
Mr. Trungale. Yes ; I will decline to turn them over.
The Chairman. Even if subpenaed by the committee?
Mr. Trungale. That is right.
The Chairman. On what grounds ?
Mr. Trungale. On the grounds of self-incrimination.
IMPROPER ACTIVITIES IN THE LABOR FIELD 12947
The Chairman. They would be ?
Mr. Trungale. They might tend to incriminate me.
The Chairman. I see.
Mr. Kennedy. That is all, Mr. Chairman.
The Chairman. All right.
With the understanding that you are under recognizance to re-
appear when needed, you may stand aside.
Call the next witness.
Mr. Kennedy. Mr. Chairman, the last matter is a staff investigator,
but I want to put the figures in of the Chicago Kestaurant Association
which we discussed this morning.
TESTIMONY OF JAMES MTJNDIE— Resumed
The Chairman. You have been previously sworn ?
Mr. Mundie. I have, sir.
The Chairman. Proceed, Mr. Kennedy.
Mr. Kennedy. Mr. Mundie, have you made a study of the voluntary
fund of the Chicago Restaurant Association ?
Mr. Mundie. I have.
Mr. Kennedy. You have already put in the figures, have you not,
on the income to the Chicago Restaurant Association itself?
Mr. Mundie. That is correct.
Mr. Kennedy. But you have here the income to the Chicago Res-
taurant Association voluntary fund ; is that right ?
Mr. Mundie. That is correct.
Mr. Kennedy. Could you tell us what it has been from 1951 ? Could
you give us each year from 1951 to 1956 ?
Mr. Mundie. In the year 1951, $152,019.69; 1952, $139,961.90; 1953,
$144,466.75 ; 1954, $194,242.73 ; 1955, $178,164.55 ; 1956, $163,893.02.
Mr. Kennedy. Would you give us those again ?
Mr. Mundie. In 1956 ?
Mr. Kennedy. No ; start over again.
Mr. Mundie. In 1951 it was $152,019.69; in 1952, $139,961.90; in
1953, $144,866.75; in 1954, $194,248.73; 1955, $178,164.55; 1956, $163,-
893.02; 1957, $148,013.17; making a total of $1,121,167.81.
Mr. Kennedy. That was at the disposal of the Chicago Restaurant
Association ?
Mr. Mundie. That is correct.
(At this point Senator Ervin left the hearing room.)
Mr. Kennedy. Out of this amount of money, how much did Mr.
Teitelbaum receive ?
Mr. Mundie. $302,800.
Mr. I^NNEDY. And he left their employment in the end of 1953 and
then came back for a short time in 1954 ?
Mr. Mundie. That figure is from October 31, 1950, to 1954.
Mr. Kennedy. Then how much did Mr. Champagne receive out of
that?
Mr. Mundie. $83,200.
Mr. Kennedy. And the rest of the money was used in various ways ?
Mr. Mundie. That is correct ; strike funds and so forth.
12948 IMPROPER ACTIVITIES IN THE LABOR FIELD
The Chateman-. Are there any questions ?
Senator Goldwater. No questions, Mr. Chairman.
The Chairman. All right. Thank you very much.
The committee will stand in recess until 10 o'clock in the morning.
(Members of the select committee present at time of recess : Senators
McClellan and Goldwater.)
(Whereupon, at 4:53 p. m., the select committee recessed, to re-
convene at 10 a. m. Wednesday, July 16, 1958.)
INVESTIGATION OF IMPROPER ACTIVITIES IN THE
LABOR OR MANAGEMENT FIELD
WEDNESDAY, JULY 16, 1958
United States Senate,
Select Committee on Improper Activities
IN THE Labor OR Management Field,
Washington^ D. 0.
The select committee met at 10 a. m., pursuant to Senate Resolution
74, agreed to January 30, 1957, in the caucus room, United States
Senate, Senator Jolm L. McClellan (chairman of the select commit-
tee) presiding.
Present : Senator Jolin L. McClellan, Democrat, Arkansas ; Senator
Frank Church, Democrat, Idaho; Senator John F. Kemiedy, Demo-
crat, Massachusetts; Senator Barry Goldwater, Republican, Arizona;
Senator Carl T. Curtis, Republican, Nebraska.
Also present : Robert F. Kennedy, chief counsel ; Jolm J. McGovem,
assistant counsel; LaVern J. Duffy, investigator; James P. Kelly, in-
vestigator; James Mundie, investigator; Ruth Young Watt, chief
clerk.
The Chairman. The committee will be in order.
(Members of the committee present at the convening of the session
were: Senators McClellan and Church.)
The Chairman. Call your next witness.
Mr. Kennedy. Mr. Gustav Allgauer.
The Chairman. You do solemnly swear that the evidence given
before this Senate select committee shall be the truth, the whole
truth, and nothing but the truth, so help you God ?
Mr. Allgauer. I do.
TESTIMONY OF GUSTAV ALLGAUER
The Chairman. State your name, and your place of residence, and
your business or occupation.
^ Mr. Allgauer. My name is Gustav Allgauer, I reside at 6636 Leroy
m Lmcolnwood, 111.
The Chairman. Wliat is your business ?
Mr. Allgauer. I am president of the Allgauer, Inc. Allgauer,
Inc. consists of the Allgauer Restaurant, 6666 Ridge Avenue, and
Allgauer Fireside Restaurant, 7200 Lincoln Avenue, and that is burned
up- Allgauer's Heidelburg, 14 West Randolph Street.
The Chairman. Thank you, sir. Do you waive counsel, do you ?
Mr. Allgauer. Yes, sir.
Mr. Kennedy. Mr. Allgauer, you have operated the Allgauer's
Fireside Restaurant, and the Ridge Avenue Restaurant since 1951 ?
12949
12950 IMPROPER ACTIVITIES IN THE LABOR FIELD
Mr. Allgauee. We ran the restaurant since 1947.
Mr. Kennedy. And the Fireside since when?
Mr. Allgauer. 1951.
Mr. Kennedy. How long have you been in tlie restaurant business ?
Mr. Allgauer. Since 1937.
Mr. Kennedy. Was your family in it before that ?
Mr. Allgauer. I am the family.
Mr. Kennedy. You are the whole family ?
Mr. Allgauer. Yes, sir.
Mr. Kennedy. Now, in 1951, were you approached at the Fireside
Restaurant about having any of your employees join a union?
Mr. Allgauer. Yes, sir.
Mr. Kennedy. Could you tell us when that happened and what
conversations ensued?
Mr. Allgauer. Well, they came in and asked if I would like to
unionize the place and I said "Yes."
Mr. Kennedy. Who is it that came in to see you at that time ?
Mr. Allgauer. The business agent, the name of Lou Kouba.
Mr. Kennedy. He was a business agent for local 450 ?
Mr. Allgauer. That is right.
Mr. Kennedy. Of the Hotel and Restaurant Employees Union and
he came in and said he would like to organize your employees ?
Mr. Allgauer. Yes, sir.
Mr. Kennedy. And what was your response ?
Mr. Allgauer. I said to him "it is all right with me."
Mr. Kennedy. What happened then? Did you go around and
talk to the employees ?
Mr. Allgauer. He did, and they joined.
Mr. Kennedy. All of them joined?
Mr. Allgauer. At that time it was very small, and we started small.
Mr. Kennedy. How many employees did you have ?
Mr. Allgauer. I wouldn't know offhand, and I would say about
40 or 50.
Mr, Kennedy. Did you agree to put a certain number of your em-
ployees into the union?
Mr. Allgauer. No, I didn't. He could unionize anybody he wanted
to at that time.
Mr. Kennedy. What happened ? Did the employee submit a state-
ment that they wanted to join the union ?
Mr. Allgauer. No, no statement at all, and he went around and he
got so many in the union, and some he didn't get in, and we let that go.
Mr. Kennedy. Now, isn't it correct that you were the one that sub-
mitted the names, Mr. Allgauer?
Mr. Allgauer. No, I did not submit the names.
Mr. Kennedy. You didn't give him 18 or 20 names ?
Mr. Allgauer. Not in 1951. In 1952 I did.
Mr. Kennedy. Well, did the employees join up in 1951 ?
Mr. Allgauer. Yes, sir.
Mr. Kennedy. How long did they remain in the union ? Did they
come back and see you again in 1952 ?
Mr. Allgauer. Well, they came back eveiy so often and collected
dues themselves?
Mr. Kennedy. How did you submit the names in 1952, and what
brought that about?
IMPROPER ACTIVITIES IN THE LABOR FIELD 12951
Mr. Allgauer. Well, I imagine it must have been from the payroll
book that I gave them the names.
Mr. Kennedy. In 1952, they came back and asked for some names?
Mr. Allgauer. They asked for 20 names of the miscellaneous
workers.
Mr. Kennedy. Wliere would the miscellaneous workers be employed,
where about in your restaurant ?
Mr. Allgauer. That would be dishwashers mostly, and porters, and
things like that.
Mr. Kennedy. Who came in and asked for the 20 names ?
Mr. Allgauer. The same man, Mr. Kouba.
Mr. Kennedy. Did you then furnish him 20 names ?
Mr. Allgauer. Yes, and I talked with Chicago, and we did give
him 20 names.
Mr. Kennedy. You talked to those employees prior to furnishing
their names ?
Mr. Allgauer. I did not.
Mr. Kennedy. You just gave them the list of 20 names ?
Mr. Allgauer. Yes, sir.
Mr. Kennedy. How much money did you give him at that time ?
Mr. Allgauer. One-hundred and eighty dollars. We didn't have
20 names of these workers, and so I gave him 2 bakers, and a pantry-
man I have been told, and they held the cards from 1952.
Mr. Kennedy. You had to give him some other than miscellaneous
workers because you didn't have 20 workers in that category ?
Mr. Allgauer. At that time, that is right, they were there.
Mr. Kennedy. Did you have to bargain back and forth as to how
many people you would give, and had he wanted more originally ?
Mr. Allgauer. Originally they wanted more, but I got it down to
20.
Mr. Kennedy. Was he satisfied with 20 ?
Mr. Allgauer. He was satisfied then with 20.
Mr. Kennedy. And at that time, which was October 31, 1952, you
gave him $220, isn't that right? I think your records showed you
gave him $220.
Mr. Allgauer. That is right.
Mr. Kennedy. He had originally asked for how much money ?
Mr. Allgauer. Well, I think they wanted about $500 or some-
thing like that. I wouldn't want to make a statement because I am
not too sure but I know it was more.
Mr. Kennedy. And you finally were able to get him satisfied with
just $220 ?
Mr. Allgauer. That is right.
Mr. Kennedy. Well, did you ever make any kind of a contract with
the union at that time ?
Mr. Allgauer. In 1956, you mean ?
Mr. Kennedy. In 1952.
Mr. Allgauer. No contract.
Mr. Kennedy. Had you given him any money when he came before
that in 1951 ? 1952 was the first time ?
Mr. Allgauer. That is right.
Mr. Kennedy. Why did you give him money at that time, Mr.
Allgauer, and why did you make this payment to him ?
12952 IMPROPER ACTIVITIES IN THE LABOR FIELD
Mr. Allgatjer. In 1952, you mean ?
Mr. Kennedy. Yes.
Mr. Allgatjer. Well, they came in and they said that they don't
get enough money out of this place, and with all of the employees
we had, and I believe they said they had different places and the
same kind of arrangement as he offered me, and they were all going
along, and so I figured, well, in order to have peaceful and nice rela-
tions, $180 wasn't going to kill me.
Mr. Kennedy. Everybody else was going to do it, and you figured
you had better do it, too ?
Mr. Allgauer. That is right.
Mr. Kennedy. Did he mention anything about a picket line ?
Mr. Allgatjer. No.
Mr. Kennedy. He didn't mention a picket line ?
Mr. Allgatjer. No.
Mr. Kennedy. You just felt that everybody else was doing it and
you had better pay, too ?
Mr. Allgatjer. That is right.
Mr. Kennedy. You furnished him this list of 20 employees, and
did he ever come back to discuss wages and hours or conditions ?
Mr. Alixjatjer. Never, no.
Mr. Kennedy. Did you periodically make payments to him after
that?
Mr. Allgatjer. Every 3 months.
Mr. Kennedy. That would be about $180 every 3 months.
Mr. Allgauer. Until 1956.
Mr. Kennedy. The next payment according to your records was
$180 on June 30, 1953. Did you make any payments between October
31, 1952, and June 30, 1953 ? Did you give him any cash ?
Mr. Allgatjer. I never gave him cash, and I always paid by check.
Mr. Kennedy. Always by check ?
Mr. Allgatjer. Yes, sir.
Mr. Kennedy. And then on September 28, 1953, $180, and Decem-
ber 29, 1953, $180. June 4, 1954, $180. November 5, 1954, $180.
November 28, 1954, another $180. April 25, 1955, $180. September
15, 1955, $180. December 13, 1955, $180. June 29, 1956, $180.
Then did it go up after that, in 1956 ?
Mr. Allgatjer. To $210.
Mr. Kennedy. To $210?
Mr. Allgatjer. Yes, sir.
Mr. Kennedy. You paid them on November 21, 1956, you paid him
$210; is that right?
Mr. Allgatjer. That is right.
Mr. Kennedy. And you followed that procedure of paying him
$210 every 3 months up to the present time ?
Mr. Allgatjer. Up to the fire.
Mr. Kennedy. Now, you spoke also of having another restaurant,
the Allgauer's Eidge Avenue Kestaurant ?
Mr. Allgatjer. That is right.
Mr. Kennedy. Were you ever approached there about making pay-
ments to the union ?
Mr. Allgatjer. Yes, I was.
Mr. Kennedy. When was that?
IMPROPER ACTIVITIES IN THE LABOR FIELD 12953
Mr. Allgatier. I am not sure.
Mr. KJENNEDY. In 1953?
Mr. Allgauer. Yes, late in 1953.
Mr, Kennedy. How many employees did you have at the Ridge
Avenue Restaurant ?
Mr. Allgauer. They asked me for the miscellaneous workers.
Mr. Kennedy. They wanted the miscellaneous workers ?
Mr. Allgauer. And I put 8 of those in the union, and I gave them
8 names.
Mr. Kennedy. That was to local 593 ; is that right ?
Mr. Allgauer. That is right.
Mr. Kennedy. And was any contract signed with that local regard-
ing these employees ?
Mr. Allgauer. With these employees, no.
Mr. Kennedy. Was there ever any discussion of wages and hours
or conditions of employment ?
Mr. Allgauer. No.
Mr. Kennedy. The union official just wanted this payment and the
dues money or the initiation fees ?
Mr. Allgauer. We all like that.
Mr. Kennedy. That is what they wanted at that particular time ?
Mr. Allgauer. That is right.
Mr. Kennedy. There was never any discussion about the employees
themselves, as to the condition of their work ?
Mr. Allgauer. No.
Mr. Kennedy. How much money did you pay then to local 593 ?
Mr. Allgauer. I gave you the record, and I think it is $64.
Mr. Kennedy. I think it is $56.
Mr. Allgauer. Yes, sir.
Mr. Kennedy. On November 30, 1953, you first paid $56; is that
right?
Mr. Allgauer. That is right.
Mr. Kennedy. And then^January 1954, $56, and April of 1954, $56.
July 28, 1954, $56. September 1954, another $56, and in November
1954, $56.
February 3, 1955, $56. March 15, 1955, $56. May 1955, $56. July
1955, $56. September 1955, $56. November, $56. February, $56.
March 1956, $56, and May, $56.
You paid every 3 months.
Mr. Allgauer. Yes, sir.
Mr. Kennedy. Was there ever any benefit for your employees in
either the Allgauer's Fireside Restaurant, or in the Ridge Avenue
Restaurant because of these payments ?
Mr. Allgauer. I talked to Chicago, and they told me they had one
of those books at the Fireside Restaurant, and they were supposed to
get letters, and I couldn't tell you about that.
Mr. Kennedy. But the only benefit that you know of would be after
they died ?
Mr. Allgauer. That is right.
Mr. Kennedy. As far as their present employment or present wages
or hours or conditions, there was no benefit by joining the union?
Mr. Allgauer. Well, Mr. Kennedy, I do thmk if a man would have
been a cardholder and he would have gotten sick, he would have one
21243— 58— pt. 34 7
12954 IMPROPER ACTIVITIES IN THE LABOR FIELD
of those books, and they had to take him to the hospital, they might
have paid that, but I couldn't think of a case,
Mr. Kennedy. Did you inform the employees on whose names you
were paying these initiation fees and dues that they were actually
members of the union ?
Mr. Allgauer. We did that at the beginning when we got the
books. After we got the books in
Mr. Kennedy. When did you get the books ?
Mr. Allgauer. I think a month later or so.
Mr. Kennedy. Isn't it correct that you didn't inform them until
1956, some 3 years later ?
Mr, Allgauer. Something like that.
Mr. Kennedy. About 3 years later, and they didn't know during
that period ?
Mr. Allgauer. Most of them didn't.
Mr. Kennedy. And a number of them didn't know. We have a
deposition from one of the employees that you might want to read.
The Chairman. Do you have an employee named Walter H. Claas-
sen?
Mr. Allgauer. Yes, sir.
The Chairman. Where does he work ?
Mr. Allgauer. He was the manager of Fireside Restaurant.
The Chairman. Is that located at 7200 North Lincoln Avenue ?
Mr. Allgauer. Yes.
The Chairman. We have an affidavit from Mr. Claassen, and it
may be printed in the record in full at this point. I will read the
pertinent paragraphs of it.
(The document is as follows :)
I, Walter M. Claassen, who reside at ,510.5 More Avenue, Skokie, III., make the
following statement to James P. Kelly, who has identitied himself to me as a
member of the staff of the United States Senate Select Committee on Improi^er
Activities in the Labor or Management Field. I make this statement freely and
voluntarily, and I have received no promise of immunity from any consequences
which may result from the submission of this statement to the aforementioned
Senate select committee.
I have been employed as a manager at Allgauer's Restaurant, located at 7200
North Lincoln Avenue, Lincolnwood, 111., since 19r»l. Some time in June 1956 I
was visited by a representative o£ Suburban Local 450 of the Restaurant Workers
Union whom I knew at the time only by the name "Lou."
He asked me for the names of about 2{) employees who were working in the
kitchen at the time. When I asked the reason for this request he informed me
that Mr. Allgauer, my employer, was paying the union dues for approximately
this number of employees and that he, Lou, wanted their names so that he could
put them in the union. When I informed him that there might not be 20
employees working in the kitchen at that time he said, "O. K., just give me any
old names. The boss pays for it so they shouldn't worry as long as they get the
benefits."
I gave him the names of approximately 20 employees who were working there
at the time. I do not recall the names of all the employees I gave him in June
1956 since some of them are no longer employed here. On a subsequent date, Lou
gave me approximately 20 small black union dues books with the names, social
security numbers, and initiation dates of the employees whose names I furnished
him.
The only remaining dues book in my possession I showed to Committee Investi-
gator James P. Kelly on February 24, 1958, in my office. It contained the name
of Jack Kinney. SSX ,S49 10 3023, who left our employ about a year ago. I do not
know his present whereabouts. From time to time the other employees whose
IMPROPER ACTIVITIES IN THE LABOR FIELD 12955
books I kept in my desk would bother me about seeing their books with the dues
stamps in them. I finally gave them the books and told them to keep them.
To the best of my recollection there has been no contact between this union
representative "Lou" and any of the employees whose names I furnished him.
Walter M. Claassen.
Witness :
James P. Kelley.
Sworn and subscribed to before me this 4th day of March 1958.
( s ) Ethel Appel, Notary Public.
My commission expires November 12, 1960.
(At this point, Senator Curtis entered the hearing room.)
(At this point, the following members were present: Senators
McClellan and Church and Curtis.)
Does that affidavit state the facts so far as you know them ^
Mr. Allgauer. It is a little strong but it is all right.
The Chairjiaist. It is pretty strong i
Mr. Allgauer. Yes.
The Chairman. What is strong about it ?
Mr. Allgauer. I don't know if he said ''Give me any old name," I
I don't know if he said that or not. But I mean I did not hear it.
The Chairman. Is there anything in there that you know to bo
untrue ?
Mr. Allgauer. No, I imagine it is all right.
The Chairman. All right, proceed.
Mr. Kennedy. I want to ask Mr. Duffy, who made an examination
of the books and records of the union, a question, Mr. Chairman. It
would appear from this affidavit that although Mr. Allgauer fur-
nished the names in 1953, that these individuals were not in fact placed
in the union until 1956. I would like to ask Mr, Duffy if he has any
information regarding this matter.
The Chairman. Mr. Duffy, did you examine the books of these
unions ?
Mr. Duffy. Yes, Mr. Chairman.
The Chairman. All right, state what you found with reference to
these employees of the Allgauer Eestaurant.
Mr. Duffy. We examined the books of local 450, the suburban
local of Chicago, to determine if the 20 employees were actually put
in the union when Mr. Allgauer started paying his dues in 1952.
From an examination of those records, we do not find any indication
that those employees were actually put in the union until 1956, when
Mr. Claassen submitted the names of 20 employees and the books
were furnished.
The evidence indicates that the employees that were actually put
in the union in 1956, some of those were with you in 1952. On the
application cards, it indicates that those people were marked as being
initiated into the local in 1956. If they had actually been put in the
union in 1952, it would have been noted on their application cards,
which further indicates that they were not put into the union until
1956.
The Chairman. Mr. Duffy had been previously sworn and the state-
men?: has been made under oath.
M •. K.'^.nnedy. So this w^as, once again, a source of income or what
amounts to a shakedown?
12956 IMPROPER ACTIVITIES IN THE LABOR FIELD
Mr. Duffy. It seems to be that.
The Chairman. In other words, for about 3 years you were just
paying off and they did not have the name of any of your employees
or any record of it. Did you know that was going on?
Mr. Allgauer. I didn't know it for sure or not. I know it now.
The Chairman. You had a strong suspicion that is the way the
game was being operated, didn't you ?
Mr. Allgauer. Yes.
The Chairman. That is the way you felt about it?
Mr. Allgauer. Yes.
Mr. Kennedy. Just taking the names, of course, would not be suf-
ficient. That would perhaps give it a shade of legality, and that
existed after 1956. But prior to 1956, this was just a pure unadul-
terated shakedown.
The Chairman. They didn't even have the names prior to 1956.
There is no record, as I understand it.
Mr. Duffy. They apparently received the names, but there is no
indication in the union records that those people were actually put
into the union until 1956.
The Chairman. That is what I am talking about. The union rec-
ords do not reflect that a record was made of their entrance into the
union or that they were carried as members of the union.
Mr. Duffy. That is correct.
Senator Church. Mr. Allgauer, you have indicated that in 1952,
when you commenced to pay $180 at given intervals, that the purpose
for that payment, as far as you were concerned, was to buy peace, to
keep your restaurant out of troubles. Wasn't that the case?
Mr. Allgauer. I would say so.
Senator Church. Then in 1956, the price went up to $210. What
was the occasion for the rise in price ? Inflation ?
Mr. Allgauer. The dues went up. Inflation.
Senator Church. Inflation.
The Chairman. All right.
Senator Curtis. Mr. Chairman ?
The Chairman. Senator Curtis.
Senator Curtis. I would like to know whether or not we are deal-
ing with a minority situation in the Chicago restaurant business, or
whether or not there are restaurants in Chicago that are unionized by
nonracketeering unions. By a nonracketeering union, I mean other
than the kind we have been hearing about. I am referring to the
union that does represent the intentions and wishes of the people who
work in the establislunent and does not engage in any of this.
Do you know ?
Mr. Allgauer. Well, my Ridge Restaurant comes under local 25
downtown, a downtown local. But I would say this, that they have
operated, as I could see, 100 percent correct.
Senator Curtis. In other words, in your dealings with them, they
have shown no evidence of corruption. Is that what you are referring
to?
Mr. Allgauer. That is right, sir.
Mr. Kennedy. But, Mr. Allgauer, you are still making payoffs on
the Ridge Restaurant.
Mr. Allgauer. But they have names.
IMPROPER ACTrVITIES IN THE LABOR FIELD 12957
Mr. Ejennedy. Those employees don't know about it.
Mr. Allgauer. Yes ; they have the cards.
Mr. KJENNEDY. Out of the 8 employees, only 2 are still there. You
were paying at the time we went in and examined your records, in
answer to Senator Curtis, only 2 out of the 8 employees were working
for you.
Mr. Allgauer. My manager in Chicago, what operates and man-
ages the Ridge Restaurant, he claims they are exchanging names with
somebody that is not there any more.
Mr, Kennedy. At the time that we went in and examined your
records, you were paying on 6 out of the 8 people who were not even
employed at you restaurant. Again, it is just a shakedown, and it is
strictly forbidden by law. It is a criminal offense.
Senator Curtis. Even in that situation, in your downtown restau-
rant, the individual that you have to deal with is the union boss who
does not work in your restaurant ; isn't that correct ?
Mr. Allgauer, That is correct.
Senator Curtis. I think there is something here that we must keep
in mind always, that the right to organize and bargain collectively is
a right that belongs to the workers. It is not a right that belongs to
the union, it is not a right that belongs to the union bosses. It is an
inherent right in employees. These outside racketeers, in my opinion,
have no rights, because they are not employees, and they are not chosen
representatives of employees,
I would like to ask the staff : Are there any restaurant unions in
the Chicago area that have not engaged in the gross misconduct that
we have been hearing here ?
Mr. Kennedy. I am sure there must be some. Senator.
Senator Curtis. Wliat I mean, is it a citywide problem, pretty
much ?
Mr. Kennedy. It is a citywide problem. I am sure there are some
that are perfectly run and that are not making these kinds of pay-
offs or forced to make these kinds of payoffs. I don't believe we found
any, but I am sure that there are some. Of course, we have not gone
into all of the local unions. Senator.
Senator Curtis. I miderstand that. I think that creates a real
problem. Here there might be an individual who is trained and ex-
perienced and wants to start a restaurant in the Chicago area.
He is faced at the start with whether he must either make his
peace and pay the tribute to an unlawful combine that does not
rej)resent employees or go through all the trouble of fire, harassment,
strikes, pickets, and secondary boycotts. I think it is a very serious
situation.
That is all, Mr. Chairman.
Mr. Kennedy. Senator, so that we get a correct perspective, we
had a relatively small staff. There are thousands of restaurants and
a number of different unions in Chicago. Of course, we could not go
into every one of them or make an examination of the books and
records of every local in Chicago. So our sampling is relatively
minor.
Senator Curtis. How long have you lived in Chicago ?
Mr. Allgauer. Since 1927.
12958 IMPROPER ACTIVITIES IN THE LABOR FIELD
Senator Curtis. How long have you been in the restaurant busi-
ness?
Mr. Allgauer. 1937.
Senator Curtis. 19 — when ?
Mr. Allgauer. 1937.
Senator Curtis. In your visiting around with other restaurant
owners, are they all pretty much faced with the same problem you
are, so far as unions are concerned ?
Mr. Allgauer. I don't go around to different restaurant owners.
Senator Curtis. You couldn't have any friends among them?
Mr. Allgauer. Yes ; I have a lot of friends.
Senator Curtis. That is what I mean, among your friends in the
restaurant business, has their experience with unions been maybe not
as severe but in dealing with them
Mr. Allgauer. It is about the same thing.
Senator Curtis. That is what I want to know. That is all.
. Mr. Kennedy. Mr. Chairman, I would like to ask Mr. Gotsch
about the situation as far as the number of employees in the res-
taurant.
The Chairman. Mr. Gotsch has been previously sworn. You may
make your statement, Mr. Gotsch.
Mr. Kennedy. First, Mr. Gotsch, regarding the Fireside Res-
taurant, did you examine the list of those on whom Mr. Allgauer is
paying this money ?
Mr. Gotsch. That is coiTect.
Mr. Kennedy. The names on whom IVIr. xlllgauer is paying the
money ?
Mr. Gotsch. Yes.
Mr. Kennedy. How many is he paying on ?
Mr. Gotsch. Approximately 20.
Mr. Kennedy. How many are still employed ?
Mr. Gotsch. I could only find 6 — 3 cooks and 3 miscellaneous
workers.
Mr. Kennedy. And the cooks do not belong in that union anyway ?
Mr. Gotsch. That is right. They should belong to the Cooks'
Union instead of the miscellaneous.
Mr. Kennedy. But out of the 20 on whose names the dues are be-
ing paid, there are only 6 that are still emjjloyed there, is that right?
Mr. Gotsch. That is right.
Mr. Kennedy. Mr. Allgauer has other employees in the restaurant
who are members of other unions, is that right ?
Mr. Gotsch. That is correct.
Mr. Kennedy. And they are paying the dues themselves?
Mr. Gotsch. That is right.
Mr. Kennedy. That is a proper procedure in that restaurant as far
as these employees paying their own dues, is that right ?
Mr. Gotsch. That is correct.
Mr. Kennedy. Could you tell us what the situation is as far as
whether the union is enforcing the contracts or is insuring that the
employees are being paid union scale ?
Mr. Gotsch. Well, there is a total of 149 employees at the Fireside
Restaurant, 73 are union. Of that 73, 56 are paid below union scale.
Mr. Kennedy. Would you give me that again, please ?
IMPROPER ACTIVITIES IN THE LABOR FIELD 12959
Mr. GoTSCH. Of the 149 employees at the Fireside Restaurant, 73
are union.
Mr, Allgauer. I have here a letter before me from my secretary
that came yesterday; 150 employees, 83 employees which are actual
union members.
Mr. Kennedy. I don't think there is much difference in the figure.
Mr. Allgauer. It is 83.
Mr. Kennedy. What time was this ?
Mr. GoTScii. This is the March payroll.
Mr. Allgaltir. This is the March 30.
The Chairman. What does the March payroll show ?
Let's ji'et that in the record and if you have later information on it,
we will take that.
What does the March record show with respect to the employees ?
Mr. GoTSCH. As I said before, in the restaurant categories, and it
does not include musicians, it is 149 employees, and 73 are union and
76 are nonunion ; 56 union employees are paid below scale.
The Chairman. How many ?
Mr. GoTSCH. Fifty-six. A majority of those. Senator, are wait-
resses.
The Chairman. Fifty-six of the seventy-three are paid below union
scale ?
Mr. GoTSCH. That is correct.
Mr. Kennedy. How many of the 76 nonunion are paid below union
scale ? Do you have that figure ?
Mr. GoTscH. Yes ; I do. Thirty-five.
Mr, Kennedy. So percentagewise you are doing better if you are
not a member of the union as far as getting union scale ?
Mr. GoTSCH, According to these figures.
The Chairman, What does your letter show as of now ?
How many employees do you have now ?
Mr, Allgauer, It shows here I have 150 employees; 83 employees
which are actual union members.
The Chairman. 83 are union members ?
Mr, Allgauer. Yes,
The Chairman, Do you have any further information ?
Mr, Allgauer, No, not right now. We will come to it after a while.
Mr, Kennedy, Do you know how many of those are paid below
union scale ?
Mr, Allgauer, I haven't got that in there.
Mr, Kennedy. Do you know what the union scale is ?
Mr, Allgauer. 67 cents,
Mr, Kennedy, Do you know for all your employees ?
Mr, Allgauer, I know that since last Friday, I did not know when
Heft,
Mr, Kennedy, You did not know until you arrived here ?
Mr. Allgauer. Until I left Chicago. My headwaiter that works
for me now from the Heidelberg downtown, I said, "We always pay
union scale, don't we?" And he said, "No, Mr. Allgauer, we are off a
little bit."
I think it is 6 cents an hour, is that right ?
Mr. Kennedy, Doesn't the union representative ever speak to you ?
Mr, Allgauer. Never in my life, no, sir.
12960 IMPROPER ACTIVITIES IN THE LABOR FIELD
Mr. Kennedy. Of any of the employees, they never speak to you
about it ?
Mr. Allgauer. No, sir.
Senator Church. In other words, you found out what the union
scale was when you left Chicago Friday to come here to Washington ?
Mr. Allgauer. That is right.
Mr. Kennedy. Could you tell us at the Allgauer Restaurant what
the cost would be to Mr. Allgauer if he had to pay union scale ?
Mr. GoTscii. If he was paying union scale to the people paid below
union scale at the Fireside would be $14,700.
Mr. Kennedy. He would have to pay $14,700 more if he was paying
union scale ?
Mr. GoTSCH. That is correct.
Mr. Kennedy. Was that on all the employees ?
Mr. GoTSCH. That is on all the employees.
Mr. Kennedy. That would be on the ones who are nonunion as
well as the ones wdio are union ?
Mr. GoTSCH. That is correct.
Mr. Kennedy. On the 56 who are union as well as the others ?
Mr. GoTSCH. As well as the 35.
Mr. Allgauer. May I talk to Mr. Gotsch for a while? Is it all
right with you ?
The Chairman. You may make any statement or ask any questions
for information, if you desire.
Mr. Allgauer. Thank you, sir.
You are talking right now about I would save $14,000 a year. I
have paid above union wages and union wages until up to 2 years
ago. As long as you are so handy with figures, do me a personal
favor, I am not. Will you mark down what I tell you, please ? Start-
ing 1952, starting 1951, until up to now, I paid every year a bonus at
Christmas time amounting to an average of $33,000 a year.
The Chairman. Amounting to what ?
Mr. Allgauer. An average of $33,000.
The Chairman. An average of $33,000 a year.
Mr. Allgauer. Yes ; that is right.
The Chairman. You have paid that in bonuses ?
Mr. Allgauer. In bonuses.
The Chairman. To your employees ?
Mr. Allgauer. Yes, sir, to my employees. As I said, I paid union
wages and above until 2 years ago.
The Chairman. Until 2 years ago ?
Mr. Allgauer. Yes, sir.
The Chairman. You paid union wages ?
Mr. Allgauer. And above. And above.
The Chairman. How do you know you were if you didn't know
what union scale was? I thought you didn't find out until last
Friday.
Mr. Allgauer. But I checked it up until 2 years ago. That is
what happened up until 2 years ago. I am under oath, and my
statements are correct.
The Chairman. We want to get the record correct, but I had
understood you to say that you did not know what union scale was
until last Friday.
IMPROPER ACTIVITIES IN THE LABOR FIELD 12961
Mr. Allgauer. In 1951, I took out a group insurance for all of
the employees what were in my employ for 6 months. After 6
months they were entitled to that group insurance. The insurance
was taken
The Chairman. That is something that you set up for them your-
self?
Mr. Allgauer. Yes, sir. The group insurance was taken out from
John Hancock.
The Chairman. Their situation in that respect has not been im-
proved any by reason of the fact that they have been put in the union.
Mr. Allgauer. During the time
The Chairman. The union did not require you to do that for them?
Mr. Allgauer. No, sir, that was my own free will.
The Chairman. You did it yourself ?
Mr. Allgauer. Yes, sir.
The Chairman. And the union has not undertaken to bargain
with you at any time with respect to their wages or working con-
ditions ? The union has never come in and said "Look, here, we want
to look over your situation, how you are treating your employees,
to see that you are doing the right thing for them," and the union
has never done that, have they ?
Mr. Allgauer. Not 450.
The Chairman. Not local 450. Wliat are some of the other locals
where you have some of your men ?
Mr. Allgauer. Local 25.
The Chairman. Local 25 ?
Mr. Allgauer. Yes, sir, a Chicago local.
The Chairman. Have we investigated local 25? Well, we don't
have that. What about 593 and 450 ? Has 593, any of its representa-
tives, ever interested themselves in your wages or working conditions
of your employees ?
Mr. Allgauer. No, sir.
The Chairman. Have you ever signed a contract with 593 ?
Mr. Allgauer. No, sir.
The CHAmMAN. Or with 450 ?
Mr. Allgauer. No.
The Chairman. Have they ever undertaken to negotiate a contract
with you ?
Mr. Allgauer. I don't think they have.
The Chairman. In other words,' they have not been concerned about
anything except getting the money ?
Mr. Allgauer. No, sir.
The Chairman. Am I correct ?
Mr. Allgauer. You are correct.
The Chairman. Do you know of anything they have been con-
cerned about except getting the money ?
Mr. Allgauer. That is about it.
The Chairman. That is about it.
Senator Curtis. Mr. Chairman ?
The Chairman. Senator Curtis.
Mr. Allgauer. But I would like to counteract this case. I mean,
I am here. I had enough trouble in the last 2 months and enough
12962 IMPROPER ACTIVITIES IN THE LABOR FIELD
damage was done to me and I don't take any home from here, as long
as I am in the right. It is just like you said about the $14,000 here.
I mean, I have a right to do that, haven't I ?
The Chairman. You have.
Senator Curtis. I think you have.
Mr. Allgauer. All right, sir.
Mr. Kennedy. Mr. Allgauer, one of the major points is that these
people are employed there and the union is supposed to endorse that.
The union did not see fit to. Maybe their wage scale is all wrong,
maybe it shoidd be different for each restaurant. I don't know that.
But this is what the figures show. That is all we are putting into the
record. On each restaurant owner we have made an examination of
the books and records and some of them are paying union scale and
some are not. It is only fair that we put the figures into the record
and you make any explanation you want.
The Chairman. Let the Chair- point out this : It may not be any
reflection on you whatsoever. The reflection here is upon a union that
pretends to i-epresent the interests and welfare of the workers, who
show no interest, have no regard for their welfare, and are only con-
cerned with a shakedown that gets money.
The reflection primarily is on the union.
Mr. Allgauer. Yes, sir. Senator, but I am on television.
The Chairman. You are what ?
Mr.ALLGALTSR. I am on television.
The Chairman. All right, take advantage of it.
Mr. Allgauer. And I got thousands of people in Cliicago, in the
great city I come from, that is my friends. I like them to know it,
too.
The Chairman. All right.
Mr. Kennedy. Go ahead.
Mr. Allgauer. As I said, I took the John Hancock insurance out
for all those employees that worked there for over 6 months. I
changed that around 4 j^ears later to the Prudential. In those years,
we paid out in sick benefits, when girls got sick and boys got sick,
over $20,000. We just paid out not long ago for one man that died,
and his wife got $1,500. One man lost his leg, with liospitalization and
everything, that must have run $15 or $1,800. But I always seen to
it that my employees who were steady employees were in every way
100 percent got their benefits as they are supposed to have them if they
get sick or something should happen to them.
The Chairman. In that connection now, since they are in the union,
some of them, they have received no additional benefits in any way by
reason of the fact that they are in the union.
Mr. Allgauer. Yes, 2 years ago I took out a health and welfare
fund from the union, and I am paying now the health and welfare
fund.
Besides that, as of March 30, 1 still carry 28 of my employees under
Prudential from my Ridge Avenue Restaurant, and I still carry 42
on the Prudential from the Fireside Restaurant as of March 30.
The Chairman. What I am trying to clarify is whether you did that
of your own initiative because you wanted them to have it, or whether
the union required you to do it. Which ?
IMPROPER ACTIVITIES IN THE LABOR FIELD 12963
Mr. Allgauek. No, we signed a contract on the health and welfare
2 years ago.
The Chairman. You signed a contract on the health and welfare 2
years ago ?
Mr. Allgauer. Yes, sir.
The Chairman. Did you do that of your own volition or did the
union require you to do it?
Mr. Allgauer. No, that was an agreement with all the union
operators.
The Chairman. You came in with all the union operators ?
Mr. Allgauer. Definitely.
The Chairman. In other words, you would not have done that ex-
cept for the fact that the union required you to do it ?
Mr. Allgauer. Well, we were a group of 60 to 70 union operators
at the meeting, and there was a group in there that would rather strike
than go into it, and there was another group in there that rather would
not strike and accept it. I was one of the group who did not want to
strike and I accepted the health and welfare.
Tlie Chairman. In other words, you were threatened with a strike ?
Mr. Allgauer. No. One of our own — we had two groups. Half
of the group, about half, were for a strike, that we strike, rather than
take the health and welfare. The union did not threaten us with a
strike at all. But I was for the health and welfare. So we won out
and we got the health and welfare.
The Chairman. I still don't know. I still don't know whether some
of your employees now have the benefit of the health and welfare fund
by reason of the fact that they are in the union or by reason of the fact
that you wanted to make that arrangement for them of your own voli-
tion.
Mr. Allgauer. They are sending a statement out every 6 months
from the health and welfare. There are, I think, two restaurant oper-
ators on the board, and this thing is on the up and up.
The Chairman. Are all of your employees in the health and wel-
fare funds ?
Mr. Allgauer. All my union employees are in the health and wel-
fare.
The Chairman. Then are you carrying health and welfare on a lot
of people not working for you ?
Apparently you are paying dues here on people not working for
you.
Mr. Allgauer. No, Senator, those 20 names are not on there. Every-
body else is.
The Chairman. I can't understand. Am I correct that some of
the people that he has been paying on are not even working for him ?
Mr. Kennedy. That is correct.
The Chairman. Are you paying health and welfare dues on them ?
Mr. Allgauer. No, I don't.
The Chairman. Do you have a separate list that you pay on ?
Mr. Allgauer. Those 20 names that I submitted, and those 20
books, on those 20 books we don't pay no health and welfare.
The Chairman. You don't pay no health and welfare ?
Mr. Allgauer. Not on those 20 books.
12964 IMPROPER ACTIVITIES IK THE LABOR FIELD
The Chairman. Wliere is the list of names of those that you do
pay on, if it is not the same list ?
Mr. Allgatjer. Well, we got the regular — we got our payroll book.
The Chairman. You may have it. You may be paying welfare
fund. I am not arguing about it, except I am trying to determine
whether it is a result of their being in the union.
Mr, Allgauer. In every place I have a shop steward.
Mr. Kennedy. Maybe I can try to clear it up. He has some em-
ployees who are legitimately members of unions, who pay their own
dues. Then there is this other arrangement regarding the miscellane-
ous workers in a union that has been under study by this committee,
local 593, where they have just taken 20 names and stuck them in and
he has made the periodic payment. On the people who are mem-
bers of unions legitimately, who actually pay their own dues, those
people have the health and welfare.
Is that right, Mr. Allgauer ?
Mr. Allgauer. Yes, sir.
Mr. Kennedy. But the ones where he selected the 20 names in one
instance and 8 names in the other restaurant, there is not health and
welfare for those.
So they are not getting that from local 593. As you point out,
some of those people are not still working.
Senator Church. Mr. Allgauer, I wonder if I might summarize
this. Tell me if I am wrong, because I want to understand your
testimony. In the first place, let me emphasize that this committee is
not endeavoring in any way to show that you have not been entirely
fair with your employees. You may be a very generous employer.
The purpose of this inquiry is to determine whether or not the
unions that 3'ou are paying dues to on behalf of certain lists of em-
ployees are, in fact, representing those employees or are merely in-
volved in a shakedown racket.
Did I understand you to say that between 1951 and up until 2 years
ago, that you paid your employees generally at or above union scale
by virtue of Christmas bonuses that you gave and these Christmas
bonuses aggregated approximately $33,000 a year ?
Mr. Allgauer. Yes, sir.
Senator Church. And in addition, was it during this same period —
that is, from 1951 up until 2 years ago — that you also provided in-
surance including sick benefits, and that over $20,000 was paid out to
your employees under the sick benefits ?
Mr. Allgauer. That is correct, sir.
Senator Church. And then about 2 years ago you entered into
an arrangement with the union involving those employees that are
actually paying dues on their own, which gives those employees the
health and welfare benefits of the union program ?
Mr. Allgauer. That is correct, sir.
Senator Church. But, in addition, you continue to maintain cer-
tain insurance coverage for other employees that are not covered by
the health and wejf are ?
Mr. Allgauer. Some of those are covered by health and welfare
and some are not.
Senator Church. And some are not. Do you continue or have you
continued, since making the health and welfare arrangement with
IMPROPER ACTIVITIES IN THE LABOR FIELD 12965
the union some 2 years ago, any other insurance program for employ-
ees who are not covered under the health and welfare arrangement?
Mr. Allgauer. I have.
Senator Church. I thought this ought to be brought out merely
to emphasize, because you are on television, and I suppose that a great
many people in Chicago are watching. I think it ought to be made
clear that the purpose of this committee is not to indict you for unfair
practice with respect to your employees; what we are interested in
is determining the kind of union representation these employees are
getting and the kind of practices that certain locals are engaged in
with respect to restaurants in Chicago.
Mr. Allgauer. I myself do not believe that every restaurant should
have the same contract. Now I will just give you a picture why,
I saw yesterday, I was here at this session — I had nothing else to
do so I spent a little time here, and I saw different operators. I show
you the scope of my operation. I have 6,800 of my own charge ac-
counts out. I got an IBM machine in my office to cope with them.
People come in my place, they sign, a lot of them. When they sign,
the waitress gets a pretty good tip, usually — I think better than the
average restaurant. Wlien they put the tip right on tlie check, we
pay it out and we wait for the money. It is entirely a different opera-
tion than most other operations. So a waitress in my place does a
darn sight better than she does in most places.
Senator Church. Other restaurant owners have also pointed out
the differences between the restaurants and the different compensations
that waitresses obtain by virtue of the kind of business being done
in different restaurants.
Mr. Allgauer. Mr. Gotsch was in my place in Chicago. Mr.
Gotsch, did you have food there ? Did you eat ?
Mr. Gotsch. No ; I did not.
Mr. Allgauer. Mr. Duffy, you ate there, didn't you ?
Mr. Duffy. It is very line food.
Mr. Allgauer. Mr. Duffy, how about the surroundings ?
Mr. Duffy. I beg your pardon ?
Mr. Allgauer. How were the surroundings ?
Mr. Duffy. It is a very beautiful restaurant.
Mr. Allgauer. And the service ?
Mr. Duffy. It was a beautiful restaurant.
Mr. Allgauer. It was. Thank you. Don't you think in a place
like this, Mr. Duffy, you tip an extra 10 cents ?
Mr. Duffy. I think your are right. I would, _
Mr. Allgauer. You would. You did. That is fine.
Senator Curtis. Mr. Chairman ?
The Chairman. Senator Curtis.
Senator Curtis. I think there are a number of things about your
operation that indicate your fairness to your employees. This bonus,
do you usually pay that at Christmastime ?
Mr. Allgauer. Yes, sir.
Senator Curtis. And does it reach all classes of employees? I
presume there are people that come to a restaurant and they want to
work and work a few days and then they go on and no one knows
where they are. But I am referring to those people who come and
seek work and perform their work satisfactorily and continue on and
12966 IMPROPER ACTIVITIES IN THE LABOR FIELD
stay with the job. All of such people have a chance to share in the
bonus, do they ?
Mr. Allgauer. Yes, sir; we give bonuses to dishwashers, if they
are steady. We even pay dishwashers vacations when they are steady.
Senator Curtis. And the same is true of the group insurance that
you provide ?
Mr. Allgauer. That is definite.
Senator Curtis. In other words, if the employee continues on and
does satisfactory work, he has been entitled to share in these things?
Mr. Allgauer. Absolutely.
Senator Curtis. And that is true of the sick benefits also ?
Mr. Allgauer. Yes, sir.
Senator Curtis. Now, I want to ask you this : Has anybody been
paid any benefits out of the union health and welfare fund ?
Mr. Allgauer. Yes.
Senator Curtis. Have any of the workers gotten any benefits ?
Mr. Allgauer. Definitely.
Senator Curtis. They have ?
Mr. Allgauer. Yes, sir.
Senator Curtis. Does management have anything to do with the
handling of those funds that are paid in ?
Mr. Allgauer. The management is on the board, also.
Senator Curtis. It is a joint board ?
Mr. Allgauer. Definitely.
Senator Curtis. I agree with you that it cannot be said that a
failure to pay an alleged union scale means a saving of a certain
amount of money, so many thousand dollars, 14 or anything else, be-
cause there may be other forms of pay that offset that, such as bonuses,
sick benefits, and group insurance. Do you happen to know whetlier
this insurance is such that, if one of your employees is under it for
several years and would move away, they can convert their policy into
something?
Can they ? Do you know that ?
Mr. Allgauer. I don't think so. They can take it out. When they
come back to Chicago, they get reendorsed.
Senator Curtis. And there are other situations where an estab-
lished wage scale is absolutely endorsed and it may result in fewer
employees. Not always, but sometimes you have that situation.
I tlioroughly agree with you that it cannot be said that tlie failure
to adhere to a schedule which obviously is one designed for all res-
taurants can mean a saving in all cases. It might in some cases, but
not in all.
The Chairman. Proceed, Mr. Kennedy.
Mr. Kennedy. Did you also make an examination, Mr. Gotsch, of
the other restaurant, the Ridge Restaurant ?
Mr. GoTSCH. I did, sir.
Mr. Kennedy. Will you tell us how much more Mr. Allgauer would
have to pay if the union enforced its wage scale there?
Mr. GoTSCH. $5,600 annually.
Mr. Kennedy. How many employees are there?
Mr. Gotsch. This involves 70 employees at his Ridge Restaurant.
It is a little smaller.
IMPROPER ACTIVITIES IN THE LABOR FIELD 12967
Mr. Kennedy. How many are union and how many nonunion ?
Mr. GoTSCH. There are 47 union members, of whom 4 are paid
below union scale, and 23 nonunion, of wliom 14 are paid below scale.
Mr. Kennedy. Of the eight that Mr. Allgauer is paying these dues
on, or paying this money for, how many were working there at the
time you made your examination ?
Mr. GoTSCH. Two.
Mr. Kennedy. Mr. Chairman, once again, considering that this is
a union contract and if it was enforced, it can be used against some
employers where the union scale is enforced, and, of course, that gives
a competitive advantage over another restaurant where the union
scale is not enforced.
Possibly the union should change its way of operation. This is the
way it operates. These are the wages where a union contract exists,
where the union is supposed to be bargaining for the employer. These
are the wages that are supposed to be enforced. This is a differential
at these two restaurants of approximately $19,000.
The Chairman. I think it has been clearly shown with respect to
these unions, two, particularly — 450 and 593 — that they are just un-
ions in name. That is about all. So far as their having a legitimate
operation of trying to actually serve those whom they presumably
represent, I don't think they have any interest in it at all. I think
their charter and whole proceeding is just a shield for a shakedown
operation.
I can well understand, and I think it can hardly be controverted,
that different situations prevail in different restaurants. One may
cater to a very extravagant trade.
Mr. Allgalter. You would like my restaurant, Senator.
Tlie Chairman. Just a moment. And another may be serving a
clientele that is not able to eat expensive food and pay large tips and
so forth. There have to be adjustments. I don't think just a flat wage
scale all across the board necessarily would be fair to the employees
as well as unfair to the employers. But the point here that stands
out like a sore thumb is that you have an operation here under the
guise of unions that is nothing in the world but a racket. That is the
way I see it. It is no reflection, necessarily, upon the employers, but
I think you do commit an illegal act when you place people in a union
without their consent.
I can appreciate sometimes small business people and maybe large
business people, too, are coerced and intimidated into doing that, with
a view of either they must submit to the demands of these racketeers,
or else their business will be injured by picket line or otherwise. It is
a serious problem in this country. I think it is a growing problem.
I think it is becoming more of a menace to our society and to our
economy all the time, when people under the guise of representing
unions or under the guise of representing a business association can
extort money under threat or under coercion from what would nor-
mally be legitimate business.
Here they seem to have a racket going around, getting as many as
they can in management to sign up, for as many as they can get of the
employees, and let him pay off, and that is all they want.
I think the reflection primarily is upon that sort of unionism.
12968 IMPROPER ACTIVITIES IN THE LABOR FIELD
I know that this is not a reflection upon the employees themselves.
They are good, honest people, they are working and most of them
don't even know, apparently, they are in a union. I think their rights
are being encroached upon, because I think a worker should have a
right to say for himself whether he joins a union, and if he joins what
union he would prefer to join. In this way, he has no chance, he has
no say-so about it, and does not even know about it. Even the man-
ager, the proprietor, the owner of the business, may be good to his
employe-es, maybe trying to give them the best wages he can and give
them other benefits insofar as his business will afford it, still there is
a racket that becomes an imposition and a burden upon the economy
of this country.
That is what we are seeking to ferret out here and find ways to
stop it.
(At this point. Senator Curtis withdrew from the hearing room. )
Mr. Kennedy. Mr. Allgauer, you had a fire at your restaurant,
did you ?
Mr. Allgauer, Tliat, yes, sir.
Mr. Kennedy. That was at the Fireside Restaurant?
Mr. Allgauer. Yes, sir.
Mr. Kennedy. What was the date of the fire ?
Mr. Allgauer. May 13.
Mr. Ivennedy, What was the loss in the fire, monetarily? How
much was it worth ?
Mr. Allgauer. Well, I would say to rebuild the place would cost —
the wav it has been — would cost about $1,400,000.
Mr. Kennedy. $1,400,000?
Mr. Allgauer. One million four to one million and a half.
Mr. Kennedy. Were you present at the time the fire started ?
Mr. Allgauer. No ; I was not. I was sleeping.
Mr. Kennedy. Could you tell the committee what happened ?
Mr. Allgauer. I received a telephone call from the police that there
is a fire, so that is it, and by the time we got there — I only live 5 min-
utes away from there — by the time we got there the whole place was
in flames.
(At this point. Senator Gold water entered the hearing room.)
Mr. Kennedy. How had the fire started ?
Mr. Allgauer. Sir?
Mr. Kennedy. How had the fire started?
Mr. Allgauer. Well, I wasn't there. I got a man here who was
there. He could tell you more about it.
Mr. Kennedy. Could we have him here, Mr. Chairman ?
The Chairman. Who was the man you referred to ?
Mr. Allgauer. Mr. Milas.
The Chairman. Mr. Milas, come forward, please. Be sworn. Do
you solemnly swear the evidence you shall give before this Senate
select committee shall be the truth, the whole truth, and nothing but
the truth, so help you God ?
Mr. Milas. Yes.
TESTIMONY OF ANDREW MILAS
The Chairman. State your name, your place of residence, and your
business or employment.
IMPROPER ACTIVITIES IN THE LABOR FIELD 12969
Mr. MiLAS. Andrew Milas, 5056 Carmen, Chicago, 111. ; night stew-
ard in Allgauer's Restaurant.
The Chairman. Night steward ?
Mr. Milas. Steward ; yes, sir.
The Chairman. Do you waive counsel ?
Mr. Milas. Yes, sir.
The Chairman. All right, Mr. Kennedy.
Mr. Kennedy. That is M-i-1-a-s ; is that how you spell your name ?
Mr. MiLAS. That is right.
Mr. Kennedy. Mr. Milas, you come to work at what time in the
evenino:
Mr. Milas. 12 o'clock, midnight.
Mr. Kennedy. What time ?
Mr. Milas. 12 midnight.
Mr. Kennedy. And then you clean the restaurant up ; do you ?
Mr. Milas. No ; I don't clean.
Mr. Kennedy. Well, you have people under you ?
Mr. Milas. No; the boys don't start to work until 12:30 but they
get there at 12 o'clock so they have something to eat before they start.
Mr. Kennedy. Then it is arranged to put the restaurant in order
for the following day ?
Mr. Milas. That is right.
Mr. Kennedy. And you are in charge of that, are you ?
Mr. Milas. Right.
Mr. Kennedy. You were there on the evening of May 12, the morn-
ing of May 13, is that right ?
Mr. Milas. May 13.
Mr. Kennedy. And how many people did you have with you at
that time i
Mr. Milas. Well, there was six that night.
Mr. Kennedy. And you had had something to eat and were working
in the restaurant arranging to have it cleaned up ?
Mr. Milas. Yes. Well, there is some work in the kitchen. Wher-
ever they can work until the restaurant closes. That is generally
1 o'clock during the week.
Mr. Kennedy. Do you lock up while you are doing this work ?
Mr. Milas. We don't lock up until everybody is out.
Mr. Kennedy. Well, when everybody is out.
Mr. Milas. Well, I don't lock up, I stay by the door and see that
everybody is out when I lock up.
MV. Kennedy. Well, this is 1 o'clock or after. On the night of
May 12, and the morning of May 13, had you locked the restaurant up ?
Had you locked the various doors ^
Mr. Milas. That is right, they were all locked.
Mr. Kennedy. Could you tell us what happened as far as anything
out of the ordinary that evening ?
Mr. Milas. Well, we closed up, I closed the back door up, and I left
the captains, the bartenders and checkers went out the front door and
I closed the front door. Then I had one man out that takes the em-
ployees to the Howard Avenue "el" station because there is no trans-
portation after 11 o'clock. I waited for him to come back, to open up
so he could get in. When I seen the station wagon come back, I opened
up for him, he came in, I closed the door, and he was a maintenance
21243 — 58— pt. 34 8
12970 IMPROPER ACTIVITIES IN THE LABOR FIELD
man and had to do a toilet upstairs in the hidies' room, it was out of
order. He went up there to fix it. I went into the dining room. There
was some dust in the ceiling there, and I put some sheets over the
flowers so they wouldn't get dusty while we was using the vacuum
cleaner. I went and got the vacuum cleaner, put water in it, came
back, put the plug in, I moved a couple of tables, and then I went on
top of a chair and started vacuuming the ceiling. It was only a small
spot. I had only been up there a half minute or a minute, and I seen
a fellow down there. I looked and he had a gun in liis hand. He
said "Get down from there." So I got down. He told me to go down
the aisle. I went down the aisle and in front of me he had two other
men, and they sent us to the back of the restaurant, toward the kitchen
part and told us to lay on the floor. They said "How many men you
got here?" I said, "There are seven of us altogether.-' He said "Are
you sure there are seven ?" And I said "Yes." He said "Where are the
other three ? "
In the meantime they got the other fellow on a vacuum cleaner,
Ralph, that was 4 of us, and they w^ent in the kitchen and got 3 of
them, and that was 7 of us there. They held us for about 10 minutes.
They said, "We are not going to hurt you guys." We didn't say
nothing. Then they said, "Get up." We got up and they took us
into the checker's desk, right off the dining room, about 20 feet.
Mr. Kennedt. How many of them were there ?
Mr. MiLAS. Two that we seen at the time.
Mr. Kennedy. And they both had guns ?
My. Milas. Yes, and they put us in the checker's desk, and that is
as big as this table here and they put seven men in there, and we were
all sitting down in there. They held us in there for about 10 minutes,
and all of a sudden one fellow mentioned my name. He said, "Who
is Andy?" And I said, "Right here," and he said, "Come with me."
So I went with him, and he took me in the good dining room, and
he said "Open up that side door." Well, I said, "I don't know. That
side door hasn't been opened for over a year and we remodeled it last
year and I don't know if it was opened or not."
So our front-door key and our side-door key are on one chain, and
I put the key in and it fit, and he said, "That is enough," and I left
the key right in the lock and I went back with him then, and we stayed
there about 5 or 6 minutes and they took us to the little maintenance
room. They kept us there about 10 or 15 minutes and then they took
us from there and took us into 2 men's rooms, and they put 4 in one and
3 of us in the other, and they held us there for about 15 minutes.
Then they gave us some instructions, and they said, "Now you
fellows, when we get out of here, we are going to take you outside, and
we are going to put you against the wall there," and he said, "When
our automobile goes, you guys run north."
So we stood around for awhile and they finally called us over, and
instead of taking us directly to the outside they took us to the New
England Room, and they held us there for about approximately 5
or 10 minutes.
That is when I was smelling gasoline or some chemical anyway it
was.
They said, "All right," and we went outside and lined us against the
wall, and we stood there waiting for that machine to go.
IMPROPER ACTIVITIES IN THE LABOR FIELD 12971
So the machine started up and they saw a car coming down Lincoln
Avenue and they said, "Wait a minute," and so we all waited, and
then the car passed, and their car went and we went, and we went
running north.
Mr. Kennedy. A car came by and picked them up ?
Mr. MiLAs. No, some other car, a strange car it was, and they stopped
because I guess they didn't want to be seen by the other car.
Mr. Kennedy. Did someone come and pick them up ?
Mr. MiLAs. Oh, yes, there was a man in the car, a third man, and
we only saw the shadow, and he lifted his head up and right down,
because it was pretty dark back there. So when we ran north, I looked
back and run about 50 feet, and I looked back, and there were windows
about 18 or 20 feet high, and you could see it all red. Then I run
toward Lincoln Avenue and toward the gas station and there is a
gas station on Lincoln to call the fire department.
Well, before I got half way there, there was a motorist going north,
and he turned around and he went over and called the fire depart-
ment, and by that time the things wasn't blazing so much from the
outside you couldn't see but you could see smoke all through the
diningroom roof.
Well, we run back and there was this one man. Sam Coburn, the
maintenance man, and he already had his car at the gas station. I said,
"Jim, come on, I want to get my car," and so he drove me back and
we got our car, and we drove over on Touhy Avenue, and then the
Lincolnwood police officer came along, and we told him that it was a
started fire.
So he called up on the telephone of his car, and I said, "I am going
over and see Mr. Claassen," and so I didn't know Mr. Claassen's tele-
phone number and I knew he only lived about 4 or 5 blocks or so
from the restaurant. So I got to Mr. Claassen's house, and I woke up
the whole family and all four of them came down and it took about
10 minutes and I told him about it and we called Mr. Allgauer.
Mr. Kennedy. Now, while they were there, was there any money
in the restaurant ?
Mr. MiLAS. Yes, I guess there was.
Mr. Kennedy. Did they try to take any of the money ?
Mr. MiLAs. No, there was no attempt of robbery at all, and because
I had the keys for the office and they never asked me for it.
Mr. Kennedy. They were only interested in burning the restaurant ?
Mr. MiLAs. Yes, sir.
Mr. Kennedy. Just burning it down ?
Mr. MiLAS. Yes, sir.
Mr. Kennedy. Mr. Allgauer, can you give us any explanation as to
who might come in and burn your restaurant down ?
Mr. Allgauer. I have as much of an idea as you have.
Mr. Kennedy. You don't have any enemies ?
Mr. Allgauer. Not knowingly. I have dozen of friends who stood
by me after the fire and until now.
Mr. Kennedy. You can give no explanation whatsoever for your
restaurant being burned down ?
Mr. Allgauer. No, sir.
Mr. Kennedy. Do you know any of the underworld figures m
Chicago ?
12972 IMPROPER ACTIVITIES IN THE LABOR FIELD
Mr. Allgauer. Well, one of them comes in my place so often
and I never even knew he belonged to that. He was on the stand here,
Ross Prio, and we called him Mr. Ross in my place of business. He
came there quite often but I never knew the man had anything to do
with the underworld.
Mr. Kennedy. Did j^ou know Jack Gussik at all ?
Mr. Allgauer. I knew him and he was in my place quite aften but
I never went to his table, and if he would walk in this place now I
wouldn't recognize him because I always stayed away from people like
that all of my life.
Mr. Kennedy. You have no explanation whatsoever for someone
coming in and burning down your restaurant that cost $1.4 million ?
Mr. Allgauer. No, I haven't any idea.
Mr. Kennedy. Were you making any payments to anybody for pro-
tection ?
Mr. Allgauer. Never in my life.
Mr. Kennedy. Has anybody ever approached you to make any pay-
ments ?
Mr. Allgauer. Never.
Mr. Kennedy. Do you know of any restaurants that are making
payments for protection in Chicago ?
Mr. Allgauer. No, I don't.
Mr. Kennedy. You never heard of that ?
Mr. Allgauer. No.
Mr. Kennedy. Was this after the committee started its investiga-
tion?
Mr. Allgauer. Yes, sir.
Mr. Kennedy. How long had we been in your restaurant, do you
know?
Mr. Allgauer. I don't know. I think about 6 weeks before ; wasn't
it something like that, Mr. Duffy ?
Mr. Duffy. We spent a great number of hours in Mr. AUgauer's
restaurant, and probably we were there within 2 weeks from the time
the fire took place, and we were there as far back as February.
Mr. Allgauer. I think that you spent your time in my office ; didn't
you?
Mr. Duffy. We spent quite a bit of time going over your books and
you cooperated fully with us at that time.
Mr. Kennedy. That is all for now, Mr. Chairman.
The Chairman. Are there any questions ?
Senator Church. Mr. Allgauer, do you suppose that inasmuch as
you had cooperated with the committee and investigations had been
made for a series of weeks prior to the time that your restaurant was
burned down by arsonists, this might have been an effort to intimi-
date you or to indicate to others that it might be healthier if they
didn't cooperate with this committee and divulge the facts to this
committee ?
Mr. Allgauer. I have never talked to anyone about the investiga-
tion going on, and I have never. I kept this quiet.
Senator Church. But it might have been known, even though you
did not talk to anyone about it.
Mr. Allgauer. That I wouldn't know, but I never did talk to
anyone about it.
IMPROPER ACTIVITIES IN THE LABOR FIELD 12973
Senator Church. If that were the explanation, at least it is obvious
that it didn't work, because you have come to the committee and
have made a complete statement here and you have cooperated, and I
think that you are to be commended for it.
Mr. Allgauer. Thank you.
The Chairman. Have you had any telephone calls or has anyone
contacted you since your restaurant burned ?
Mr. Allgauer. No, I never did.
The Chairman. No one has presumed to give you any informa-
tion regarding it?
Mr. Allgauer. No.
The Chairman. Have you had any threats ?
Mr. Allgauer. I haven't.
The Chairman. Either directly or indirectly ?
Mr. Allgauer. Sir ?
The Chairman. Have you had any threats from anyone either di-
rectly or indirectly regarding your testimony here ?
Mr. Allgauer. I never did.
The Chairman. Well, this thing didn't happen just incidentally,
and there is some reason for it.
Mr. Allgauer. That is right.
The Chairman. Do you know what the reason is ?
Mr. Allgauer. If I would have known it, I would have a better
idea going about finding out about it.
The Chairman. Do you have any idea about it? You know who
you have business with and whom you contact, and what has happened,
and what has transpired in the past, and there is nothing in the past
that gives you any idea ? Is there no conversation or contact or any-
thing that gives you any indication or clue as to who may have wanted
to do you this great injury ?
Mr. Allgauer. No, sir" The people I do business with are definitely
legitimate the same as I am.
The Chairman. You never received any threat prior thereto ?
Mr. Allgauer. No, I didn't.
The Chairman. You had no controversy where there was ill feeling
or any disagreement so far as you knew ?
Mr. Allgauer. No.
The Chairman. You had no enemies ?
Mr. Allgauer. No, sir.
The Chairman. Well, there is something very strange about this
whole thing.
Mr. Kennedy. Did you ask for protection afterward, Mr. Allgauer?
Mr. Allgauer. I neVer asked for protection.
Mr. Kennedy. Mr. Classen from your office called ?
Mr. Allgauer. Mr. Classen did, and I had police protection from
Lincolnwood police, and after 2 days I told them to get going, and I
told them pointblank if my life was threatened or they wanted to get
me they could have gotten me a long time ago.
Mr. "Kennedy. You know about all of the many other fires m resta-
rants around Chicago ? ■, -r v.-
Mr. Allgauer. I heard about some of those, and I say this to you
most sincerely: I always believe somebody who did it must have
gained by it or they wouldn't do it.
12974 IMPROPER ACTIVITIES IN THE LABOR FIELD
Mr. Kennedy, They must have gained by it ?
Mr. Allgauer. Or else they wouldn't do it.
Mr. Kennedy. What is your explanation for so many fires among
restaurants in Chicago?
Mr. Allgauer. Well, I couldn't tell you at all, Mr. Kennedy. I
only know about mine and that is all.
Mr. Kennedy. Well, that is the problem we have in each restaurant.
Each owner says, "Well, I can't tell you," and no one will talk at all,
Mr. Allgauer.
Mr. Allgauer. I am willing to talk and tell you anything you would
like to know.
Mr. Kennedy. Someone doesn't just walk by and burn down a $1.4
million restaurant, and that just doesn't happen. Somebody has to
have a reason.
Mr. Allgauer. If I would know who did it, I would tell you. I
am not afraid of anybody.
Senator Church. ]\Ir. Allgauer, directing your attention to those
two large pictures that are located down at the end of the witness
table, are those pictures of your restaurant? Is the one on the left
a picture of the first that has been testified to?
Mr. Allgauer. Yes, sir.
Senator Church. And the one on the right, is that an accurate
picture of A\hat was left of your restaurant after the fire?
Mr. Allgauer. That is just about right.
The Chairman. Mr. IVIilas, was anything said by the men who com-
mitted this arson ? AVas anything said by them that might have indi-
cated their reason or their motive for this act ?
Mr. MiLAS. No, they didn't say. All they said was, the Mexican
boy, "You guys will be looking for a job ; this place is going up in
smoke." That is all he said.
The Chairman. Did they tell you why ?
Mr. MiLAS. No.
The Chairman. Did they mention Mr. AUgauer's name ?
Mr. IVIiLAS. No.
The Chairman. Did they mention the union ?
Mr. MiLAS. No.
The Chairman. Did they mention any payoffs ?
Mr. MiLAS. No.
The Chairman. The only thing they said was that this thing is
going up in smoke and you are going to be looking for a job?
Mr. MiLAS. That is right. They asked for a glass of milk, one of
them did. They asked where the milk was.
The Chairman. Did you get them a glass of milk ?
Mr. MiLAS. Yes, and I had the keys, but I said, "We haven't got
the keys," and I told them it was open and where the milk was.
The Chairman. Did you know either of the men ?
Mr. IVIilas. No, I didn't, sir.
The Chairman. Would you recognize them again if you saw them ?
Mr. MiLAS. No ; they had hoods on.
The Chairman. They had hoods on ?
Mr. MiLAS. That is right.
The Chairman. Wliat kind of hood ?
Mr. MiLAs. Well, over their heads.
IMPROPER ACTIVITIES IN THE LABOR FIELD 12975
The Chairman. Just something that covered their eyes, or some-
thing over their heads ?
Mr. MiLAS. They had glasses; one guy had dark glasses on, and
they were all dark to me.
The Chairman. They pulled the hoods ojff after they got out of the
restaurant ?
Mr. MiLAS. No, and I never saw them with the hoods off.
Mr. Allgauer. From all indications as I can see, they weren't there
to injure anybody and they wanted to see everybody got out, and they
just wanted to destroy the place.
Senator Church. They wanted to commit arson and murder.
Mr. MiLAS. Just before we left outside one of them spoke up, and
he said, "Now are you sure there are only seven men in here?" be-
cause they didn't want to leave anybody in the place. And they
said, "Are you sure?" And I said, "Yes, there are only seven."
The Chairman. When did they light the match to it ?
Mr. MiLAS. That is when they took us from the New England Koom
outside, about a minute after that. They had us lined against the
wall, and we couldn't see what they were doing, because there is a
step going up about five steps.
The Chairman. Did they leave someone else in there, one of them
was in there when you came out ?
Mr. MiLAs. One was guarding us, and we were in the front of them
all of the time then.
The Chairman. I understand, but did you see them light the
match ?
Mr. MiLAS. No, I didn't. We were against the wall, where you
can't see, and the restaurant is this way.
The Chairman. You were on the outside on the sidewalk ?
Mr. MiLAS. We were outside in back of the parking lot. That is
where they took us.
The Chairman. Did one of them remain back in the building when
you folks were out there ?
Mr. MiLAs. Well, yes. We say one, and one must have been in the
building, or on the steps someplace.
The Chairman. When did you first know the building was afire?
Mr. MiLAs. Well, when they told us to run, and when I looked back
from about 50 feet, and that is when I knew it was on fire.
The Chairman. Were all of them on the outside at that time?
Mr. MiLAs. They had us outside.
The Chairman. They had you outside, but were all of them outside
when they told you to run ?
Mr. MiLAS. They were by the car already, and they didn't tell us to
run, and they told us to run when that car got started.
The Chairman. How long did the car sit out there, and how long
had it been outside before you actually ran ?
Mr. MiLAs. I would say 2 or 3 minutes we were outside.
The Chairman. Obviously the torch had been lit inside before you
came out ?
Mr. MiLAs. I suppose, and I don't know.
The Chairman. Well, did they go back in there after they came
out, either of them ?
Mr. MiLAS. No ; they went to the car.
The Chairman. You all came out together ?
12976 IMPROPER ACTIVITIES IN THE LABOR FIELD
Mr. MiLAs. Two of them.
The Chairman. Where is the other one ?
Mr. MiLAs. The other one was a chauffeur, that was the third one.
The Chairman. The two that had been in there ; there had only been
two of them in there ?
Mr. MiLAs. We only saw two in the restaurant ; that is all we saw.
The Chairman. They came out at the same time you did ?
Mr. MiLAs. Yes.
The Ch^virman. They went to the car ?
Mr. MiLAs. No ; they didn't go to the car. They lined us up against
the wall.
The Chairman. And they had you lined against the wall and then
where did they go after they lined you against the wall?
Mr. MiLAs. One of them went back.
The Chairman. Went back where ?
Mr. MiLAS. To the restaurant I guess, that is when he lit it up, I
think.
The Chairman. One of them went back in, after they had you lined
up, that is what I was trying to get.
Mr. MiLAs. That is right.
The Chairman. Then when he came out, how long was it before
you had to run ?
Mr. IVIiLAs. As soon as he got out or he came out, he ran to his car.
The Chairman. He ran to the car ?
Mr. MiLAS. Yes, sir, and when he saw that car come down Lincoln
Avenue, he said, "Wait a minute," and the car passed and they were
going, and we went. They told us to run when the car got started.
The Chairman. They followed the other car ? After the other car
passed, that car moved out ?
Mr. MiLAs. They were approximately about 75 to 100 feet from
Lincoln Avenue where they were parked in the parking lot, and when
that car passed then they shot out, and we shot north. That is where
they told us to go.
The Chairman. That is what I was trying to get. One of them did
go back in after they had you on the outside ?
INIr. MiLAS. Yes, sir.
The Chairman. All right ; is there anything else ?
Mr. Kennedy. I have just one question. How did they get in
there ; do you know ?
Mr. MiLAS. Well, all of the doors were locked, and there is only
one possible way they could get in, is through the roof and a couple of
windows, and that is all.
If they went in during business hours, probably upstairs through
the roof, that is the only possible chance they could get to get in.
The Chairman. Were they in the restaurant as guests or customers?
Mr. MiLAS. It could have been possible that way, or the roof, and
that is the only two ways they could have got in.
The Chairman. All right. Thank you very much.
Call the next witness.
Mr. Kennedy. Mr. McFarland.
The Chairman. You swear that the evidence given before this
Senate select committee shall be the truth, the whole truth, and nothing
but the truth, so help you God ?
Mr. McFarland. Ido.
IMPROPER ACTIVITIES EST THE LABOR FIELD 12977
TESTIMONY OF JOHN McFAELAND
The Chairman. State your name and your place of residence and
your business or occupation.
Mr. McFarland. John McFarland, 430 Arbor Avenue, West Chi-
cago, 111. I work for the State of Illinois, chief investigator for
arsons in Chicago.
The Chairman. Do you waive counsel ?
Mr. McFarland. I waive counsel.
Mr. Kennedy. You are chief investigator for arsons in Chicago ?
Mr. McFarland. That is right, sir.
Mr. Kennedy. Mr. McFarland, how long have you been in this
job or held this position ?
Mr. McFarland. I have been an investigator for approximately 15
years.
Mr. Kennedy. How long have you been working on arsons ?
Mr. McFarland. Probably the last 10 years.
Mr. Kennedy. Could you tell the committee whether there has been
an extraordinary number of fires among restaurants in the Chicago
area over the last few years ?
Mr. McFarland. I would say in the last 2 or 3 years we have had
a great increase in the number of fires in restaurants and cafes and
taverns.
Mr, Kennedy. Do you have a list of the fires that have occurred ?
Mr. McFarland. I have them in my files ; yes, sir.
Mr. Kennedy. Could you present that to the committee ?
Mr. McFarland. Yes, sir.
Mr. Kennedy. What period of time does this list cover ?
Mr. McFarland. That approximately covers the last 2 years, 1957
and 1958.
Mr. Kennedy. From January of 1957 to the present time?
Mr. McFarland. That is right.
Mr. Kennedy. How many fires have there been among restaurants
and taverns in the Chicago area since January '?
Mr. McFarland. Approximately 40.
Mr. Kennedy. Isn't that an extraordinary number of fires in this
business ?
Mr. McFarland. It is an unusual amount in that period of time.
Mr. Kennedy. Well, it is even beyond just unusual, is it not, Mr.
McFarland?
Mr. McFarland. Yes ; it is.
Mr. Kennedy. Have you been able to solve any of these?
Mr. McFarland. No ; we have not.
Mr. Kennedy. None of the 40 fires ?
Mr. McFarland. We haven't, as we call it, marked any of them, or
determined.
Mr. Kennedy. What is the explanation in a general sense, Mr.
McFarland, for the number of fires in these restaurants and taverns?
Have you found any pattern going through any of them ?
Mr. McFarland. They all seem to be following a certani pattern,
and follow a pattern that we can't determine or actually mark as to the
cause. We can't determine why they should start as they do.
Mr. Kennedy. Is there any other pattern now, Mr. McFarland,
regarding these fires ?
12978 IMPROPER ACTIVITIES IN THE LABOR FIELD
Mr. McFarland. In what way ?
Mr. Kennedy. Is there any pattern as to the nature of the tires, the
origin of the fires ?
Mr. McFari.and. They are all similar in nature, and their origin
seems to be the same, and they start out with an enormous lire immedi-
ately.
Mr. Kennedy. Would it indicate to you from your 15 years' experi-
ence that most of these are arsons ?
Mr. McFaruynd. We can't call them arsons until w^e can prove it.
Mr. Kennedy. Now, Mr. McFarland, I am not getting down to any
particular fire, and I am just asking you as a general pattern, and I
would like to get your cooperation with the committee. As a general
pattern, wouldn't it indicate or wouldn't it seem to indicate that these
fires were arsons ?
jNIr. McFarland. They are of that nature.
Mr. Kennedy. Could you tell us whether you received cooperation
and help and assistance from the owners of these restaurants and
taverns in attempting to solve the fires ?
Mr. McFarland. That I will say we have not. They stand on the
statement that they do not know why they should have such a fire, or
what caused the fire.
Mr. Kennedy. Can you give any explanation as to why they have
been less than cooperative with you in your investigation ?
Mr. McFarland. Well, there is a motive why they will not cooper-
ate, and they all seem to have a motive.
Mr. Kennedy. What is that ?
Mv. McFarland. Well, I think they are afraid to talk.
Mr. Kennedy. Generally in these 40 fires, have you found that that
is the situation ?
Mr. McFarland. Maybe it wouldn't hold true with all 40 fires, but
as a general pattern, it will be there on the percentage of the fires that
we are talking about.
Mr. Kennedy. That these people, the owners of these restaurants
and taverns, the employers are afraid to talk ?
Mr. McFarland. That is right, sir.
Mr. Kennedy. Plave you uncovered or found out or learned in-
formation that a number of these restaurant owners have to make
payoffs to certain individuals in the Chicago area?
Mr. McFarland. I have heard that ; yes.
Mr. Kennedy. Once again, you found it difficult to have any em-
ployer come in and give you or be willing to testify to that ?
Mr. McFarland. They are willing to come in and make a statement,
but the statement amounts to nothing.
Mr. Kennedy. They won't give you any specific information ?
Mr. McFarland. They won't give us any reason for the fire.
Mr. Kennedy. And they will not give you any information regard-
ing these wholesale payoffs that have to be made?
Mr. McFarland. That is right, sir.
Mr. Kennedy. Do you understand that these payoffs, Mr. Mc-
Farland, have to be paid to certain underworld figures in Chicago ?
Mr. McFarland. To certain figures, yes; collection agencies.
Mr. Kennedy. "Wliat a number of these so-called collection agen-
cies are selling is protection from fires and stinkbombs or whatever
IMPROPER ACTIVITIES IN THE LABOR FIELD 12979
it may be, and if payments are not made the restaurants get bombed
or arsoned. Is that the situation ?
Mr. McFarland. It could be.
Mr. Kennedy. Is that the situation you have found generally. I
am not saying as to any particular restaurant, but generally is that
the situation ?
Mr. McFarland. It follows that pattern.
Mr. Kennedy. Can you identify these pictures ?
The Chairman. Did you prepare this list of fires ?
Mr. McFarland. I did, sir.
The Chairman. And you testified to its accuracy to the best of your
knowledge and belief ?
Mr. McFarland. That is right, sir.
The Chairman. This list may be made exhibit No. 33.
(Document referred to was marked "Exhibit No. 33" for reference,
and may be found in the files of the select committee.)
The Chairman. First I will ask you if you identify these pictures
as pictures of the Allgauer fire, and the debris left afterward?
Mr. McFarland. They are the Allgauer fire.
The Chairman. They may be made exhibit No. 34 (A) and (B).
(Documents referred to were marked "Exhibit No. 34 (A) and
(B)" for reference and may be found in the files of the select
committee.)
The Chairman. Do you regard this list here of some 40 fires in a
period of 17 months — does this cover all of the restaurant and tavern
fires that were reported to you during that period of time?
Mr. McFarland. No; it does not. There probably are 4 or 5
restaurant fires that were determined.
The Chairman. Four or five others that were determined?
Mr. McFarland. In other words, we found the cause.
The Chairman. Out of 45 fires then in that period of time, you
have only been able to determine the cause of the fire in 4 or 5
instances ?
Mr. McFarland. I would say somewhere around that number.
The Chairman. Now, were any of those determined to be arson ?
Mr. McFarland. Definitely not.
The Chairman. None of them ?
Mr. McFarland. No.
The Chairman. So, in other words, these 40, the list of which you
have submitted, are carried as potential arson cases; is that correct?
Mr. McFarland. We carry them as unmarked fires.
The Chairman. Do you ever carry any as arson fires ?
Mr. McFarland. Not until after we prove it.
The Chairman. I understand; and you don't carry them as sus-
picion of arson?
Mr. McFarland. No ; we do not.
The Chairman. Well, sometimes they arrest people on suspicion
of murder ?
Mr. McFarland. That is right.
The Chairman. And they find the corpse, and the victim, and they
believe from the circumstances he was murdered and, of course, I
don't know how you would do that. You wouldn't carry it as some-
thing else, and you carry it on the basis that it requires investigation
12980 IMPROPER ACTIVITIES IN THE LABOR FIELD
and it warrants cause of the circumstances attending it. Isn't that
correct ?
Mr. McFarland. That is right.
The Chairman. Then you are carrying these fires, this list of 40
here, on the basis of their circumstances that indicates they should be
investigated for arson ?
Mr. McFarland. We carry those fires as unmarked fires until we
have enough circumstantial evidence to warrant them to be listed as
suspected arson.
(At this point the following members were present: Senators Mc-
Clellan, Church, and Goldwater.)
The Chairman. Are any of these listed now as suspected arson ?
Mr. McFarland. I would say no.
The Chairman. You mean even
Mr. McFarland. Well, theirs isn't suspected. That is known. That
is a marked arson fire.
The Chairman. Is it carried on here as known arson ?
Mr. McFarland. It could be. I don't know whether Allgauer is
on there or not.
Mr. Kennedy. Yes ; it is.
The Chairman. Obviously they are getting by with arson up there,
if these are arson, and you either don't have the ability or the law-
enforcement agencies are not able to cope with it in view of the cir-
cumstances of how the arson is committed, is that correct, if they are
arson ?
Mr. McFarland. If they are arson, we will so mark them.
The Chair]vian. When?
Mr. McFarland. When we have enough circumstantial evidence to
prove our point.
The Chairman. Do I understand you now that there are not any
of the 40 here upon which you have sufficient circumstances to mark
them as possible arson cases ?
Mr. McFarland. On Allgauer's you will probably find in our office
a supplementary report, referring to Allgauer's as an arson fire. That
would be submitted after this list was made.
The Chairman. Who would make that report ?
Mr. McFarland. The investigator and myself.
The Chairman. Have you made such a report?
Mr. McFarland. My investigator has, but I have not had a chance
to read it.
The Chairman. Wlien was itmade?
Mr. McFarland. I think it was made the day before yesterday, and
it was stenotyped, and she was copying it.
The Chairman. Is that the only 1 of the 40 that you are carry-
ing as a potential arson case ?
Mr. McFarland. I would say, at this time, yes.
The Chairman. I see some of them were iDack in January ; Janu-
ary 1, 1957.
Mr. Kennedy. There is one for December 30, 1956.
The Chairman. One is December 30, 1956.
Mr. McFarland. There is one in there ; yes, sir.
The Chairman. If arson can be committed with those odds in favor
of them never being caught or detected or the fact established, it looks
IMPROPER ACTIVITIES IN THE LABOR FIELD 12981
like an arsonist is just having a field day out there. Wlien they want
to burn something, they can do it and get by with it. Have you got
any explanation for that ?
Mr. McFarland. I think they are, sir.
The Chairman. You think they are doing it ?
Mr. McFarland. Yes.
The Chairman. You are convinced of that?
Mr. McFarland. Yes.
The Chairman. Are you also convinced that it is connected with
these gangsters or racketeers that are demanding payoff for protec-
tion ? Do you also associate it with that ?
Mr. McFarland. They are connected with some agency that has
some pressure on this group.
The Chairman. In other words, you think there is an organized
•criminal element back of these arsons ?
Mr. McFarland. There is an organized element in back of it ; yes.
The Chairman. Well, if it is arson, it is criminal, isn't it?
Mr. McFarland. I didn't say it was arson.
The Chairman. Well, if there is an organized element going out
and burning property, what do you call it, if it is not arson ? Do you
have a name for it that it is different?
Mr. McFarland. I haven't proved this organization has been doing
this yet.
The Chairman. Are you interested in finding out ?
Mr. McFarland. I surely am.
Senator Gold water. Mr. Chairman ?
The Chairman. Senator Goldwater.
Senator Goldwater. Mr. McFarland, would 40 fires in this period
•of time be out of ratio with other cities in the country ? That is, 40
fires to the total number of restaurants.
Mr. McFarland. I never did check up on that.
Senator Goldwater. Has the frequency of these fires increased
over the past few years?
Mr. McFarland. Yes ; they have.
(At this point, Senator McClellan withdrew from the hearing
room.)
Senator Goldwater. You have been in this job for 15 years?
Mr. McFarland. Yes, sir.
Senator Goldwater. Was there a time during this 15 years when
you were not particularly bothered by restaurant fires?
Mr. McFarland. Yes ; there was. 'Ten years ago, if we had 1 or 2
serious restaurant fires a year it was probably normal.
Senator Goldwater. When did they start increasing?
Mr. McFarland. I would probably say the last 3 years or 4 years;
the list would be growing each year.
Senator Goldwater. Have there been any fires in the last month in
the restaurants ?
Mr. McFarland. Not that I would mark as arson.
Senator Goldwater. No ; I mean fires.
Mr. McFarland. Yes.
Senator Goldwater. How many have you had in the last month ?
Mr. McFarland. RcvStaurant fires ?
Senator Goldwater. Yes.
12982 IMPROPER ACTIVITIES IN THE LABOR FIELD
Mr. McFarland. Two, probably.
Senator Goldwater. Were tliey serious fires ?
Mr. McFarland. They were totals.
Senator Goldwater. Totals ?
Mr. McFarland. Yes.
Senator Goldwater. When you say restaurants, do you include
bars ?
Mr. McFarland. I would say 90 percent of them have a combina-
tion bar and restaurant.
Senator GoLDWAn!:R. That is all I have.
Mr. Kennedy, Just let me ask you : Is there any pattern in any
of these other restau; ants similar to the Allgauer Restaurant, where
gunmen came in and put kerosene and gasoline around the restaurant
and set it afire ?
Mr. McFarland. We have been told there was one similar to this.
Mr. Kennedy. What did they do in that one?
]Mr. McFarland. We were told that two gunmen entered the place
and poured gasoline all over it, spread it out, and then torched it.
Mr. Kennedy. What restaurant was that ?
IMr. McFarland. That was the Flame,
Mr. Kennedy. Was there any other restaurant where you found
that they ])ut material over and set it afire?
Mr. McFarland. Over the period of years, are you speaking ?
Mr. Kennedy. Xo, I am talking about since January 1957 ?
INIr. McFarland. No.
]Mr. Kennedy. There hasn't been anything like that ?
Mr. McFarland. No.
Mr. Kennedy. That is, where they poured gasoline or put paper
artmnd ?
]Mr. ]\[cFarland. No ; previous to that, but not the recent one you
are referring to.
Mr. Kennedy. Is that Villa LeMaine, or the Flame Restaurant?
Mr. ]McFarl.\nd. That is the same.
Mr. Kennedy. I don't see that on here. When was that ?
Mr. McFarland. Well, that was probably a month ago. Is that
on there at all ?
]Mr. Kennedy. It is not on here ?
Mr. McFarland. It is probably too x'ecently.
Mr. Kennedy. So we are up to 1941. From your investigation can
you associate these payments that are made with labor relations, or is
it just protective payments, or both ?
Mr. McFarland. Probably a combination.
(At this point. Senator McClellan entered the hearing room.)
Mr. Kennedy. Thank you.
Senator Ciil:rch. There are no further questions. I have no ques-
tions.
Call the next witness, please.
Mr. Kennedy. Mr. Julian Schwartz.
The CiTAiRjvrAN. You do solemnly sw^ear the evidence you shall give
before this Senate select committee shall be the truth, the whole truth
and nothing but the truth, so help you God ?
Mr. Schwartz. I do.
IMPROPER ACTIVITIES IN THE LABOR FIELD 12983
TESTIMONY OF JULIAN SCHWAKTZ
The Chairman. State your name, your place of residence, and your
business or occupation.
Mr. Schwartz. Julian Schwartz. I live at 860 Lake Shore Drive
in Chicago. My place of business is Julian's Restaurant at 103 East
Chicago Avenue.
The Chairman. You waive counsel ?
Mr. Schwartz. I do.
The Chairman. Thank you very much. Proceed.
Mr. Kennedy. Mr. Chairman, for the most part yesterday we dealt
with local 394 and the arrangement of employers, restaurant owners,
with that local. Today for the most part we will be dealing with the
arrangements between the employer and owners of restaurants with
local 593.
Mr. Schwartz, you purchased a restaurant in May of 1955?
Mr. Schwartz. That is correct, sir.
Mr. Kennedy. Formerly known as Rickett's Restaurant ?
Mr. Schwartz. That is right.
Mr. Kennedy. At that time, at the time you purchased it, had the
owner been paying a certain amount of money periodically to the
union ?
Mr. Schwartz. Well, that I found out later.
Mr. Kennedy. When did you hnd it out ?
Mr. Schwartz. Maybe 4 or 5 months after I had taken possession
of the business.
Mr. Kennedy. And how did you find out ?
Mr. Schwartz. I ran across a clieck during one of my periods of
payments, and I inquired of the bookkeeper what it was for. She
said that was union dues for some of the kitchen employees. She
said that arrangement had been made by Mr. Ricketts.
Mr. Kennedy. So did you go ahead and continue to pay to the union
that amount of money ?
Mr. Schwartz. Well, it was being done without my knowledge at
the time I was there.
Mr. Kennedy. You had worked at the restaurant prior to that
time?
Mr. Schwartz. No, sir.
Mr. Kennedy. What do you mean it was being done while you were
there without your knowledge ?
Mr. Schwartz. Well, I evidently didn't see perhaps the first or
second checks.
Mr. Kennedy. You signed the checks without being aware-
Mr. Schwartz. Well, some, yes. I probably didn't notice it.
Mr. Kennedy. Did you decide to go along with this arrangement ?
Mr. Schwartz. Well, after I spoke to the bookkeeper, she told me
that it was done that way, so I just went along with it.
Mr. Kennedy. You continued to pay to the union ?
Mr. Schwartz. Yes, sir.
Mr. Kennedy. How much money did you pay ?
Mr. Schwartz. At that time I believe it was $77 every 2 months.
Mr. Kennedy. Did you ever have any conferences or conversations
with any union representative regarding wages, hours or conditions
of your employees ?
12984 IMPROPER ACTIVITIES IN THE LABOR FIELD
Mr. Schwartz. No, sir.
Mr. Kennedy. Were you ever told that if you failed to make the
payment, you would have a picket line ?
Mr. Schwartz. Well, I never had any discussions with them.
Mr. Kennedy. You just continued to pay, is that right ?
Mr. Schwartz. That is correct, sir.
Mr. Kennedy. An examination of the records at your restaurant
indicated that you were paying on, supposedly, 8 workers, and that 2 of
the 8 workers that you were paying on were no longer employed at
your restaurant at the time we made our investigation.
Mr. Schwartz. Yes, sir ; that is correct.
Mr. Kennedy. Did the union ever come by and try to modernize the
list or bring it up to date ?
Mr. Schwartz. Well, that was done about 4 months ago.
Mr. Kennedy. After our investigation started ?
Mr. Schwartz. Yes.
Mr. Kennedy. Do you know what the union scale is for your
employees ?
Mr. Schwartz. For some of them I do, yes.
Mr. Kennedy. Did you ever discuss that with any union repre-
sentative ?
Mr. Schwartz. No. They sent a pamphlet with the different scales
on it.
Mr. Kennedy. The differential if you were paying union scale would
be a total of $9,933, approximately, that you would have to pay more
if you were paying union scale.
Mr. Gotsch, is that correct ?
Mr. Gotsch. That is correct.
Mr. Kennedy. That is if they enforced the contract.
Mr. Schwartz. Well, I wouldn't know about that, sir.
Mr. Kennedy. The only thin^ they were interested in was the
money that they received ; is that right ?
Mr. Schwartz. Well, it seemed that way.
Mr. Kennedy. But they never discussed anything else with you so
far as the employees are concerned ?
Mr. Schwartz. No, sir.
Mr. Kennedy. This is local 593, Mr. Chairman, which is the biggest
local, 10,000 members, and Mr. Lardino is administrative director of it.
The Chairman. Are you still paying this $77 ?
Mr. Schwartz. $56 now, sir.
The Chairman. $56?
Mr. Schwartz. Yes. We have less employees.
The Chairman. $56 each 2 months ?
Mr. Schwartz. Two months; yes, sir. They reduced the number,
the union reduced it.
The Chairman. How do you make the checks ?
Mr. Schwartz. It is made payable to the union.
The Chairman. Local
Mr. Schwartz. 593.
The Chairman. 593.
Mr. Schwartz. Yes, sir. That is handled by the bookkeeper. I
just sign it.
The Chairman. Do you have a list of those you are paying on ?
IMPROPER ACTWITIES IN THE LABOR FIELD 12985
Mr. Schwartz. Well, in our business, of course, you get so many
transient workers. They come and go and it is rather difficult. You
might get 40 or 50 percent of them that might stay for 5 or 6 months
and longer, but the majority of them don't. So it is rather difficult.
The Chairman. So when you send in the check, you don't write a
cover letter, of say "This check covers the dues oi employee" so and
so ? You don't name them ?
Mr. Schwartz. No, sir.
The Chairman. You just send the check, do you ?
Mr. Schwartz. Well, the agent comes up and collects it, the BA.
The Chairman. He comes by and collects the check ?
Mr. Schwartz. He comes to the office and collects the check.
The Chairman. And from the time you started imtil this commit-
tee got its investigation underway, neither you nor the union were
particularly concerned about the names of who you may be paying on ?
Mr. Schwartz. Well, that seemed to be the arrangement and I went
along with it in order to avoid any union trouble.
The Chairman. I mean you didn't go to any trouble to determine
whether you were paying on Bill Smith or Tom Jones. All you were
doing was paying what they demanded of you ?
Mr. Schwartz. Well, I looked at the list. We made a change. I
put on the employees who were there at the time when they made this
different arrangement, they reduced the number. I thought if there
was any benefits to be derived I would like to see the steady employees
benefit by it.
The Chairman. So you did revise the list after you went in and
gave them a list of regular employees ?
Mr. Schwartz. Yes, sir.
The Chairman. Was that list kept current ?
Mr. Schwartz. After a fashion. As well as could be. As I say,
there are so many transients that they leave and you would probably
have to do it every time the imion agent came.
The Chairman. Do you find now that you may have paid on some
that were not in your employ, no longer in your employ ?
Mr. Schwartz. Yes ; no doubt about it.
The Chairman. Did it work that way ?
Mr. Schwartz. Yes.
The Chairman. Do you know of any benefit these people get out of
the union ?
Mr. Schwartz. Are you speaking of 593 ?
The Chairman. I am talking about the men that you are paying on.
Mr. Schwartz. Well, not offhand, no. Some, I imagine, have.
I mean from conversations with the employees. Just hearsay.
The Chairman. In other words, you would have paid them the
same wages, they would have had the same working hours and they
would have had the same working conditions, even if there had not
been any union involved, would they not ?
Mr. Schwartz. Yes, sir.
The Chairman. You would provide them with every benefit that
you have provided them with ?
Mr. Schwartz. Yes.
The CHAIR3IAN. So they got nothing by reason of your paying this
money into the union?
21243— 58— pt. 34 9
12986 IMPROPER ACTIVITIES IN THE LABOR FIELD
Mr. Schwartz. No ; they did not. to my knowledge.
The Chairman. Except, possibly, they may have benefited indi-
rectly in that the place was not picketed, you had no union trouble.
Mr. Schwartz. That is correct.
The Chairmax. But so far as a direct benefit to them by increase
in wages, shorter hours, or improved working conditions, they got no
direct benefit ?
Mr. Schwartz. Outside of the usual little raises from year to year.
That is the only thing I could
The Chairman. Well, you would do that anyway; wouldn't you?
Mr. Schwartz. I supi)ose. Changing times, I mean, with a little
inflation creeping up. You do those things.
The Chairman. Did you ever sit down and negotiate a contract with
the union ?
Mr. Schwartz. No, sir.
The Chairman. Did they ever ask you to negotiate a contract ?
Mr. Schwartz. No, sir.
The Chairman. Did you ever sign a contract ?
Mr. Schwartz. No; 1 never did.
The Chairman. All right.
Senator Church. Did representatives of this local ever come in and
urge you or undertake to persuade you to make these little increases in
wages for your employees from time to time, or did you do that entirely
on your own ?
Mr. Schwartz. Well, perhaps we are speaking of two different
things. Are you speaking of local 593, miscellaneous ?
Senator Church. I am speaking of local 593, yes, the one that you
made this $56-a-month payoff to.
Mr. Schwartz. No ; there was no discussion with them.
Senator Church. So you have been paying, then, solely for the pur-
pose of — —
Mr. Schwartz. Of maintaining peace.
Senator Church. Of maintaining peace.
Mr. Schwartz, That is correct.
Senator Church. And you were afraid that if you failed to make
them, they might make trouble for you ?
Mr. Schwartz. I would not say I was afraid. I never entered into it.
Senator Church. If you weren't afraid that they might make trou-
ble for 3'ou, then there wouldn't be any point in continuing payments;
would there ?
]\Ir. Schwartz. Well, I paid a large sum of money for this business,
and I wanted to stay in business, and I just didn't want to have any
difficulties with anybody. I maintained the status quo, as it were.
Senator Church. If their charge was $56 a month for maintaining
the status quo, then you were willing to pay the $56 a month?
Mr. Schwartz. Yes, sir.
Senator Church. Do you regard this as just a business expense?
Mr. Schwartz. Well, I am afraid I have to.
Senator Church. Do you deduct it as a business expense on your
income tax returns of your business ?
Mr. Schwartz. I imagine it has been handled that way; yes.
Senator Church. I have no further questions.
The Chairman. Senator Goldwater.
IMPROPER ACTIVITIES IN THE LABOR FIELD 12987
Senator Goldwater. Do you pay a Christmas bonus to vour
employees ?
Mr. Schwartz. I have at times, yes, when conditions warranted it
and you can afford it.
Senator Goldavater. Do you pay any other bonuses through the
year when you can afford it ?
Mr, Schwartz. No, not at that establishment. No.
Senator Goldwater. Do you have any fund from which your
employees can borrow, or do you personally help them out once in a
while ?
Mr. Schwartz. I personally do, yes, sir.
Senator Goldwater. Do you do much of that ?
Mr. Schwartz. Quite a bit.
Senator Goldwater. Do you ever get stuck ?
Mr. Schwartz. I have in the past, at different times.
Senator Goldwater. Do you have any way of knowing what your
waitresses' tips might average?
Mr. Schwartz. Well, you hear a lot of conversation as to just what
they do, but I never inquire. I would not be in a position to give a
fair estimate of it, I don't think.
Senator Goldwater. Have they or any of your employees ever come
to you and asked that you allow them to seek representation by a
union ?
Mr. Schwartz. Would you repeat the question, please?
Senator Goldwater. Have your waitresses or any other of your
employees ever sought through you permission to seek recognition
from the union, and to be represented by a union ?
Mr. Schwartz. No.
Senator Goldwater. Have they seemed to be satisfied with the
working conditions there?
Mr. ScHAVARTZ. Yes.
Senator Goldwater. Do your employees stay with you a reason-
able length of time compared
Mr. Schwartz. Well, there are some that do.
I would say perhaps 50 percent of the employees are steady and
reliable, maybe 60 percent, and then there is certain element that are
just transient, such as cooks and waitresses and busboys, dishwashere
and so forth.
Senator Goldwater. There is a very high turnover in the restaurant
business, isn't there?
Mr. Schwartz. I think the average is about 8 times a year for the
number of employees ; yes, sir.
Senator Goldwater. That is all.
The Chairman. Is there anything further?
Mr, Kennedy, That's all.
The Chahjman, Thank you very much.
Call the next witness,
Mr, Kennedy, Mr, Jack Kinner, .
The Chairman, Do you solemnly swear the evidence you shall give
before this Senate select committee shall be the truth, the whole
truth, and nothing but the truth, so help you God ?
Mr. Kinner. Yes, sir.
12988 IMPROPER ACTIVITIES IN THE LABOR FIELD
TESTIMONY OP JACK KINNER
The CHAiRMAisr. State your name, your place of residence, and your
business or occupation.
Mr. KiNNER. I am Jack Kinner. I live at 321 Desplaines, Riverside.
My business is 163 West Van Buren.
The Chairman. Wliat is your business ?
Mr. Kinner. The restaurant business.
The Chairman. Do you waive counsel ?
Mr. Kinner. I do.
The Chairman. Proceed.
Mr. I^NNEDY. Mr. Duffy will question this witness.
The Chairman. All right, Mr. Duffy.
Mr. Duffy. Mr. Kinner, you heard the testimony of the prior
witness ?
Mr. Kinner. I did.
Mr. Duffy. Did you also inherit a situation whereby you paid dues
on certain of your employees?
Mr. Kinner. That is right.
Mr. Duffy. What was the first year you started making this
arrangement ?
Mr. Kinner. 1948.
Mr. Duffy. What was the union involved ?
Mr. Kinner. 593.
Mr. Duffy. What business agent came to you and asked you to
make an arrangement of this type ?
Mr. Kinner. Cinegram.
Mr. Duffy. C-i-n-e-g-r-a-m ?
Mr. Kinner. That is right.
Mr. Duffy. Business agent of local 593 ?
Mr. Kinner. Yes, sir.
Mr. Duffy. Wliat did he say to you at that time?
Mr. Kinner. This was already in effect. I just continued.
Mr. Duffy. Did he ask you if you were going to continue the
arrangements ?
Mr. Kinner. That is right.
Mr. Duffy. Did he threaten you with a picket line unless you did ?
Mr. Kinner. Yes.
Mr. Duffy. What did he say to you, if you recall ?
Mr. Kinner. Well, that is a long time ago. There was a place
picketed across the street from me shortly after that.
Mr. Duffy. And you continued that arrangement then ?
Mr. Kinner. Yes.
Mv. Duffy. Because he had threatened you ?
Mr. Kinner. Yes, sir.
Mr. Duffy. How long did you continue to pay dues to local 593 ?
Mr. Kinner. Until last month.
Mr. Duffy. How many did you pay on ?
Mr. IviNNER. Eight.
Mr. Duffy. Out of how many employees ?
Mr. Kinner. Fifteen or sixteen employees.
Mr. Duffy. Eight out of sixteen employees you paid dues on.
Mr. Kinner. Yes.
IMPROPER ACTIVITIES IN THE LABOR FIELD 12989
Mr. DuTTY. You continued that up to the present time?
Mr. KiNNER. Yes, sir.
Mr. Duffy. Mr. Cinegram stopped coming around and another
business agent came in for him ?
Hr. KiNNEK. Yes.
Mr. Duffy. Who was that ?
Mr. KiNNER. I never heard his name,
Mr. Duffy. Some time in 1957 did another business agent come in?
Mr. KiNNER. Yes.
Mr. Duffy. Was that Mr. Albi ? '
Mr. KiNNER. Well, he was at the same time. Not always together,
but one or the other did.
Mr. Duffy. Also an official of 593 ?
Mr. KiNNER. Yes.
Mr. Duffy. Have you made any changes in this list over the years ?
Mr. KiNNER. Yes. It is up to date at present. It was not for a
while.
Mr. Duffy. When did you bring it up to date ?
Mr. KiNNER. About a year ago.
Mr. Duffy. Are you sure it has been a year ?
Mr. KiNNER. Well, it is some time within the year.
Mr. Duffy. In the last few months possibly ?
Mr. KiNNER. I am sure it is at least 8 months or 10.
Mr. Duffy. Do you pay your employees union wage scale?
Mr. KiNNER. Well, I think some do.
Mr. Duffy. On this particular item, you pay the dues yourself
and write it off on your tax returns ?
Mr. KiNNER. That is right.
Mr. Duffy. Do you pay union scale to this group ?
Mr. KiNNER. I think most of them.
Mr. Duffy. Do you know what union scale is ?
Mr. KiNNER. I don't think so.
Mr. Duffy. Do you have a signed contract with 593 ?
Mr. KiNNER. I believe I do.
Mr. Duffy. When did you sign it ?
Mr. KiNNER. It has been some years ago.
Mr. Duffy. Do you know what union scale is on those employees?
Mr. KiNNER. No, I do not.
Mr. Duffy. So you don't know if you pay your employees union
scale or not ?
Mr. KiNNER. No.
The CHAiRaiAN. You say you think there was on a contract you
signed many years ago ?
Mr. KiNNER. Yes.
The Chairman. How long was it to be in effect ?
Mr. KiNNER. I don't think there was any date on it.
The Chairman. Do you have a copy of it ?
Mr. KiNNER. I may have. I am not sure.
The Chairman. Have you ever been interested to see what it pro-
vided?
Mr. KiNNER. Well, they didn't make any effort
The Chairman. A little louder.
Mr. KiNNER. They made no effort to do anything about it.
12990 IMPROPER ACTIVITIES IN THE LABOR FIELD
The Chairman. They didn't enforce the contract, whatever it was ?
Mr. KiNNER. No.
The ChaiRxUan. It has never been enforced ?
Mr. KiNNER. No.
The Chairman. All they have been concerned with is your making
the payments ?
Mr. KiNNER, As far as I know.
The Chairman. There has been no complaint about anything else ?
Mr. IOnner. No.
The Chairman. They have not been solicitous about the welfare of
your employees ?
Mr. KiNNER. No.
The Chairman. So, from your viewpoint, this keeps them off your
neck ; they don't picket you or give you trouble ; it is a satisfactory
arangement ?
Mr. KiNNER. Well, we could not help ourselves too much on it.
The Chairman. You felt you could not help yourself?
]\rr. KiNNER. That is right.
The Chairman. You felt if you did not continue this arrangement
you would be picketed and maybe put out of business ?
Mr, KiNNER. Yes, sir.
The Chairman. You are doing it under intimidation and coercion ?
]Mr. KiNNER. Yes, sir.
The Chairman, Is that the way you regard it ?
Mr. KiNNER. Yes, sir.
The Chairman. Do your men put you in the union know they are
in the union ?
Mr. KiNNER, Yes, sir.
The Chairman. How do you give them that information ?
Mr. KiNNER. I just told them about it, and they did not want to
join the union.
The Chairman. They did not want to ?
Mr. KiNNER. No.
The Chairman. They told you they did not want to belong to a
union ?
Mr. KiNNER. That is right.
The Chairman. And yet, you in agreement with union officials put
them in there anyhow ?
Mr. KiNNER. Yes; and that is they would not join of their own
accord.
The Chairman. They would not of their own accord ?
Mr. KiNNER. No.
The Chairman. Did you ever hear of them attending union meet-
ings or getting any notice of union meetings ?
Mr. KiNNER. No.
The Chairman. They are just kind of pawns in this transaction ?
Mr. KiNNER. I suppose so.
The Chairman, Is that right ?
Mr. KiNNER. I suppose so.
The Chairman. Are there any further questions ?
Mr. Duffy. Could I ask Mr, Gotsch a few questions ?
I want to ask about the number of these employees, and are any
of these employees cooks that he is paying on ?
Mr. GoTSCH, He is paying on three cooks.
IMPROPER ACTIVITIES IN THE LABOR FIELD 12991
Mr. Duffy. Can these cooks belong to this local 593 ?
Mr. GoTSCH. No ; tliey belong to local 88.
Mr. Duffy. Actually Mr. Kinner put three cooks in the union that
don't even belong in the union ?
Mr. GoTscH. That is correct.
Mr. Duffy. Were they paid union scale if they were considering
the union scale for the cooks ?
Mr. GoTSCH. No ; they are not. They are paid below union scale.
Mr. Duffy. What is the total saving to the employer here by not
paying his employees union wage scale ?
M. GoTSCH. Approximately $13,300 per year.
Mr. Duffy. I think that is all.
The Chairman. Is there anything further? Would you like to get
out from under this arrangement?
Mr. Kinner. Yes, sir ; I believe so.
The Chairman. You realize it is not strictly on the up and up;
don't you?
Mr. Kinner. Yes, sir.
The Chairman. You would like to get out from under it ?
Mr. Kinner. Yes, sir.
The Chairman. But you feel that you and other small restaurant
people like you are the victims of an organization that can impose
on you and do you harm and injury in your business unless you do
their bidding and conform to their demands ?
Mr. Kinner. That is right.
The Chairinian. That is a bad situation in this land of the home of
the free and so forth ; is it not ?
Mr. Kinner. It is.
The Chairman. Well, I appreciate your cooperation.
Mr. Duffy. I have one more question, Mr. Chairman. How much
do you pay to the union, local 593, every month ?
Mr. Kinner. Well, they come in every month.
Mr. Duffy. Is it $56 ?
Mr. Kinner. For 2 months ; yes.
The Chairman. Is there anything further ?
Senator Church. I have one question, Mr. Chairman.
You make these payments as a business payment and you don't
deduct these dues from your employees, do you ? From the wages you
pay to your employees ?
Mr. Kinner. That is right.
Senator Church. Do you deduct these payments as a business ex-
pense on your income tax ?
Mr. Kinner. Yes.
Senator Church. That is all.
Mr. Kennedy. I would like to point out once again, Mr. Chairman,
that all of these payments that are being made in this fashion, not
only by this witness but by the previous witnesses, including Mr. All-
gauer and witnesses yesterday and last week, are all illegal under sec-
tion 302 of the Taft-Hartley.
The Chairman. All right.
Thank you very much. Call the next witness.
Mr. Kennedy. Mr. Ashley U. Kicketts.
The Chairman. Come forward, please, sir.
12992 IMPROPER ACTIVITIES IN THE LABOR FIELD
You do solemnly swear the evidence you shall give before this Sen-
ate select committee shall be the truth, the whole truth, and nothing
but the truth, so help you God ?
Mr, RiCKETTs. I do.
TESTIMONY OF ASHLEY U. RICKETTS, ACCOMPANIED BY
COUNSEL, RICHARD B. FINN
The Chairman. State your name, your place of residence, and your
business or occupation.
Mr. EicKETTS. My name is Ashley U. Ricketts. I live in Park
Ridge, 111. My place of business is the Homestead Restaurant, 8305
West North Avenue, May wood. 111.
The Chairman. You are in the restaurant business? You are a
restaurant owner and operator ?
Mr. Ricketts. Yes, sir; I am a third generation in the restaurant
business, Senator.
The Chairjman. Thank you.
You have counsel.
Mr. Counsel, will you identify yourself for the record?
Mr. Finn. My name is Richard B. Finn. I am an attorney licensed
to practice before the Supreme Court of Illinois and the Supreme
Court of the United States. My office is 39 South La Salle Street,
Chicago, 111.
The Chairman. Thank you.
Proceed, Mr. Kennedy.
Mr. IvENNEDY. In 1938 or 1939 you purchased the Homestead Res-
taurants ?
Mr. Ricketts. Yes, sir.
Mr. Ejennedy. That is on West North Avenue, May wood. 111.?
Mr. Ricketts. That is right.
Mr. Kennedy. When you took over the restaurant, it was partially
union?
Mr. Ricketts. Yes, it was.
Mr. Kennedy. Were you paying any moneys to the union pre-
vious
Mr. Ricketts. No, it was only 14 tables and a bar.
Mr. Kennedy. And some of the employees were members of union ;
is that right ?
Mr. Ricketts. Yes.
Mr, Kennedy. In 1952 or 1953 were you approached by union rep-
resentatives ?
Mr. Rickjetts. Yes, I was.
Mr. Kennedy. By whom?
Mr. Ricketts. The business agent of union 450.
Mr. Kennedy. That is Mr. Couba?
Mr. Ricketts. That is right.
Mr. KJENNEDY. He was business agent ?
Mr. Ricketts. That is right.
Mr. Kennedy. Wliat had he requested you to do at that time?
Mr. Ricketts. Well, from 1948 to 1952 we increased some of the
girls, the waitress, and the waitresses, the ones that were out in the
country there, were union, and we had a few dishwashers. So all
IMPROPER ACTIVITIES IN THE LABOR FIELD 12993
he asked them was to have some of the dishwashers sign up. So I
agreed to pay their union dues.
Mr. Kennedy. Did the dishwashers themselves indicate that they
wanted to join the union ?
Mr. RicKETTS. No.
Mr. Kennedy. He just wanted you to put a number of people in
the union?
Mr. RicKETTS. That is right. The dishwashers would not
Mr. Kennedy. The employees themselves had not been consulted,
is that right ?
Mr. RicKETTS. Just the dishwashers.
Mr. Kennedy. Had they been consulted ?
Mr. RicKETTS. No.
Mr. KJENNEDY. He just wanted their names ?
Mr. RicKETTS. That is right. They were Mexicans and they didn't
understand the union business, so I signed up for them.
Mr. Kennedy. And you paid the initiation fees and dues?
Mr. RicKETTS. That is right.
Mr. Kennedy. How many of them were signed up ?
Mr. Ricketts. There were just four of them.
Mr. Kennedy. Did you pay the dues each month after that ?
Mr. Ricketts. That is right.
Mr. Kennedy. You gave a check to the union ?
Mr. Ricketts. No, I paid them cash and then took it out of the
business expense, every 3 months.
Mr. Kennedy. How much did you pay every 3 months ?
Mr, Ricketts. We took a slip, he gave us the receipt, we got a card,
signed them up, and took a receipt from the cash.
Mr. Kennedy. How much did you pay every 3 months ?
Mr. Ricketts. I think it was about $40 or $42.50 every 3 months.
Mr. Kennedy. Why did you pay this in cash ?
Mr. Ricketts. Well, I think it was just out of the business, I would
say out of the cash, the petty cash, as it was.
Mr. Kennedy. I understand. Most of your bills you pay by check ;
don't you ?
Mr. Ricketts. Most of them, yes. No, I would not say — well, I
would say yes most of them you do pay by check. Senator.
The Chairman. In no instance did you give a check ?
Mr. Ricketts. No.
The Chairman. You don't know whether that money went into the
union treasury or not ?
Mr. Ricketts. I imagine it did. That I don't know, but they had a
receipt, we have receipts for it. They wrote out their name.
The Chairman. Signed by them as union officials ?
Mr. Ricketts. That is right.
The Chairman. All right.
Mr. Kennedy. These four employees that were working, the mis-
cellaneous employees, dishwashers, didn't remain with you very long,
did they ?
Mr. Ricketts. No. Dishwashers come and go, Mr. Kennedy.
Mr. Kennedy. But you continued to pay on these same individuals ?
Mr. Ricketts. That is right.
12994 IMPROPER ACTIVITIES IN THE LABOR FIELD
Mr. Kennedy. There was never any interest as far as the employees
themselves were concerned ? They did not get any benefit out of this ?
Mr. RicKETTS. The dishwashers ?
Mr. Kennedy. Yes.
Mr. Ricketts. No.
Mr. Kennedy. The reason you were paying the money was just to
keep
Mr. Ricketts. The business going.
Mr. Kennedy. The business going, is that right, to avoid difficul-
ties and troubles with the union ?
Mr. Ricketts. Well, I wouldn't say there would be any trouble. It
was just the idea
Mr. Kennedy. "\^^iy would you suddenly start paying $56 — how
much was it you paid ?
Mr. RicKEi-TS. $42.50.
Mr. Kennedy. To this group.
Mr. Ricketts. Every 3 months.
IMr. Kennedy. Why would you do that ?
Mr. Ricketts. Well, if it was a union shop, the girls are union,
the bartenders are union, and the dishwashers
]\Ir. Kennedy. But the dishwashers never indicated they wanted
to join the union.
Mr. Ricketts. No, they would quit.
Mr. Kennedy. They would have quit rather than join tlie union?
Mr. Ricketts. One thing I want to do
Mr, Kennedy. Wait a moment. I want to get this point straight,
that the reason you paid this money was to avoid any difficulty with
the union.
Mr. Ricketts. That is right, sir.
Mr. Kennedy. In 1956, Mr. Leonard! took over from Mr. Couba,
and he was another business agent, is that right ?
Mr. Ricketts. That is right.
Mr. Kennedy. And he wanted four new names ?
Mr. Ricketts. That is right.
Mr. Kennedy. You submitted four new names and continued the
arrangement ?
Mr. Ricketts. That is right.
Mr. Kennedy. This was just a pattern that was accepted by every-
body in the union or at least the representatives that contacted you?
Mr. Ricketts. That is right, so far as the dishwashers.
Mr. Kennedy. He continued the arrangement but wanted four new
names ?
Mr. Ricketts. That is right.
The Chairman. Were those additional names ?
Mr. Ricketts. Yes.
The Chairman. That made eight ?
Mr. Ricketts. No. It is the same four.
The Chairman. You still continued to pay on four, but new names.
Mr. Ricketts. I had five.
Mr. Kennedy. This is an arrangement that you understand is gen-
erally followed amongst restaurants in Chicago ?
Mr. Ricketts. That is right, sir.
IMPROPER ACTIVITIES IN THE LABOR FIELD 12995
Mr. Kennedy. As we have discussed, we are going to put in the
wage scale and what the union scale is and then you will discuss what
extra benefits you give your employees.
Mr. RicKETTS. Fine.
Mr. Kennedy. Will you tell the committee what the arrangements
were for the four employees that were put in the union in 1956 ?
Are any of them presently working at the Homestead Restaurant?
Mr. RiCKETTs. Yes, they are now, Mr. Kennedy.
Mr. Kennedy. I am talking about the four at the time we made our
investigation. , . . ,, -,^ i ^.t, «
Mr. GoTSCH. At the time of our investigation, Mr. Kennedy, they
had terminated their employment.
Mr. Kennedy. None of them were working there ?
Mr. GoTscH. That is correct.
Mr. RiCKETTs. The ones from 1950, that is right, you are right, Mr.
Gotsch, that is right.
Mr. Kennedy. Did you get four new names since then «
Mr. Ricketts. Yes, since Mr. Gotsch and Mr. Kelly were m, we
have the 4, 5. -.o rrx.
Mr. Kennedy. It doesn't reallv make any ditterence, does it? iJie
use of names is just a farce, actually, in all of these cases, is it not?
You are just making payments and it doesn't matter whether you
have names or not.
Mr. Ricketts. That is true.
Mr. I^NNEDY. For anybody it doesn't make any difference. 1 liat
is just to try to give a shade of legality to the union, to this operation.
But it is very synthetic, and it is obvious that there was no benefits
for anybody out of this arrangement.
Let me ask you whether the union scale exists for tlie various em-
ployees. - . -1 • +
Mr Gotsch. There are 15 miscellaneous employees at this restau-
rant. * Four are union, on which Mr. Ricketts pays dues, and at the
time of our visit three were being paid below union scale.
Mr. IvENNEDY. What is the saving?
Mr. Gotsch. The total saving yearly is $8,500.
Mr. Kennedy. If they had to pay union scale on these employees,
the employees of the restaurant, they would have to pay $8,500 more,
approximately ?
Mr. Gotsch. Additionally ; that is correct.
Mr IvENNEDY. You have something you wanted to say ?
Mr. Ricketts. On the union scale ; that is on the dishwashers (
Mr. Gotsch. Actually, they are porters.
Mr. Ricketts. Well, that is the busboys and the dishwashers.
Mr. Kennedy. And that includes the waitresses also.
Mr. Ricketts. Sir?
Mr. KJENNEDY. The waitresses. ., , , , • i
Mr. Gotsch. The waitresses are paid slightly below union scale.
Mr. Kennedy. $1,800 of that is waitresses. .
Mr Ricketts. In the waitresses, as far as comparing with the
union, they get 2 meals a day instead of 1. Then they get-we have
a health policy from John Hancock Insurance, and a $1,000 life policy
and surgical, if they go to the hospital. Then they get their uniforms
free, they get paid vacations, and we give them a Christmas— well, m
12996 IMPROPER ACTIVITIES EST THE LABOR FIELD
other words, we treat them nice because we haven't had too much turn-
over with the waitresses. As far as the dishwashers, we just com-
pleted a home in back, and $16,000 bunkhouse, I would say ; they have
never lived so well. They have 3 meals a day, board and room, and
$7 a day. So it is 6 days a week, and they get a day. And at Christ-
mastime we are closed on Christmas, and we give them a Christmas
gift there.
Mr. Kennedy. I understand you run a very nice restaurant.
Mr. RiCKETTS. Thank you, Mr. Kennedy.
On the dishwasliers, these are the tax returns [indicating] in 1 year
of the dishwashers that have come back "do not live here any more."
So as far as dishwashers, they are just all transients.
That is why we have a place where they can live.
The Chairman. It would actually be hard to organize them and to
keep them organized, would it not?
Mr, RiCKETTS. That is right.
The Chairman. The turnover is too fast.
Mr. RicKETTS. Tliat is right.
The Chairman, In order to try to keep good ones, you have gone to
this extra expense to give them fringe benefits over and above the
salary you pay ?
Mr. RiCKETTS. That is right. We are out in the country and there
is no transportation. But being in this business, it is a wonderful busi-
ness, it is a hard business, I would just like to say one thing before we
leave, and that is on fires. This gentleman is a specialist, but in the
restaurant industry, grease fires are the most prevalent and it is the
most highly flammable. ISIost of tlie places render grease. It will be
on top of a stove and within a short time if they don't watch — well, that
is all I wanted to touch on.
The Chairman. AMien that occurs, a grease fire, as you term it, when
that occurs you usually know the cause of it, don't you ?
Mr. RiCKETTS, That is right.
The Chairman, The whole building just doesn't go up in one flame.
Mr, RiCKETTS, That is right.
The Chairman. So it is not difficult to determine or detect the cause
when it happens in that fashion ?
Mr. RiCKETTS, That is right.
Senator Church. ]Mr. Ricketts, I think as has been emphasized
earlier today, that it should be stressed that the purpose of this com-
mittee is not to try to make it appear to the people of Chicago that you
are unfair to your employees. I do think that your testimony indi-
cates the same old pattern that we have seen again and again and again
among the restaurant owners in Chicago,
That pattern involves this one continuing characteristic, that with
respect to these 2 or 3 unions that we are now investigating, these
particular locals, employers are paying tribute to stay out of trouble.
I think that is a terribly sad thing because this country has never
taken easy to tribute; we once sent the United States Navy over to
settle with some pirates that were trying to exact tribute from our
Government.
It looks to me like you have some pirates in Chicago that need smok-
ing out, I just hope that the disclosures that are being made in the
course of these hearings assist in smoking out these j^irates so that
IMPROPER ACTIVITIES IN THE LABOR FIELD 12997
we can put an end to tribute in legitimate business enterprises in Chi-
cago and elsewhere in the country.
Mr. Kennedy. I would just like to aid that in all of this the em-
ployees are the ones that get no representation. They are the ones
that desire representation, possibly, and are qualified and should have
representation.
They receive none. They are the ones that suffer.
Senator Church. Yes. I think we could go one step further and
say that by virtue of locals of this kind, legitimate locals that would
undertake to represent the interest of their employees are frozen out.
Mr. Kennedy. That is right.
The Chairman. Is there anything further ?
If not, thank you very much.
The Chair has to attend a conference this afternoon on an appro-
priations bill and will not be able to return as early as the normal time.
I think we will have to adjourn over until 2 : 45 this afternoon.
(Whereupon, at 12:25, the hearing recessed to reconvene at 2:45
p. m. of the same day, with the following members present : Senators
McClellan and Church.)
AFTERNOON SESSION
(At the reconvening of the session, the following members were
present : Senators McClellan and Church.)
The Chairman. The committee will come to order.
Call the next witness.
Mr. Kennedy. Mr. George Annes.
The Chairman. You do solemnly swear the evidence you shall give
before this Senate select committee, shall be the truth, the whole
truth, and nothing but the truth, so help you God ?
Mr. Annes. I do.
TESTIMONY OF GEORGE ANNES
The Chairman. State your name, your place of residence, and your
business or occupation.
Mr. Annes. My name is George J. Annes. I live at 915 Isabella
Street, Evanston, 111. My business is at 105 South Wampus, Johnny's
Steak House.
The Chairman. You operate a restaurant ?
Mr. Annes. Yes, sir.
The Chairman. You waive counsel, do you ?
Mr. Annes. Yes, sir.
The Chairman. Proceed, Mr. Kennedy.
Mr. Kennedy. The name of your restaurant is Johnny's Steak
House ?
Mr. Annes. Yes, sir.
Mr. Kennedy. You have been in the restaurant business since ap-
proximately 1921, is that right ?
Mr. Annes. Yes, sir.
Mr. Kennedy. You opened Johnny's Steak House how long ago ?
Mr. Annes. About 3 years ago, thought not quite.
Mr. Kennedy. About 3 years ago ?
Mr. Annes. Yes.
12998 IMPROPER ACTIVITIES IN THE LABOR FIELD
Mr. Kennedy. You have been making payments to the union period-
ically ?
Mr. Annes. No. I pay the dues for the kitchen help.
Mr. Kennedy. How did you happen to start paying dues, or sup-
posed dues ? How did you happen to start doing that ?
Mr. Annes. Well, I, after 1 opened up the place, about 21/^ years
ago, Mr. Cinegram approached me
Mr. Kennedy. Mr. Charles Cinegram ?
Mr. Annes. Yes.
Mr. Kennedy. He is formerly a business agent for local 593, Mr.
Chairman.
Mr. Annes. Yes, sir.
Mr. Kennedy. O. K. ; what did he say to you ?
Mr. Annes. That, if I would not agree, he would have it full of
pickets.
Mr. Kennedy. That if you would not agree to put in a certain
number of your employees ?
Mr. Annes. Not some ; all of them.
Mr. Kennedy. You had to put all of them in ?
Mr. Annes. Yes, sir.
Mr. Kennedy. Had he approached your employees before that ?
Mr. Annes. I don't know if he did or not.
Mr. Kennedy. He just wanted all of the men, and you were to pay
the initiation fees and the due on them ; is that right ?
JSIr. Annes. All I did was pay the initiation and the dues for the
kitchen.
Mr. Kennedy. Did you agree to do that then ?
Mr. Annes. Yes, sir.
!Mr. Kennedy. How many employees were there involved ?
Mr. Annes. I would say around 45 or 50.
Mr. Kennedy. Did you put all of them in ?
Mr. Annes. Yes, sir.
Mr. Kennedy. All 45 were put in the union ?
Mr. Annes. Yes, sir.
Mr. Kennedy. How many did you pay dues on ?
Mr. Annes. Around 15.
Mr. IvENNEDY. About 15 you paid the dues on, and the rest paid
their own ?
Mr. Annes. Yes, sir.
Mr. Kennedy. And the rest paid their own to the stewards ?
Mr. Annes. Yes, sir.
Mr. Kennedy. Why did you agree to make these payments ?
Mr. Annes. Well, the kitchen help, they would not pay.
Mr. KJENNEDY. They did not want to join the union ?
Mr. Annes. They don't want to join the union and they don't want
to pay the dues, so I did it to keep the help.
Mr. Kennedy. They said they would quit if they had to join the
union and pay their dues ?
Mr. Annes. No; if they join the union — they don't mind joining
the union, but they don't want to pay the dues.
Mr. Kennedy. Part of being a member of the union is paying dues,
so they didn't want to join the union and have to pay their dues ; is
that correct ?
IMPROPER ACTIVITIES IN THE LABOR FIELD 12999
Mr. Annes. Well, that is it.
Mr. Kj2Nnedy. So, in order to keep your employees, in order to
keep them working there, you had to pay the dues for them ?
Mr. Annes. Yes, sir.
Mr. Kennedy. Did you write out a check ?
Mr. Annes. Yes, sir.
Mr. Kennedy. How often did you give them a check ?
Mr. Annes. I think it is every other month.
Mr. Kennedy. How much did you pay ?
Mr. Annes. I think around $40 or $50. I don't know exactly,
now.
Mr. KJENNEDY. Did you ever discuss the wages, hours, or conditions
of your employees with the steward ?
Mr. Annes. No.
Mr. Kennedy, Did you ever sign a contract with the union ?
Mr. Annes. Yes.
Mr. Kennedy. Where is the contract ?
Mr. Annes. I got it at my premises.
Mr. Kennedy. Have you got a contract ?
Mr. Annes. Yes, sir.
Mr. Kennedy. When we were out there the last time, you were
not able to find it.
Mr. Annes. Yes, and the next day I did find it, and I got it in
the premises, in the office.
Mr. Kennedy. Did the contract signify how much you should pay
your employees ?
Mr. Annes. I didn't even look at the contract.
Mr. Kennedy. Have you ever read the contract ?
Mr. Annes. No, sir.
Mr. Kennedy, Has the union ever evidenced any interest in what
you are paying your employees? Have they ever come to you and
said you should pay them more, or anything like that ?
Mr. Annes. They never asked me. I don't know if they didn't
ask the employees.
Mr. Kennedy. I will have to ask Mr. Gotsch
Mr. GoTSCH. The annual savings for this restaurant is $10,900 a
year.
Mr. Kennedy. If they paid union scale ?
Mr. Gotsch. To all employees ; that is right.
Mr, Kennedy. It would cost them $10,900 more ?
Mr. Gotsch. Additionally, per year. The total number of em-
ployees in the various categories in this restaurant total 49. Thirty-
nine are union, and, of these 39 union employees, 21 are paid below
scale and 18 are paid above scale. Of the 10 nonunion employees
here, 6 are paid below scale and 4 are paid above scale.
Mr. Kennedy. That is on the 15 he is paying the dues on, or the
10 that he is paying the dues on ?
Mr, Gotsch. Fifteen is correct.
Mr. Kennedy, How many of those are below union scale ?
Mr. Gotsch, Of the 15?
Mr. Kennedy, Yes.
Mr, Gotsch. Eight and ten. It is 8 miscellaneous and 2 cooks.
13000 IMPROPER ACTIVITIES IN THE LABOR FIELD
Mr. Kennedy. And, even on the others, where they are paying dues,
the union dues, themselves, a number of them are being paid below
union scale ; is that right ?
Mr. GoTSCH. That is right.
Mr. Kennedy. That is all.
The Chairman. Why did you put these folks in a union when they
didn't want in a union ?
Mr. Annes. Do you mean the help ?
The Chairman. Yes ; your help.
Mr. Annes. They said they don't want to belong to the union.
That is all they told me about.
The Chairman. They didn't want to belong?
Mr. Annes. They didn't want to pay their dues.
The Chairman. They didn't want to have to pay dues ?
Mr. Annes. That is right.
The Chairman. And you have been paying the dues for them?
Mr. Annes. That is right.
The Chairman. Why do you do that ?
Mr. Annes. To keep the help.
The Chairman. To keep the help. Well, they were willing to
stay there without being in a union.
Mr. Annes. Then I am going to have trouble with the union.
The Chairman. The real reason was you did it to avoid trouble
with the union.
Mr. Annes. That is right.
The Chairman. And, of course, if you had trouble with the union,
you might not be able to keep the help.
Mr. Annes. Keep the help or keep the business.
The Chairman. You might not be able to keep your business?
Mr. Annes. That is right.
The Chairman. Do you feel that this is a just payment?
Mr. Annes. Well
The Chairman. Well? Sir?
Mr. Annes. I think it is. There is nothing else I can do.
The Chairman. You think there is nothing else you can do 2
Mr. Annes. That is right.
The Chairman. That does not necessarily mean that it is just, that
it is fair, that it is right.
Mr. Annes. Well, I don't think it is right, but there is nothing
else I could do.
The Chairman. You don't think it is right, but there is nothing
else you could do if you were to continue in business ; that is the way
you felt about it ?
Mr. Annes. That is right.
The Chairman. lYliat benefit do these employees that you pay on
get from it ?
Mr. Annes. They have insurance, a welfare fund.
The Chairman. They have a welfare fund ?
Mr. Annes. Yes, sir.
The Chairman. Did they have that before they went into the union ?
Mr. Annes. No; after they went in the union I paid that every
month myself, $5.65 an employee.
The Chairman. How much?
Mr. Annes. $5.65 each employee.
IMPROPER ACTIVITIES IN THE LABOR FIELD 13001
The Chairman. That goes into a welfare fund.
Mr. Annes. That is right.
The Chairman. But so far as any benefit they got from increase
in wages, shorter hours, or improved working conditions, they got
nothing ?
Mr. Annes. Well, they get almost all the union scale, and they get
bonus.
The Chairman. They get what ?
Mr. Annes. They get a bonus once a year, every Christmas.
The Chairman. They get a what once a year?
Mr. Annes. A Christmas bonus.
The Chairman. You have been giving that anyway, haven't you ?
The union didn't make you give them a Christmas bonus ?
Mr. Annes. No.
The Chairman. That had nothing to do with the union ?
Mr. Annes. No, sir.
The Chairman. You do that just because you appreciate your em-
ployees and the work that they do.
Mr. Annes. That is right.
The Chairman. And you try to share your prosperity or your
profits with them ?
Mr. Annes. That is right.
The Chairman. But the union did not require you to do that.
Mr. Annes. No.
The Chairman. You do that yourself ?
Mr. Annes. Yes.
The Chairman. So they don't get that benefit by reason of their
being in the union ?
Mr. Annes. No, sir.
The Chairman. Are you still making these payments ?
Mr. Annes. Yes, sir.
The Chairman. Is there anything further ?
Mr. Kennedy. No.
The Chairman. Senator Church ?
Senator Church. No, Mr. Chairman. This is just an extension of
the same pattern that has now become very familiar to this com-
mittee. I have no questions.
The Chairman. Thank you very much.
Call the next witness.
Mr. Kennedy. Mr. Jack DeMar.
The Chairman. Mr. DeMar? Be sworn, please. You solemnly
swear the evidence you shall give before this Senate select committee
shall be the truth, the whole truth, and nothing but the truth, so help
you God ?
Mr. DeMar. I do.
TESTIMONY OF JACK A. DeMAR
The Chairman. State your name, your place of residence and your
business or occupation.
Mr. DeMar. My name is Jack A. DeMar. I am a restaurateur. I
live at 2918 West Hollywood, Chicago, 111.
The Chairman. Do you have counsel or do you waive counsel ?
21243— 58— pt. 34 10
13002 LVIPROPER ACTIVITIES IN THE LABOR FIELD
Mr. DeMar. I waive counsel.
The Chairman. Proceed, Mr. Kennedy.
Mr. Kennedy. Mr. DeMar, how many restaurants do you have in
the Chicao;o area ?
Mr. DeMar. Twelve.
Mr. Kennedy. In 1948, Mr. DeMar, were you approached by a
representative of local 593 to sign up some of your employees ?
Mr. DeMar. Yes, sir.
Mr. Kennedy. By whom were you approached ?
Mr. DeMar. I was approached by a fellow by the name of Ben.
Mr. Kennedy. T-o-m-p-k-i-n-s ?
Mr. DeMar. Yes, sir.
Mr. Kennedy. He is business agent for local 593 ?
Mr. DeMar. Yes, sir.
Mr. Kennedy. "VMiat conversation did you have with him ?
Mr. DeMar. He asked me to sign up all the help that worked for
me in three different locations. There was 1159 South Canal Street,
800 West Madison Street, and 156 East Ohio Street.
I told him "I can't sign them up. Go sign them up yourself. They
are working in the gi'ills, not in the kitchen." We have open grills.
So he talked to them and then left. He came back 2 days later and
said "If you don't sign the help up, you are going to have pickets."
I said "Go ahead and picket the store."
The next day they had pickets in front of the three stores. They
started about 7 in the morning.
Mr. Kennedy. Did this hurt your business ?
Mr. De]\L\r. We were dead.
Mr. Kennedy. You were dead?
Mr. DeMar. Dead.
Mr. Kennedy. The picket line finished you ?
Mr. DeMar. We didn't have two customers from 7 in the morning
until 2 in the afternoon.
Mr. Kennedy. What did you do then ?
Mr. De:Mar. I went down to 10 North Wells Street.
Mr. Kennedy. That is the headquarters of 593 ?
Mr. DeMar. That is right.
Mr. Kennedy. Wlio did you talk to there ?
Mr. DeMar. I don't remember.
Mr. Kennedy. Was it Mr. Blakeley, who was vice president of the
union ?
Mr. DeMar. I don't remember.
Mr. Kennedy. Are you sure ?
Mr. DeMar. Positive.
Mr. Kennedy. Didn't you think initially it was Mr. Blakely ?
Mr. DeMar. I thought it was him, but I don't remember. I could
not say for sure.
Mr. Kennedy. All right. Go ahead. What did you do when you
got down there ?
Mr. DeMar. I signed up 3 at 1159 Canal Street, and I signed u])
4 people at 800 West Madison Street, and I signed up 3 at 156 East
Ohio. We only had between 4 and 6 people working at those stores.
They are real small 12 stool grills. We call them hamburger shops.
Mr. Kennedy. You only had three restaurants at that time?
IMPROPER ACTIVITIES IN THE LABOR FIELD 13003
Mr. DeMar. No ; we had 9 at that time. But they only picked on
those 3.
Mr. Kennedy. And you signed three employees in each one ?
Mr. DeMar. No; I signed up my partners and my relatives that
worked for me there.
Mr. Kennedy. You signed up your own family ?
Mr. DeMar. Own family, that is right.
Mr. Kennedy. The owners of the restaurant, they were the ones that
were made members of the union ?
Mr. DeMar. That is right.
Mr. IvENNEDY. What good can the union do for them?
Mr. DeMar. Well, one of my partners died, and they buried him and
;they paid $200 for it.
Mr. Kennedy. Let me rephrase it. What could they do for him
while he was alive i
Mr. DeMar. I don't know, they couldn't do much for him.
Mr. Kennedy. They couldn't do anything for him, is that right?
Mr. DeMar. They could do nothing.
Mr. Kennedy. Where did you pay the money to the union?
Mr. DeMar. To get pickets off the line and stay in business.
Mr. Kennedy. Did you continue to pay them periodically ?
Mr. DeMar. I paid every 2 months.
Mr. Kennedy. How much ?
Mr. DeMar, We paid anywheres from $14 every 2 months to $21.
Mr. Kennedy. For these employees, for these people you men-
tioned ?
Mr. DeMar. For those people.
Mr. Kennedy. What about when you opened up a new restaurant,
did the union approach you then ?
Mr. DeMar. They did come around, and they would sign up 4 or 5.
It all depends on the size of the restaurants.
Mr. Kennedy. And the arrangement continued; is that right?
Mr. DeMar. The same way.
Mr. Kennedy. This has been going on, then, for about 10 years ; is
that right?
Mr. DeMar. That is right, sir.
Mr. Kennedy. And you make these periodic payments ?
Mr. DeMar. That is right, sir.
The Chairman. What are your usual payments now ?
Mr. DeMar. $3.50.
The Chairman. I beg your pardon ?
Mr. DeMar. About $3.*50.
The Chairman. A month per member?
Mr. DeMar. The last time we paid for May-June and it was $21,
$7, $7, and $7 for 101 East Grand Avenue. We have larger locations
over at 3801 West Madison Street. We have 29 people working there,
and we signed up 9. We pay $42 every 2 months.
The Chairman. For all of your establishments now, what is the
total of your monthly payments ?
Mr. DeMar. a little less than $100 every 2 months. Less than
$200. Less than $100 every 2 months.
The Chairman. You are paying something near $100 each 2
months ?
13004 EVIPROPER ACTIVITIES IN THE LABOR FIELD
Mr. DeMar. That is right.
The Chairman. Between $500 and $600 a year?
Mr. DeMar. That is right.
The Chairman. That is to keep a picket line off of you ?
Mr. DeMar. That is right, sir.
The Chairman. And there is no other reason, I assume ?
Mr. DeMar. That is right.
Senator Chur( ti. Mr. Chairman, I would say this has one new
twist tliat heretofore has not been brought to the attention of the
committee. That is, I believe this is the first case where the manage-
ment itself was enrolled in the union. Has there been one other?
Mr. KJENNEDY. Yes.
Senator Church. It is the first one that has been called to my at-
tention.
Mr. Kennedy. It is the first one in this local.
Mr. DeMar. We had some outsiders signed up in the union as we
went along.
Senator Church. But originally it was members of the family and
representatives of the management.
Mr. DeMar. Just the working partners.
Mr. Kennedy. This is a form of extortion or blackmail ; is it not ?
Mr. DeMar. I don't know what you call it. It is just a good way
for me to stay in business.
Mr. Kennedy. Isn't that what it is, you are making these payments
for that purpose.
Mr. DeMar, I am making the payments to stay in business and
keep the picket lines off. I can't afford to have a strike.
Mr. Kennedy. There is no place you can go in a situation such
as this ?
Mr. DeMar. No, sir.
Senator Church. Have you consulted your own attorney with re-
gard to your situation ?
Mr. DeMar. No, sir.
Senator Church. You have not ?
Mr. DeMar. No, sir.
Senator Church. Do you, yourself, know of any laws of the State
of Illinois that would protect you against this kind of thing ?
Mr. DeMar. Yes, sir.
Senator Church. But you have never made an effort to secure the
assistance of the prosecuting attorney or any other law enforcement
officer ?
Mr. DeMar. No, I did not. But I hear say that some did, and they
did not get nothing out of it.
Senator Church. You had heard that some had tried and had got-
ten no satisfaction ?
Mr. DeMar. Yes. I heard him, many times.
Senator Church. And they just went on paying the tribute?
Mr. DeMar. That is right.
Mr. Kennedy. Is this a general situation that you know about?
Mr. DeMar. I hear say it is.
Mr. Kennedy. You knew that before these hearings started, did
you not?
Mr. DeISIar. Yes, sir.
IMPROPER ACTIVITIES IN THE LABOR FIELD 13005
Mr. Kennedy. These are really relatively small restaurants that you
have, although you have quite a number of them ?
Mr. DeMar. That is right, sir.
Mr. Kennedy. Mr. Gotsch, could you tell us how much the wait-
resses are being paid, the employees are being paid ?
You made a survey in what, three of the restaurants ?
Mr. Gotsch. Three of the restaurants.
Mr. Kennedy. Could you tell us what the wage scale is? I think
there are three that were partially unionized.
Mr. Gotsch. The wage scale for the waitresses is $3 per day in
these restaurants.
Mr. DeMar. What location was that?
Mr. Gotsch. Pardon me ?
Three locations involved, 4804 North Broadway, 3243 North Ash-
land Avenue, 3801 West Madison Street.
Mr. Kennedy. That is about $15 a week for a 5-day week ?
Mr. Gotsch. It is about $14 a week savings.
The Chairman. Has the union ever shown any interest or been
solicitous in any way about the welfare of your workers ?
Mr. DeMar. No, sir.
The Chairman. They have never been concerned about the wages
they are receiving, the hours they are working, or the conditions of
their employment ?
Mr. DeMar. No, sir.
The Chairman. They have never complained to you ?
Mr. DeMar. Never complained.
The Chairman. Never requested you to make any improvements or
raise salaries or shorten hours or do anything ?
Mr. DeMar. No, they didn't.
The Chairman. They are just satisfied to get that much money?
Mr. DeIVIar. Right.
Mr. Kennedy. Mr. Chairman, this is about as low as we found at
Carson's Restaurant, which we had last week, where they were only
paying about $3 a day.
Mr. DeMar. Wliere did you get those figures of $3 a day ?
Mr. Gotsch. From your partners.
Mr. DeMar. You didn't get the right figures from my partners.
We pay more than $3 a day. We pay 50 cents an hour.
Mr. Gotsch. In some cases you do.
Mr. DeMar. We pay 50 cents an hour and guarantee the girl $70
a week.
If she doesn't make $70 a week at 50 cents an hour, we guarantee
the difference. You know a girl can't live on $15 a week. Her room
rent is $21.
Mr. Kennedy. This is according to the records on the employees.
We are glad, as to that, as the other witnesses have done, to have
you put in information.
Mr. DeMar. Maybe the girls worked 3 days.
Mr. Kennedy. This is based on a per-hour scale of how much some
of your people get at these restaurants.
Mr. DeMar. Mr. Kennedy, he didn't get the right figures, I tell you.
Mr. Gotsch. For example, at your Broadway store, here is a waitress
working a 48-hoiir week and receiving $24. that is 50 cents an hour.
There are certain waitresses that do.
13006 IMPROPER ACTIVITIES IN THE LABOR FIELD
Mr. DeMar. That is right. Do you mean to say that a girl makes
a living on a half dollar an hour ?
Mr. Kennedy. How much is the union scale?
Mr. GoTSCH. Sixty-seven cents an hour.
Mr. Kennedy. That is 17 cents below.
Mr. GoTSCH. A waitress at your store at 3801 Madison Street re-
ceived $3 a day for an 8-hour day. Some work a 5-day week, some
3 days and some 6 days.
Mr. De]\Iar. Have you the names ?
Mr. GoTscH. Yes. The last name is Carmardo, Virginia Carmardo.
Mr. DeMar. She works part time.
Mr. GoTscH. How about Gladys Moore. She works a 6-day week.
Mr. DeMar. That is right.
Mr. GoTSCH. She gets $3 a day.
Mr. DeMar. Yes, but she cashed in Saturday and Sunday $37, she
cashed in in nickels, dimes, and quarters, $37. I cashed in her money
myself.
The Chairman. Are you talking about tips ?
Mr. DeJMar. That is right, sir.
The Chairman. We are talking about what you pay out of your
business income.
Certainly they get tips, and, considering their tips, they may be well
paid. But the important thing of this is to show you have a union
that claims it has a union scale and geting people to join, or coercing
business people into joining the union, putting their employees in a
union and then they have no further interest in it at all.
They are not in the legitimate union movement business. They
are practicing a racket. You may employ a waitress at $3 a day, and
she may make $10 a day or $15 a day with her tips.
Mr. DeMar. I have girls that we pay $65 a week. She don't pick
up any money, and we give her $65 a week. That is what we pay her.
Mr. Kennedy. Do you guarantee that every one of your girls will
make $70 a week ?
Mr. DeMar. We guarantee every girl if they don't make $70 a week,
she will, we will make up the difference.
Mr. Kennedy, Do you mean if some of these girls are only making
$25, you would make up the difference ?
Mr. DeMar. She wouldn't come to work at that time.
Mr. Kennedy. Do you guarantee every girl working for you will get
$70 a week ?
Mr. DeMar. That is right, sir, that she will make up $70 a week
between her pay and her tips, and I trust my girls.
Mr. Kennedy. You guarantee that ? Say she only gets $35.
Mr. DeMar. Mr. Kennedy, I don't give them a written contract. I
tell her if she doesn't make $70 a week, I will make up the difference.
If she don't make up the difference, doesn't qualify, she quits the job^
or we let her go. We send her to the union for a new job.
Mr. Kennedy. It isn't absolutely guaranteed that she is going ta
make $70 a week.
Mr. DeMar. Well, we guarantee her $70 a week. If she does not
make it, we give her the difference.
Mr. Kennedy. I thought you said she left then, if she could not
make that she would leave.
IMPROPER ACTIVITIES IN THE LABOR FIELD 13007
Mr. DeMar, Sometimes they leave and sometimes we let them go.
It all depends. If she can't make $70 a week, she is a poor waitress.
We would let her go altogether.
The Chairman. Do you mean one of these girls that are drawing
$3 a day, if she doesn't get enough tips to make up the $70, you let
her go ?
Mr. DeMar. We pay more than $3 a day. We pay 50 cents an hour.
Where did you get the $3-a-day business ?
The Chairman. Let's say 50 cents an hour.
Mr. DeMar. That is $4 a day, not $3. There is a lot of difference.
The Chairman. Take your figure. Say $4 a day and they work 6
days a week. Four time six would be $24 that they would get in
salary.
Mr. DeMar. That is right.
The Chairman. If they don't get enough tips to make $70 a week,
then you make up the difference ?
Mr. DeMar. That is right. We jjut her on a bigger payroll, pay
her more money.
The Chairman. Do you find anything in his records to show that
he does that ?
Mr. Gotsch. No, sir. To the contrary, Senator, his partner, George
Sherman is the one that gave these figures.
Mr. Kennedy. This isn't a restaurant where there are extra high
tips like some of the people we have had.
Mr. DeMar. That particular restaurant, them girls
Mr. Kennedy. You say you are paying them 50 cents. For a 48-
hour week, that gives them $24 a week. According to a review of the
records, some of them you are paying as little as $3 a day.
Mr. DeMar. Maybe they work short hours.
Mr. Kennedy. That is 8 hours a day.
Mr. DeMar. That Virginia, I know she works short hours.
Mr. Kennedy. Maybe once again the union should adjust its salary
in some of these restaurants, but in many cases we have had, or in a
number of cases we have had, this amounts to sweetheart arrange-
ment with the employer.
Even 50 cents an hour or 45 cents an hour does not seem to me to be
very high wages in this period of the history of the United States. ^
The Chairman. This is one thing that is perfectly clear. The union
does not care if they don't get but $24 a week. It has no interest in
them whatsoever.
Mr. DeMar. That is right, sir.
The Chairman. It has manifested no interest.
Mr. DeMar. That is right.
The Chairman. It has done nothing whatever.
Mr. DeMar. That is right.
Mr. Kennedy. What is the total savings ?
Mr. GoTSCH. The Broadway store saves $6,100 per year ; the Ashland
Avenue store, $5,500 per year ; and the DeeMar's Barbeque on Madison
Street saves $15,500 a year.
Mr. Kennedy. What is the total ?
Mr. Gotsch. $27,100, approximately.
Mr. Kennedy. That would be how much more they would have to
pay if they paid union scale ?
Mr. GoTSGH. On these three restaurants ; yes.
13008 IMPROPER ACTIVITIES IN THE LABOR FIELD
Mr. Kennedy. And the rest of the restaurants don't have unions?
Mr. GoTSCH. There is one other that is union. There are about
eight that would be nonunion. There are four union.
The Chairman. All right. Is there anything further?
Mr. Kennedy. That is all.
The Chairman. Call the next witness.
Mr. Kennedy. Mr. Arthur Eberhart.
The Chairman. Do you solemnly swear the evidence you shall give
before this Senate select committee shall be the truth, the whole truth,
and nothing but the truth, so help you God ?
Mr. Eberhart. I. do.
TESTIMONY OF ARTHUR EBERHART
The Chairman. State your name, and your place of residence, and
jour business occupation.
Mr. Eberhart. My name is Arthur Eberhart. I live in Bolton,
111. My restaurant is Flanders Tea Koom at 7501 South Exchange
Avenue.
The Chairman. Do you waive counsel ?
Mr. Eberhart. I do.
The Chairman. Proceed.
Mr. IvENNEDY. Mr. Eberhart, in 1956 you purchased the Flanders
Tea Room ?
Mr, Eberhart. That is right.
Mr. I^NNEDY. And that is 6909 South Chappel, Chicago?
Mr. Eberhart. Yes. No ; that is the address of the previous owner.
Mr, Kennedy. 7501 South Exchange Avenue?
Mr. Eberhart. That is right.
Mr. Kennedy. At the time you purchased the restaurant, the pre-
vious owner was paying a certain percentage of money, a certain
amount of money to the union ?
Mr. Eberhart. She was paying for the kitchen help, all the kitchen
help, and the waitresses were paying their own union dues direct
to the union.
Mr. Kennedy. Did you continue the arrangement of making these
payments to the union ?
Mr. Eberhart, I did, for a period of time,
Mr, Kennedy. How much were you paying ?
Mr, Eberhart, Well, I was paying — there were three unions rep-
resented in this restaurant; the waitress, the cooks, and the miscel-
laneous unions. I was paying, I believe, on six people, monthly.
Mr. Kennedy. Was that to local 593 ?
Mr. Eberhart. Yes, sir.
Mr. KJENNEDY. And the cook's local is 88 ; is that right ?
Mr. Eberhart. That is right.
Mr. Kennedy. You continued that until January 1957?
Mr. Eberhart. Yes, sir.
Mr. Kennedy. What was the reason that you were making these
payments ?
Mr. Eberhart. Well, I inherited that situation.
Mr. Kennedy. Why did you continue making the payments?
Mr, Eberhart. I was afraid of the union situation, I was afraid
I would be put out of business.
I
IMPROPER ACTrVITIES IN THE LABOR FIELD 13009
Mr. Kennedy. Were the union officials ever interested in finding
out what the wages, hours, or conditions of the employees were?
Mr. Eberhart. No, sir.
Mr. Kennedy. That is for both local 593 and local 88; is that
rigiit?
Mr. Eberhart. That is right.
Mr. Kennedy. How much money did that involve ?
Mr. Eberhart. Not too much. It was $3.50 a person, and most of
the time there were 6 people per month.
Mr. Kennedy. That is about $40 every 2 months, is it ?
Mr. Eberhart. In that neighborhood ; yes, sir.
Mr. Kennedy. You stopped in January 1957 ?
Mr. Eberhart. Yes, sir.
Mr. Kennedy. Could you tell us, briefly, why you stopped ?
Mr. Eberhart. Well, I am a country boy. I moved in from
Wheaton, 111. We didn't have that kind of pressure on us. Looking
over my bills, I was running a little short of money to pay them, and
I decided there was one bill I didn't have to pay any more, so I quit.
Mr. Kennedy. Did you also have an argument with one of the
union officials ?
Mr. Eberhart. Yes. One day, unfortunately, I am not sure why it
happened, but I have a morning shift, a morning baker, and for some
reason or other they didn't show up one morning, and it was me or
close up. I was doing the work early, all by myself in the kitchen,
and a union official came in and said I would have to join the Cooks
Union and the Bakers Union. I refused.
Mr, Kennedy. What did he say to you? What else did he say
to you ?
Mr. Eberhart. He said I would have to join both unions.
Mr, Kennedy. Did he tell you to get out of the kitchen ?
Mr. Eberhart. He told me to get out of the white clothes that I was
in, that I was cooking with.
Mr. Kennedy. What language did he use? What did he say to
you?
Mr. Eberhart. Well, it wasn't friendly. It was an unfriendly
spirit. It was a demand to get out of those clothes or join the union,
one of the two.
Mr. Kennedy. What unions did he want you to join ?
Mr. Eberhart. Well, that was the Cooks Union.
Mr. Kennedy. You were also baking there, too ?
Mr. Eberhart. At that time — I like to do the work. I was baking
and cooking at the same time.
Mr. Kennedy. What union did he say you would have to join?
Mr. Eberhart, Well, particularly, his. I don't know what the
Bakers Union is; I never even heard of it. I know there is one.
Mr. Kennedy. Did he suggest that you join just the Cooks, or the
Cooks and Bakers ?
Mr. Eberhart. He said I would have to join both of them,
Mr, Kennedy. And this is your own kitchen ?
Mr. Eberhart. This is my own kitchen.
Mr. Kennedy. What did you tell him ?
Mr, Eberhart. I told him I would wash windows, scrub floors, I
would do anything I wanted to in my own restaurant, and for him to
get out. Then he backed up ; I got scared.
13010 IMPROPER ACTIVITIES IN THE LABOR FIELD
Mr. Kennedy. How did you get scared ?
Mr. Eberiiart. Well, I was afraid of union difficulties. I was buy-
ing this restaurant. It had to remain open. I took the man — it was
before 11 o'clock. I took him down in the basement and showed him a
record of my receipts and told him I couldn't go on with that circum-
stance and decided that I wasn't going to join the union under any
conditions.
Mr. Kennedy. Then you really didn't back out ?
Mr. Eberiiart. Well, I tried to be friendly about it, and it didn't
go over too well.
Mr. Kennedy. What happened, finally ? You told him to get out
of the restaurant, finally ?
(At this point, Senator Kennedy entered the hearing room.)
Mr. Eberiiart. Well, it was a little more than that. He threatened
me with pickets. He said one of the previous owners — he had had to
pull a strike on them. He had had the pickets out there all lined up,
and the man was bullheaded. It wouldn't have been necessary if he
had gone along with the union. Then that the same thing would hap-
pen to me. I stated tliat I wasn't under any conditions, going to join
the union, and told him to go ahead and get his pickets, that I would
do some business then. That would give me good, free advertising
that I wasn't getting at the time. He said he wasn't going to do it
that way. I said if he broke my windows I would break his. I also
said if he hurt my family or myself I would hurt him.
Mr. Kennedy. What ha})pened after that ?
Mr. Eberiiart. Well, he left.
Mr. Kennedy. Then what happened ?
Mr. Eberiiart. Well, I got nervous, as I am nov,-, and, from trying
to play safe, watching my car going home, trying to enter my home, I
had a heart attack.
Mr. Kennedy. What sort of safeguard did you take ?
Mr. Eberiiart. Well, there isn't any safeguard you can take in this
situation. There is nobody you can go to, right up to this particular
room here, all the way along the line. You are on your own. That
is what we need to stop.
Mr. Kennedy. What sort of things would you do in order to try to
protect yourself ?
]\Ir. Eberhart. AVell, make it legitimate. For one, I would make
the unions responsible. I would make them responsible, the same as a
corporation is, to report their income and where it goes and who it
goes to. A corporation has to do it ; why shouldn't the union have to
do it? I could not see any reason to pay out to them, so I just quit.
They have not bothered me, but I am plenty scared, and I am scared
right now.
^Ir. Kennedy. What sort of safeguard were you taking for your
own life after you had this fight ?
Mr. Eberhart. Well, there is no place that you can go at any time
for labor trouble. You have no friends. You are entirely on your
own. And, as being on your o\^^l, you have to use whatever defensive
methods you have got, and mine was a shotgun.
]Mr. Kennedy. Were you careful where you drove ?
Mr. Eberhart. Yes, sir. I drove around the block several times
before I started out away from my restaurant; I looked my car over
IMPROPER ACTIVITIES IN THE LABOR FIELD 13011
to see that it was all right. At no time did they molest me. But I was
afraid that they would.
Mr. Kennedt. Why were you so afraid that they would ?
Mr. Eberhart. Well, it is the type of people you are dealing with.
You don't know what they are apt to do.
Mr. Kennedy. Did you know at any time that any restaurants or
restaurant owners had been bothered in the past ?
Mr. Eberhart. No, but your imagination plays against you, and
you get scared. I was the first one to buck them, I think, and I think
there might be some more, but at least I bucked them.
Mr. Kennedy. Had you heard in the past that they had caused
difficulty and trouble for anybody ?
Mr. Eberhart. Only gossip and hearsay. I don't know of an actual
case where a union man has hurt anybody. But I still was scared.
I will say that to the best of my knowledge they did not bother me,
except to try to get me to go back in from time to time, which I refused.
Mr. Kennedy. You never paid any money after that ?
Mr. Eberhart. I refused to pay 1 cent more. They asked me for
money for their convention down in Miami this year, and I laughed
at them.
The Chairman. Is there anything further ?
Senator Church. I would just like to say, Mr. Eberhart, that pos-
sibly if many of these other restaurant owners who have come here and
testified before the committee, and have admitted very candidly that
they were paying for protection to an outfit that operated under the
label of a union, but in fact was no union, perhaps this racket would
not have spread so far in Chicago, and I want to say that personally
I admire you for taking the stand that you did and refusing to pay
tribute to this particular local in order to continue to do business.
Had more of the restaurant owners assumed the same attitude, it
would have been very hard for this racket to have spread so far. I
want to commend you for it.
Mr. Eberhart. Thank you.
The Chairman. Haye you any questions. Senator Kennedy ?
Senator Kennedy. No questions, Mr. Chairman.
The Chairman. Well, thank you.
Senator Kennedy. What are the wage rates paid in your restau-
rant as compared to the union rate ?
Mr. Eberhart, Let me say this, Good restaurant management in a
diner-type restaurant calls for approximately 25 percent of the receipts
to be w^ages. In my restaurant, the wages compared to the sales are
37 percent of the receipts and they have never been below 32 percent
even in our best months. They have been that way for over 12 years
of being in business.
Senator Kennedy. That is all.
Mr. Kennedy. We have the figures. Again, you can make any
explanation,
Mr, Gotsch, The annual savings by Mr. Eberhart in his restaurant
are $9,800 per year. He has a total of 18 employees. Six are union
and 12 are nonunion. They are all paid below union scale.
Mr. I^nnedy. I might say as far as Mr. Eberhart is concerned and
the type of restaurant he runs, it might very well be that the tips are
higher there and their income is supplemented, and also Mr. Eber-
13012 UMPROPER ACTIVITIES IN THE LABOR FIELD
hart has-been veiy cooperative in the course of the investigation.
But he might want to make a statement about the wage scale.
Mr. Eberhart. I would like to ask one statement of the man, and
that is if you tell my bank I am $9,000 ahead, I haven't got it.
The Chairman. The Chair wishes to commend you for your courage.
Mr. Eberhart. Thank you, sir.
The Chairman. We need more people like you in this country. This
is not any one man's battle. You say when you get in trouble with
them or get this pressure on you, it seems like maybe you don't have
a friend anyM-here to stand by you. But we can only combat this
organized crime and these rackets by the decent citizenship of this
country standing together and refusing to submit to their extortionist
demands.
You will remain under subpena, a continuing subpena, subject to
being recalled any time the committee may desire to hear further
testimony from you. You will acknowledge that recognizance?
Mr. Eberhart. I do, but can I go home? My restaurant needs me.
The Chairman. Yes, you can go home. But we may need your
testimony further. In the second place, I want to do it and serve
notice that if you receive any threats or any effort is made to harm
you or interfere with your peaceful pursuits in any way, I want you
to report it to this committee. I shall regard, and I think the com-
mittee will approve this position unanimously, any attempt to threaten,
to intimidate, harass you in any way because of your testimony here,
or to prevent you from giving further testimony, in my judgment,
would be contempt of the United States Senate and I would ask this
committee to deal with it and the Senate to deal with it accordingly.
Mr. Eberhart. Thank you.
The Chairman. Thank you very much.
Call the next witness.
Mr. Kennedy. Mr. Richard Jansen.
The Chairman. You do solemnly swear that the evidence you shall
give before this Senate select committee shall be the truth, the whole
truth, and nothing but the truth, so help you God ?
Mr. Jansen. I do.
The Chairman. State your name, your residence, and your business
or occupation.
TESTIMONY OF RICHARD JANSEN
Mr. Jansen. Richard Jansen, 2516 Lincoln Avenue, Evanston, 111.
I manage the Ivanhoe Restaurant, 3000 North Clark Street, Chicago,
lU. ' ^ »
The Chairman. Do you waive counsel ?
Mr. Jansen. I do.
Mr. Kennedy. How long have you been with the Ivanhoe
Restaurant ?
Mr. Jansen. Since January 1946.
Mr. Kennedy. You went as manager of the restaurant shortly after
you got out of service ?
Mr. Jansen. I didn't serve as manager at that time. I spent quite
a lot learning about the different parts of the operation.
Mr. Kennedy. Well, it was a short time after you got out of the
service ?
IMPROPER ACTIVITIES IN THE LABOR FIELD 13013
Mr. Jansen. Yes, sir.
Mr. Kennedy. And you learned, I understand, in the early 1950's,
that a certain amount of money was being paid liy the restaurant to
the union ?
Mr. Jansen. To the best of my recollection, yes, about 1950.
Mr. Kennedy. Do you know what the reason was for that money
being paid?
Mr. Jansen. I was not present at the time the arrangements were
made concerning that amount of money, but I believe the information
which you want is in an affidavit which is signed by my father.
The Chairman. Your father is Harold L. Jansen ?
Mr. Jansen. That is correct.
The Chairman. The affidavit to which the witness referred will be
placed in the record at this point.
(The document is as follows :)
I, Harold Jansen, of 653 Wellington Avenue, Chicago, 111., make the following
statement to James P. Kelly who has identified himself to me as a representative
of the United States Senate Select Committee on Improper Activities in the
Labor or Management Field. I am aware that this statement may be used by
the committee as it see fit and no force or duress has been used to compel me to
give it. I have received no promise of immunity from anyone for giving this
statement :
For the past 35 years I have been associated with the Ivanhoe Restaurant
located now at 3000 North Clark Street, Chicago, 111. At the present time I am
a partner in the restaurant.
Sometime in the 1940's, I do not recall the year, two business agents from the
miscellaneous local of the restaurant union came into the Ivanhoe and asked
to speak to me and to my brother Ralph who was a partner at the time.
They told us that we would have to put 10 employees in the miscellaneous
category into the union. They did not talk to the employees to my knowledge.
We agreed to comply. When we spoke to the miscellaneous employees they told
us that they did not Vvant to join the union. We told them we would pay the
dues because we were afraid the employees would quit if they were forced to
join the union. To the best of my recollection we also paid the initiation fees
for 10 men.
The union business agents did not threaten us at this time but my brother
and I realized that there might be trouble if we did not go along. I recall the
union agents giving us application cards which we gave to the employees to
sign. For many years the union collected dues on the original 10 men although
some of them had left our employ.
In 1944, or thereabouts, a business representative of the checkroom attend-
ants union came in and told us that we would have to put two employees in
their union. I told the two girls in the checkroom they would have to join the
union and they said they would quit first, which they did. When I promised
them I would pay their union dues they agreed to return.
In 1958 this union merged with the miscellaneous local and we paid dues on
a total of 17 employees, 15 miscellaneous employees and the 2 checkroom
attendants.
The only actual threats we received from the union was in 1952 when, on the
eve of Mother's Day, approximately five union oflScials came into the restau-
rant with a copy of a union contract which we were in the process of negotiat-
ing and told us, "We will give you 5 minutes to sign this or we will pull out all
of your employees on strike."
Because of the economic duress prior to a holiday when we had reservations
hooked for Mother's Day, my brother Ralph signed the contract. The crafts
represented were the bartenders, cooks, and waiters. I do not recall whether
the miscellaneous category was represented at that time.
To the best of my recollection the union dues were always paid by check. I
have never given any money either by cash or check to any union oflScial. The
Ivanhoe Restaurant pays the dues to the miscellaneous local by check. The
receipts for the dues oii the miscellaneous employees are kept in the office here
3.t the restaurant.
13014 IMPROPER ACTIVITIES IN THE LABOR FIELD
To the best of my knowledge and recollection all the foregoing statements are
true.
Harold L. Jansen.
Witness :
Sworn to before me this 5th day of July 1958.
[sbial] Astked Hoch.
My commission expires June 1961.
Mr. Kennedy. Mr. Jansen, you are paying union scale at your
restaurant i
Mr. Jansen. Yes, we are.
Mr. Kennedy. Mr. Chairman, we made an analysis of the records
of Mr. Janseii's restaurant and have found that all of his employees
are being paid union scale or above. In many cases they are being
paid above.
I expect it is a. competitive advantage for some of your competitors,
for those of your competitors who are not paying union scale, is it
not?
Mr. Jansen. Yes, it would certainly seem so.
Mr. Kennedy. You are also an employer trustee of the health and
welfare trust fund ?
Mr. Jansen. That is right, Mr. Kennedy.
Mr. Kennedy. Why did you take that position ?
Mr. Jansen. Because I believe that the benefits of a health and
welfare program are the type of thing the restaurant industry should
want in its contracts.
Mr. Kennedy. Had you felt that there wasn't enough interest in
the part of some of the employers ?
Mr. Jansen. Well, I feel it was a very new step for our industry.
We had just signed a very costly contract in 1955, and the health and
welfare being a part of it was only part of the total cost of the con-
tract. I think the industry was very definitely disappointed with
the cost of the contract which amounted to something like an 18 per-
cent incease in wage rates.
It was understandable. It isn't that they did want to pay into it,
but they didn't want to cooperate particularly in organizing the trust
itself, I think there was the feeling that it would take a lot of time,
and so forth, and there weren't too many who were interested.
Mr. Kennedy. So you decided to volunteer and go into it?
Mr. Jansen. Yes. I am not taking any personal credit for it. I
was not the only one ; Mr. Louis Berkhoff, a Chicago restaurant oper-
ator, and Mr. Hal Benn were all approved by a group of union res-
taurant operators who met and voted on forming the management
trustees.
Mr. Kennedy. How many employees are covered by it ?
Mr. Jansen. Approximately 3,200 at this time.
Mr. Kennedy. And that is about 220 restaurants that participate?
Mr. Jansen. Yes, that is right, Mr. Kennedy.
Mr. Kennedy. It is a great advantage, a distinct advantage for the
employees, that arrangement ?
Mr. Jansen. I should say so.
Mr. Kennedy. What is your feeling toward these union contracts,
or supposed union contracts, where there are some of the employees
that are members of the union, and the contract is not enforced ?
IMPROPER ACTIVITIES IN THE LABOR FIELD 13015
Mr. Jansen . I am only familiar with the arrangements you speak
of from the hearings here in this committee room, I haven't, let's
say, been in knowledge of them long enough to have an opinion.
Mr. Kennedy. Would you have any statement about it whatsoever ?
Mr. Jansen. Would you state the question again?
Mr. Kennedy. About the fact that some of your competitors and
other people who run restaurants in Chicago are permitted by the
union to pay far less than union scale for their employees?
Mr. Jansen. I think that is a coincidental arrangement. I cer-
tainly could place no blame on another restaurant operator for, let's
say, enjoying a lower wage rate than we are paying. I think it is one
of the unfortunate consequences of putting too much power in the
hands of people who are not capable of assuming that power.
I think there is no question but what the issue here, as I understand
it, and the suggestion, if I might be permitted to make one, is that the
trouble is not with giving authority, privileges, to labor people, but
rather that the Government be sure that it doesn't give this sort of
power to the wrong people. I think there is no question but what if
this authority that unions have to put picket lines on places were
handled judiciously, there would be no hearing here today. That is
my opinion.
Mr. Kennedy. It is a gi'eat advantage, is it not, for some of these
restaurants ?
Mr. Jansen. It certainly is an economic advantage as it has been
described here.
Mr. Kennedy. It is not just something that accrues to the benefit
of a few union officials, but it is something that accrues to the benefit,
in many cases, of management ?
Mr. Jansen. Yes, it does. I have been aware of this to some extent
over the years. I hadn't any idea of the extent of it as it has been
reported here, until this week in Washington.
Mr. Kennedy. And the three groups that suffer are people such as
yourself who pay union scales, the employees who are paid less than
they ought to be paid, and the consumers ?
Mr. Jansen. I would say, of course, that I think that question has
in its background the inference that there might be a responsibility
for some blame, perhaps, to be attached to restaurant operators who
don't pay these scales. I would say that a restaurant operator — I
don't know what wage scales we would pay. I would like to think
they would be exactly the same. But I don't know what they would
be if we didn't have a union contract.
I don't think most business people in any industry want to know-
ingly stand for less than a living wage for their employees.
Mr. Kennedy. Are you still paying now this sum of money ?
Mr. Jansen. We aren't as of about 10 days ago.
Mr. Kennedy. "Why did you stop ?
Mr. Jansen. We stopped because we felt that as a consequence of
this investigation we would perhaps not be criticized too strongly by
the union for what we had been told was now very definitely an im-
proper practice.
Mr. Kennedy. Had you known it was improper prior to this time ?
Mr. Jansen. I would have assumed it to be, certainly.
Mr. Kennedy. Why did you continue to pay even if it was im-
proper ?
13016 IMPROPER ACTIVITIES IN THE LABOR FIELD
Mr. Jansen. I think we preferred not to explore tlie consequences.
(At this point, Senator Kennedy left the hearing room.)
Mr. Jansen. I think the economic consequences of falling out of
grace, let's say, with the union is something that most business people
are extremely sensitive about.
Mr. Kennedy. So you were really over a barrel and had to pay the
money because of that ?
Mr. Jansen. In so many words, yes.
Mr. Kennedy. Once again, ISIr. Chairman, this restaurant and the
owners of this restaurant, have been very cooperative.
Mr. Jansen. I would like to make one more statement, if I may be
given permission at this time, Mr. Chairman.
The Chairman. Proceed.
Mr. Jansen. I think there is no question but what the integrity of
the restaurant people of Chicago has been very much put on trial at
these hearings, certainly not through the conscious fault of the com-
mittee but certainly through the happenstance of the conduct of the
hearings. I think that the question that has come to my mind, and
I am somewhat puzzled — if I may interpret properly the Chair's
attitude I think there seems to be a dissatisfaction with the coopera-
tion restaurant people have given this committee.
If I could come away from this witness' chair having thrown a little
more light on that situation, I would feel a great deal relieved. I
cannot believe — I know these restaurant people in Chicago — I know
of nothing which they should jointly or collectively be ashamed of. I
personally am not ashamed of being a restaurant operator in Chicago.
I think like many businesses or any business there are parts of it
which certainly offer plenty of room for improvement. But I think
the situation here is one where if you are serving perhaps the reason
that restaurant operators are less than cooperative because they are
in fear of their body, of harm, then I would say I think that is erron-
eous. I would like to say that I think the power of a strike has cer-
tainly been the adequate means that the union has had at its disposal
to bring any restaurant to its knees.
It is one of the powers when I speak and say that it certainly must
be put in judicious hands.
(At this point, Senator Goldwater entered the hearing room.)
Mr. Jansen. I think given the power to take the staff out of an
industry, and in our industry we are dealing with very perishable
items, our inventory includes hundreds of items we have to have
delivered to us in numerous deliveries daily, and without deliveries
being able to cross the picket line, this stops our business completely.
Holding a gun to our ribs and demanding our money wouldn't impress
us half so much as a picket line.
I say there is nothing wrong with a picket line, there is nothing
wrong with this power, provided it is in the hands of responsible
people.
The Chairman. How would you suggest we get it in the hands of
responsible people ?
Mr. Jansen. I think you have done a great deal to do that already,
Mr. Chairman.
The Chairman. We can agree with you, readily agree with you.
I think the power to strike, the right to strike, is something we don't
IMPROPER ACTIVITIES IN THE LABOR FIELD 13017
want to take away from the worker. But how to keep it, that author-
ity and that power, in the hands of people who are honest and who
will use it for proper purposes, I don't know, because you can't
legislate that sort of integrity in every man who might become the
head of a union.
Mr. Jansen. I don't suggest that Government subcommittes inves-
tigating these things are an instrument to be used to bring these
things about, but certainly they do become that. I think the investi-
gation by Senator Kef auver in the committee previously investigating
as they did several years ago, brought with it a great deal in its wake.
I think that the opportunity to bring a great deal of light into
corners where it seldom gets put a feeling of responsibility on a lot of
people who haven't, perhaps, been made to feel it. I think a lot of
people feel it is corny to be honest, it is corny to have ideas. I think it
has been proven that the Government of the United States can be
interested in almost any corner of the United States, and that there
isn't anybody who is so far high or low that he can't stop and think
that he might some day be called to answer for what he does.
The Chairman. Do you think hearings such as this accomplish some
good ?
Mr. Jansen. There is no question of it.
The Chairman. We are glad to know that you approve. I say to
you again that it is not our purpose to reflect upon the restaurant in-
dustry and the people who operate restaurants. That isn't the prob-
lem.
As we pointed out here over and over — and neither are we opposing
unionism — as you refer to it, misplaced power, or power placed in the
hands of people who lack integrity to use its judiciously, or the will
to do so, does do and can cause a great deal of harm.
Mr. Jansen. I would like to make one specific suggestion, Senator
McClellan, if I may.
I think the right to strike is a privilege, and I think that the author-
ity to call a strike is such a terrific responsibility because of what it can
bring if it is not handled properly. I think a strike should have some
certification, or at least this is the experience of such things as we
have had in Chicago, if such a thing is within the realm of a possi-
bility. The picket line to the public's eye has the public endorse-
ment with it.
I don't think it should have that endorsement if it isn't a legitimate
picket line.
The Chairman. What do you mean by that ?
Mr. Jansen. One that is the outgrowth of the complaints of the
bone fide employees of that establishment. _
The Chairman. In other words, you are opposed to coercive picket-
ing of a union, to compel management to sign up or to sign up the
employees into that union ?
Mr. Jansen. I certainly am.
The Chairman. You speak of a strike. You would like to know, as
I interpret your remarks, or you would like to feel that a strike, when
called, was actually carrying out the will, and it is being done with the
approval of those employees who are affected by it.
Mr. Jansen. Exactly.
21243 — 58— pt. 34 11
13018 IMPROPER ACTIVITIES IN THE LABOR FIELD
The Chairman. Well, I agree with you in principle 100 percent.
Thank you very much.
Senator Goldwater. Mr. Chairman ?
The Chairman. Senator Goldwater.
Senator Goldwater. Mr. Jansen, would you feel that the Congress
should provide some legislation to control organizational picketing ?
Mr. Jansen. Well, other than the suggestion. Senator Goldwater,
that I just made I haven't, frankly, been able to give it that much
thought and consideration. I do feel, though, that the picket line
certainly is endorsed and accepted by most every American. I think
it carries with it a connotation, and I think to all the world when you
see one you might be inclined to think that certainly here is a place
where a man pays less than he should or he is unfair to his employees.
I think unfortunately in many, many cases this is certainly far from
the truth. I think if a law could be devised that would carry with it
the endorsement of the employees in that establishment, I think it
would then have a connotation, certainly, of being a bona fide picket
line, representing those employees.
Senator Goldwater. You, in effect, are suggesting what has been
suggested several times here. I believe you are suggesting that we
provide for a strike vote before a strike can occur, and the subsequent
picket line.
Mr. Jansen. Yes, but I would even go further. After all, there
are so many things surrounding a vote. I think both unions and
management might, in many cases, question the propriety or the
integrity of a vote, because of the means available to vote may be
coercive.
I think, rather, the vote should be conducted by a third party. I
think there should be great lengths gone to to establish this. It might
seem absurd in some small establishments, but a man who has worked
years to build a business, and certainly the employees being properly
represented, are entitled to no less.
Senator Goldwater. The Congress has considered several times
during the last 6 years the advisability of providing for a strike vote
along the lines that you have suggested, but so far we have not been
able to accomplish an3'thing in that direction.
Now I have just one more question, because I think you have given
us more than just passing thoughts. I did not want to pass up the
opportunity to get your thinking on this.
We have attempted to legislate in this field. There are varying
opinions as to the effectiveness of what we have done. As these hear-
ings go on day after day after day and we find the way that these
unions in Chicago — and I suspect elsewhere — have been infiltrated
by members of the underworld, gangsters, hoodlums, and so forth,
it becomes more and more obvious to me that it is pretty nearly im-
possible to legislate in a way that will allow unions to cleanse them-
selves of these people.
For instance, the current legislation that is now in the House would
not, in my opinion, offer an easy or even a workable way for the
unions in Chicago to rid themselves of some of these people who have
no jail or prison terms, who have never been even arrested for some
of the things that they do.
IMPROPER ACTIVITIES IN THE LABOR FIELD 13019
I was wondering if you might not agree that if we made of the
union movement in America as it is in every other country in the
world, with the exception of three others, and there only by lack
of law, if we would make of it a free movement, where if a man
didn't like what was going on in his union he could quit that union
without losing his job and remove compulsion, put them on the same
basis as all other organizations, such as organizations that you belong
to. What do you think of a suggestion like that ?
Mr. Jansen. I think it is a splendid suggestion as I understand
it. I had not heard of it prior, so I am not too familiar with all of
the ramifications. But I would say this: It occurs to me, and has
many times, that labor unions are much like business in the sense
that they have something to offer or should have something to legiti-
mately offer a worker. I think the success of a union should depend
upon their being able to legitimately demonstrate their ability to
offer something for the wage earner.
I think there is no question but that the means of accomplishing
that in the law you mention certainly seems to be adequate.
Senator Goldwater. Somebody once said that they could vote by
foot or vote by their feet, and they meant that they could walk out
if they didn't like the way the organization was being run. I think
we are having demonstrated to us daily the futility of trying to write
legislation that would be as effective as making of the union move-
ment a free movement so that a man could join or not join and not
have that affect his job.
Mr. Jansen. I think that would bring a great deal of responsi-
bility to the union. There is no question. Senator Goldwater.
Senator Goldwater. Thank you.
Senator Church. I would like to say, Mr. Jansen, in behalf of the
committee, that we appreciate your testimony. It has been very help-
ful. I think it would be useless to debate the pros and cons of the
question of voluntary unionism.
I would only observe here that the racket that we have been investi-
gating would be little affected by the question of voluntary unionism,
because in essence this has been a racket perpetrated by a handful of
men in a handful of locals, who largely have dealt with management
and have come to terms with management, whereby management
agrees to impose membership in these particular locals upon the em-
ployees, and in many cases, if not in most, this is done against the will
of the employees.
It is quite outside the framework of any law at all. It is an arrange-
ment that management enters into. In the course of these hearings, we
have had three different kinds of representatives of management here.
We have had restaurant owners like yourself who are operating legiti-
mate union shops, where the unions undertake to take an interest in
the employees, and where the union scale is being paid, and the whole
operation is being conducted in a generally legitimate way.
Then we have had witnesses like Mr. Eberhart, who preceded you
to the witness stand.
Mr. Eberhart refused to pay tribute for the privilege of doing
business. He had the gum.ption to say "No," and he has managed to
get away with it. That is to his great credit. Were there more like
13020 IMPROPER ACTIVITIES IN THE LABOR FIELD
him, I am sure the racket we have been investigating would not have
spread so far in Chicago.
Finally, there has been the third category of owners. These owners
have paid this tribute to these particular locals, and all of them could
testify that the locals couldn't care less about the employees. All of
them have testified, in effect, that they paid the tribute in order not to
be bothered by pickets or coercion or other intimidations, because they
were afraid that if they did not make this payment, the could not do
business peacefully. Some of them would have made these payments,
may pay bonuses and may give other fringe benefits to their employees
so that they are dealing fairly with those employees even though they
are not paying the union scale.
But 1 must say in order to keep this thing in perspective, that there
are others who have been here, who clearly are benefiting by this ar-
rangement, who, by virtue of the fact that they do not have to deal
with a legitimate union, they do not have to pay the kind of wages
that you are paying in your restaurant, again a definite competitive
advantage, and they may well consider it cheap enough to deal with
these racketeers to protect their businesses from legitimate unions,
because these particular locals are freezing out unions that might un-
dertake, in a bonafide way, to represent the waiters and the chefs.
I think we must balance the picture out and keep it in perspective.
I feel that evidence has been presented here that would indicate that
some restaurant owners are obtaining a benefit to their own operation
by paying out an agreed amount for protection, not only against
picketing and troubles, but also for an arrangement whereby they
don't have to pay union scale and thus have a competitive advantage
that might not otherwise obtain.
Mr. Jansen. Senator Church, I think at this distance it might
well be so interpreted. However — and I beg the Chair's indulgence for
the length of time I have taken already, but I must say it — I think
there is a great importance on the spirit in which these agreements
were entered into.
Frankly, I cannot believe that management would have preferred
it that way. I still think they would rather operate cleanly, non-
union or union, but to have had the legitimate arrangement in either
case.
I think, frankly, they don't like to have somebody come in and say
"For a cheap price, you can get back this way."
I do not believe the whole industry of people could feel so.
Senator Church. I would not want to make that charge, and I do
not.
I would merely say that we have various kinds of operators who have
been variously motivated. Although I am sure the great majority of
restaurant owners dislike the circumstance they find themselves in,
and many have been coerced into doing this, that nonetheless there
are going to be some who will benefit by it.
Mr. Jansen. There is no question.
The Chairman. Are there any further questions ?
Mr. Duffy. I have one last question before we close with this
witness.
What was the date of the last payment you made to the union before
you stopped?
IMPROPER ACTIVITIES IN THE LABOR FIELD 13021
Mr. Jansen. It has been about 2 months ago.
tii^^?" ^^^^^- ^"^ ^^"^ ^''°'^ ^'""^ "^^^^ y«^ paid to the union at that
Mr. Jansen. I imagine it would have been around $120
ivT iQ I'S^- ^ ^^'"'^ ^^'^ ''^''^^^ ^^^«^s it was $126, and it was on
May io, lyoo.
Mr. Jansen. I stand corrected.
Mr. Kennedy. You were making those payments every 2 months,
were you? "^ '
Mr. Jansen. That is correct.
Mr. Kennedy That is, up until you stopped a short time ago.
Mr. Jansen. That is correct.
The Chairman. You say you have stopped making these payments
JJo you expect the employees to make their own payments «
Mr. Jansen. Yes, I do. We raised the salary of 17 employees bv
an amount equal to the dues and informed them of our action and the
fact that they had, of course, had their dues paid by the restaurant
over these years, but that that arrangement was no longer possible
and they m the future, as we advised the union, will have to make
their arrangements on the proper basis ?
The Chairman. Do you have a withholding basis ?
Mr. Jansen. Yes, absolutely.
The Chairman. So you will hereafter withhold their dues?
Mr. Jansen. Withhold? No, we don't intend to withhold their
wages. Ihey will actually pay their wages to the business agent of
the union, as every other employee does.
J^T ? 9.^'^^^?^^^- }^. some places, you know, the management checks
ofl 1 believe they call it, the dues, withholds it out of their wages.
Mr. Jansen. We will not do that. We never have done it.
The Chairman. In other words, they will have to pay their dues
on their own ?
Mr. Jansen. Yes, sir.
The Chairman. But they will be expected, of course, to belonfr to
the union. ^
Mr. Jansen. That is correct. However, we are raising their wa^es
by that amount.
The Chairman. Do you have a union contract clause in your con-
tract ? "^
Mr. Jansen. We do have.
The Chairman. In other words, you have to operate a union shop ?
Mr. Jansen. We can hire a nonunion employee provided he joins
the union within a certain length of time; yes.
The Chairman. That is what we term the union shop.
Mr. Jansen. Eight, correct.
The Chairman. Are there any further questions ?
If not, thank you. Call the next witness.
Mr. Kennedy. Now I would like to call the union official who is in
charge of 593, the biggest local of this kind in Chicago. He is ad-
ministrative director for local 593 and a man of considerable interest
to us. That is Mr. John Lardino.
The Chairman. Come forward, Mr. Lardino.
Mr. Kennedy. We had testimony about Mr. Lardino on the first
day of the hearing, and also today, and some last week.
13022 IMPROPER ACTIVITIES IN THE LABOR FIELD
The Chairman. You do solemnly swear the evidence you shall give
before this Senate select committee shall be the truth, the whole truth,
and nothing but the truth, so help you God ?
Mr. John Lardino. I do.
TESTIMONY OF JOHN LARDINO, ACCOMPANIED BY
COUNSEL, MYRON EHRLICH
The Chairman. State your name, your place of residence, and your
business or occupation.
Mr. John Lardino. My name is John Lardino. I live at 1201
Belleporte, Oak Park, 111.
The Chairman. What is your business, please, sir, or your occu-
pation ?
Mr. John Lardino. I decline to answer on the grounds that the
question may tend to incriminate me.
The Chairman. You have counsel present, do you? That would
not incriminate you to state that, would it ?
Mr. John Lardino. I decline to answer on the ground that the
question may tend to — ^the answer may tend to incriminate me.
The Chairman. All right, Mr. Counsel, you may stand aside. If
the witness will not acknowledge you as his counsel, you may stand
aside.
Mr. Ehrlich. I don't think he failed to acknowledge me as his
counsel.
The Chairman. I asked him if he had counsel present, and he
refused to answer on the ground it might tend to incriminate him.
So you may stand aside, unless he can acknowledge he has counsel
present.
(The witness conferred with his counsel.)
Mr. John Lardino. I acknowledge that. I misunderstood you.
The Chairman. It does not incriminate you, does it ?
Mr. John Lardino. I am sorry. I misunderstood you.
The Chairman. Identify yourself for the record, Mr. Counsel.
Mr. Ehrlich. My name is Myron Ehrlich. I practice law in the
District of Columbia, and I have done so for 33 years.
The Chairman. Thank you. Proceed, Mr. Kemiedy.
Mr. Kennedy. Mr. Lardino, you have been supervisor of local 593 ?
Mr. John Lardino. I decline to answer on the grounds that the
question may tend to incriminate me.
Mr. Kennedy. When did you come into 593 ? Just tell us tlie date
that you came with 593, Mr. Lardino.
Mr. John Lardino. I decline to answer on the grounds that the
question may tend to incriminate me.
(The witness conferred with his counsel.)
Mr. John Lardino. The answer may tend to incriminate me.
The Chairman. Do you honestly believe that if you gave a truth-
ful answ^er to the question of when did you come into local 593, that
a truthful answer thereto might tend to incriminate you ?
(At this point, Senator Kennedy entered the hearing room.)
Mr. John Lardino. I refuse to answer on the grounds that my
answ^er may tend to incriminate me.
IMPROPER ACTIVITIES IN THE LABOR FIELD 13023
The Chairman. The Chair, with the permission of the committee,
■orders and directs you to answer the question of whether or not you
honestly believe that if you gave a truthful answer to the question
when did you come into local 593, that a truthful answer might tend
to incriminate you.
Mr. John Lardino. I refuse to answer on the grounds that my
answer may tend to incriminate me.
The Chairman. The order and direction of the Chair will stand
and continue throughout your examination and while you remain on
the witness stand.
Senator Ejennedy. Mr. Lardino, you are the administrative direc-
tor of local 593 with jurisdiction over the business agents for that
local ; is that correct ?
Mr. John Lardino. I decline to answer on the grounds that my
answer may tend to incriminate me.
Senator Kennedy. Mr. Lardino, we have heard testimony that the
union collected from the employer union dues which the employers
charged off as business expenses ; that there was no interast shown by
the union in regard to the working conditions and how much the
employers were paying, whether they were paying the union wage,
and that, therefore, this was a form of extortion which the workers
were being forced to contribute to.
The responsibility of the union in this case is quite clear, and you
were the administrative director of local 593, with jurisdiction oyer
the business agents. Could you tell me whether you took any action
while you were associated in this effort, and while you were tied up
with people like Tony Accardo, Jack Cerone, Paul "The Waiter"
Ricca, and others ?
Mr. John Lardino. I decline to answer on the ground that my
answer may tend to incriminate, me.
(At this point. Senator Church withdrew from the hearing room.)
Senator Kennedy. Could you tell me whether you conceive it as
your responsibility as administrative officer of this union to check and
find out what services the people who were paying their union dues
were getting?
Mr. John Lardino. I decline to answer on the grounds that my
answer mav tend to incriminate me.
Senator Kennedy. Could you tell me whether as of today you hold a
position of responsibilty in the local ?
Mr. John Lardino. I decline to answer on the grounds that my
answer may tend to incriminate me.
The Chairman. Do you honestly believe that if you answered that
question, whether you now hold a responsible position in the local, that
a truthful answer thereto might tend to incriminate you ?
Mr. John Lardino. I decline to answer on the grounds that my
answer may tend to incriminate me. .
The Chairman. With the approval of the committee, the Chair
orders and directs you to answer the question whether you honestly
believe that a truthful answer to the question whether you now hold a
responsible position in the local, would tend to incriminate you.
Mr. John Lardino. I decline to answer on the grounds that my an-
swer may tend to incriminate me.
The Chairman. The order and direction of the Chair will continue
throughout your examination.
13024 IMPROPER ACTIVITIES IN THE LABOR FIELD
Senator Kennedy. Isn't it correct, Mr. Lardino, that you resigned
at noon today from your position ?
Mr. John Lardino. I decline to answer on the grounds that my an-
swer may tend to incriminate me.
Senator Kennedy. Are you planning to give us any information
about your activities as a responsible or irresponsible union official ?
Mr. John Lakdino. I decline to answer on the grounds that my an-
swer may tend to incriminate me.
The Chaikman. Were you born in this country ?
Mr. John Lardino. I decline to answer on the grounds that my an-
swer may tend to incriminate me.
The Chairman. Do you honestly believe that if you gave a truthful
answer to the question, "Were you born in this country?" that a truth-
ful answer might tend to incriminate you?
Mr. John Lardino. I decline to answer on the grounds that my
answer may tend to incriminate me.
The Chairman. With the approval of the committee, the Chair
orders and directs the witness to answer the question. Do you honestly
believe that if you gave a truthful answer to the question, "Were you
born in this country?" that a truthful answer might tend to incrimi-
nate you ?
Mr. John Lardino. I decline to answer on the grounds that my
answer may tend to incriminate me.
The Chairman. The order and direction of the Chair will continue
throughout your examination ? May I ask you another question ? Are
you an American citizen ?
Mr. John Lardino. I decline to answer on the ground that my an-
swer may tend to incriminate me.
The Chairman. Do you honestly believe that if you truthfully an-
swered the question, "Are you an American citizen?" that a truthful
answer thereto might tend to incriminate you ?
Mr. John Lardino. I decline to answer on the grounds that my an-
swer may tend to incriminate me.
The Chairman. With the approval of the committee, the Chair
orders and directs you to answer the question. Do you honestly believe
that if you gave a truthful answer to the question, "Are you an Ameri-
can citizen r' that a truthful answer thereto might tend to incrimi-
nate you.
Mr. John Lardino. I decline to answer on the grounds that my an-
swer may tend to incriminate me.
Senator Kjennedy. Mr. Chairman, I hope the committee will have
an opportunity of acting on this question of whether the witness is
permitted to refuse to answer a question such as, "Is he an American
citizen?" so that we can get more precise instructions from the court
as to what the rights of the witness are and what the rights of the
committee of the Congress are in attempting to obtain information.
The Chairman. The Chair will, as he has already announced with
respect to some other testimony which I regard as flagrant contempt
of this committee, or the lack of testimony, rather, which was refused,
and I will regard it as flagrant contempt of this committee — the Chair,
as soon as the staff can prepare the proper and necessary papers for
the committee to act, will call the committee into executive session,
having in mind that it should act to cite for contempt, or ask the Sen-
IMPROPER ACTIVITIES IN THE LABOR FIELD 13025
ate, rather, to cite for contempt, those who have shown such flagrant
contempt for the committee.
I cannot conceive that the highest court in this land would ever
condone, give its judicial sanction, to the right of one to refuse to state
under oath that he is a citizen of this country, or refuse to answer
the question that he honestly believes that if he gave a truthful answer
to the question "Are you a citizen of this country?" that a truthful
answer could possibly tend to incriminate him.
I think one who takes that position shows the utmost and lowest
contempt and disrespect for the flag that is a symbol of the liberty and
freedom that he enjoys as an American citizen. I sincerely trust that
we will be able to process these cases to that tribunal that will have the
final judgment, and that we will clarify this jungle that has developed
here in the use of the fifth amendment, where it has been perverted
into an instrumentality to serve and protect the lowest kind of crimi-
nals that the human mind can imagine.
All right. Are there any other questions ?
Mr. Kennedy. Mr. Lardino, when the staff first interviewed you,
you admitted that you had come into the union in May of 1939, and
that you had come in on the recommendation of Louis Romano. Is
that correct ?
Mr. John Lardino. I decline to answer on the grounds that my
answer may tend to incriminate me.
Mr. Kennedy. Have you gone under the names of Edward Nardi
and John Alcott, at various times ?
Mr. John Lardino. I decline to answer on the grounds that the
answer may tend to incriminate me.
Mr. Kennedy. Aren't those some aliases you have used, Mr.
Lardino ?
Mr. John Lardino. I decline to answer on the grounds that my
answer may tend to incriminate me.
Mr. Kennedy. Mr. Chairman, what we are going into is the matter
of the nonenforcement of the union regulations that was discussed
earlier, and the fact that the union employees, or the employees of
the various shops, are getting no benefit from the union.
The other matter, which is of extreme importance, and which we
must keep our minds on, is what we developed at the beginning of this
hearing, that many of these individuals came in under gangster spon-
sorship, and that these organizations and unions were operated and
set up by the underworld in Chicago.
We had the testimony that this was so, and then we have seen devel-
oped here the fact that the employees in the various restaurants get no
benefit whatsoever, and that this amounted to really a shakedown or
mass extortion.
I would like to ask Mr. Lardino if he knows some of these individ-
uals with whom he has been linked in earlier testimony. That in-
cludes some of the highest of the underworld in Chicago, including
Paul "The Waiter" Ricca.
Do you know Paul "The Waiter" Ricca ?
Mr. John Lardino. I decline to answer on the grounds that my
answer may tend to incriminate me.
Mr. Kennedy. We had testimony that you were at the wake of
Louie "Little New York" Campagna, at Reggo's Funeral Home in
Chicago of June 1955. How did you happen to go to his wake ?
13026 IMPROPER ACTIVITIES IN THE LABOR FIELD
Mr. John Lardino. I decline to answer on the grounds that my
answer may tend to incriminate me.
Mr. Kennedy. What was there about him ? Was he a great friend
of yours, Mr. Lardino ?
Mr, John Lardino. I refuse to answer on the grounds my answer
may tend to incriminate me,
Mr. Kennedy. At the wake, in addition to "Little New York"
Campagna, was Joey Aiuppa. Was he a friend of yours ?
Mr. John Lardino. I refuse to answer on the grounds that my
answer may tend to incriminate me.
Mr. Ivennedy. Sam "Mooney" Giancana ?
Mr. John Lardino. I refuse to answer on the grounds that my
answer may tend to incriminate me.
Mr. Kennedy. Tony Accardo ?
Mr. John Lardino. I refuse to answer on the grounds that my
answer may tend to incriminate me.
Mr. Kennedy. Claude Maddox ?
Mr. John Lardino. I refuse to answer on the grounds that my
answer may tend to incriminate me.
The Chairman. Let the record further show here, with emphasis,,
that the witness is emphasizing his contempt for the committee by
using the word "refuse" instead of "decline."
Proceed.
Mr. Kennedy. Jack Cerone ?
Mr. John Lardino. I refuse to answer on the grounds that my
answer may tend to incriminate me.
Mr. Kennedy. These are all close friends of yours, Mr. Lardino?
Mr. John Lardino. I refuse to answer on the grounds that my
answer may tend to incriminate me.
Mr. Kennedy. In addition to Mr. Campagna's wake, we understand
that you also attended Tony Accardo's parties. Is that right, Mr.
Lardino ?
Mr. John Lardino. I refuse to answer on the grounds that my
answer might tend to incriminate me.
Mr. Kennedy. Your car was seen at the Fourth of July party of
Tony Accardo in 1954. You were present at that party, were you^
Mr. Lardino ?
Mr. John Lardino. I refuse to answer on the grounds my answer
may tend to incriminate me.
Mr, Kennedy, And we also had information that Paul "The
Waiter" Ricca was there,
Mr, John Lardino, I refuse to answer on the grounds that my
answer may tend to incriminate me,
Mr, Kennedy, And Jack "Skippy" Cerone ?
Mr. John Lardino, I refuse to answer on the grounds that my
answer may tend to incriminate me.
Mr, Kennedy, These people are all friends of yours, are they, Mr,
Lardino ?
Mr, John Lardino. I refuse to answer on the grounds that my
answer may tend to incriminate me.
Mr. Kennedy. We had some testimony regarding a Mr. Labriola
and Mr. Weinberg, who were trying to set up some trade association
in 1953-54. According to the information we had, they were in touch
IMPROPER ACTIVITIES IN THE LABOR FIELD 13027
with somebody they identified as you, on the telephone. Could you
tell us if you talked with them about setting up these trade asso-
ciations ?
Mr. John Lardino. I decline to answer on the grounds my answer
may tend to incriminate me.
Mr. Kennedy. Did you ever have any conversations with Robert
Greenfield
Mr. John Lardino. I decline to answer on the grounds that my
answer may tend to incriminate me.
Mr. Kennedy. Wait until I finish the question. Who is working
now with Allen Dorfman, and who was associated with that group?
Mr. John Lardino. I decline to answer on the grounds that my
answer may tend to incriminate me.
Mr. Kennedy. Where did you get your present home from, Mr.
Lardino ?
Mr. John Lardino. Pardon me ; I didn't hear you.
Mr. Kennedy. Where did you buy your present home ?
Mr. John Lardino. I decline to answer on the grounds my answers
may tend to incriminate me.
Mr. Kennedy. Can you tell us from whom you purchased it?
Mr. John Lardino. I decline to answer on the grounds my answer
may tend to incriminate me.
Mr. Kennedy. Did you purchase it from Johnny Bananas, in
Chicago ?
Mr. John Lardino. I decline to answer on the grounds my answer
may tend to incriminate me.
Mr. Kennedy. According to the information we have, you pur-
chased your home from Johnny Bananas, who is a syndicate hoodlum
in Chicago, in 1948. Is that correct ?
Mr. John Lardino. I decline to answer on the grounds my answer
may tend to incriminate me.
Mr. Kennedy. Could you tell us how you happned to buy your home
from him ?
Mr. John Lardino. I decline to answer on the grounds my answer
may tend to incriminate me.
Mr. Kennedy. And you paid $40,000 for that, is that right, in 1948 ?
Mr. John Lardino. I decline to answer on the grounds my answer
may tend to incriminate me.
Mr. Kennedy. Could you tell us where you got that money ?
Mr. John Lardino. I decline to answer on the grounds my answer
may tend to incriminate me.
Mr. Kennedy. Could you tell us what your relationship has been
with Anthony Champagne, who was a labor counsel for the Chicago
Restaurant Association ?
Mr. John Lardino. I decline to answer on the grounds my answer
may tend to incriminate me.
Mr. Kennedy. And Abraham Teitelbaum; can you tell us about
that?
Mr. John Lardino. I decline to answer on the grounds my answer
may tend to incriminate me.
Mr. Kennedy. And could you tell us how it was that the Marquis
strike was settled ?
Mr. John Lardino. I decline to answer on the grounds that my
answer may tend to incriminate me.
13028 IMPROPER ACTIVITIES IN THE LABOR FIELD
Mr. Kennedy. Could you tell us about bringing your brother, Danny
Lardino — do you know Danny Lardino ?
Mr. John Lardino. Yes.
Mr. Kennedy. Did you bring him into the labor movements?
Mr. John Lardino. I decline to answer on the grounds my answer
may tend to incriminate me.
Mr. Kennedy. Do you work with Danny Lardino ?
Mr. John Lardino. I decline to answer on the grounds my answer
may tend to incriminate me.
Mr. Kennedy. He was with local 658, and then was brought over
to your local. Could you tell us why that was done ?
Mr. John Lardino. I decline to answer on the grounds my answer
may tend to incriminate me.
Mr. Kennedy. How much money do you get, legitimately, or do you
get from the union, which is actually recorded?
Mr. John Lardino. I decline to answer on the grounds my answer
may tend to incriminate me.
Mr. Kennedy. Could you tell us why there are no records prior to
1955 for local 593 ?
Mr. John Lardino. I decline to answer on the grounds my answer
may tend to incriminate me.
Mr. Kennedy. According to our records, in 1955, you received from
the local, salary, $19,865, another salary adjustment of $3,400, a weekly
expense of $5,850, a convention expense of $2,400, a Christmas bonus
of $400, making a total of $31,915. Is that correct ?
Mr. John Lardino. I decline to answer on the grounds my answer
may tend to incriminate me.
Mr. Kennedy. Mr. Chairman, that was incorrect. I gave Mr.
Blakely. How much do you get, Mr. Lardino ?
Mr. John Lardino. I decline to answer on the grounds my answer
may tend to incriminate me.
Mr. Kennedy. From the local 593, salary of $19,865, salary adjust-
ments of $3,400, weekly expense of $5,872, total for that year, con-
vention expense of $1,400, automobile expense of $2,420.40, Christmas
bonus of $400, making a total of $33,357.40. Is that right?
Mr. John Lardino. I decline to answer on the grounds my answer
may tend to incriminate me.
Mr. Kennedy. You got $33,357.40 m 1955 for doing exactly what,
Mr. Lardino ?
Mr. John Lardino. I decline to answer on the grounds my answer
may tend to incriminate me.
Mr. Kennedy. "VVliat other money did you get from the local?
Mr. John Lardino. I decline to answer on the grounds my answer
may tend to incriminate me.
Mr. Kennedy. Mr. Chairman, could I call Mr. Mundie, to confirm
these figures for 1955 and put the figures for 1956 and 1957 in?
The Chairman. Yes.
TESTIMONY OF JAMES MUNDIE— Resumed
The Chairman. Mr. Mundie, you have been previously sworn.
Mr. Mundie. I have.
The Chairman. You will remain mider the same oath.
IMPROPER ACTIVmES IN THE LABOR FIELD 13029
rec'^rds'SS^k'^'™ ^°" "'•*" ^" examination of the books and
Mr. MuNDiE. I have.
Mr. Kennedy Were all of the books and records available 2
Mr. MuNDiE. For the years 1955, 1956, and 1957 ^^^^^^ble ?
Mr. Kennedy Prior to that, there were no books or record^,?
Mr. Mhndie. They told me they had been destroyed
Mr. Kennedy. Would you tell us what the books and records show
for IQ^.T w *T^' *^f ^"^^ *« M^- Lardino? I gaVr^he ^^^^
for 1955. Were those figures correct 2 S^tvy uie ngures
Mr.MuNDiE. That is correct.
Mr M^rin^ioi^r ^m ^V' '^' ^^"^^^^ ^^^ 1^^^' Pl^^^e?
weekly exnense of%S ^'^ ^'?^^^^ "'"'^^^^ ^^^''^^0 in salary;
^^^a<JoK^ ? ^^'^PS; convention expense of $2,050- strike ex
pense $65; purchase^of an automobile, ddillac aiLmoMle $9 oeT
Christmas bonus, $400 ; making a total of $33,900 '''''''"''''''^^' *^'"^^ ,
Mr. Kennedy. What about 1957 «
Mr. Kennedy. Does he receive more money out of the local monev
Mr. MuNDiE. Well, m he year 1957, it was about $500 more.
Mr. Kennedy. Mr. Blakely is the next ?
Mr. MuNDiE. Yes, sir
partmeSrfXboJ^" *"""'"' '"^^ '"'''' ''' '^'« ^^P-'s with the De-
Mr. MuNDiE. That is correct.
nf^j'^ni^^^''''^''^^'' the reports that were filed with the Department
lUn^V""' ^^ °"" investigation beginning, which wasT^r?;
S l.r? ''''''''' ''^'^'^'' ^^^ ^'- T^^r^l"^« report accurately how
ir ^? ^ ^^® ^^^ receiving out of this union ?
^Mr^UNDiE. In the year 1955, the report to the Labor Depart-
Mr' M^^'^'^'o^f T •^' ^'"'^^ ^^S' %^^^^^ ^^^^^^ be filed in 1956?
reH-nr wo °'- J^'/^. IS correct; Mr. Lardino, as administrative di-
rector, was reported to have $18,796.
Mr. Kennedy How much money did he actually receive?
Mr.MuNDiE. $33,357.40. j eive.
U.^l'i^Ti^'^'''''-^'^ ^^ ^^P^^*^ ^^1 *^® ™o^ey on his income-tax re-
turns that he received out of the union ?
Mr. Mundie. Mr. Lardino reported his salary, no weekly expense
bomS"^^"^ ^^ expense, and no automobile expense, and no Christmas
r^o^I;i-^^i?^^^J- T!",^ T^^^^y expense was expense that he received
periodically and which there were no vouchers for «
Mr. Mundie. Every week.
iQ^'''-"^?'^5^-''T' ¥'''' ^^'^ y^^^ 1^^^' t^^<^ report was not filed until
lyo ( ; IS that right ?
Mr. Mundie. That is correct,
ri ht '? "^^^^^^^' ^^^ ^^^^^ report is accurate, in substance; is that
13030 IMPROPER ACTIVITIES IN THE LABOR FIELD
Mr. MuNDiE. In substance, with the exception of the convention ex-
pense and the automobile and bonus.
TESTIMONY OF JOHN LARDINO— Resumed
Mr. Kennedy. You have a safety deposit box?
Mr. John Lardino. I decline to answer on the grounds that it may
tend to incriminate me. . .
Mr. Kennedy. Isn't it correct, when I talked to you out m Chicago,
you said you had a safe-deposit box and made arrangements for us
to look at the safe-deposit box ?
Mr. John Lakdino. I decline to answer on the grounds it may tend
to incriminate me.
Mr. Kennedy. Could you tell us what you had in the safe-deposit
box? ,
Mr. John Lardino. I decline to answer on the grounds it may tend
to incriminate me. .
Mr. Kennedy. I would like to call Mr. Duffy, Mr. Chairman, who
made an examination of the safe-deposit box.
The Chairman. Mr. Duffy, you have been previously sworn. You
may remain where you are.
TESTIMONY OF LaVERN J. DUFFY— Resumed ■
Mr DuFi'Y. When we examined that, we found he had $25,000 in I
cash 5^^25,000 in Government bonds made out to John and Joanne f
Lardino. I might also add, at the time I asked Mr. Lardmo how
much money he had in his personal possession, and he stated that he
had $1,000 in his pocket. , ,r -r t v i.- u i. „.
Mr. Kennedy. Also, did we ask Mr. Lardino where his bank ac-
counts were? ^ -.. , 1 -^ ^n £ ^U„
Mr Duffy We asked Mr. Lardino to submit the names ot the
various banks he had money in, and he stated he had no bank accounts
in Chicago, that he did not keep any money in the banks.
Mr Kennedy. Is that correct, Mr. Lardmo ? . . .
Mr. John Lardino. I decline to answer on the grounds that my
answer may tend to incriminate me. .
Mr. Kennedy. Could you tell us where the $25,000 m cash came
Troin
Mr! John Lardino. I decline to answer on the grounds my answer
may tend to incriminate me. tit t t
Mr Kennedy. Mr. Duffy, did we request from Mr. Lardmo an
examination of the bills, so that we could determine the location and
the number of the bills? . . , • ^. i: i ^o-4-
Mr Duffy Yes. When I examined the currency m the sate-deposit
box i asked to take off some of the serial numbers on the money. The ,
attorney, or I should say Mr. Lardino, was present, not his attorney, |
and they refused to let me take any of the numbers oft ot the bills.
Mr Kennedy. Is that correct ?
Mr. John Lardino. I decline to answer on the grounds my answer
may tend to incriminate me.
Mr Kennedy. You wouldn't tell us anythmg, then, about your
associates, your criminal associates, your assocuites in the underworldj
You wouldn't tell us anything about the operation of the union, and
IMPROPER ACTIVITIES IN THE LABOR FIELD 13031
you wouldn't tell us anything about your personal finances; is that
right, Mr. Lardino ?
(The witness conferred with his counsel.)
Mr. John Lardino. I decline to answer on the grounds it may tend
to incriminate me.
Mr. Kennedy. Mr. Chairman, Mr. Lardino's brother is working
for the local. We have had some testimony about him and his activi-
ties. I would like to have permission to call him as a witness.
The Chairman. Let him be called around.
Mr. Kennedy. Mr. Danny Lardino.
Mr. Ehrlich. ISIr. Chairman, I represent Mr. Danny Lardino. Is
he going to sit over there ?
The Chairman. He can sit right there by you. Be sworn. You
do solemnly swear the evidence you shall give before this Senate
select committee shall be the truth, the whole truth, and nothing
but the truth, so help you God ?
Mr. Danny Lardino. I do.
TESTIMONY OF DANNY LARDINO, ACCOMPANIED BY
COUNSEL, MYRON EHRLICH
The Chairman. State your name, your place of residence, and your
business or occupation.
Mr. Danny Lardino. My name is Daniel L. Lardino, 6018 North
Winthrop.
The Chairman. What is your business or occupation, Mr. Lardino?
Mr. Danny Lardino. I decline to answer on the grounds that my
answer may tend to incriminate me.
The Chairman. Do you have an attorney ?
Mr. Danny Lardino. Yes, sir.
The Chairman. You have already, I believe, identified yourself.
Mr. Ehrlich. Yes, sir. I have identified m3^self for the record.
The Chairman. Do you have a brother ?
Mr. Danny Lardino. Yes ; I do.
The Chairman. Do you recognize your brother when you see him ?
Mr. Danny Lardino. Yes ; I do. Senator.
The Chairman. Do j^ou see him now ?
Mr. Danny Lardino. Yes ; I do, Senator.
The Chairman. He is in the witness chair with you?
Mr. Danny Lardino. Yes, Senator.
The Chairman. Proceed, Mr. Kennedy.
^Ir. Kennedy. Mr. Chairman, Mr. Danny Lardino was secretary-
treasurer of Local 658 of the Drugstore, Soda Fountain and Luncheon-
ette Employees Union. This local was absorbed by local 593 in Janu-
ary of this year. Is that correct ?
Mr. Danny Lardino. I decline to answer on the grounds that my
answer may tend to incriminate me.
Mr. Kennedy. And that you were in charge of local 658 up until the
time it was absorbed by 593', and now you are a business representative
of 593 ; is that right ?
Mr. Danny Lardino. I decline to answer on the grounds that my
answer may tend to incriminate me.
13032 EVIPROPER ACTIVITIES IN THE LABOR FIELD
Mr. Kennedy. We had some testimony regarding your activities
down in Dallas, Tex., in 1946. Could you tell us if you have ever been
to Dallas, Tex. ?
Mr. Danny Lardino. I decline to answer on the grounds that my
answer may tend to incriminate me.
Mr. Kennedy. Prior to going down there in 1944, you had been
arrested on suspicion of burglary, and then took a plea of guilty to
malicious mischief, and spent 90 days in the house of correction? Is
that right, Mr. Lardino ?
Mr. Danny Lardino. I decline to answer on the grounds that my
answer may tend to incriminate me.
Mr. Ivennedy. Then in 1946 you w^ent down to Dallas, Tex., accord-
ing to sworn testimony we have had before the committee. Is that
right?
Mr. Danny Lardino. I decline to answer on the grounds that my
answer may tend to incriminate me.
Mr. Kennedy. That you went down there with Marcus Lipsky,
Labriola, Weinberg, and Louis Schneider ; is that right ?
Mr. Danny Lardino. I decline to answer on the grounds that my
answer may tend to incriminate me.
Mr. Kennedy. And you were acting as Lipsky's bodyguard, is that
right ?
Mr. Danny Lardino. I decline to answer on the grounds that my
answer may tend to incriminate me.
Mr. Kennedy. And that you went down there to set up the arrange-
ments for the control of vice in Texas and Arkansas and some of the
States in that area, is that right, and Louisiana ?
Mr. Danny Lardino. I decline to answer on the grounds that my
answer may tend to incriminate me.
Mr. Kennedy. Then you came back to Chicago. You received a
telephone call from your brother, telling you to get out of there, is that
right ?
Mr. Danny Lardino. I decline to answer on the grounds that my
answer may tend to incriminate me.
The Chairman. Mr. Lardino, were you born in this country ?
Mr. Danny Lardino. I decline to answer on the grounds that my
answer may tend to incriminate me.
The Chairman. Do you honestly believe that if you gave a truthful
answer to the question of "Were you born in this country?" that a
truthful answer thereto might tend to incriminate you ?
Mr. Danny Lardino. I decline to answer on the grounds that my
answer may tend to incriminate me.
The Chairman. With the approval of the committee, the Chair
orders and directs you to answer the question "Do you honestly believe
that if you gave a truthful answer to the question 'Were you born in
this country?' " that a truthful answer might tend to incriminate you?
Mr. Danny Lardino. I decline to answer on the grounds it may
tend to incriminate me.
The Chairman. The order and direction of the Chair will stand
through the remainder of your testimony.
Are you an American citizen ?
Mr. Danny Lardino. I decline to answer on the grounds that my
answer may tend to incriminate me.
IMPROPER ACTIVITIES IN THE LABOR FIELD 13033
The Chairman. The chair asks you : Do you honestly believe that
if you gave a truthful answer to the question "Are you an American
citizen?" that a truthful answer might tend to incriminate you?
Mr. Danny Lardino. I decline to answer on the grounds that my
answer may tend to incriminate me.
The Chairman. The Chair, with the direction and approval of the
committee, orders and directs you to answer the question "Do you
honestly believe that if you gave a truthful answer to the question
'Are you an American citizen?' " that a truthful answer thereto might
tend to incriminate you ?
Mr. Danny Lardino. I decline to answer on grounds that my answer
may tend to incriminate me.
The Chairman. The order and direction of the Chair will stand
throughout the remainder of your testimony.
Proceed, Mr. Kennedy.
Mr. Kennedy. When the staff interviewed you out in Chicago, you
said that you did not know most of these individuals who were down
in Dallas, Tex. Is that right, Mr. Lardino ?
Mr. Danny Larding. I decline to answer on the grounds that my
answer may tend to incriminate me.
Mr. Kennedy. You said that you did not know Labriola, you did
not know Weinberg, you did not know Paul Jones, and you did not
know Louis Schneider ; is that correct ?
Mr. Danny Lardino. I decline to answer on the grounds that my
answer may tend to incriminate me.
Mr. Kennedy. Do you in fact know them, Mr. Danny Lardino ?
Mr. Danny Lardino. I decline to answer on the grounds that my
answer may tend to incriminate me.
Mr. Kennedy. Would you identify this registration ?
The Chairman. Would you recognize your own signature ?
(The witness conferred with his counsel.)
Mr. Danny Lardino. I decline to answer on the grounds that my
answer may tend to incriminate me.
The Chairman. Do you mean your answer or your signature ?
Mr. Danny Lardino. I decline to answer on the grounds that my
answer or my signature may tend to incriminate me.
The Chairman. I am going to show you your signature, what pur-
ports to be your signature, and give you an opportunity to identify it.
Present the witness with this signature on the registration card
of the hotel.
(The document was handed to the witness.)
Mr. Danny Lardino. I decline to — I decline to look at it on the
grounds that it may tend to incriminate me.
The Chairman. The Chair is going to order and direct you to look
at it, with the approval of the committee.
Mr. Danny Lardino. I have looked at it, and I decline to answer on
the grounds that it may tend to incriminate me.
The Chairman. Let that card with the signature on it be made
exhibit No. 35.
(The document referred to was marked "Exhibit No. 35" for ref-
erence, and may be found in the files of the select committee.)
The Chairman. Present to the witness the hotel bill and let him
examine that.
21243— 58— pt. 34 12
13034 IMPROPER ACTIVITIES IN THE LABOR FIELD
(The document was handed to the witness.)
The Chairman. State if you identify it.
Mr. Danny Larding. I decline to answer on the grounds that my
answer may tend to incriminate me.
Tlie Chairman. Have you examined the hotel bill ?
Mr. Danny Larding. Yes ; I have.
The Chairman. And you decline to answer ?
Mr. Danny Larding. Yes.
The Chairman. Let the hotel bill be made exhibit 35A.
(The document referred to was marked "Exhibit No. 35 A" for
reference and may be found in the files of the select committee.)
The Chairman. Proceed.
Mr. Kennedy. Mr. Chairman, Mr. Lardino stated that he did not
know any of these individuals, and yet an examination of these hotel
registrations show that he registered in the room with at least one of
them, Mr. Louis Schneider.
Can you explain that to us, Mr. Lardino ?
Mr. Danny Larding. I decline to answer on the grounds it may tend
to incriminate me.
Mr. Kennedy. And while this was going on down in Dallas, Tex.,
in 1946, Mr. Danny Lardino was living with Mr. Sclmeider, while this
arrangement was being set up to take over the vice and the gambling
and other operations in that area.
Can you tell us about that ?
Mr. Danny Larding. I decline to answer on the grounds that my
answer may tend to incriminate me.
Mr. Kennedy. So we have information that you knew Ross Prio,
and that j'ou knew these other individuals ? Then you came back to
Chicago, and shortly afterward Nick DeJohn was found murdered in
California. Could 3'ou tell us anything about his murder ?
Mr. Danny Larding. I decline to answer on the grounds that my
answer may tend to incriminate me.
Mr. Kennedy. According to the information and the testimony be-
fore the committee, Mr. Nick DeJohn had borrowed some money,
including some money in Chicago, and the fact that he was unable
to repa}^ this money to the Chicago underworld was the reason that
he was murdered. Could you tell us about that ^
Mr. Danny Larding. I decline to answer on the grounds that it may
tend to incriminate me.
Mr. Kennedy. With this fine background and experience, and a
number of other arrests, you finally became head of one of the local
unions in Chicago in 1950 ; is that right ? Local 658 ?
Mr. Danny Larding. I decline to answer on the grounds that it may
tend to incriminate me.
Mr. Kennedy. And you received the endorsement of no other than
Mr. James Blakely, who is the international vice president of this
whole union ; is that right ?
Mr. Danny Larding. I decline to answer on the grounds that it may
tend to incriminate me.
Mr. Kennedy. And shortly after you took over the local a great
deal of violence took place in a number of the drugstores in the Chi-
cago area ; is that right, Mr. Lardino ?
IMPROPER ACTIVITIES IN THE LABOR FIELD 13035
Mr. Danny Lardino. I decline to answer on the grounds that it may
tend to incriminate me. . m • ^
Mr. Kennedy. And windows were broken and other acts o± violence
occurred; is that right? j .i .
Mr. Danny Larding. I decline to answer on the grounds that my
answer may tend to incriminate me. .
Mr Kennedy. Garbage and debris was dumped and set on tire m
front of drugstores. Was that all done at your direction, Mr.
Lardino? , i ^i x -^ i. a
Mr. Lardino. I decline to answer on the grounds that it may tend
to incriminate me. . . -,, j ao -n^
Mr. Kennedy. Wliy was that organizational drive called ott i Vo
you know? Can you tell us about that ? j -i, , -^
Mr. Danny Lardino. I decline to answer on the grounds that it
may tend to incriminate me. , i . -,
Mr Kennedy. The Chicago Retail Druggists Association hired a
man by the name of Nathan Ruvell. Can you tell us anything about
Mr. Danny Lardino. I decline to answer on the grounds that it
may tend to incriminate me. , . , • i tt
Mr Kennedy. And he was hired as a public relations counsel. Me
is a close associate of Abraham Teitelbaum. Within a few days or
shortly after he was hired, this strike was called off and he was able
to settle it. Could you tell us how that happened ? -, ^i ^ -.
Mr. Danny Lardino. I decline to answer on the grounds that it
may tend to incriminate me. . i i
Mr Kennedy. And when an investigation occurred, or took place,
in the retail drugstore labor picture in Chicago in 1951, he was sum-
marily fired. Can you tell us anything about that?
Mr. Danny Lardino. I decline to answer on the grounds it may
tend to incriminate me. • i ht
Mr Kennedy. Could vou tell us about how you organized, Mr.
Lardino? According to the information we have, you were also one
of those who was just interested in collecting some money and mak-
ing sure that your salary and expenses are paid, with no interest m
the employees at all.
Is that the kind of procedure that you follow ( _
Mr. Danny Lardino. I decline to answer on the grounds it may
tend to incriminate me. .
Mr. Kennedy. You and your brother just set up a very nice racket
out there so that you would have a source of income; is that correct,
Mr. Lardino? .
Mr. Danny Lardino. I decline to answer on the grounds it may
tend to incriminate me.
Mr. Kennedy. Is that right, Mr. John Lardino ?
Mr. John Lardino. I decline to answer on the grounds that my
answer may tend to incriminate me.
Mr. Kennedy. You wouldn't tell us anything, Mr. Danny Lardino,
as to what there was in your background that warranted you being
given a charter into the Hotel and Restaurant Workers Union m
Chicago ? . 1 J
Mr. Danny Lardino. I decline to answer on the grounds my an-
swer may tend to incriminate me.
13036 IMPROPER ACTIVITIES IN THE LABOR FIELD
Mr. Kennedy. Could you tell us anything about the threats on
Mr. Teitelbaum's life in 1954 ?
Mr. Danny I^ardino. I decline to answer on the grounds that my
answer may tend to incriminate me,
Mr. Kennedy. Mr. John Lardino, can you tell us anything about
that?
Mr. John Lardino. I decline to answer on the grounds my an-
swer may tend to incriminate me.
Mr. Kennedy. We had testimony this morning, Mr. Lardino, that
there were some 40 fires which had the pattern of being arsons, that
there had been set on fire purposely certain of these restaurants and
taverns. Can you tell us the reason or the source of any of those
fires?
Mr. John Lardino. I decline to answer on the grounds my answer
may tend to incriminate me.
Mr. Kennedy. Could you tell us who was responsible, Mr. Danny
Lardino, for those fires?
Mr. Danny Lardino. I decline to answer on the grounds my answer
may tend to incriminate me.
Mr. Kennedy. That is all, Mr. Chairman.
The Chairman. Do you have a position with a labor union at this
time?
Mr. Danny Lardino. I decline to answer on the grounds that my
answer may tend to incriminate me.
The Chairman. Do you think that answer reflects upon unionism
in this country?
Mr. Danny Lardino. I decline to answer on the grounds that my
answer may tend to incriminate me.
The Chairman. Have you ever done a decent thing for working
people in your life?
Mr. Danny Lardino. I decline to answer on the grounds my answer
may tend to incriminate me.
The Chairman. Do you have a friend whom you can acknowledge
or anyone whose acquaintance you can acknowledge without possible
self-incrimination ?
Mr. Danny Lardino. I decline to answer on the grounds my answer
may tend to incriminate me.
The Chairman. Are there any other questions ?
Is there anything further ?
Mr. Kennedy. Just, Mr. Chairman, that these individuals have
positions of great importance and responsibility in that area. Mr.
John Lardino controlled the biggest local, and Danny had complete
control over another local for 6 or 7 years. They had positions of
power and authority over the employees.
The Chairman. Everything I said with respect to the attitude and
refusal to cooperate on the part of witness John Lardino, of course,
applies to this witness, Dany Lardino.
Mr. Kennedy. I might ask what the arrangements were with the
Chicago Restaurant Association, Mr. John Lardino ?
Mr. John Lardino. I decline to answer on the grounds my answer
may tend to incriminate me.
IMPROPER ACTIVITIES IN THE LABOR FIELD 13037
Mr. Kennedy. Do you know why it was that they should have as
somebody doing their labor relations with your unions, first,, Teitel-
baum, who had many criminal associations, and then Mr. Teitelbaum
should get Mr. Louis Komano, who had a criminal record, with many
criniinal associations, and Mr. Champagne, with many criminal asso-
ciations, and he should take on Sam English, also, who is very close to
Sam Golfbag Hunt, why they should have individuals like that asso-
ciated with them ?
Mr. John Larding. I decline to answer on the grounds that my an-
swer may tend to incriminate me.
Mr. IVENNEDY. Was it necessary because on your side you also had
the same kind of association, the same kind of records ?
Mr. John Lardino. I decline to answer on the grounds that my an-
swer may tend to incriminate me.
The Chairman. Is there anything further?
Mr. Kennedy. That is all.
The Chairman. Mr. John Lardino, I think possibly your further
testimony may be needed by this committee at a later date. Therefore,
I am directing the clerk of the committee, Mrs. Watt, to serve this
subpena upon you here in open session of the committee. You will be
under that subpena subject to return on that date, unless you are noti-
fied not to.
(The document was handed to the witness.)
The Chairman. The Chair at this time directs the clerk to prepare
a similar subpena for your brother, the witness Danny Lardino, to
appear again on the same date as this subpena, the 11th day of Sep-
tember 1958, here at the committee room, 101, Senate Office Building,
Washington, D. C.
That subpena is in the course of preparation. The Chair directs
that it be served on the witness Danny Lardino before he is excused
from attendance here today.
As soon as the subpena is prepared, you will serve it on this witness.
The witness is not released from his presence before this committee
until that subpena is served.
Wlien the committee recesses this afternoon, it will recess until 10
o'clock in the morning, to reconvene in this room.
Mr. Kennedy. I would think, Mr. Chairman, that we will only be
a half day on Friday.
The Chairman. Do you think we may get through by Friday ?
Mr. Kennedy. Yes.
The Chairman. Let the record show, and, if you will hand me that
subpena, let the record show it is dated the I7th, whereas it should be
dated the 16th. Change the copy of the subpena to the 16th.
You will acknowledge the change in yours accordingly. It is actu-
ally issued on the 16th, rather than the 17th. It is a typographical
error in the dating of it.
Mrs. Watt, you will serve this subpena on Danny Lardino.
(The document was handed to the witness.)
Mr. Kennedy. It is my information that John Lardino has re-
signed today from his union positions, as well as Mr. Danny Lardino,
although we have not heard officially.
13038 IMPROPER ACTIVITIES IN THE LABOR FIELD
I understand that is correct.
Is that correct, Mr. Danny Lardino ?
Mr. Danny Larding. I decline to answer on the grounds that my
answer may tend to incriminate me.
Mr. Kennedy. What about it, Mr. John Lardino ?
Mr. John Lardino. I decline to answer on the grounds that my
answer may tend to incriminate me.
Mr. Kennedy. I understand they are both out of jobs, Mr. Chair-
man.
The Chairman. Is there anything further ?
If not, the committee stands in recess until 10 o'clock in the morning.
("WHiereupon, at 5 : 05 p. m., the committee recessed, to reconvene
at 10 a. m. Thursday, July 17, 1958, with the following members pres-
ent : Senators McClellan and Goldwater.)
INVESTIGATION OF IMPROPER ACTIVITIES IN THE
LABOR OR MANAGEMENT FIELD
THURSDAY, JULY 17, 1958
United States Senate,
Select Committee on Improper Activities
IN THE Labor or Management Field,
Washington^ D. C.
The select committee met at 10 a. m., pursuant to Senate Resolution
74, agreed to January 30, 1957, in the caucus room. United States Sen-
ate, Senator John L. McClellan (chairman of the select committee)
presiding.
Present : Senator John L. McClellan, Democrat, Arkansas ; Senator
Frank Church, Democrat, Idaho.
Also present : Eobert F. Kennedy, chief counsel ; John J. McGovern,,
assistant counsel ; LaVern J. Duffy, investigator ; James P. Kelly, in-
vestigator; James Mundie, investigator; Ruth Young Watt, chief
clerk.
The Chairman. The committee will be in order.
(Members of the committee present at the convening of the session
are : Senators McClellan and Church.)
The Chairman. Call the next witness.
Mr. Kennedy. Mr. Joseph Wilkos.
The Chairman. Do you solemnly swear that the evidence you shall
give before this Senate select committee shall be the truth, the whole
truth, and nothing but the truth, so help you God ?
Mr. WiLKOS. I do.
TESTIMONY OF JOSEPH WILKOS
The Chairman. State your name, and your place of residence and
your business or occupation.
Mr. Wilkos. My name is Joseph Wilkos, and I live at 724 Selborn
Road, Riverside, and I am a restaurant owner.
The Chairman. Do you waive counsel ?
Mr. Wilkos. Yes, sir.
The Chairman. All right.
Mr. Kennedy. We have dealt in the past, Mr. Chairman, with a
number of different locals, including 593, and to some extent 88 and
394, and also to a lesser degree 484. Today we are going to deal with
local 450. We will have testimony on that local, as well as testimony
from some of the officials of that local.
Now, Mr. Wilkos, you purchased the Richards Restaurant and
Lounge, did you ?
Mr. Wilkos. That is right.
13039
13040 IMPROPER ACTIVITIES IN THE LABOR FIELD
Mr. Kennedy. In October of 1953 ?
Mr. AViLKOs. That is right.
Mr. Kennedy. Now, were you approached shortly after you made
the purchase to organize j^our employees ?
Mr. WiLKOs. Several months after the purchase, I was approached.
Mr. Ivennedy. Was that from a representative of local 450 ?
Mr. WiLKos. Yes, sir.
Mr. Kennedy. Now, could you tell us what statements were made to
you at tliat time ?
Mr. WiLKos. Well, they told me that they had a contract with the
previous owner.
Mr. Kennedy. Could you tell us \vho told you this ?
Mr. WiLKos. I don't remember if it was I^izzare or if it was another
one.
Mr. Kennedy. Was it Mr. Leonardi ?
Mr. WiLKOs. Or it might have been Leonardi; I don't remember
whether it was Lizzare or Leonardi.
Mr. Kennedy. All right, go ahead.
Mr. WiLKOS. They said they had a contract with the previous owner,
and they expected me to go along with the old contract.
]Mr. Kennedy. What did you tell them that you would do ?
Mr. WiLKos. Well, I said I guess I didn't have much choice but to
go along with the old agreement.
Mr. Kennedy. What was the old agreement ? What did you learn
that was ?
Mr. WiLKos. Well, I think the old agreement provided for six em-
ployees in the union.
Mr. Kennedy. Did you agree to pay money on six employees ?
Mr.WiLKos. I did.
Mr. Kennedy. Did he tell you anything about the fact that you
could avoid trouble if you did this ?
Mr. WiLKOs. Something was mentioned like that.
Mr. Kennedy. "Wliat was mentioned in substance ?
Mr. WiLKOs. When I tried to talk my way out of it, they just told
me, "You didn't want any trouble ; did you ?"
Mr. Kennedy. What did you understand he meant by that?
Mr. WiLKOS. Well, it is common knowledge that when something
like that is said, it means a picket line.
Mr. Ej^nnedy. Now, did you have any discussions with him later
on, and you agreed at that time to put in some six of your employees ?
Mr. WiLKOs. That is right.
Mr. Kennedy, To pay dues on six employees ?
Mr. WiLKOS. That is right.
Mr. Kennedy. And the initiation fees ?
Mr. WiLKOS. That is right. We didn't pay initiation fees on those.
Mr. Kennedy. Just the dues ?
Mr. WiLKos. Yes, sir.
Mr. Kennedy. How much did that amount to ?
Mr. WiLKOs. It was approximately $60 quarterly.
Mr. Kennedy. Did he make an approach at a later time ?
Mr. WiLKOs. Yes, sir.
Mr. Kennedy. Who came back to see you then ?
Mr. WiLKOs. It was different ones ; and it was Kouba and Lizzare
were the chief ones, and then Leonardi would come in once in a while.
IMPROPER ACTIVITIES IN THE LABOR FIELD 13041
Mr. Kennedy. What was Leonard!, what did he tell you ?
Mr. WiLKOS. That he wanted more people in the union.
Mr. Kennedy. Mr. Leonardi told you that ?
Mr. WiLKOS. Yes, sir.
Mr. Kennedy. And what arrangements did you make then ? This
is the second time ?
Mr.WiLKos. Well, we added 2 or 3 to the list.
Mr. Kennedy. Wlien did he come back, and when did Mr. Leonardi
have this conversation with you ?
Mr. WiLKOS. The first time, or the last time ?
Mr. Kennedy. The time that you agreed to put in some more em-
ployees.
Mr. Welkos. I wouldn't remember the date.
Mr. Kennedy. How long after ? Was it 1954 during the same year ?
Mr. WiLKos. I think about 1955.
Mr. Kennedy. How many employees then did you agree to put in ?
Mr. WiLKOs. I think we added three then.
Mr. Kennedy. So then you were paying for nine employees alto-
gether ?
Mr. WiLKOS. At that time.
Mr. Kennedy. How much was the total you were paying to the
union?
Mr. WiLKos. Well, the amounts varied, from $60 when we started
to the present time, we were paying $142.50.
Mr. Kennedy. Why are you paying this money ?
Mr, WiLKOS. Well, to keep the employees.
Mr. Kennedy. Did they want to join the union ?
Mr. WiLKOs. They don't, and they don't want to pay the dues.
Mr. Kennedy. So you have to make these payments in order to
keep your employees working, and the employees who don't want to
join the union ?
Mr. WiLKOS. That is right.
Mr. Kennedy. What would be the result or what would happen if
you didn't make the payments to the union ?
Mr. WiLKOs. That would strictly be a guess.
Mr. Ivennedy. "What did you think would happen if you didn't
pay?
Mr. WiLKOs, That we would get tied up with a picket line.
Mr. Kennedy. That would destroy your business, would it ?
Mr. WiLKOS. It would knock our business out completely.
Mr. Kennedy. You signed a union contract, did you ?
Mr. WiLKOs. At a later date.
Mr. Kennedy. Wlien was that ?
Mr. WiLKOs. That was in 1956.
Mr. Kennedy. Did you sign a contract for health and welfare ?
Mr. WiLKos. Yes, sir.
Mr. Kennedy. Was this for all of your employees ?
Mr. WiLKOs. No, it was not for all of the employees.
Mr. Kennedy. Just certain of the employees paid their own dues?
Mr. WiLKOs. That is right.
Mr. Kennedy. And the health and welfare covered those employees ?
Mr. WiLKOs. No.
Mr. Kennedy. Which emploj^ees did it cover ?
13042 IMPROPER ACTIVITIES IN THE LABOR FIELD
Mr. WiLKOS. Health and welfare covered full-time employees that
we carried, the ones we paid for.
Mr. Kennedy. All of those?
Mr. WiLKOs. The full-time ones that we paid on. J
Mr. Kennedy. Did Mr. Leonardi, the union representative, ever dis- ^
cuss with you the wages, hours, or conditions of your employees?
Mr. WiLKOs. No.
Mr. Kennedy. They just wanted the money, is that right ?
Mr. "WiLKOS. Well, they wanted a contract or you can call it that
if you want to.
Mr. Kennedy. That is what it is, isn't it? It is $142.50 quarterly?
Mr. WuLKos. That is right.
Mr. Kennedy. All right.
The Chairman, How do you pay this money ?
Mr. WiLKOs. By check.
The Chairman. You always pay it by check ?
Mr. WiLKOs. Yes, sir.
The Chairman. So you are paying $570 a year now to this hijacking
outfit?
Mr. WiLKOs. That is right.
The Chairman. That is what it amounts to, isn't it ?
IVIr. WiLKOs. The suspicion looks that way.
The Chairman. Are there any facts to controvert the suspicion?
Mr. WiLKOs. No, I guess not.
The Chairman, You are in on the deal and you know about it. Do
you know of any facts ?
Mr. WiLKOs. Well, the fact is that if you want to stay in busi-
ness
The Chairman. You have to pay it ?
Mr. WiLKos. O.K.
The Chairman. Is that right ?
Mr. WiLKOs. That is right.
The Chairman. That is the way you feel about it ? You don't pay
it voluntarily, and you pay it because you feel you have to to stay in
business ?
Mr. WiLKOs. That is right.
The Chairman. As far as any benefit from it is concerned you know
of no lawful benefit that you get, that is, no benefit that you are not
entitled to under the law anyway ?
Mr. WiLKos. That is right.
The Chairman. All right.
Mr. Kennedy. One of the employees or one of the people that you
are paying on is yourself, is it not ?
Mr. WiLKOs. That is right.
Mr. Kennedy. There is no benefit that the union can do for you ?
Mr, WiLKOs. At that time they wanted representation in the kit-
chen, and I thought it would be a good idea to put myself in, instead
of paying initiation dues on people that might come and go.
Mr. Kennedy. So you just put yourself in as the representative in
the kitchen ?
Mr. WiLKOs. Yes, sir.
IMPROPER ACTIVITIES IN THE LABOR FIELD 13043
Mr. Kennedy. But there is no benefit that the union could have
given you, is there? This was just a question of keeping them away,
and you made a payment in order to keep them away ?
Mr. WiLKOS. That is right.
Mr. Kennedy. That is all.
The Chairman. Do you work in the kitchen ?
Mr. WiLKOS. My office is in the kitchen, yes.
The Chairman. You actually do your work as office work, do you
not?
Mr. WiLKOS. Well, I still do some butchering and frying.
The Chairman. I imagine in small restaurants, you sometimes get
in and help when you have a shortage or something ?
Mr. WiLKos. That is right.
The Chairman. Actually you are owner and manager ?
Mr. WiLKOs. Yes, sir.
The Chairman. And you put yourself in the union and pay dues
just to keep peace ?
Mr.WiLKOS. To keep peace, that is right.
The Chairman. It is to avoid being driven out of business by an
illegal picket line ?
Mr. WiLKOS. That is right.
Senator Church. Did I understand you to say that you commenced
making these payments at the rate of $60 a quarter in 1954, and that
since the rate has gone up to $142.50 per quarter ?
Mr. WiLKOS. That is right.
Senator Church. You made these payments through 1954 and 1955,
but you didn't enter into any kind of union contract at all imtil 1956 ?
Mr. WiLKOs. That is right.
Senator Church. Very well, that is all.
The Chairman. What does the contract provide, do you know ?
Mr. WiLKOs. No, I wouldn't know exactly.
The Chairman. Have they ever done anything to enforce the con-
tract other than to collect the money ?
Mr.WiLKOs. No.
The Chairman. They never complained you were not living up to
the contract in any respect ?
Mr. WiLKOs. No.
The Chairman. Did they ever seek higher wages for your em-
ployees ?
Mr.WiLKos. No.
The Chairman. Did they ever complain about their working con-
ditions ?
Mr. WiLKOS. No.
The Chairman. Their hours of work ?
Mr. WiLKOS No, sir.
The Chairman. I see.
Mr. Kennedy. That is all.
The Chairman. Thank you every much. Call the next witness.
Mr. Kennedy. Miss Marjorie Pechan.
The Chairman. Do you solemnly swear that evidence you shall
give before this Senate select committee shall be the truth, the whole
truth, and nothing but the truth, so help you God ?
Miss Pechan. I do.
13044 IMPROPER ACTIVITIES EST THE LABOR FIELD
TESTIMONY OF MARJORIE PECHAN
The Chairman. State your name, your residence, and your business
or occupation, please.
Miss Pechan. My name is Majorie Peclian, and I live at 3910 West
24th Street, in Chicago, and I am employed at Kichard's Restaurant
and Cocktail Lounge.
The Chairman. Do you waive coimsel ?
MIssPechan". Yes, sir.
Mr. Kennedy. How long have you been employed at Richards^
Restaurant ?
Miss Pechan. It will be 4 years this September.
(At this point, the following members were present : Senators Mc-
Clellan and Church. )
Mr. Kennedy. And you are a waitress there, are you ?
Miss Pechan. Yes, I am.
Mr. Kennedy. Did any official representative of local 450, any
union, approach you about joining the union in 1955 ?
Miss Pechan. No, they did not.
Mr. Kennedy. No one ever spoke to you ?
Miss Pechan. No one except the manager, when he informed me
that I was being put into the union.
Mr. KJENNEDY. The manager ?
Miss Pechan. Yes,
Mr. Kennedy. What was his name ?
Miss Pechan. Mike Wohlen.
Mr. Kennedy. He told you you were being placed in the union ?
Miss Pechan. That is right.
ISIr. Kennedy. But you had never been approached by anyone to
join the union before ?
Miss Pecham. No.
Mr. Kennedy. You never signed any card of any kind ?
Miss Pechan. No, sir.
Mr. KJENNEDY. Why did he tell you he was putting you into the
union ?
Miss Pechan. Well, he said they had to put a few girls in, and I
was one of them, and he just thought that it would be best that he tell
us in case we received any literature through the mail magazines, or
notices of meetings or anything like that.
Mr. Kennedy. Did you want to join the union ?
Miss Pechan. No.
Mr. Kennedy. Did any of the other girls want to join the union ?
Miss Pechan. I didn't discuss it with any of them. I believe it was
immaterial to them as it was with me.
Mr. Kennedy. Did you think tliis was a rather strange way of
handling it ?
Miss Pechan. Well, yes. I didn't think it was the right way. But
I knew that Richard was protecting himself for which I couldn't blame
him, either.
The Chairman. Protecting himself from what ?
Miss Pechan. From all the tilings that had been happening to
other places, I mean that we had heard about and read about. I mean,
it was just hearsay.
IMPROPER ACTIVITIES EST THE LABOR FIELD 13045
The Chairman, What were some of the things ?
Miss Pechan". Well, you hear of these picket lines and people hav-
ing restaurants burned and so forth.
The Chairman. So you felt that he was having to do it in order
to protect his property and protect his business ?
Miss Pechan. That is right.
The Chairman. To keep from having his property destroyed or
his business destroyed ?
Miss Pechan. Yes, sir.
The Chairman. Is that the general feeling that you find through-
out your contacts, that such a condition prevails there in Chicago
where people have to pay off, business people, small-business people,
have to pay off to this element in order to stay in business ?
Miss Pechan. Well, I'm assuming that most people think that
way, although we don't discuss it.
The Chairman. It is kind of a hush-hush affair, is it ?
Miss Pechan. Well, actually, we are just waitresses and it isn't our
business or our property, and it does not actually touch us directly.
So I guess that is why we just never discuss it.
The Chairman. All right.
Senator Church. Tell me, from the time that you were notified
that you had been placed in this union, have you ever been contacted
by any representative of this local inquiring as to your working con-
ditions or as to your wages ?
Miss Pechan. No.
Senator Church. Have you received any benefits that you know of
by virtue of your membership in this union ?
Miss Pechan. No. I don't know of any benefits. If there are any,
I don't know about them.
Senator Church. Have you ever been advised by any member of
the local as to the terms or conditions of a union contract that governs
your employment ?
Miss Pechan. No.
Senator Church. So that as far as you are concerned, your work
and the conditions of your work have continued unaffected since the
time you were notified that you were a member of this union ? It has
meant nothing to you at all, no benefits of any kind, no interest shown
by the local in your working conditions or in your wages, in that no
contact was made. Is that a correct statement?
Miss Pechan. That is correct.
Mr. Kennedy. In fact, until the investigation started, you did not
even know what local you were in ?
Miss Pechan. That is correct.
Mr. Kennedy. You were never invited to a union meeting or any-
thing?
Miss Pechan. I did receive cards, but I never attended.
Mr. Kennedy. You never attended.
That is all.
The Chairman. Thank you very much. Call the next witness.
Mr. KIennedy. Mr. Charles Hoch.
The Chairman. Do you solemnly swear the evidence you shall give
before this Senate select committee shall be the truth, the whole truth,
and nothing but the truth, so help you God ?
Mr. Hoch. I do.
13046 IMPROPER ACTIVITIES IN THE LABOR FIELD
TESTIMONY OF CHARLES HOCH
The Chairman. State your name, your place of residence, and
your business or occupation.
Mr. Hocii. My name is Charles Hocli, and I live at 6420 West 28th
Street, Berwyn, 111. I am manager of the Klas Restaurant, in Cicero,
111.
The Chairman. You waive counsel, do you. Mr. Hoch ?
Mr. HocH. Yes, I do.
Mr. Kennedy. You are the manager of Klas Restaurant ?
Mr. Hoch. Yes ; I am.
Mr. Kennedy. Did you understand that back in 1939 or approxi-
mately 1939 that the management of the restaurant had started to pay
money to the union supposedly on a certain number of employees ?
Mr. Hocii. That is right ; yes, sir.
Mr. Kennedy. How mucli money was being paid, or for how many
em])loyees ?
Mr. Hocii. Well, offhand I would not have the figure on that, but it
approximated $3 a month for each employee.
Mr. Kennedy. And how many employees were they paying on ?
Mr. Hoch. I believe it was four.
Mr. Kennedy. For what reason were they paying for these in-
dividuals ?
JSIr. Hoch. Well, I just can't answer that. It was requested, by re-
quest, that we have a union house, and that we try to get as many
employees as possible into it.
Mr. Kennedy. The employees had not indicated a desire to join the
union, had they ?
Mr. Hoch. No, sir.
Mr. Kennedy. Well, then, why were you paying the money ? Why
was management paying this money ?
Mr. Hoch. The same reasons as everybody else.
Mr. Kennedy. What is that ?
, Mr. Hoch. To keep the business going.
Mr. Kennedy. And that arrangement has continued up to the pres-
ent time, has it ?
Mr. Hoch. Yes, sir.
Mr. Kennedy. Who are the people that are in the union at the
present time ?
Mr. Hoch. The names of the employees ?
Mr. Kennedy. Well you still have four people in, have you ?
Mr. Hoch. Well, we have more than that, Mr. Kennedy.
Mr. Kennedy. How many are you paying on now ?
Mr. Hoch. The waitresses
Mr. Kennedy. How many are you paying on now ?
Mr. Hoch. Directly?
Mr. Kennedy. Yes.
Mr. Hoch. I believe it is four.
Mr. Kennedy. Who are the four ?
Mr. Hoch. The chef, the salad woman, my brother, and myself.
Mr. Kennedy. You and your brother are 2 of the 4?
Mr. Hoch. Yes, sir.
IMPROPER ACTIVITIES IN THE LABOR FIELD 13047
Mr. Kennedy. There is no benefits that the union could do for you
and your brother, is there ?
Mr. HocH. No, sir.
Mr. Kennedy. It is just a payment being made to keep the union
away ; is that right ?
Mr. HocH. That is correct.
Mr. Kennedy. Two of the employees you are paying on — you and
your brother are two — the salad girl left the employment in February
1957, and you continued to pay in her name ?
Mr. HocH. Yes, sir.
Mr. Kennedy. The chef left in September of 1957 and you con-
tinued to pay in his name, is that right ?
Mr. HocH. That is correct.
Mr. Kennedy. So it is just a payoff in order to keep the union
away ; is that right ?
Mr. HocH. Well, you might call it that.
Mr. Kennedy. Isn't that what it is ?
Mr. HocH. I suppose it is ; yes, sir.
Mr. Kennedy. When the salad girl and the chef were present, did
they know they were members of the union ?
Mr. HocH. No, sir.
Mr. Kennedy. And no representative of local 450 has ever dis-
cussed wages, hours, or conditions with you or the employees ?
Mr. HocH. Well, they have as far as the waitresses are concerned.
Mr. Kennedy. But as far as
Mr. HocH. As far as our wages ?
Mr. Kennedy. Yes.
Mr. HocH. No, sir. They said we should handle that ourselves.
Mr. Kennedy. And this payment that you make is deducted as a
business expense ; is it not ?
Mr. HocH. No, sir ; that is taken from Mr. Klas' personal account.
Mr. Kennedy. It is not deducted ?
Mr. HocH. No, sir.
Mr. Kennedy. Why isn't it deducted ?
Mr. HocH. Why is it deducted ?
Mr. Kennedy. Why is it not ?
Mr. HocH. Well, I think Mr. Klas felt that he could stand that
difference in his profits for the end of the year.
Mr. Kennedy. Because it was felt that it would be an improper
payment ; is that why he didn't deduct it ?
Mr. HocH. Yes ; I believe so ; yes, sir.
Mr. Kennedy. How much do you pay ?
Mr. HocH. $3.50 a month. Do you mean the total amount?
Mr, Kennedy. Yes.
Mr. HocH. Well, when we were taking out the waitresses' dues, it
averaged around $100 or $150 every 3 months.
Mr. Kennedy. I am just talking on the four employees.
Mr. HocH. $3.50 a month, sir.
Mr. Kennedy. That is $14 a month ; is that right ?
Mr. HocH. That is correct.
Mr. Kennedy. The other employees ; you deduct from them ?
Mr. HocH. From their wages ; yes.
13048 IMPROPER ACTIVITIES EST THE LABOR FIELD
Mr. Kennedy. Have they given you permission to do that ?
Mr. HocH. Yes ; they have.
Mr. Kennedy. They have signed cards ?
Mr. HocH. Yes, sir.
The Chairman. Is there anything further?
Senator Church. I have just one question, I understand, then, that,
for these 4, 2 of them were Mr. Klas and yourself, representatives oi
management, and the otlier 2 were the salad girl and the chef ?
Mr. HocH. That is right.
Senator Church. Is that correct ?
Mr. HocH. Yes.
Senator Church. The salad girl and the chef didn't know about it
at the time ? And they are no longer in your employment ?
Mr. ITocH. That is right.
Senator Church. But the $14-a-month payments have continued;
is tliat correct ?
Mr. Hocii. That is right.
The Chairman. Do the payments continue on the two that are not in
your employ ? You haven't substituted other names for them ?
Mr. HocH. Yes; I have, in one case, but the gentleman also left
since then.
The Chairman. Then what ?
Mr. HocH. But we continued paying.
The Chairman. Well, do you send in new names when one that you
are paying on goes out of your employ ?
Mr. Hoch. Well, we don't see these gentlemen very often; once
every 3 months. We were changing them as they happened, as the
changes happened.
The Chairman. They are not interested in the name or in the
individual. All they want is the money ?
Mr. Hoch. Well, as far as these four employees are concerned, but
the rest they were. We changed the salary. We gave them the benefit,
the health and welfare fund, so that, to a certain extent, employees
had benefited by it.
The Chairman, All right. Is there anything further ?
Mr. Kennedy. That is all.
The Chairman. Call the next witness.
Thank you very much.
Mr. Kennedy. Beverly Sturdevant and Mae Christiansen.
The Chairman. Be sworn, please. Do you and each of you solemnly
swear that the evidence you shall give before this Senate select com-
mittee shall be the truth, the whole truth, and nothing but the truth,
so help you God ?
Mrs. Christiansen. I do.
Mrs. Sturdevant. I do.
TESTIMONY OF BEVERLY STURDEVANT AND MAE
CHRISTIANSEN
The Chairman. Beginning on my left, will you state your name,
your place of residence, and your business or occupation, please ?
Mrs. Christiansen. Mae Christiansen, 2332 South Austin, Cicero,
111., presently unemployed.
IMPROPER ACTIVITIES IN THE LABOR FIELD 13049
Mrs. Stuedevant. My name is Beverly Sturdevant; I live in Chi-
cago, 111. I am manager of Embassy Restaurant in Cicero.
The Chairman. Do each of you ladies waive counsel ?
Mrs. Christiansen. Yes, sir.
Mrs. Sturdevant. Yes, sir.
The Chairman. Thank you.
Proceed.
Mr. Kennedy. Your name is Mae Christiansen ?
Mrs. Christiansen. That is correct.
Mr. Kennedy. And it is Beverly Sturdevant ?
Mrs. Sturdevant. Correct.
Mr. Kennedy. You were a waitress at Sramek's Restaurant ; is that
right.
Mrs. Sturdevant. Yes, sir.
Mr. Kennedy. How long had you worked there ?
Mrs. Sturdevant. Well, I started there in January of 1956.
Mr. IvENNEDY. Are you still in that same place ?
Mrs. Sturdevant. Yes, sir; it is the same place, but a different
name.
Mr. Kennedy. It has changed its name ?
Mrs, Sturdevant. The Embassy Restaurant.
Mr. Kennedy. Wliat is the address ?
Mrs. Sturdevant. 6144 West Cermak Road.
Mr. Kennedy. Did any representative of the union come in to start
to organize ?
Mrs. Sturdevant. Yes, sir.
Mr. Kennedy. While you were working there as a waitress ?
Mrs. Sturdevant. Yes, sir.
Mr. Kennedy. When was that ?
Mrs. Sturdevant. In February of 1956.
Mr. Kennedy. Who came in at that time ?
Mrs. Sturdevant. Mr. Daniel Leonardi and Mr. Mack.
Mr. Kennedy. They were business agents of local 450 ?
Mrs. Sturdevant. Yes, sir.
Mr. Kennedy. Could you tell us what occurred ?
Mrs. Sturdevant. Well, they came in and they told us that they
wanted to organize us into the union.
Mr. Kennedy. Had they had any discussions with the employer
prior to that time ?
Mrs. Sturdevant. Yes, sir ; they had.
Mr. Kennedy. And what did the employer say ?
Mrs. Sturdevant. I have no idea.
Mr. IvENNEDY. Then they approached you ?
Mrs. Sturdevant. Yes, sir. They told us that — we told them that
we did not need a union ; we were getting 70 cents an hour, and we
felt it was a fair rate of pay ; there were no unfair conditions going
on in the business; we were very happy with our employer, and we
did not need a union. They then told us that if we didn't join the
union they would put up a picket line which would put our employei*,
eventually, out of business.
We told them it was up to them to do that ; that we would be willing
to face something like that at that time. They then told us that there
21243—58 — pt. 34 13
13050 IMPROPER ACTIVITIES IN THE LABOR FIELD
could be an accident down the stairs. Our restaurant is in the base-
ment.
The Chairman. There could be what?
Mrs. S'lTiRDEVANT. There could be an accident down the stairs, to
■where whoever was pushed down the stairs would sue our employer
and put him out of business in that respect.
Mr. Kennedy. How was the accident to occur ? Did you understand
how that was to liappen ?
Mrs. Sturdevant. It was to be a push down the stairs.
Mr. Kennedy. Who told you this?
Mrs. Sti'rdevant. Mr. Leonardi.
Mr. Kennedy. And this was while he was trying to organize you;
is that right ?
Mrs, Sturdevant. Yes, sir.
Mr. Kennedy. What was your reaction to that ?
Mrs. Sturdevant. It didn't leave us much choice.
Mr. Kennedy. Did you have some further ccmversations with him ?
Mrs. Sturdevant. Yes, sir. They kept pursuing the matter. They
told us there was no guaranty against any liarm to the girls themselves.
We had assumed that meant if they would put up a picket line we
would not be able to cross it ^^ithout getting hurt.
Mr. Kennedy. What did he say about tliat ?
Mrs. Sturdevant. ]\Ir. Leonardi ? He was the one that told us
there was no guaranty.
Mr. Kennedy. There was no guaranty that you would not get hurt ?
Mrs. Sturdevant. Yes, sir.
Mr. Kennedy. He told the waitresses this ?
Mrs. Sturdevant. Yes, sir.
Mr. Kennedy. And you better join the union if you wanted to pro-
tect yourselves ; is that right ?
Mrs. Sturdevant. Yes, sir.
Mr. Kennedy. Was there much apprehension among the waitresses
after that?
Mrs. Sturdevant. Yes, sir.
Mr. Kennedy. ]\Irs. Christiansen, did you have any conversations
with any of these union officials ?
Mrs. Christiansen. Yes; I have attended the first meeting that
they had.
Mr. Kennedy. And did anybody make any statements similar to
this?
Mrs. Christiansen. Yes ; they did.
Mr. Kennedy. "VAHio told you this ?
Mrs. Christiansen. Mr. Mack and Mr. Leonardi.
Mr. Kennedy. What did they say to you ?
Mrs. Christiansen. Well, they wanted us to join the union or else
quit our jobs.
Mr. Kennedy. Did they tell you you would not be able to get a job?
Mrs. Christiansen. They told me, personally, that if I quit my job
they would see to it that I was not allowed to work in a union house
again.
Mr. Kennedy. Who told you this?
Mrs. Christiansen. Mr. Mack or Mr. Leonardi. I am not sure
which.
IMPROPER ACTIVITIES IN THE LABOR FIELD 13051
Mr, IvENNEDY. That if you didii't join the union you would not
be able to get a job anyplace else ?
Mrs, Christiansen. That is right.
Mr. Kennedy. Wliat did you tell him? What did you tell Mr.
Leonardi ?
Mrs. Christiansen. I asked them if they called themselves Amer-
ican. If they could imply such tactics as that to me, it was not being
American.
Mr. Kennedy. What did he say ?
Mrs. Christiansen. Oh, he also told me I should shut up.
Mr. IvENNEDY. Mrs. Sturdevant, you ultimately decided to join the
union ?
Mrs. Sturdevant. Yes, sir.
Mr. Kennedy. Why did the waitresses decide to join the union ?
Mrs. Sturdevant, We joined to protect our employer. We enjoyed
working for him and with him, and we didn't want to see any harm
come to him in his business, so we joined the union to keep away
pickets and any accidents.
Mr. Kennedy. But nobody was interested in joining the union ?
Mrs. Sturdevant. No, sir ; definitely not.
Mrs, Kennedy, It was just a fear as to what might happen to the
employer?
Mrs, Sturdevant. Yes, sir.
Mr. Kennedy. And also, apprehension on behalf of the waitresses
themselves ?
Mrs. Sturdevant. Yes, sir.
Mr, Kennedy, Was there any fear among the waitresses?
Mrs. Sturdevant. Well, we talked it over, and w^e just decided it
was the best thing to do.
Mr. Kennedy, Was part of that or any of it in view of the state-
ments they had been making to you ?
Mrs, Sturdevant, Yes, sir,
Mr, Kennedy, After you joined the union — when was that ?
Mrs. STURDEVAJ*a\ When we joined ?
Mr. Kennedy. Yes.
Mrs. Sturdevant, We joined in March of 1956, I believe it was
when we signed,
Mr, Kennedy. Did you have any contact with the union after
that?
Mrs. Sturdevant. No, sir.
Mr. Kennedy. Did you personally hear from anybody from the
union ?
Mrs, Sturdevant, No, sir,
Mr. Kennedy, The representatives of the union have been aware
that you have had some conversations with the members of the com-
mittee ?
Mrs. Sturdevant, Yes, sir,
Mr, Kennedy, Did anybody speak to you about testifying before
this committee?
Mrs. Sturdevant, Yes, sir,
Mr, Kennedy, Would you tell us what happened ?
Mrs, Sturdevant, I was told not to come down to Washington to
testify.
13052 niPROPER ACTIVITIES IN THE LABOR FIELD
The Chairman. You were told what ?
Mrs. Sturdevant. I was told not to come down to Washington,
that I should get sick before coming down to Washington or be sicker
when I get back.
Mr. Kennedy. Or that you would be sicker ?
Mrs. Sturdevant. Yes, sir.
Mr. Kennedy. Will you tell us exactly what happened ?
Mrs. Sturdevant. It is all being handled by the FBI, and at this
time I would not care to give any more information on it.
Mr. Kennedy. Can you at least relate to the committee what the
full statement was that was made to you ?
Mrs. Sturdevant. That is the extent of it, the better part of it, the
real core of it.
Mr. Kennedy. Would you repeat it, please, so we get it straight?
Mrs. Sturdevant. I should get sick before I come down to Washing-
ton or I would be sicker when I get back.
The Chairman. Have you given the full information regarding
this to the FBI?
Mrs. Sturdevant. Yes, sir, I have signed a complete statement with
the FBI.
The Chairman. And given the names of those persons involved?
Mrs. Sturdevant. Yes, sir.
The Chairman. And when did this occur ?
Mrs. Sturdevant. Last week, Wednesday.
The Chairman. Last Wednesday ?
Mrs. Sturdevant. Yes, sir.
The Chairman. Wednesday of this week ?
Mrs. Sturdevant. No, the week before.
The Chairman. One week ago Wednesday ?
Mrs. Sturdevant. Yes, sir.
The Chairman. Did you report it immediately to the FBI?
Mrs. Sturdevant. Yes, sir ; I did.
The Chairman. Is there anything further ?
Well, I see you didn't obey, you didn't heed the warning given you.
You didn't get sick apparently, but instead you came on down here
as a good American citizen, to be helpful to your country.
Mrs. Sturdevant. Yes, sir.
The Chairman. Do you have any fear or apprehension now about
bodily harm by reason of this threat ?
Mrs. Sturdevant. No, sir.
The Chairman. Well, I hope no fear is justified. I sincerely trust
the FBI will perform its ablest function, and duty, and protection,
and apprehend those who have dared to obstruct the processes of
Govermnent by threats and intimidation of an American citizen.
The committee will be interested in this, and will confer with the
FBI. It may have a function to perform in this connection. And
at which time, if we need your testimony directly about it, of course,
you would be willing to give it ?
Mrs. Sturdevant. Yes, sir.
Mr. Kennedy. Have you been frightened about all of this?
Mrs. Sturdevant. Yes, sir ; I have.
Mr. Kennedy. I guess it has upset your family ?
Mrs. Sturdevant. Yes, sir ; it has.
IMPROPER ACTIVITIES IN THE LABOR FIELD 13053
Senator Church. I should think it would.
Mrs. Sturdevant. Pardon?
Senator Church. I should think it would, and the other waitresses,
too. I think it is a disgraceful condition. I am certainly hopeful
that these hearings will contribute toward cleaning out this racket
in Chicago.
Mrs. Sturdevant. Yes, sir ; that was why I am here.
Senator Church. I know that, and I appreciate your coming.
Mr. Kennedy. I think somebody as specifically threatened as this
young lady has been, and who then comes and testifies anyway, is
really doing something.
The Chairman. It is going to take that kind of courage on the
part of the citizens of this country to clean up these elements that
are preying upon helpless victims. If we have law enforcement, the
local officials have to take some responsibility for these conditions.
As I have stated heretofore, this committee is not a police agent.
It has no enforcement powers other than to take action when one
commits contempt of the committee, of the Senate. But we have
developed in many instances clues, leads, and information, factual
information, upon which local law enforcement officials could act. In
some instances we have gotten action, and in some instances they have
immediately performed their duties and gone out and apprehended
those who were guilty of ofi'enses and brought them to justice. We
are hopeful that will be the result in this case. IVlioever did that
should be denied his freedom for a good long period of time, in my
judgment.
Is there anything else? Is there any statement you ladies wish
to make ?
Mrs. Sturdevant. No, sir.
Mrs. Christiansen. No, sir.
The Chairman. You will be dismissed with the thanks of the com-
mittee, and I trust the thanks of every decent American and I hope
others will take courage and faith by reason of the actions you have
taken, and will cooperate with law-enforcement officials and with this
committee in helping us to expose and eradicate as far as we can do so
this unwholesome element from our society. Thank you very much.
Mrs. Christiansen. Thank you, sir.
Mr. I^nnedy. We are going to call Mr. Leonardi now, Mr. Chair-
man.
It might be that these ladies will want to hear him.
The Chairman. Will you ladies just move back 2 or 3 chairs.
Mr. Kennedy. Mr. Leonardi.
The Chairman. You do solemnly swear the evidence you shall give
before this Senate select committee shall be the truth, the whole
truth, and nothing but the truth, so help you God ?
Mr. Leonardi. Yes, sir.
TESTIMONY OF DANNY LEONARDI, ACCOMPANIED BY
COUNSEL, FRANK W. OLIVER
The Chairman. State your name, your place of residence, and
your business or occupation.
Mr. Leonardi. My name is Danny Leonardi. I live at 922 South
Monitor, Chicago, 111.
13054 IMPROPER ACTIVITIES IN THE LABOR FIELD
The Chairman. What is your business or occupation, Mr.
Leonardi ?
Mr. Leonardi. Under the fifth amendment to the Constitution of
the United States, I respectfully decline to answer on the ground
that my answer may tend to incriminate me.
The Chairman. Who is that sitting next to you ?
Mr. Leonardi. My attorney.
The Chairman. What is his name ?
Mr. Leonardi. Frank Oliver,
The Chairman. Do you know him ?
Mr. Leonardi. Yes, sir. He is my attorney.
The Chairman. Well, I wanted to find out. I wanted to get
one answer from you, at least.
Would you identify yourself for the record, please?
Mr. Oli\t.r. My name is Frank Oliver. I am of the Illinois bar.
The Chairman. What is your address, please?
Mr, Oliver. 33 North La Salle Street, Chicago.
The Chairman. Proceed, Mr. Kennedy.
Mr. Kennedy. i\Ir. Leonardi, you have heard the testimony here
regarding your activities. You are business agent of local 450. We
have had the testimony from this young lady that you told her that
people could be pushed down the stairs and there would be no recourse
for them. Would you tell us about that ?
Mr. Leonardi, Under the fifth amendment of the Constitution
of the United States, I respectfully decline to answer on the ground
that my answer may tend to incriminate me.
Mr. Kennedy. Is that how you go about organizing establishments,
Mr. Leonardi, tell young ladies that you will get them pushed down
the stairs ?
Mr. Leonardi, Under the fifth amendment to the Constitution of
the L^nited States, I respectfully decline to answer on the grounds
that the answer might tend to incriminate me.
Mr. Kennedy. And then the employer pays the money and you
are able to get your salary, is that right, and your expenses, and
a little extra ?
Mr. Leonardi. Under the fifth amendment to the Constitution of
the United States, I respectfully decline to answer on the grounds
that my answer may tend to incriminate me.
The Chairman, Will you two ladies step forward, the previous
witnesses, Mrs. Christiansen and Mrs. Sturdevant.
Do you see anyone sitting before you there that you know ?
Mrs, Sturdevant. Yes, sir.
The Chairman. "Wliat is his name ?
Mrs. Sturdevant. Danny Leonardi.
The Chairman. Is that the man that made these threats against
you?
Mrs. Sturdevant. At the time of organizing, yes, sir.
The Chairman. He is the one that suggested you might be pushed
down the stairs and injured?
Mrs. Sturdevant. Yes, sir.
The Chairman. Both of you identify him ?
Mrs, Christiansen. Yes, sir.
The Chairman. He is the same man ?
IMPROPER ACTIVITIES IN THE LABOR FIELD 13055
Mrs. Christiansen. Yes, sir.
The Chairman. The one that made those threats against you ?
Mrs. Christiansen. Yes, sir.
The Chairman. And intimidated you into joining the union you
didn't want to join ?
Mrs. Christiansen. Yes, sir.
Mrs. Sturdevant. Yes, sir.
The Chairman. Thank you very much. Have a seat.
Mr. Kennedy. Mr. Chairman, we have a number of affidavits re-
garding Mr. Leonardi's activities.
This one further supports the testimony whicli has been given.
The Chairman. Before we proceed any further, let's ask the witness
a question or two. Were you born in this country ?
Mr. Leonardi. Yes, sir.
The Chairman. Are you a citizen of the United States ?
Mr. Leonardi. Yes, sir.
The Chairman. Do you respect the flag and your country ?
(The witness conferred with his counsel.)
Mr. Leonardi. Yes, sir.
The Chairman. All right. Are you willing to cooperate with your
Government, are you ?
Are you willing to cooperate with the Government that gave you
protection and freedom?
Mr. Leonardi. Under the fifth amendment to the Constitution of the
United States, I respectfully decline to answer on the grounds that
my answer may tend to incriminate me.
The Chairman. Do you honestly believe that if you cooperated with
your Government, that such cooperation might tend to incriminate
you ?
(The witness conferred with his counsel.)
Mr. Leonardi. May I confer with my attorney, Mr. McClellan ?
The Chairman. Yes.
(The witness conferred with his counsel.)
Mr. Leonardi. I don't understand the question. Senator.
The Chairman. Do you honestly believe that if you cooperated with
your Government, that cooperation v/ith your Government might
tend to incriminate you ?
(The witness conferred with his counsel.)
Mr. Leonardi. I don't understand what you mean by "cooperate." _
The Chairman. Well, cooperate with your Government when it
establishes a committee, the legislative branch of it, the Senate of the
United States, to investigate the improper practices in labor-manage-
ment relations.
(The witness conferred with his counsel.)
Mr. Leonardi. I am fearful that if I would cooperate, I may tend to
incriminate myself.
The Chairman. You honestly believe that if you did cooperate
with this committee as a branch of your Government, performing a
function of Government, that such cooperation might tend to in-
criminate you ?
Mr. Leonardi. Under the fifth amendment to the Constitution
(The witness conferred with his counsel.)
Mr. Leonardi. Yes, sir.
13056 IMPROPER ACTIVITIES EST THE LABOR FIELD
The Chairman. You honestly believe that ?
Mr, Leonardi. Yes, sir.
The Chairman. All right. I think you are correct. Go ahead.
Well, we are going to give you an opportunity if any of tliis testi-
mony that we heard against you is untrue or false, the committee wants
to be very fair and give you an opportunity, of course, to refute it, to
deny it. We don't want to put you in the wrong light. We also have
some affidavits here. You have heard the two ladies testify about your
attitude and your conduct toward them and your threats of personal
violence to them. You have heard that. Do you want to deny that
before we proceed any further ?
Mr. Leoxardi. Under the fifth amendment to the Constitution of
the United States, I respectfully decline to answer on the grounds that
my answer may tend to incriminate me.
The Chair]man. I will read an affidavit or two, the principal parts
of them.
This is an affidavit from Bernice Brown. It is dated the 24th day of
April 1058. I will read some of the pertinent parts of it.
She states :
Since June 1957 I have been employed as a waitress at the Old Prague Restau-
rant, located at 5928 West Cermak Road, Cicero, 111. During the year 1956
while employed at Sramek's Restaurant, I joined Local 450, Hotel and Restaurant
Employees and Bartenders Union. I recall vividly the circumstances surrounding
my joining the union. During the early part of 1956, officials of local 450
approached Mr. Ed Sramek, owner of the restaurant. Mr. Sramek refused to
put the waitresses in the union. Failing in this initial effort, two officials of
local 450, Mr. Dan Leonardi —
That is your name, isn't it, Dan Leonardi ?
Mr. Leonardi. Yes, sir.
The Chair^ian (reading) :
head of local 450 —
were you head of local 450 ?
Mr. Leonardi. Under the fifth amendment to the Constitution of
the United States, I respectfully decline to answer on the grounds that
my answer may tend to incriminate me.
The Chairman. Were you engaged in some activity as head of that
union, some immoral or illegal practice that might tend to incriminate
you if you acknowledge what you were doing ?
Mr. Leonardi. Under the fifth amendment to the Constitution of the
United States, I respectfully decline to answer on the ground that my
answer may tend to incriminate me.
The Chairman. All right.
Then she further says :
and Mr. Henry Mack, a business agent of local 450, met on three occasions with
a number of the waitresses who were employed at Sramek's. During the two
meetings which I attended, I recall Mr. Leonardi at the outset of each meeting
made it very clear that if we did not join the union, a picket union, a picket
line would be placed in front of the establishment.
Did you attend such meetings with these waitresses ?
Mr. Leonardi. Under the fifth amendment to the Constitution of
the United States, I respectfully decline to answer on the ground that
my answer may tend to incriminate me.
The Chairman. She further states :
1
IMPROPER ACTIVITIES EST THE LABOR FIELD 13057
Mr. Leonard! emphasized the facts that if we wanted to keep our jobs and
keep the employer out of difl5culty, we would have to join the union.
Is that true ?
Mr. Leonardi. Under the fifth amendment to the Constitution of
the United States, I respectfully decline to answer on the ground that
my answer may tend to incriminate me.
The Chairman. She says further :
I remember saying that the stairs just outside the restaurant were steep and
accidents could happen.
Did you say that ?
Mr. Leonardi. Under the fifth amendment to the Constitution of
the United States, I respectfully decline to answer on the grounds that
my answer may tend to incriminate me.
The Chairman. If you said it, did you mean it ?
Mr. Leonardi. Under the fifth amendment to the, Constitution of
the United States, I respectfully decline to answer on the grounds that
my answer may tend to incriminate me.
The Chairman. Don't 3'ou think any big old stiff that would say
that to a poor girl, a working girl, would be tiying to emphasize his
brutishness rather than his manhood ?
Mr. Leonardi. Under the fifth amendment to the Constitution of
the United States, I respectfully decline to answer on the ground that
my answer may tend to incriminate me.
The Chairman. Wouldn't you regard, as a good American citizen,
if you are, wouldn't you regard such an act as an act of cowardice?
Mr. Leonardi, Under the fifth amendment to the Constitution of
the United States, I respectfully decline to answer on the ground that
my answer may tend to incriminate me.
The Chairman, She further says :
The girls did not want to join the union, but we finally joined in order to
prevent trouble to ourselves and to our employer.
Do you believe that is the right way to go about organizing people
in the union ?
Mr. Leonardi. Under the fifth amendment to the Constitution of
the United States, I respectfully decline to answer on the grounds that
my answer may tend to incriminate me.
The Chairman. This affidavit may be printed in full in the record
at this point.
(The document referred to follows :)
Affidavit
I. Bernice Brown, who reside at 1328 oOth Avenue, Cicero, 111., freely and
voluntarily make the following statement to LaVern J. Duffy, who has identified
himself to me as a member of the staff of the United States Senate Select Com-
mittee on Improper Activities in the Labor or Management Field. No threats,
force, or duress has been used to induce me to make this statement, nor have I
received any promise of immunity from any consequences which may result from
submission of this statement to the aforementioned Senate select committee :
"Since June 1957 I have been employed as a waitress at the Old Prague
Restaurant located at 5928 Vi^'est Cermak Road, Cicero, 111. From August 1955
to Jime 1957 I was a waitress at Sramek's Restaurant located at 6144 Cermak
Road, Cicero, 111. During the year 1956. while employed at Sramek's Res-
taurant, I joined Local 4.50, Hotel and Restaurant Employees and Bartenders
Union. I recall vividly the circumstances surrounding my joining the union.
During the early part of 1956 oflBcials of local 450 approached Mr. Ed Sramek,
13058 LMPROPER ACTIVITIES IN THE L.\BOR FIELD
owner of the restaurant. Mr. Sramek refused to put the waitresses in the union.
Failing in this initial effort, 2 oflScials of local 450, Mr. Dan Leonardi, head
of local 450, and Mr. Henry Mack, a business agent of local 450, met on 3
occasions with a number of the waitresses who were employed at Sramek's.
"During the two meetings which I attended I recall Mr. Leonardi at the outset
of each meeting made it very clear that if we did not join the union a picket
line would be placed in front of the establishment. Mr. Leonardi emphasized
the fact that if we wanted to keep our jobs and keep the employer out of dif-
ficulty, we would have to join the union. I remember Mr. Leonardi saying
that the stairs just outside of the restaurant were steep ;ind accidents could
happen. The girls did not want to join the union but we finally joined in order
to prevent trouble to ourselves and to our employer."
I have read the foregoing statement, and to the best of my knowledge, it is
true and correct.
(Signed) Bernice Brown.
Bernice Brown.
Witnesses :
(Signed) Gerald G. Gotsch.
(Signed) Ethel Appel.
Sworn and subscribed to before me this 24th day of April 1958.
(Signed) Ethel Appel,
Notai'y PuMic.
My commission expires November 12, lOCO.
Mr. Kennedy. Here is an affidavit on another matter, Mr. Chair-
man, dealincf with Mr. Leonardi's orgfanizin<r activities.
The Chairman. This is an affidavit from James Kirie.
It is dated the 24tli day of June 1958. It states, in substance, as
follows, and this affidavit will also be printed in the record in full
at this point:
Approximately 2 years ago — I believe it was in the fall of 1950 — Dan Leonardi,
an official of Suburban Local 450, Cicero, 111., came into my restaurant. He told
me he had received complaints that my restaurant, Kirie's, located at 2826
Thatcher Avenue, River Grove, 111., was not a union house. He demanded to
know why we were not union. He asked me to talk my help into joining the
union. At first Mr. Leonardi said he wanted to unionize the whole restaurant.
He then said that he would settle for the waitresses. I asked him what scale
the union paid on waitresses. He told me the union scale was 62 cents per hour.
At the time I was paying my waitresses 65 cents per hour. I asked him what
other benefits the union offered, and he said health and welfare benefits. At
the time, Kirie's had a plan with the Washington National Insurance Co. cov-
ering all of our employees.
I presented the union benefits to my waitresses and told them they could vote
for or against joining the union. In a secret ballot they voted against union-
ization. When I apprised Mr. Leonardi of this fact, he told me to "line up the
employees and tell them they're in the union. You deduct the dues from their
■wages. If any of them object, fire them and we will furnish you help." This
I refused to do.
Did you make that statement to Mr. Kirie ?
Mr. Leonardi. Under the fifth amendment to the Constitution of
the United States, I respectfully decline to answer on the ground that
my answer may tend to incriminate me.
The Chairman. Do you believe that anybody would do that ; under-
take to organize in that fashion and threaten people with bodily harm ?
Do you believe that he can believe in the freedom and the personal
human liberty that this country provides, under its laws and Con-
stitution, for its citizens? Do you believe he can conscientiously
believe in that and do these things ?
Mr. Leonardi. Under the fifth amendment to the Constitution of
the United States, I respectfully decline to answer on the ground that
my answer may tend to incriminate me.
IMPROPER ACTIVITIES IN THE LABOR FIELD 13059
The Chairmax. And he states further :
This I refused to do. Mr. Leonard! made about 2 or 3 visits to my establish-
ment to talk to me about unionization. He never spoke to any of the employees.
He told me that he did not want to talk to them. On his last visit, he said to me :
"Will you put your people into the union ?"
AYhen I again refused, Mr. Leonardi said to me : "You're too goddam good to
your help. Is that your last word?" I have never heard from him again in
regard to this matter.
Did you say it ?
Mr. Leonardi. Under the fifth amendment to the Constitution of
the United States, I respectfully decline to answer on the ground that
my answer may tend to incriminate me.
The Chairman. Do you feel that an employer paying a little higher
wages than your union scale is too good to his employees? Do you
honestly feel that way ?
Mr. Leonardi. Under the fifth amendment to the Constitution of
the LTnited States, I respectfully decline to answer on the ground that
my answer may tend to incriminate me.
The Chairman. This affidavit I just read will be printed in full in
the record.
(The affidavit is as follows :)
I, James Kirie, 2826 Thatcher Avenue, River Grove, 111., freely and voluntarily
make the following statement to and at the request of James P. Kelly, who has
identified himself to me as member of the staff of the United States Senate
Select Committee on Improper Activities in the Labor or Management Field:
Approximately 2 years ago, I believe it was in tlie fall of 1956, Dan Leonardi,
an official of suburban local 450, Cicero, 111., came into my restaurant. He told
me he had received complaints that my restaurant, Kirie's, located at 2826
Thatcher Avenue, River Grove, 111., was not a union house. He demanded to
know why we were not union.
He asked me to talk my help into joining the union. At first, Mr. Leonardi
said he wanted to unionize the whole restaurant. He then said that he would
settle for the waitresses. I asked him what scale the union paid on waitresses.
He told me the union scale was 62 cents per hour. At the time, I was paying
my waitresses 65 cents per hour. I asked him what other benefits the union
offiered, and he said health and welfare benefits. At the time, Kirie's had a
plan with the Washington National Insurance Co. covering all our employees. I
presented the union benefits to my waitresses and told them they could vote for
or against joining the union. In a secret ballot, they voted against unionization.
When I apprised Mr. Leonardi of this fact, he told me to "line up the em-
ployees and tell them they're in the union. You deduct the dues from their
wases. If any of them object, fire them and we will furnish you help." This,
I refused to do.
Mr. Leonardi made about 2 or 3 visits to my establishment to talk to me about
unionization. He never spoke to any of the employees. He told me that he did
not want to talk to them. On his last visit he said to me, "Will you put your
people into the union?" When I again refused, Mr. Leonardi said to me, "You're
too goddam good to your help. Is that your last word?" I have never heard
from him again in regard to this matter.
I have read the foregoing statement, and it is true and correct, to the best of
my knowledge.
James C. Kirie.
Witness :
James P. Kelly.
Sworn to before me this 24th day of June 1958.
[seal] Rosalind Springer,
Notary Public.
My commission expires July 16, 1960.
The Chairman. Will you read the pertinent parts of this affidavit
to the witness and interrogate him about it?
13060 IMPROPEK ACTIVITIES IN THE LABOR FIELD
Senator Church. This is an affidavit from Laddie Vola, who resides
at 1940 Sunnyside, Westchester, 111. The pertinent parts of the
affidavit are as follows:
Since August 1944, I have owned and managed the Old Prague Restaurant,
located at 5928 West Cermak Road, Cicero, 111.
In the year 1952, a union official from the Hotel, Club, Restaurant Employees
and Bartenders Union, Suburban Local 450, who identified himself as a Mr.
Frankel, came in to see me and said he wanted to organize my restaurant. At
the time, I had approximately 50 employees, who were nonunion.
When the union oflScial approached me I suggested that he talk to the
employees, and, if they wanted to join, it was fine with me. The business agent
objected to this procedure, and demanded that I make a deal which put into the
union a certain number of my employees. When I refused to go along with this
arrangement, he threatened me with a picket line. He said : "There are ways
to bring you in line."
I finally agreed on partial unionization of my restaurant, which put 16 of my
employees in the union.
After I agreed to this arrangement, I discussed the problem with the waitresses,
and they advised me they were not interested in joining the union. Some of
them said they would quit if they had to pay dues. In order to resolve this
problem, I agreed to pay the union dues on the waitresses myself.
The dues on the waitresses, which I have paid over the years, have been
written off at the end of each year as a business expense.
In the latter part of 1955 or early 1956, Dan Leonardi, an official of local 450 — •
that would be you, would it not, Mr. Leonardi?
Mr. Leonardi. Under the fifth amendment to the Constitution of the
United States, I respectfully decline to answer on the ground that my
answer my tend to incriminate me.
Senator Church. Continuing, then, with the affidavit :
In the latter part of 1955 or early 1956, Dan Leonardi, an official of local 450,
came into my restaurant and tried to pressure me into putting two additional
employees in the union. On this same visit, he also insisted that I start making
health-and-welfare payments on my unionized employees.
Are these statements correct, Mr. Leonardi?
Mr. Leonardi. Under the fifth amendment to the Constitution of
the United States, I respectfully decline to answer on the ground mv
answer may tend to incriminate me.
Senator Church. The affidavit continues:
At this particular meeting, which my wife attended, Mr. Leonardi spoke
in a very belligerent tone, and said if I did not agree to his demands something
could happen.
What did you mean when you said "something could happen," Mr.
Leonardi ; did you say it and, if so, what did you mean by it ?
Mr. Leonardi. Senator Church, under the fifth amendment to the
Constitution of the United States, I respectfully decline to answer on
the ground my answer my tend to incriminate me.
Senator Church. The affidavit then continues:
After this meeting, I called Mr. Donald Kiesau, executive vice president of the
Chicago Restaurant Association, of which I am a member. He told me to come
in and visit him, which I did. Mr. Kiesau told me, "I don't think you can fight
them alone. The only thing you can do is to hold them off as long as possible
and then make the best deal possible with them. You don't want to have
happen to you what happened out on the South Side, do you?" He was referring
to the Nantucket Restaurant strike, which was the scene of many acts of
violence, such as the breaking of windows in a number of automobiles and the
slashing of tires.
IMPROPER ACTIVITIES EST THE LABOR FIELD 13061
Do you have personal knowledge of the Nantucket Eestaurant strike
that is referred to in this affidavit ?
Mr. Leonardi. Under the fifth amendment to the Constitution of
the United States, I respectfully decline to answer on the ground that
my answer may tend to incriminate me.
Senator Church. The affidavit finishes with this final statement :
Shortly after my visit to Mr. Kiesau's office, Mr. Leonardi paid me another
visit, at which time I signed a contract incorporating health-and-welfare pay-
ments on my unionized employees, and for this concession Leonardi forgot about
his demand that I vmionize two additional employees.
Is that statement correct, Mr. Leonardi ?
Mr. Leonardi. Under the fifth amendment to the Constitution of
the United States, I respectfully decline to answer on the ground that
my answer may tend to incriminate me.
(The affidavit is as follows :)
I, Laddie Vala, who reside at 1940 Sunnyside, Westchester, 111., freely and
voluntarily make the following statement to LaVern .J. Duffy, who has identified
himself to me as a member of the staff of the United States Senate Select Com-
mittee on Improper Activities in the Labor or Management Field. No threats,
force, or duress has been used to induce me to make this statement, nor have
I received any promise of immunity from any consequences which may result
from submission of this statement of the aforementioned Senate Select Com-
mittee.
Since August 1944, I have owned and managed the Old Prague Restaurant,
located at 5928 West Cermak Road, Cicero, 111.
In the year 1952, a union official from the Hotel, Club, Restaurant Employees
and Bartenders Union, Suburban Local 450, who identified himself as a Mr.
Frankel, came in to see me and said he wanted to organize my restaurant. At
the time, I had approximately 50 employees, who were nonunion.
When the union official approached me, I suggested that he talk to the em-
ployees, and, if they wanted to join, it was fine with me. The business agent
objected to this procedure, and demanded that I make a deal which would put
into the union a certain number of my employees. When I refused to go along
with this arrangement, he threatened me with a picket line. He said, "There
are ways to bring you in line."
I finally agreed on partial unionization of my restaurant, which put 16 of my
employees in the union.
After I agreed to this arrangement, I discussed the problem with the
waitresses, and they advised me they were not interested in joining the union.
Some of them said they would quit if they had to pay dues. In order to resolve
this problem, I agreed to pay the union dues on the waitresses myself.
The dues on the waitresses, which I have paid over the years, have been
written off at the end of each year as a business expense.
In the latter part of 1955 or early 1956, Dan Leonardi, an official of local 450,
came into my restaurant and tried to pressure me into putting two additional
employees in the imion. On this same visit, he also insisted that I start making
health-and-welfare payments on my unionized employees. At this particular
meeting, which my wife attended, Mr. Leonardi spoke in a very belligerent tone,
and said if I did not agree to his demands something could happen.
After this meeting, I called Mr. Donald Kiesau, executive vice president of
the Chicago Restaurant Association, of which I am a member. He told me to
come in and visit him, which I did. Mr. Kiesau told me, "I don't think you can
fight them alone. The only thing you can do is to hold them off as long as
possible and then make the best deal possible with them. You don't want to
have happen to you what happened out on the South Side, do you?" He was
referring to the Nantucket Restaurant strike, which was the scene of many acts
of violence, such as the breaking of windows in a number of automobiles and the
slashing of tires.
Shortly after my visit to Mr. Kiesau's office, Mr. Leonardi paid me another
visit, at which time I signed a contract incorporating health-and-welfare pay-
ments on my unionized employees, and for this concession Leonardi forgot about
his demand that I unionize two additional employees.
13062 IMPROPER ACTIVITIES IN THE LABOR FIELD
I have read the foregoing statement, and, to the best of my knowledge, it is
true and correct.
Laddie Vala.
Witnesses :
Minora M. Racky.
LaVebn J. Duffy.
Sworn and subscribed to before me tliis 29th day of May 1958.
f gE^L] Ethex Appel, Notary PuhUc.
My commission expires November 12, 1960.
Mr. Kennedy. We had testimony the first day of the hearings re-
garding the background of this local, and the fact that Mr. Claude
Maddox was involved in its direction at the beginning; also, that Mr.
Aiuppa was involved in the operation of the local. Could you tell us
if you know Claude ISIaddox?
Mr. Leonaedi. Under the fifth amendment to the Constitution of
the United States, I respectfully decline to answer on the ground that
my answer may tend to incriminate me.
Mr. Kennedy. Now, could you tell us if you know Joey Aiuppa ?
Mr. Leonardi. Under the fifth amendment to the Constitution of
the United States, I respectfully decline to answer on the ground that
my answer may tend to incriminate me. «> . i •
Mr. Kennedy. Mr. Leonardi, you are the most important ofiicial m
this local at the present time, are you not ?
Mr. Leonardi. Under the fifth amendment to the Constitution of
the United States, I respectfully decline to answer on the ground that
my answer mav tend to incriminate me.
Mr. Kennedy. Now, we have had testimony before the committee
that a number of deals were made by you whereby an employer would
give you, or pay the union, a certain amount of money and there would
be no effort to organize the employees in the restaurant or there would
be no effort afterward to find out what the wages and hours and con-
ditions of the employees were. Did you follow that procedure ?
Mr. Leonardi. Under the fifth amendment to the Constitution of
the United States, I respectfully decline to answer on the ground that
my answer may tend to incriminate me.
Mr. Kennedy. And the only interest that you had was in the direc-
tion of money: there wasn't any interest at all in the welfare of the
employees ; is that right, Mr. Leonardi ?
Mr. l^EONARDi. lUider the fifth amendment to the Constitution of
the United States, I respectfully decline to answer on the ground that
my answer may tend to incriminate me.
Mr. Kennedy. And that this union, this particular local, 450, is
just a shakedown which operates just in order to collect money, so
that you people can collect your salary and expenses ; is that right?
Mr. Leonardi. Under the fifth amendment to the Constitution of
the United States, I respectfully decline to answer on the ground
that my answer may tend to incriminate me. _ ^
Mr. Kennedy. Unlike a majority of unions, a vast majority of
unions, you operate just in order to feather your own nest and the nest
of some of those who work with you ; is that right ?
Mr. Leonardi. Under the fifth amendment to the Constitution of
the United States, I respectfully decline to answer on the ground that
my answer may tend to incriminate me.
IMPROPER ACTIVITIES IN THE LABOR FIELD 13063
Mr. KJENNEDY. And you told this procedure of just going in and
collecting amounts of money, in Richards' Restaurant, and Class
Restaurant, and Homestead Restaurant, and Kirie's Restaurant, and
the Old Prague Restaurant; is that right? Those are five instances.
Mr. Leonardi. Under the fifth amendment to the Constitution of
the United States, I respectfully decline to answer on the ground that
my answer may tend to incriminate me.
Mr. Kennedy. Could you tell us what other arrangements you have
of this kind?
Mr. Leonardi. Under tlie fifth amendment to the Constitution of
the United States, I respectfully decline to answer on the ground that
my answer may tend to incriminate me.
Mr. Kennedy. Do you think this is proper activity for a union
official to go out and collect money with the promise that there will
not be any unionization of the employees ?
Mr. Leonardi. Under the fifth amendment to the Constitution of
the United States, I respectfully decline to answer on the ground that
my answer may tend to incriminate me.
Mr. Kennedy. Isn't it correct that the reason you operate like this
is because of the fact that there is a gangster and hoodlum control of
this local?
Mr. Leonardi. Under the fifth amendment to the Constitution of
the United States, I respectfully decline to answer on the ground that
my answer may tend to incriminate me.
Mr. Kennedy. Otherwise, can you explain in any other terms the
relationship of Joey Aiuppa and Claude Maddox with this local ?
Mr. Leonardi. Under the fifth amendment to the Constitution of
the United States, I respectfully decline to answer on the ground that
my answer may tend to incriminate me.
Mr. Kennedy. And can you explain in any way how Joey Aiuppa
was able to get the charter for this local ?
Mr, Leonardi. Under the fifth amendment to the Constitution of
the United States, I respectfully decline to answer on the ground that
my answer may tend to incriminate me.
Mr. Kennedy. That is all, Mr. Chairman.
The Chairman. Are you a member of a union now ?
Mr. Leonardi. Under the fifth amendment to the Constitution of
the United States, I respectfully decline to answer on the ground that
my answer may tend to incriminate me.
The Chairman. Is your union affiliated with the AFL-CIO?
Mr. Leonardi. Under the fifth amendment to the Constitution of
the United States, I respectfully decline to answer on the ground that
my answer may tend to incriminate me.
The Chairman. Are you an official in this local 450 or in any other
local ?
Mr. Leonardi. Under the fifth amendment to the Constitution of
the United States, I respectfully decline to answer on the ground that
my answer may tend to incriminate me.
The Chairman. Well, there has been a great deal of evideucs here
that would clearly indicate, unless you want to refute it, that you are
a cheap racketeer, hoodlum, and a muscle man, and an extortionist.
There is a lot of evidence before this committee to that effect. Do
you want to admit that you are, or deny that you are ?
13064 IMPROPER ACTIVITIES IN THE LABOR FIELD
Mr. Leonardi. Under the fifth amendment to the Constitution of
the United States, I respectfully decline to answer on the ground that
my answer may tend to incriminate me.
The Chairman. Well, I hope if you are an officer in a union that
we will observe the prompt and immediate action and eil'ectiveness of
what is called the Ethical Practices Committee. I think that your
case should receive its attention before sundown today. I am hope-
ful that they can listen in on this, and get a picture of some of the
crummy things that go on in some unions, and that they will start a
little house sweeping, and begin with local 450.
Is there anything further?
jSIr. Kexxedy. Just a final question. I don't know if we have it
clear in the record. Did you have anything to do with the threats
to Beverly Sturdivant prior to her testimony here?
Mr. Leonardi. Under the fifth amendment to the Constitution of
the United States, I respectfully decline to answer on the ground that
my answer may tend to incriminate me.
Mr. Kennedy. Did you have anybody go make a visit to her in
order to threaten her so she wouldn't testify against you here?
Mr. Leonardi. Under the fifth amendment to the Constitution of
the United States, I respectfully decline to answer on the ground that
my answer may tend to incriminate me.
The Chairman. The witness will remain under the present sub-
pena. You will be under recognizance to reappear at such time as
the committee may desire to hear further testimony from you. Do
you acknowledge that recognizance ?
Mr. Leonardi. Yes, sir.
The Chairman. Do you acknowledge it, Mr. Counsel ?
JSIr. Oliver. I do.
The Chairman. Upon reasonable notice to either of you, you are
expected to appear and give further testimony, and you may stand
aside.
IMr. Kennedy. Mr. Kouba.
The Chairman. Do you solemnly swear that the evidence you shall
give before this Senate select committee shall be the truth, the whole
truth, and nothing but the truth, so help you God ?
Mr. KouBA. I do.
TESTIMONY OF LOUIS KOUBA, ACCOMPANIED BY HIS
COUNSEL, EDWAED J. CALLAHAN
The Chairman. State your name, your place of residence, and your
business or occupation.
Mr. Koi^BA. My name is Louis Kouba.
The Chairman. How do you spell it ?
Mr. KouBA. K-o-u-b-a. I live at 4149 West 21st Street, Chi-
cago, 111.
The Chairman. What did you say your occupation was ?
Mr. Kouba. My occupation, I am assistant business agent.
The Chairman. For what union ?
Mr. KouBA. Local 450.
The Chairman. Thank you, and Mr. Counsel, will you identify
yourself for the record ?
IMPROPER ACTIVITIES IN THE LABOR FIELD 13065
Mr. Callahan. My name is Edward Callahan, and I practice in
Chicago, 111., at 115 West Adams, and I am admitted to the supreme
court of the State of Illinois, and the Supreme Court of the United
States.
The Chairman. Thank you very much.
Mr. Kennedy. How long have you been an assistant business agent ?
Mr, KouBA. Fifteen years, approximately.
Mr. Kennedy. How long were you with local 450 ?
Mr. KouBA. Well, I was with the Bartender's Union prior to that.
Mr. Kennedy. And you came in as an assistant business agent?
Mr. KouBA. Yes, sir.
Mr. Kennedy. Whom were you working under, on whom did you
report to ?
Mr. KouBA. Mr. William Kerr.
Mr. Kennedy. For all of the period of time ?
Mr. KouBA. No; Mr. Kerr resigned in 1953, I believe it was.
Mr. Kennedy. Up to 1953, you reported to him ?
Mr. KoTJBA. That is right.
Mr. Kennedy. And what about after that, and who have you
reported to then ?
Mr. KouBA. After that I reported to Henry Mack.
Mr. Kennedy. Wliat was his position with the local ?
Mr. KoLT5A. He was senior business agent.
Mr. Kennedy. How many business agents are there, and assistants?
Mr. KouBA. Well, 1 senior, and 5 assistant business agents.
Mr. Kennedy. What is your salary, and expenses ?
Mr. KouBA. My salary is $100 a week, plus $32 a week expenses.
Mr. Ivennedy. How many members does local 450 have ?
Mr. KouBA. Wlien ?
Mr. Kennedy. Now, how many members does it have now ?
Mr. KoTJBA. Now, I would say in the neighborhood of 2,200 or
2,300, and I am not certain about that figure.
Mr. Kennedy. ^Yliat dues do they pay ?
Mr. KouBA. Well, they vary. The miscellaneous workers and wait-
resses pay $3.50 a month, and the cooks jjay $4 a month, and the
bartenders and waiters pay $4.50 a month.
Mr. Kennedy. How often do you have meetings, Mr. Kouba, of the
local?
Mr. KouBA. We have meetings every third Monday of each month.
Mr. Kennedy. Does everybody get notification to come to the meet-
ing?
Mr. Kouba. No; we notify them quarterly, but in their dues book
is a notation notifying them of the meetings every third Monday
of the month.
Mr. Kennedy. But you send out an official notification only to
about a quarter of the members of the union ?
Mr. Kouba. No, quarterly.
Mr. Kennedy. I don't understand.
Mr. Kouba. All of the members.
Mr. Kennedy. All of the members receive notice that there is going
to be a meeting ?
Mr. Kouba. Every 3 months.
21243 — 58 — pt. 34 14
13066 IMPROPER ACTIVITIES IN THE LABOR FIELD
Mr. Kennedy. Now, who is control of the local at the present time?
Who are the officers ?
Mr. KouBA. Well, Louis Mania is secretary-treasurer, and Dan
Leonardi is senior business agent.
Mr. Kennedy. Is Mr. Leonardi the one that has chief responsibility
of running the local at the present time ?
Mr. KouBA. Well, I report to Mr. Leonardi.
Mr. Kennedy. Now, could you tell us what is the procedure that you
follow, Mr. Kouba, as far as organizing? Do you ordinarily go to the
employer and try to get a percentage of his employees in the union?
Mr. KouBA. That is right, and I get permission from the employer
to talk to his employees.
Mr. Kennedy. Do you always talk to the employees ?
Mr. Kouba, As a general rule, I do.
Mr. Kennedy. Well, are there occasions that you do not ?
Mr. Kouba. Well, I most generally do.
Mr. Kennedy. Well, are there occasions that you do not ?
Mr. Kouba. Well, I can't think of any occasion where I haven't.
Mr. Kennedy. Do you say you always go to the employees, and
determine whether they wish to belong to the union ?
Mr. Kouba. That is right.
Mr. Kennedy. Then if tliey indicate that they do not want to belong
to the union what steps do you take ?
Mr. Kouba. Well, then I talk to the employer, and I tell them that
he has a man or woman who doesn't belong to the union and I would
like to have them join the union.
Mr. Kennedy. Let us consider you have a restaurant with 20 em-
ployees, and you go in there, and the employees are not interested in
joining a union. What do you do? You then go to the employer ?
Mr. Kouba. I still go to the employer.
Mr. Kennedy. Do you try to get the employer to pay a certain
amount of money ?
Mr. Kouba. No.
Mr. Kennedy. All right, what do you do? Why do you go to the
employer if the employees say they don't want to join ?
Mr. Kouba. 1 try to get him to get all of the employees together
and I talk to them.
Mr. Kennedy. But the employees have already indicated, these
20 employees have indicated they don't want to join the union. What
do you do when you go to the employer ?
Mr. Kouba. Well, I can't remember any case in my territory where
that has happened.
Mr. Kennedy. No case in which the employees have said that ?
Mr. Kouba. No.
Mr. Kennedy. Have you got a list of the places that you have
organized ?
Mr. Kouba. No, I don't have them now.
Mr. Kennedy. Would you give us some of the places that you have
organized lately ?
Mr. Kouba. Well, I cover a territory. Are you familiar with the
city of Chicago ?
Mr. Kennedy. No. Can you give us some of the names of restau-
rants that you have organized, that you have gotten the employees
to join ?
IMPROPER ACTIVITIES IN THE LABOR FIELD 13067
Mr. KouBA. I can give you the names of the restaurants, and I
wouldn't remember all of the employees at the time.
Mr. Kennedy. Just the names of some of the restaurants.
Mr. KouBA. I will start from the beginning of my territory, and
I have Gabby Hartnett's Bowling Alleys, and I have Hunt's Good-
rich Restaurant, and I have Pf eiifer's Restaurant, and I have Lawler's,
and I have the Kenilworth Inn, which incidentally is the house that
I tended bar in before I became business agent.
Mr. Kennedy. Just stop there. In each one of those instances
that you have given us, you went to the employees and they indicated
a desire to join the union ?
Mr. KouBA. Well, no. When I came in the territory, most of those
places had been organized.
Mr. Kennedy. I am asking you where you go in to an establishment
and you say that you go to the employees. Give me some instances
where you have gone to the employees and they have indicated a
desire to join the union and you haven't gone to the employer.
Mr. KouBA. I haven't had anybody refuse me.
Mr. Kennedy. Just give me a couple of instances, or a few instances
where you have gone in and organized and haven't had to go to the
employer.
Mr. KoTJBA. Well, I always contact the employer first, and I get
his permission to talk to his employees.
Mr. Kennedy. Then just give me an instance or give me several
instances where you have gone to the employees, and they have indi-
cated a desire to join the union, and the union dues have been paid
by them where you have organized.
Mr. KouBA. The union dues have been paid by whom ?
Mr. Kennedy. By the employee.
Mr. KouBA. By the employee ?
Mr. Kennedy. By the worker.
Mr. KouBA. Well, most of my people pay their own dues.
Mr. I^nnedy. Just give me an instance, Mr. Kouba, where you
have gone in and actually organized the employees, and the employees
have mdicated a desire to join the union, and have paid their own
dues, either by the checkoff system or some other system, or paid
directly to you. Give me one instance or give me several instances
where you actually have done that.
Mr. KouBA. Like I said before, Mr. Kennedy, when I came into the
territory, most of the territory was organized.
Mr. Kennedy. Can you give me any instance — and I am going to
get down to one instance — where you ever went into a restaurant and
organized the employees and the employees indicated a desire to join
the union?
Mr. KouBA. Yes.
Mr. Kennedy. And they paid their own dues ?
Mr. KouBA. I have a lot of those.
Mr. Kennedy. Would you give me an instance where you have gone
in and organized it yourself and haven't had to go to the employer?
Mr. KouBA. I have any number of houses over there where I have
gone in and organized the employees.
Mr. Kennedy. Would you give us some instances of that ?
Mr. KouBA. Well, there is the Morton House.
Mr. Kennedy. When did you organize that ?
13068 lAIPROPER ACTIVITIES IN THE LABOR FIELD
Mr. KoTJBA. Well, like I say, before that was organized-
Mr. Kennedy. I am asking you, Mr. Kouba, when you did it.
The Chairman. You understand, he is asking not those that were
organized when you went there, but those that you have organized
yourself. Now you understand that ?
Mr. KouBA. You mean a new house ; is that right ?
The Chairman. Yes ; where you went out and ^ot it organized.
Mr. Kouba. I am sorry. Senator, I didn't understand the question.
The Chairman. Go ahead.
Mr. Kennedy. Would you give me some instances of that?
Mr. KouBA. Let me think, and I am trying to think of a new house.
There was Karuso's Restaurant.
Mr. Kennedy. How do you spell it ?
Mr. KouBA. K-a-r-u-s-o.
The Chairman. All right.
Mr. Kennedy. Wliat procedure did you follow? When did you
organize Karuso's ?
Mr. Kouba. I don't rightly remember ; that is probably 3 or 4 years
ago. But I don't remember exactly. I went in there, and I talked
to Mr. Ray Karuso, and I told him I was with the union that repre-
sented that area, and I told him I would like to see him be a union
house, and Mr. Karuso was quite agreeable,
Mr. Kennedy. So what happened ?
Mr. Kouba. Well, I found then that about 50 percent of his people
had been in the union and you see Mr. Karuso previous to that had a
restaurant in Chicago, and he brought some of his employees from
Chicago to his new house in our territory. So there was no problem
there, however.
The new ones that he had, that did not belong to the union, was
very much in accord to belong to the union.
Mr. Kennedy. And you went and talked to them ?
Mr. Kouba. Yes, I did.
Mr. KJENNEDY. What arrangements were made then ?
Mr, Kouba. Well, when I was certain that they were quite agreeable,
I gave them applications, and I told them what their initiation fees
would be, and signed the applications, and they paid the initiation
fee, and that was it.
Mr. Kennedy. Did they pay the initiation fee and dues themselves ?
Mr. Kouba. Yes, they do.
Mr. Kennedy. They paid directly to you ?
Mr. Kouba. Yes, they do.
Mr. Kennedy. Now, is that the procedure you say that you use in
most of these cases ?
Mr. Kouba. Yes, I do.
Mr. Kennedy. Do you always use that procedure ?
Mr. Kouba. Yes, I do.
Mr. Kennedy. Didn't you organize Allgauer's Restaurant ?
Mr. Kouba. Well, Allgauer's Restaurant was pretty much the same.
Mr. Kennedy. You tell us what you did there. That is the same
as Karuso's ?
Mr. Kouba. Pretty much the same.
Mr. KJENNEDY. You followed the same procedure ?
Mr. Kouba. Yes, I did.
IMPROPER ACTIVITIES EST THE LABOR FIELD 13069
Mr. Kennedy. Now, you explain to us what you did in Allgauer's ?
Mr. KouBA. Well, as you probably know, Mr. Allgauer had a res-
taurant in Chicago and previous to that the Fireside was owned by
Mr. Detrick. So the employees that Mr. Allgauer brought from Chi-
cago and those that he retained that were in the house when he bought
the restaurant pretty much comj)rised the full crew.
Mr. Kennedy. Didn't you go to Mr. Allgauer and tell him that
you wanted a certain percentage of his employees, the names of a
certain percentage of his employees, and isn't that the procedure that
you follow in all these instances ?
Mr. KouBA. I had most of the employees in Allgauer's Kestaurant.
Mr. Kennedy. What about in the kitchen help? Didn't you go
to the Allgauer Restaurant and say you wanted a certain percentage
of them ?
Mr. Kouba. Well, I talked to Mr. Allgauer about it, and he said,
"Well, let us get started a little bit."
Mr. Kennedy. Did you ever go to the employees about it ?
Mr. KouBA. Not at that time.
Mr. Kennedy. Did you go to the employees when you started get-
ting paid, when you got the union initiation fees and dues ?
Mr. KouBA. That was possibly a year later.
Mr. Kennedy. You said that in every instance, you testified here
in every instance you went to the employees first. Now then you
give me the example of Karuso's, and then say, "I followed the same
procedure as I followed in Allgauer's," and now you just admit that
in Allgauer's you went to the employer. You didn't go to the em-
ployees in Allgauer's Restaurant ?
Mr. Kouba. That is what I said originally, Mr. Kennedy, and I
said that I always got the sanction of the employer.
Mr. Kennedy. Then you started collecting money from the em-
ployer. He was the one that placed these people in the union and
you didn't go to the employees ?
Mr. KouBA. I sure talked to the employees.
Mr. Kennedy. Now, you didn't talk to them until after they were
in the union then ?
_ Mr. KouBA. I talked to the employees when I gave them applica-
tions. When I talked to Mr. Allgauer in 1052 about the kitchen, he
referred me to Mr. Claassen and asked Mr. Claassen to try to get
me some employees out of the kitchen. Mr. Claassen in turn con-
tacted the chef, and he asked the chef to get the employees to sign
applications, and I in turn gave the employees the applications, and
they filled them out.
Mr. Kennedy. Why didn't you go, and why were you having man-
agement go around and get the applications ?
Mr. KouBA. For the simple reason that Mr. Allgauer asked me
not to take up too much of their time. I was talking to the employees
on Mr. Allgauer's time.
(At this point, the following members were present: Senators Mc-
Clellan and Church.)
Mr. Kennedy. Let me just read the affidavit given Mr. Walter M.
Claassen. It appears on page 1786 regarding his conversation with
you. He states :
13070 EVIPROPER ACTIVITIES IN THE LABOR FIELD
He asked me for the names of about 20 employees who were working in the
kitchen at the time. When I asked the reason for this request, he informed
me that Mr. Allgauer, my employer, was paying the union dues for approximately
this number of employees, and that he, Lou, wanted their names so that he
could put them in the union. When I informed him that there might not be 20
employees working in the kitchen at that time, he said "O. K., just give me any
old names. The boss pays for it so they should not worry as long as they get
the benefits."
Is that statement correct ?
Mr. KouBA. No, sir.
Mr. Kennedy. It is not ? That statement is not correct ?
Mr. KouBA. No, sir.
Mr. Kennedy. You went around and actually saw the employees,
did you ?
Mr. KouBA. Yes, with the chef. The chef called the employees to
his desk and I talked to them there.
Mr. Kennedy. Did you collect money then from the employees?
Mr. KouBA. No. Mr. xlllgauer agreed to a checkoff system on the
kitchen.
Mr. Kennedy. Did the employees give their permission to a check-
off system ?
Mr. Kouba. Yes, they had.
Mr. Kennedy. Do you liave those cards giving their permission?
Mr. Koub.v. No, I don't have them.
Mr. Kennedy. Where are they ?
Mr. Kouba. They are in our office.
Mr. Kennedy. Would you obtain tliose cards and bring them to the
committee, have them made available to the committee ?
Mr. Kouba. Well, we would have to have them mailed.
Mr. Kennedy. Did j^ou check and find out what salary these em-
ployees were being paid ?
ISIr. Kouba. Well, Mr. Allgauer claimed that he always paid over
scale.
Mr. Kennedy. Yes, but you were interested in the employees them-
selves. Did you ever check and find that out ?
]\Ir. Kouba. A few of the people that I talked to says that they were
getting paid over scale.
Mr. Kennedy. But, Mr. Kouba, this was your organizing for the
purpose of helping and assisting the employees. Did you check and
find out whether they were being paid union scale, and whether there
was, in fact, a checkoff ?
Mr. Kouba. I w^ould have no way to check, unless the employee told
me that he was not.
Mr. Kennedy. Did you go and have meetings with the employees ?
Did you set up a shop steward ?
Mr. Kouba. I had a shop steward in there, yes.
Mr. Kennedy. Did you determine as to whether these people were
being paid union scale ?
Mr. Kouba. I don't know whether the shop steward ever asked
anybody whether they were getting paid union scale.
Mr. Kennedy. Mr. Kouba, they weren't being paid union scale and
there wasn't any checkoff.
Mr. Kouba. That I know nothing about.
IMPROPER ACTWITIES IN THE LABOR FIELD 13071
Mr. Kennedy. You are the business agent. You went around to
organize these people. It is your responsibility. All that happened
in this case was that Mr. Allgauer was making payments, and the union
contract was not being enforced.
Mr. KouBA. To my knowledge, I thought Mr. Allgauer was deduct-
ing.
Mr. Kennedy. But your responsibility goes beyond just collecting
some money, Mr. Kouba. That is what has happened in this whole
local. This is a perfect example of it.
Mr. KouBA. As I say, then I talked to some of the people and asked
if they were getting paid all right, and they said, "Yes," that they were
getting paid over scale. So I saw no further reason to question every-
body.
Mr. Kennedy. Mr. Kouba, did you make a determination as to
whether these employees continued to be employed there?
Mr. KouBA. Yes ; I did.
Mr. Kennedy. And was it up to date — the list?
Mr. KouBA. Well, it was up to date as far as I was concerned.
Mr, Kennedy. Mr. Kouba, that, once again, was not up to date.
Mr. KouBA. I always asked the chef whether we had
Mr. Kennedy. Mr. Kouba, at the time our investigation was made,
11 out of 20 were not working there, and some of them had been gone
since 1956. You were just collecting money, that is all. You had no
interest in the employees. Eleven out of twenty weren't working
there.
Mr. KouBA. I had no way of knowing, myself, like I say. I would
always contact the chef.
Mr. Kennedy. What is the advantage for the employees if you don't
get union scale for them, and you didn't find that out, and they weren't
being paid union scale, and the employer was paying money on em-
ployees that were not even working there and you didn't check that ?
Mr. KouBA. I can only take the employees' word for that. They
said that they were getting paid over the scale.
Mr. Kennedy. That wouldn't take very much. If you were having
a meeting of that particular shop, you could go around and find out
who was attending.
Eleven out of twenty do not even work there and you have them on
your rolls.
Mr. Claassen said all you wanted was 20 names and payment on that.
Mr. KouBA, Well, that isn't so. I never said that.
Mr. Kennedy. Well, those are the facts.
The Chairman. That is exactly what you did, isn't it ? You didn't
check to see that the people were working there. You had no interest
to know whether they were working, what salary they were getting, or
anything else, did you ?
Can you mention one thing you did in the interest of those workers?
Mr. KouBA. I checked periodically whether they were still there.
The Chairman, That they were still there ?
Mr. KouBA. Yes.
The Chairman. They were gone for quite a long time and you did
not even know it ?
Mr, KouBA, I did not know it ; no.
13072 IMPROPER ACTIVITIES EST THE LABOR FIELD
Mr. Kennedy. Just on that, and this is just an instance of how this
has operated, in 1952 you went in there originally; is that right?
Mr. KouBA. Yes.
Mr. Kennedy. And you got a certain number of employees at that
time.
Mr. KouBA. That is right.
Mr. Kennedy. Then you came back in 1956 ?
Mr.KouBA. That is right.
Mr. Kennedy. To get the additional employees. When did you
give the employees that you put in in 1952 their black books, member-
ship books ?
Mr. KouBA. Well, I imagine immediately.
Mr. Kennedy. No books were furnished until — you imagine im-
mediately? Do you swear under oath that you gave them to them
immediately ?
Mr. KouBA. I can't give you the exact date, Mr. Kennedy. But it
takes a little while to process those applications.
Mr. Kennedy. Does it take 4 years ?
Mr. KoTJBA. No, it doesn't.
Mr. Kennedy. That is when they got their books, in 1956.
Mr. KouBA. Well, I know they got books right after they were
organized in 1952.
Mr. I^nnedy. Well, Mr. Claasen, who was employed there, said
that he received the books in 1956. What happened to all this money
during the period 1952 to 1956 ? Your books are destroyed for that
period of time.
Mr. KouBA. The moneys that I collect, the checks that I collect, I
always turn in to the office.
Mr. Kennedy. Why didn't you give the people their membership
books until 1956?
Why weren't they listed in the union until 1956 ?
Mr. KouBA. Mr. Claasen must be confused, because I know I gave
them books in 1952.
]VIr. Kennedy. Mr. Duffy, what do the application cards of these
employees show as to the date ?
Mr. Dtttty. In examining the application cards for these 20 em-
ployees which Mr. Allgauer had been paying on — exactly 20 ; not 21,
not 22, but 20 employees — from 1952 to the present time, we checked
the names of those employees on the records of local 450. We found
that all those employees had been initiated into the union for the
first time, and it is written right on the cards to see, in 1956 — not
1952 ; 1956. How do you explain that ?
Mr. KouBA. That I am not able to answer.
Mr. Duffy. Well, that is what the facts are. I examined those
records myself.
Mr. KouBA. I know when I collect money, I make a report and
turn the money into the office.
Mr. Duffy. That further supports Mr. Claasen's statement that
these books were not actually given to the employees until 1956.
Mr. KouBA. I know that I gave them books right after they were
organized in 1952.
Mr. Duffy. Why, on the application cards, do they not show 1952?
Why shouldn't they show 1952 on those application cards if they
were initiated in 1952 ?
IMPROPER ACTIVITIES IN THE LABOR FIELD 13073
Mr. KouBA. They were probably replacements by them.
Mr. Duffy. We checked some of those employees. They were there
since 1952, up to the present time. They were not initiated into the
local imtil 1956.
Mr. KouBA. Well, I can't answer that. They must have been re-
placements.
The Chairman. We cannot conclude with this witness this morning,
because this chamber has been made available to someone else for the
noon hour. We have to vacate a little early today.
The committee will now recess until 2 o'clock this afternoon, at
which time you will return to the witness stand, Mr. Kouba.
(Whereupon, at 11 : 45 a. m., the hearing was recessed, to reconvene
at 2 p. m. of the same day, with the following members present : Sen-
ators McClellan and Church.)
AFTERNOON SESSION
(At the reconvening of the committee, the following members were
present : Senators McClellan and Church.)
The Chairman. The committee will come to order.
Call the next witness.
Mr. Kennedy. Mr. Kouba.
TESTIMONY OF LOUIS KOUBA— Eesumed
The Chairman. Proceed, Mr. Kennedy.
Mr. Kennedy. We were talking about the Allgauer Restaurant,
Mr. Kouba. You went in in 1956, and you received the 20 names of the
employees ?
Mr. Kouba. I received some replacements.
Mr. Kennedy. Well, you received 20 names ; did you not ?
Mr. Kouba. No, I did not receive 20. I received 20 in 1952. Then
in 1956, or intermittently, I would get new replacements.
Mr. Kennedy. In 1956 you specifically came in and got 20 names;
did you not ?
Mr. Kouba. No, I did not get 20 then.
Mr. Kennedy. Once again, the sworn testimony of Mr. Claasen is
that you turned over 20 names to him at that time. Your testimony
is conflicting directly with the testimony of other witnesses, Mr.
Kouba.
Mr. Claasen testified that you came in and got 20 names. The books
and records of the local union show that 20 names appeared at that
time. They all appear on the same date. Mr. Claasen testified that
he then received the books immediately afterward.
Mr. Kouba. Then it must have been 20 replacements.
Mr. Kennedy. Twenty replacements. All at one time you got 20
replacements ?
Mr. Kouba. Well, if that is what Mr. Claasen said. I still main-
tain that I got replacements intermittently.
Mr. Kennedy. How come there were 20 replacements all at one
time?
The testimony that we have had, and which is a theme that has run
through this hearing, is that the union was only interested in receiv-
ing the money. And, further, that the wishes or desires of the em-
13074 IMPROPER ACTIVITIES IN THE LABOR FIELD
ployees, the welfare of the employees, were ignored. In this case the
testimony is that Mr. Allgauer started paying back in 1952, and it
was not until 1956 that any names were taken.
JNIr. KouBA. Well, I know that there was books issued when I got
the first moneys from Mr. Allgauer.
Mr. Kexnedy. Then if there were books issued, why were there 20
books issued in 1956?
Mr. KouBA. That I can't answer.
Mr. Kennedy. That is the key to it, Mr. Kouba.
Mr. KuoBA. That I don't know.
Mr. Kennedy. That is the key. Of course, that supports the review
of Mr. Duffy's testimony on what the books and records of your
local union shows, and it supports the testimony of Mr. Claasen in
this case.
Mr. KouBA. If there is any mistake, it must lie with the office, not
with me.
^Ir. Kennedy. That is No. 1 point. The second point we discussed
this morning is the fact that when we made our investigation, 11 of
the 20 individuals weren't working there, and that is in 1958.
Mr. Kouba. Well, as I told you this morning, I would check with
the chef.
Mr. Kennedy. Who was the chef that you checked with ?
Mr. KouBA. His name was Max. I don't recall his name now.
Mr, Kennedy. We interviewed the chef. Mr. Gotsch interviewed
the chef. His name is Max Ludke.
Mr. KouBA. That may be.
Mr. Kennedy. Tell us what conversations you had with Mr. Ludke.
Mr. KouT^A. Well, I would go to Max, the chef, and I would ask
him if he had any new members or if there was any that had left, I
would like to talk to him and get replacements for those that had left.
Mr. Kennedy. Why did you have to go to him? If you had the
names on a list, the union had the names, why would you have to go
to the chef? Why didn't you just go to the new employees?
Mr. KouBA. Mr. Kennedy, I have possibly 600 people in my terri-
tory. I certainly can't remember all their names.
Mr. Kennedy. You have a list of names.
Mr. Kouba. Yes.
Mr, Kennedy. If there is any interest in the employees, that is
our point, if you were interested in other than just simply collecting
money, why didn't you just go to the employees and find out if they
wanted to belong to the union ?
Mr. Kouba. I did, I told you that this morning,
Mr. Kennedy, You said you went to the chef and found out from
him ; j^ou asked him if there was any replacements of names,
Mr, Kouba. Well, the chef was the one that could enlighten me
on that, let me know if there was any people that had left, or if there
was any new one.
Mr. Kennedy. Wliat did he tell you ?
Mr, Kouba. Then he would probably say, "I have 2 new ones, or
3 new ones" ; and I would ask him to call them to his office and talk to
them and give them applications and they would fill them out and
that was it.
I
IMPROPER ACTIVITIES IN THE LABOR FIELD 13075
Mr. Kennedy. Mr. Gotsch, did you interview Max Ludke ?
Mr. Gotsch. Yes.
Mr. Kennedy. Did you ask him who was in the union ?
Mr. Gotsch. Mr. Kennedy, I attempted to find out if he could tell
me the employees there that were union or nonunion, and he said he
could only vouch for himself, that he was in the union.
Mr. Kennedy. He didn't know anything about others ?
Mr. Gotsch. He could not give me any information on the other
employees.
Mr. Kennedy. O. K.
The Chairman. He is supposed to be the steward up there for you ?
Mr. KouBA. Well, not exactly the steward.
The Chairman. Well, what was he exactly ? This whole thing is a
rambling nothing.
Mr. KouBA. He was the man that was referred to me by Mr. Claasen.
The Chairman. As what ?
Mr. KouBA. Mr. Claasen said that he would take care of— —
Tlie Chairman. Did the chef keep the books on who works and who
doesn't ?
Mr. KouBA. No ; but he has a list of his employees.
The Chairman. He w^ould have a list of the employees ?
Mr. KouBA. Yes ; the chef would.
The Chairman. Did he have a list of those who were union members
and those that were not ?
Mr. KouBA. I don't know whether he had a list of those that were
not, but I know he had a list of those that were.
The Chairman. Well, if he had a list of all that were, it was easy to
tell who was not. Wouldn't it be ?
Mr. KouBA. Yes ; he could.
Mr. Kennedy. Why was it always just 20 employees? Why didn't
it vary, depending on who was working and how many were working
there ?
Mr. KouBA. Well, as you know, them employees are floaters.
Mr. Kennedy. Yes ?
Mr. KouBA. They don't stay too long.
Mr. Kennedy. Yes?
Mr. KouBA. Mr. Allgauer says that at the peak of his business, he
probably has more than 20, but we would take 20 that were more or
less steady.
Mr. Kennedy. They weren't very steady if they weren't even work-
ing there in 1956. You have only nine that are working there.
Mr. KouBA. Well, that I don't know, Mr, Kennedy.
Mr. Kennedy. Mr. Kouba, you are the one that has the responsi-
bility. You are the union official. What benefit was this? What
benefit was going to accrue to any of these employees for this ? You
didn't find out if they were paying union scale.
You admit that.
Mr. KouBA. I talked to the people, and they said they were getting
paid over the union scale.
Mr. Kennedy. The books and records show they were not.
The Chairman. You say they were getting over union scale ; is that
right ?
Mr. KouBA. That is what they told me.
13076 IMPROPER ACTIVITIES IN^ THE LABOR FIELD
J,^®^9^^AiKMAN. You knew that when they joined, didn't you ?
Mr.lvouBA. No; I didn't know when they joined.
The Chairman. When did you find it out ?
Mr. KouBA. After they were in the union. I wanted to make sure
they were getting the union scale.
The Chairman. You never talked to those that actually got into the
union, yourself ; did you?
Mr. kouBA. Yes; I did.
The Chairman. Name one.
Mr. Kouba. Max Egloff.
The Chairman. What did he do ?
Mr. KouBA. He was a pantryman.
The Chairman. A pantryman?
Mr. KouBA. Yes.
The Chairman. How much wages did he get ^
Mr.KouBA. I think it was $84.50.
The Chairman. $87.50 a week?
Mr.KouBA. That is right.
The Chairman. What is your union scale ?
Mr. Kouba. That is about it.
The Chairman. Well, it is about. Is it, or is it not «
Mr.IvouBA. $85.
The Chairman. What?
Mr.KouBA. $85.
The Chairman. $85.
So that was over union scale ?
Mr. KouBA. That is right.
The Chairman. Wimx other one did you check into «
Mr. IvouBA. Albert Anderson.
The Chairman. Albert Anderson ?
Mr. KouBA. Anderson.
The Chairman. T^Hi at was Albert doing ?
Mr. KotTBA. He was a fry cook.
The Chairman. A fry cook ?
Mr. KouBA. A fry cook.
The Chairiman. Wliat did he get ?
Mr.KouBA. $95 a week.
The Chairman. When did you check with him ^
Mr. Kouba. I don't know, possibly 6 months ago.
1 he Chairman. Two or three months ago ?
Mr. KouBA. Six months ago.
JJ^^^HAiRMAN. How loug had he been in the union «
Mr. KouBA. Well, I can't say for sure.
1. J^'^ Sf^^^"^.^^- ^^f^^ is he a new one or is he a replacement or is
ne one ot the originals ? x- ^o
Mr.KouBA. I am not certain. Like I said, Senator
^/^®^^^^^^A^- How long has he been working there ^
Mr.KouBA. I don't know. Maybe 2 or 3 years.
The Chairman. How long have you been collecting dues from him «
Do you know anything at all?
Mr.KouBA. Yes, I do.
The Chairman. Well, what ?
IMPROPER ACTIVITIES IN THE LABOR FIELD 13077
Mr KouBA. I know I have been collecting dues, but I can't tell vou
exactly how long I have been collecting dues from the man. I don't
have that mformation.
Mr. Kennedy. Albert Anderson left the employ of Allgauer's Ees-
laurant m September 1957, and they were paying dues on him in 1958
He was not even employed there.
Mr. KouBA. Well, that I don't know. Like I say, I always depended
on Max, the chef, to give me replacements.
The Chairman. The truth about it was that you were just runnino-
a racket-mfested union, wasn't it? That is all you were interested u?
gomg out and shakmg down these folks and getting a few dollars for
yourself.
That is the truth about it, isn't it ?
Mr. KouBA. Senator Kennedy
The Chairman. I am not Senator Kennedy. I am Senator Mc-
Olellan.
Mr. KouBA. We have paid out a death benefit for these 20 people
]n the sum of $1,375. ^ ^
The Chairman. How much did you have left? You named one
you paid out death benefits to.
Mr. KouBA. Williams.
The Chairman. To a fellow named Williams.
Mr. Kennedy. He is dead.
The Chairman. Did you do anything for anybody while they were
livmg ?
Mr. KouBA. Yes, we tried to make conditions for them.
The Chairman. Tried to make what ?
_ Mr. KouBA. We tried to create conditions for them, decent work-
ing conditions.
ji T^^ ^"'^^^^^'^^' C'onditions for them? All the witnesses who testi-
fied here from top to bottom said you never asked about conditions,
■working hours, wages, or anything.
Now you are saying all this testimony is not true ?
Mr. KouBA. I don't know anything about any of these witnesses
that testified here, I am merely speaking of the houses that I con-
tacted, and the houses that I work in. If it was not for the fact
that we had a union, these people would probably be working for 55
or 60 cents an hour.
The Chairman. When you got there the two you mentioned were
working for more than union wages. I don't know how vou can
argue that.
Mr KouBA. That is because when there is a certain wage scale set
and the man is probably a better man than the average run of man,
the proprietor gives him a raise. But if there wasn't a basic scale •
Ihe Chairman. You apparently don't know whether they did or
did not. You never looked into it. You don't know whether they
got a raise by joining the union or not, do you ?
Mr. Kouba. I testified this morning that the people said they were
getting over scale after they were in the union.
The Chairman. That was when they joined.
Mr. KouBA. No, I talked to them after they joined.
13078 IMPROPER ACTIVITIES IN THE LABOR FIELD
Mr. Kennedy. I would like to also point out we checked on Mr.
Max Eglort'. How much did you say he was making? He was a
fry cook.
The Chairman. The fry cook was $95 a week, he said.
Mr. KouiJA. That was Anderson.
INIr. Kennedy. How much was Egloff ?
:Mr.KouBA. $87.50.
Mr. Kennedy. He is making $145 a week. He is the banquet chef.
He is not the fry cook at all.
Mr. KouBA. Chances are the man got promoted. I don't know that.
Mr. Kennedy. What about at the Homestead Restaurant? How
did you organize the Homestead Restaurant t Did you work on that?
Mr. KouBA. No, tliat is not in my territory.
Mr. Kennedy. Did you work on that ?
Mr. KouBA. I don't remember rightly whether I did or not.
Mr. Kennedy. You don't remember that one at all ?
3.1r. KouBA. It is not in my territory.
Mr. Kennedy. Do you know Mr. Ricketts ?
Mr. KouBA. I know of him, yes.
Mr. Kennedy. Did you talk to him and meet with him about that
matter?
Mr. KouBA. I don't remember.
Mr. Kennedy. How do you know Mr, Ricketts of the Homestead
Restaurant ?
Mr. Kouba. Well, I have been in there.
Mr. Kennedy. Well, have you tried to organize it ?
Mr. KouBA. It was organized when I was in there.
Mr. Kennedy. Did you take any steps to organize it yourself ?
Mr. KoiBA. I don't remember, Mr. Kennedy.
Mr. Kennedy. Do you deny that you did ?
Mr. KouBA. No, I wouldn't deny it and I may have been in there.
Mr. Kennedy. Did you collect the dues in there ?
!Mr. Kouba. Give me a little time to think. I am trying to think
back. I think that I did collect them there for about 1 year.
Mr. Kennedy. Why, if it was outside your jurisdiction did you
collect the dues?
Mr. Kouba. I was transferred to that territory for 1 year, and I
believe that was in 1954 or somewhere along in there.
Mr. Kennedy. Didn't you go to Mr. Ricketts and tell him you
wanted a certain percentage of his people in there ?
Mr. Kouba. I had all of the people in the dining room.
Mr. Kennedy. Let me read you his testimony, Mr. Kouba.
Question. In 19.52 or 1953, were you approached by union representatives?
Mr. Ricketts. Yes, I was.
Question. By whom?
Mr. Ricketts. The business agent of union 450.
Question. That is Mr. Kouba?
Mr. Ricketts. That is right.
Question. He was business agent?
Mr. Ricketts. That is right.
Question. What had he requested you to do at that time?
Mr. Ricketts. Well, from 1948 to 19.52 we increased some of the girls, the
waitresses, and the waitresses, the ones that were out in the country there,
were union, and we had a few dishwashers. So all he asked them was to have
some of the dishwashers sign up. So I agreed to pay their union dues.
IMPROPER ACTIVITIES IN THE LABOR FIELD 13079
Question. Did the dishwashers themselves indicate that they wanted to join
the union?
Mr. RiCKETTS. No.
Question. He just wanted you to put a number of people in the union?
Mr. RiCKETTS. That is right. The dishwashers would not
This was a procedure that you followed generally, Mr. Kouba ?
Mr. KouBA. Mr. Kennedy, I testified this morning that I don't use
those tactics.
Mr. Kennedy. Will you explain that one then ? We have heard your
lack of explanation in the Allgauer's Restaurant situation, and ex-
plain what you did on this one, then ?
Mr. Kouba. I can't explain it because I don't remember it.
Mr. Kennedy. You were collecting dues there, and these employees
weren't working there either, and this is another situation where
money was just being paid for no employees ?
Mr. KouBA. That I don't know anything about, and if I collected
any moneys in there the money went into the office.
Mr. Kennedy. Well, the employees weren't working there, and the
union might have gotten the money that you collected, but there
weren't any employees being covered by it. All these employers
were doing was paying a sum of money every 2 months, and nobody
was interested in the wages and hours and working conditions of the
employees, including yourself, Mr. Kouba ?
Mr. KouBA. Yes, I am interested in the wages and hours and
conditions.
Mr. Kennedy. Did you put employers in the union ?
Mr. Kouba. Sometimes, yes.
Mr. Kennedy. What is the union going to do for employers ?
Mr. Kouba. Well, I have several employee that belong to the
union.
Mr. Kennedy. What does the union do for them? How can you
improve their wages, hours, and conditions if they own the restau-
rant ?
Mr. Kouba. I have several men that say, "If it is good enough for
my help, it is good enough for me and I am proud to be a member of
the union."
Mr. Kennedy. Well, now
Mr. Kouba. I can get sworn affidavits on that.
The Chairman. Wlien you bargain with them, how do you handle
that ? You are representing both sides when you do that ; aren't you ?
Mr. Kouba. They don't have any voice in the union.
The Chairman. They don't have any voice ?
Mr. Kouba. No.
The Chairman. I don't think any of them have any voice the way
you operate, either side. Here you have a man and you take him in
the union, and then you are supposed to bargain with him and him
with himself regarding the employees ?
How does that add uj) ?
Mr. Kouba. Some of the fellows want to get in the union for the
death benefit.
The Chairman. They want to get there to keep from being run out
ot business, that is what they testified to over and over and over again.
Ihere was no other reason that they do it ?
13080 IMPROPER ACTIVITIES IN THE LABOR FIELD
Mr. KoTJBA. Nobody in my territory has testified to that.
Mr. I^NNEDY. We had Mr. Allgauer, and we had Mr. Kicketts, that
is two.
The Chairman. You were collecting from both of them.
Mr. Kennedy. And you spoke this morning about DahPs Morton
House. Isn't Mr. Dahl a member of the union ?
Mr. KouBA. That is right.
Mr. Kennedy. He is one ?
Mr. KouBA. Yes, sir.
Mr. Kennedy. And you are collecting dues on him ?
Mr. KouBA. Yes, sir.
JNIr. Kennedy. A^liat can you possibly do for Mr. Dahl ?
Mr. KouBA. And Mr. Dahl just recently has collected around $1,200
fi'om the health and welfare fund.
Mr. Kennedy. Why should he be doing that ? He is an employer.
ISIr. KouBA. He just likes to be with his help.
Mr. Kennedy. He can be with his help all day long.
Mr. KouBA. He says if it is good enough for his help, it is good
enough for him, and he wants to be a part of the game.
Mr. Kennedy. The game ?
What about the Howard Johnson's restaurants? We have had
a lot of testimony on that. Were you out there ?
Mr. KouBA. Yes ; I was there.
IVfr. Kennedy. Did you do some work on that in that case?
Mr. KouBA. Yes ; I was just kind of an overseer, to see that none of
our pickets got hurt or anything.
Mr. Kennedy. That wasn't who was getting hurt. It was the
employer ?
Mr. KoiTiA. Oh, yes ; they were.
Mr. Kennedy. They were getting hurt, too ?
Mr. KouBA. Yes ; they were.
Mr. Kennedy. Who was hurting them ?
Before I get into that, how many of the actual employees went out
on strike at Howard Johnson's restaurant ?
Mr. KouBA. I am not able to answer it.
Mr. Kennedy. These are the key questions on this, and there weren't
any employees actually out on strike.
Mr. KouBA. I didn't handle the strike, Mr. Kennedy.
Mr. Kennedy. You were out there seeing that the pickets weren't
being hurt, and did you find out if any of the people at the Howard
Johnson's restaurant actually wanted to go out on strike ?
Mr. KoTTBA. That I don't know, and I didn't negotiate there.
Mr. Kennedy. Who handled the negotiations there ?
Mr. KouBA. It was Mr. Kerr.
Mr. Kennedy. You weren't a part of it ?
Mr. KouBA. I was part of it as far as being on the picket line.
Mr. Kennedy. Well, did you find any employee from the Howard
Johnson's restaurant that actually went out on the picket line himself ?
Mr. KoTJBA. That I don't know.
Mr. Kennedy. Would you answer the question. Did you find any-
body that actually w^as working at Howard Johnson's restaurant ?
Mr. KouBA. I didn't know whether there was any employees on the
line that belonged there.
IMPROPER ACTIVITIES IN THE LABOR FIELD 13081
Mr. Kennedt. You don't know of any employee that was out there ?
Mr. KouBA. No ; I don't.
ISIr. Kennedy. How was the strike settled ? Did they pay a certain
amount of money ?
Mr. KouBA. That I don't know either.
Mr. Kennedy. You don't know about the $2,240 that was paid ?
Mr. KouBA. No ; I don't.
Mr. Kennedy. Who handled that part ?
Mr. KouBA. Mr. Kerr.
Mr. Kennedy. Did you ever have anything to do with it after that ?
Mr. KouBA. No ; I didn't.
Mr. Kennedy. None whatsoever ?
Mr. KouBA. No, sir.
Mr. Kennedy. Did you ever find out whether the employees actually
wanted to joint the union ?
Mr. KouBA. No ; I never talked to any employees over there, and I
wasn't handling that case.
Mr. Kennedy. Wasn't that in your jurisdiction ?
Mr. KouBA. Yes ; it was.
Mr. Kennedy. But you didn't handle it ?
Mr. KouBA. No.
Mr. Kennedy. Mr. Kerr handled it all ?
Mr. KoTjBA. Yes, sir.
Mr. Kennedy. And you didn't make any inquiry to find out whether
any of the employees were paying their dues or were interested in
joining the union ?
Mr. KouBA. Like I said before, I wasn't handling it, and so I would
have no interest in it.
Mr. Kennedy. No ; you spoke about the jiickets being hurt. Would
you tell us about that ?
Mr. KouBA. Yes. People would drive out of there, customers, and
I don't know whether they were customers or employees, and they
would spit at the pickets and they w^ould throw ice-cream cones with
ice cream in them right in their faces and things like that.
Mr. Kennedy. What about the sugar put in the gas tanks of the
employees ?
Mr. KouBA. I know nothing about that.
The Chairman. Did you try to find out anything about it ?
Mr. KouBA. It was none of my business.
The Chairman. It was all right as long as they were doing harm
the other way, but if they threw an ice-cream cone at somebody, or
spit at them, that was awful. You weren't interested in that ?
Mr. KouBA. I don't know that that happened.
The Chairman. You don't know what happened ?
Mr. Kouba. That they threw sugar into any cars.
The Chairman. Did you hear about it ?
Mr. Kouba. I heard about it after it was testified to.
The Chairman. Did you do anything about it after you heard
about it ?
Mr. Kouba. No ; it was none of my concern.
The Chairman. You didn't care about that. It was jjart of your
tactics.
21243— 58,— pt. 34 15
13082 IMPROPER ACTIVITIES IN THE LABOR FIELD
Mr. Kennedy. Are you familiar with the Catering Industry Em-
ployee magazine, the paper ?
Mr. KouBA. You mean the monthly magazine ?
Mr. Kennedy. Yes.
Mr. KouBA. I know there is a magazine, and I get it at home, but
I don't get too much time to read it.
Mr. Kennedy. That is put out by the union ?
Mr. KouBA. Yes ; it is.
Mr. Kennedy. It discusses the Howard Johnson strike, and it says r
An outstanding feature of the strike was the lively militant pickets plus the
wonderful cooperation of the various teamster unions who collaborated 100
percent with us from start to finish. Mass picket lines were at their -peak
during the supper hours and had a telling effect in turning away prospective
customers.
This was a picket line under your direction ?
Mr. KouBA. Not under my direction.
Mr. Kennedy. You were out there working ?
Mr. KouBA. I was out there working, yes, sir.
Mr. Kennedy. Were you successful in keeping the customers away
with the mass picket line ?
Mr. KouBA. No ; we weren't.
Mr. Kennedy. This is not correct, then ?
Mr. KouBA. That I don't know, and I didn't print that.
Mr. Kennedy. Let me show it to you.
The Chairman. I read this paragraph and then I will show it to
you and let you read it.
An outstanding feature of the strike was the lively militant pickets plus
the wonderful cooperation of the various Teamsters Unions who collaborated
100 percent with us from start to finish. Mass picket lines were at their peak
during the supperhours and had a telling effect in turning away prospective
customers.
Now, you were there, and can you tell us about that? You can
check that article I have read, and can you tell us if that is an accurate
reporting of what occurred ?
(A document was handed to the witness.)
The Chairman. What do you say about it ?
Mr. KouBA. I read it.
The Chairman. You were there, and is that an accurate reporting
of what occurred ?
Mr. KouBA. I don't know about the mass picketing.
The Chairman. You would know it if you were there.
Mr. KouBA. There were 4 entrances there, and we had 2 pickets at
each entrance.
The Chairman. Is that all ?
Mr. KouBA. If that is mass picketing, that is what it is.
The Chairman. Is that what you call "mass picketing" ?
Mr. KouBA. I didn't call it that.
The Chairman. All right, then this is inaccurate, if it says "mass
picketing," and you wouldn't call two at each entrance mass picket-
ing, would you ?
Mr. Kouba. No ; I wouldn't.
The Chairman. I wouldn't either, and that is inaccurate if you
only had two there ; isn't that correct ?
IMPROPER ACTIVITIES IN THE LABOR FIELD 13083
Mr. KoTJBA. Well, I mean everybody to his own opinion. Some
people might think it is mass picketing and others don't. I don't
think it is mass picketing.
The Chairman. You are testifying you only had two pickets at
each entrance?
Mr. KouBA. That is right ; at each driveway.
The Chairman. I don't know, if anybody thinks 2 at 1 place is
mass picketing, I wonder what other kind of picketing there could be.
Mr. KouBA. Well, two at each driveway, would you call that mass
picketing ?
The Chairman. I wouldn't, and that is exactly what I am talking
about.
Mr. Kouba. I wouldn't call it mass picketing either.
The Chairman. I think picketing of two is certainly not a "mass."
Mr. Kouba. Everybody is entitled to his own opinion.
The Chairman. I am just pointing out, that is inaccurate report-
ing then.
Mr. Kouba. If they took it as mass picketing, to them it must be
mass picketing, but to me it isn't.
Mr. Kennedy. This was written by Mr. Kerr; was it not?
Mr. Kouba. I don't know.
The Chairman. Was Mr, Kerr in charge of it?
Mr. Kouba. Of the magazine; no, sir.
Tlie Chairman. In charge of the picketing ?
Mr. Kouba. Yes ; he was in charge of the strike.
Mr. Kennedy. It doesn't say, Mr. Chairman, but when we first in-
terviewed him he told us he wrote the article.
The Chairman. Mr, Kerr stated he wrote it.
Mr. Kennedy. That is all.
Senator Church. Mr. Kouba, in connection with the employees in
the local of which you are assistant manager, do you ever negotiate
with tlie restaurant ow^ners to enforce provisions of the contract and
to gain higher wages and working conditions for employees in your
local?
Mr. Kouba. We do that when we get a new contract.
Senator Church. Did you ever do it at Allgauer's ?
Mr, Kouba. I tried to enforce it ; yes, sir.
Senator Church. Well, you have testified that at the time that you
made this 20-man arrangement at Allgauer's, such inquiry as you
made with the employees indicated to you that they were satisfied with
their wages; is that correct?
Mr. Kouba. That is right.
Senator Church. And that you later ascertained that in several
cases the wages were in fact above union scale; is that correct?
Mr. Kouba. Yes, sir.
Senator Church. Did any of these complain to you at the time that
you were making this arrangement as to their dissatisfaction with
working conditions at Allgauer's ?
Mr. Kouba. Well, there was only one, and they complained about
not having a decent place to eat.
Senator Church. At Allgauer's ?
Mr. Kouba. It is the employees I am talking about.
13084 IMPROPER ACTIVITIES IN THE LABOR FIELD
Senator Church. Did you get that straightened out ?
Mr. KouBA. Yes; I did. They finally set up a table, and we got
that straightened out.
Senator Church. Aside from the complaint about a decent place
to eat.
Mr. KouBA. That is the employees.
Senator Church. They were generally satisfied with the wages and
conditions there ?
Mr. KouBA. Yes ; they were.
Senator Church. Why did you think that they ought to be in the
union ? What benefit did they get from being in the union other than
this one person that you say got a death benefit at one time ?
IVIr. KouBA. They were all covered by the health and welfare.
Senator Church. Of these 20 ?
ISIr. Koi'BA. Yes.
Senator Church. But you paid so little attention to the names that
were submitted that at one time the majority of the 20 didn't even
work for the restaurant.
Mr. KotTJA. That I don't know.
The Chairman. Is there anything further?
Mr. Kennedy. Tliat is all.
(At this point, the following members were present: Senators Mc-
Clellan and Church.)
Mr. IvENNEDY. Mr. Louis Madia.
Mr. Callahan. Mr. Kennedy, do you want me to make that state-
ment at this time ?
Mr. Kennedy. No. Why don't you wait until afterward ?
Mr. Callahan. All right.
The Chairman. Do you solemnly swear the evidence you shall give
before this Senate select committee shall be the truth, the whole truth,
and notliing but the truth, so help you God ?
Mr. Madia. I do.
TESTIMONY OF LOUIS MADIA, ACCOMPANIED BY COUNSEL,
JOHN GANNON
The Chairman. State your name, your place of residence, and your
business or occupation.
Mr. Madia. My name is Louis G. Madia, and I reside at 2844 North
Harding, in the city of Chicago. I am a citizen of the United States
of America. I am secretary-treasurer of local 450.
The Chairman. Thank you very much.
You have counsel present ?
Mr. Madia. Yes ; I have.
The Chairman. Mr. Counsel, identify yourself for the record,
please.
Mr. Gannon. My name is John Gannon. I am an attorney at law
in the State of Illinois, with an office at 209 South La Salle Street
in the city of Chicago.
The Chairman. Proceed.
Mr. Ivennedy. How long have you been secretary of local 450 ?
Mr. Madia. Under the Constitution of the United States of Amer-
ica I claim the privilege under the fifth amendment, because my an-
swer might tend to incriminate me.
\
IMPROPER ACTIVITIES IN THE LABOR FIELD 13085
The Chairman. The longer you worked or served as a secretary-
treasurer, the more likely would be the incrimination ? Is that correct ?
Mr. Madia. I must respectfully decline to answer. I claim my
constitutional privilege under the fifth amendment, because my an-
swer may tend to incriminate me.
The Chairman. Proceed.
Mr. Kennedy. Well, Mr. Chairman, the chief interest with have
with Mr. Madia is not only his important position with the local, but
the investigation that we are making of gangster and hoodlum control
of the local. We have had testimony that this is a union that was con-
trolled and operated by Claude Maddox, and that Claude Maddox had
an important role in setting up and having it function for the last 15
years.
Mr. Madia has an important position in the local : secretary-treas-
urer. What we would like to find out from him is what he knows
about the connection between the union officials, including himself,
with certain of the underworld of Chicago.
I would like to know, Mr. Madia, if you know Mr. Tony Accardo.
Mr. Madia. I must respectfully decline to answer. I claim my con-
stitutional privileges under the fifth amendment because my answer
might tend to incriminate me.
Mr. Kennedy. Isn't it a fact that you are an associate of Tony
Accardo ?
Mr. Madia. I must respectfully decline to answer. I claim my
constitutional privileges under the fifth amendment because my
answer might tend to incriminate me.
Mr. Kennedy. Isn't it correct that on or at the July 4 party in
1955, you attended Tony Accardo's lawn party at his home?
Mr. Madia. I must respectfully decline to answer. I claim my
constitutional privileges under the fifth amendment because my
answer might tend to incriminate me.
Mr. Kennedy. Could you tell the committee why you, a union offi-
cial, an important union official of a very important international,
would be going to Tony Accardo's lawn party ?
(The witness conferred with his counsel.)
Mr. Kennedy. He is secretary-treasurer of a local, Mr. Chairman,
but it is an important union in the United States. He is of an inter-
national union.
Mr. Madia. What was the question ?
_ Mr. Kennedy. Could you tell the committee why you, a union offi-
cial, would be attending a party at a notorious hoodlum residence
like Tony Accardo's ?
Mr. Madia. I must respectfully decline to answer. I claim my
constitutional privileges under the fifth amendment because my
answer might tend to incriminate me.
Mr, Kennedy. In addition to you being there, isn't it correct that
Joey Glimco of local 777 was present, of the Teamsters Union?
Mr. Madia. I must respectfully decline to answer. I claim my
constitutional privileges under the fifth amendment because my
answer might tend to incriminate me.
Mr. Kennedy. And Mr. Glimco has been arrested some 36 times.
Also Joey Aiuppa, who played a role in the formation of your local
union, he was also present at that July 4 party, isn't that correct ?
13086 IMPROPER ACTIVITIES IN THE LABOR FIELD
Mr. Madia. I must respectfully decline to answer. I claim my
constitutional privileges under the fifth amendment because my
answer might tend to incriminate me.
Mr. Kennedy. And Joey Aiuppa is an important hoodlum in
Chicago, Isn't it correct that also present at that party was Claude
Maddox ?
(The witness conferred with his counsel.)
Mr. Madia. I must respectfully decline to answer. I claim my
constitutional privileges under the fifth amendment because my
answer might tend to incriminate me.
Mr. Kennedy. Do you know Claude Maddox?
Mr. Madia. I must res))ectfully decline to answer. I claim my
constitutional privik^ges under the fifth amendment because my
answer might tend to incriminate me.
The Chairman. You have a privilege under the Constitution, if
you care to exercise it, to give testimony here that might be helpful
to the committee. Are you willing to exercise that privilege?
Mr. Madia. I must respectfully decline to answer. I claim my
constitutional privileges under the fifth amendment because my
answer might tend to incriminate me.
Mr. Kennedy, According to tlie testimony we have had before this
committee, this union was controlled by Claude Maddox. Could you
tell us anything about that ?
Mr. Madia. I must respectfully decline to answer. I claim my con-
stitutional privileges under the fifth amendment, because my answer
might tend to incriminate me.
Mr. Kennedy. Also present at the party was Paul "The Waiter"
Ricca, Joey Ceasar, Sam ''Golf bag" Hunt, and Jack Guzik; did you
see them all at this July 4 lawn party that you attended, Mr. Madia?
Mr. Madia. I must respectfully decline to answer. I claim my con-
stitutional privileges under the fifth amendment, because my answer
might tend to incriminate me.
Mr. Kennedy. Then on January 23, 1955, when Claude Maddox's
daughter was married, there was a wedding reception and you at-
tended the wedding reception ; did you not ?
Mr. ]Madia. I must respectfully decline to answer. I claim my con
stitutional privileges under the fifth amendment, because my answer
might tend to incriminate me,
Mr. Kennedy. Could you tell us the role that these various gang
sters and hoodlums play in the operation of local 450 ?
Mr. ]SL\dia. I must respectfully decline to answer. I claim my con-
stitutional privileges under the fifth amendment, because my answer
might tend to incriminate me.
Mr. Kennedy. It is just a source of income for them, is it not, par-
ticularly Mr. Claude Maddox ? Then you individuals that work under
him are just receiving «your regular salaries, and the union is used
merely as a shakedown operation ?
Mr. IVIadia. I must respectfully decline to answer. I claim my con-
stitutional privileges under the fifth amendment, because my answer
might tend to incriminate me.
Mr. Kennedy. And then the local makes its deal with the organ-
izations, such as the Chicago Restaurant Association, which employs
i
IMPROPER ACTIVITIES IN THE LABOR FIELD 13087
people such as Abraham Teitelbaum and Anthony Champagne. Is
that right ?
(The witness conferred with his counsel.)
Mr. IVIadia. I must respectfully decline to answer. I claim my con-
stitutional privileges under the fifth amendment, because my answer
might tend to incriminate me.
Mr. Kennedy. Could you tell us why there should he this group of
people with criminal records and criminal associations on both sides,
on the side of the Chicago Restaurant Association and on the side of
the union ?
Mr. Madia. I must respectfully decline to answer. I claim my con-
stitutional privileges under the fifth amendment, because my answer
might tend to incriminate me.
Mr. Kennedy. Those are the key questions, Mr. Chairman.
The Chairman. Maybe I misunderstood the witness.
Did you not voluntarily state right in the beginning of your testi-
mony that you are an American citizen ?
(The witness conferred with his counsel.)
Mr. Madia. Yes ; I did.
The Chairman. You stated that voluntarily. Were you born in this
country ?
Mr. Madia. Yes, I was.
The Chairman. Where were you born ?
Mr. Madia. In Chicago.
The Chairman. When ?
Mr. Madia. November 16.
(The witness conferred with his counsel.)
The Chairman. Do you have to ask your lawyer how old you are?
Mr. Madia. 1906.
The Chairman. 1906 ?
Mr. Madia. Yes, sir.
The Chairman. What schools did you attend ?
(The witness conferred with his counsel.)
The Chairman. Come on. Certainly there are a few decent things
in your life you can talk about.
(The witness conferred with his counsel.)
Mr. Madia. Well, I went to the Jones School and I graduated there.
The Chairman. Is that a high school ?
Mr. Madia. Well, I had about 2 or 3 years ; 3 years.
The Chairman. Three years of high school ?
Mr. Madia. Yes, sir.
The Chairman. And then what did you next do, after you got out
of school ?
(The witness conferred with his counsel.)
Mr. Madia. I must respectfully decline to answer. I claim my con-
stitutional privileges under the fifth amendment because my answer
might tend to incriminate me.
The Chairman. Do you mean up to the minute you got out of
school you got into something that you can't talk about?
Let's have order, please.
(The witness conferred with his counsel.)
Mr. Madia. Well, there is one thing that I can talk about, my
honorable discharge from the United States ISTavy. I had 2 years in
the Navy.
1
13088 IMPROPER ACTIVITIES IN THE LABOR FIELD
Tlie Chatrmax. Well, tliat is splendid. Now, then, do you still
think enoiiiili of your country to serve it?
(The witness conferred with his counsel.)
Mr. Madia, I must respectfully decline to answer. I claim my con-
stitution:!] privile<2:os under the tifth amendment, because my answer
mi«rlit tend to incriminate me.
The Ciiairmax. Obviously, you were in the service; you said you
got an honorable discharge. That was something decent you can talk
about. When I asked you if 3'ou are still willing to serve your coun-
try, you take the fifth amendment, AVhen did you sour on your
country ?
(The witness conferred with his counsel,)
Mr, IMauia. I never did.
The CiiAiRMAx. All right. You are not sour on it. Come along
now and help us out a little. Give us some infoimation. It might
enable your Congress to legislate so as to clean up some of this cor-
ruj:)tion that is going on. Tell us what you have been doing to help
unionism,
Mr, Madia, I must respectfully decline to answer, I claim my con-
stitutonal j^rivileges under the lifth amendment because my answer
might tend to incriminate me.
The CiiAiRMAx, You can't tell us what you have done to help.
Tell us what you have done to hurt,
Mr, Madia, I must respectfully decline to answer, I claim my
constitutional privileges under the fifth amendment, because my an-
swer might tend to incriminate me,
• Senator Church, Mr, Chairman?
The Chairman, Senator Church,
Senator Church, Mr, Chairman, I would like to say to INIr, Madia
that I don't think any meniber of this committee gets any pleasure
or satisfaction out of bringing any person to this committee and ask-
ing him a series of questions that are damning in nature, and listen-
ing to him invoke the fifth amendment of the Constitution in the
glare of the floodlights and the television cameras.
But the fifth amendment of the Constitution of the United States
was originally made a part of the Constitution in order to protect free
citizens against an arbitrary government, and every citizen of the
United States has a right to invoke the fifth amendment in order
that no government can force him to be a witness against himself,
in those cases where he honestly believes that an answer to the ques-
tions propounded might render him liable to criminal prosecution, or
put him otherwise in jeopardy,
Now this committee has launched upon legitimate public business.
It is public business when racketeers and gangsters infiltrate into
legitimate unionism. It is public business when they use the guise
of unions to operate vicious shakedown rackets. We have had many
witnesses come here, waitresses, employees of various kinds, many
employers and restaurant owners who have testified that these are the
things that are happening in Chicago.
That is the public's business to know.
Many serious charges and indictments have been made against your
particular union, Mr. Madia, and those of you who head i^ up. The
only purpose that this committee has in bringing you here is to give
IMPROPER ACTIVITIES IN THE LABOR FIELD 13089
you an opportunity to deny those charges and to set the record
straight if in truth and fact these charges are not so.
That is why these questions have been put to you. That is why
we have brought you here. In choosing to invoke the fifth amend-
ment, you may be within your rights — you have your attorney to ad-
vise on that — but clearly you fail to seize hold of an opportunity to set
the record straight, and you must leave this committee in a position
where it must assume that the testimony we have heard and the
charges that have been made are true, for they do not stand denied.
The Chairman. Are there any further questions ?
If not, the witness will remain under the present subpena, subject
to being recalled.
If you will acknowledge that recognizance, you may go until such
time as you are notified to reappear, with reasonable notice being
given.
Mr. Madia. Yes.
Mr. Gannon. Senator, I will undertake to discharge that obliga-
tion, if you see fit to ask for him.
Mr. Kennedy, Could I ask, Mr. Madia, if you have resigned your
position as secretary- treasurer?
Mr. Gannon. You can ask him, Mr. Kennedy.
Mr. Madia. No, I have not.
Mr. Kennedy. Do you intend to ?
Mr. Madia. Shall I pull this thing out again ?
The Chairman. Yes, pull it out.
(The witness conferred with his counsel.)
Mr. Madia. I must respectfully decline to answer. I claim my con-
stitutional privileges under the fifth amendment, because my answer
might tend to incriminate me.
Mr. Kennedy. Do you think that in view of your lack of answers
to questions here you deserve to be a union official ?
(The witness conferred with his counsel.)
Mr. Madia. I must respectfully decline to answer. I claim my con-
stitutional privileges under the fifth amendment, because my answer
might tend to incriminate me.
The Chairman. Is your union, the international union, of which
you are an official in one of its locals, a member of the AFL-CIO ?
Mr. Madia, I think it is, Senator.
The Chairman. Sir?
Mr, Madia. I think it is.
The Chairman. Wouldn't you know ?
Mr. Madia. It is.
The Chairman. It is. Well, the Chair will say again what he said
this morning. I hope they are listening in and will give the attention
to your case that it deserves before sundown tonight. I don't think
anyone who takes your position deserves to have authority over hard-
working people in this country who have to earn their living by the
sweat of their brow.
I trust the mechanism and power of the ethical practices committee
will be again invoked and appropriate action taken.
All right. You may stand aside.
Mr. IvENNEDY. I might say in connection with that, Mr. Chair-
man
13090 IMPROPER ACTIVITIES IN THE LABOR FIELD
Mr. Gannon. Thank you, Senator.
Mr. Kennedy. We have found the procedures followed by the labor
unions are far quicker than those followed by any other groups, in-
cluding the bar associations. The labor organizations have often
moved against officials who have taken the fifth amendment and who
are found to be dishonest.
The Chairman. I am not taking the matter up with the bar asso-
ciation or any others, but where we have people like some of these
witnesses who have been before us, who take the fifth amendment on
everything you ask them, and who are not cooperative at all, and
where you have the character of proof against them with respect
to their conduct that we have developed here under oath repeatedly,
I just think, if there is any agency in their organization that has the
power to eradicate them from that organization and take away from
them such authority and power as they have as officials, that it ought
to be invoked.
I cannot conceive of working people being under the domination of
union leaders such as these, who conspire with and enter into collusion
with management, where management participates in it, simply as
a shakedown, and require them to pay dues simply for no purpose
other than to enrich, possibly, those who are in a position to shake
them down.
I see nothing out of this where the union worker got any particular
benefit. Occasionally if one of them dies, somebody may have gotten
enough to bury them. But aside from that I have not seen anything
here to indicate any real legitimate unionism, interested in and trying
to serve to the welfare of the people who work and from whom they
extract their dues.
Is there anything further ?
Senator Church. I would only like to add, Mr. Chairman, that in
this Chicago investigation, it seems to me that there is an especially
good opportunity for the international unions involved and the CIO
and A. F. of L. federation to take corrective action as they have
often taken corrective action as these disclosures have been made in
months past.
Here we have had the case of a few locals that are clearly under the
dominance and control not of the people who are interested in legiti-
mate unionism, but of people who are interested in operating a very
lucrative shakedown racket for their own financial benefit. I am
hopeful that in a case of this kind, proper action on the part of the
international unions having jurisdiction over these locals will help to
clean up this problem in Chicago.
As you know, Mr. Chairman, the investigations of this committee
have been broad and have indicated that there are many different
fronts on which the fight against improper practices in the field of
management and labor has to be waged. One front is in the Congress,
one front is in the separate communities where local law enforcement
officers have been alerted by an outraged public opinion, and one front
is within the international unions themselves.
I want to say, as Mr. Kennedy said, that I think it is very gratifying
that the great AFL-CIO federation has taken such vigorous action
in other like cases to clean out these locals that need to be placed under
proper management.
I
IMPROPER ACTIVITIES IN THE LABOR FIELD 13091
I hope that in this case we will see action of that nature take place.
The Chairman. The Chair meant to say, and I am glad Mr. Ken-
nedy reminded me of the fact, that I received — or what he said re-
minded me of the fact — I received a letter this morning as chairman
of the committee from the American Bar Association, in which it
indicated it was quite interested in pursuing some developments that
have occurred here before this committee with respect to the attitude
and testimony that had been given regarding certain practices of
attorneys.
I can assure them that this committee will cooperate by making
available to the American Bar Association any information we have
that we think would be of value to it in cleaning house wherever a
house needs cleaning.
We had another witness to appear this afternoon, Mr. James
Blakeley.
Mr. Callahan. Mr. Chairman, my name is Edward J. Callahan,
Jr. I had brought Mr. Blakeley here this morning at 9 a. m. to submit
himself to the executive session.
Mr. Kennedy. You mean the staff interview ?
Mr. Callahan. Yes, that is correct. At that time, he was prepared,
and I state to this committee that he will testify. However, at noon
he complained of certain pains and that he was not feeling well. So
I asked him immediately to go back to his hotel. I called the house
physician who came and examined him. He has been given sedatives.
The house physician will return this afternoon and make further
determinations. I w^ant to assure his wife, if she is listening to this
program, or this television in Chicago, that he is not critically ill.
I represent, however, to this committee, that he is desirous of testifying
and will do so when requested. I say this subject to his present con-
dition. It was his intention to testify and to offer into the record a
statement, a copy of which has been previously furnished to the com-
mittee counsel, Mr. Kennedy,
It is a 74-page document, accompanied by exhibits, which I have
here. It is entitled "Statement by the Greater Chicago Area Joint
Executive Board and Affiliated Local Unions of the Hotel and Res-
taurant Employees and Bartenders International Union A, F, of L.-
CIO, to the Chairman and Members of the Select Committee on Im-
proper Activities in the Labor or Management Field of the United
States Senate."
I would like very respectfully to offer eight copies of this state-
ment, plus the exhibits, into the record at this time, for the com-
mittee's consideration.
The Chairman. Let the Chair understand. What is the statement ?
It is a statement that has been prepared and presented by whom ?
Mr. Callahan. It was to be presented by Mr. Blakeley on behalf
of the joint executive board of these unions which you have been look-
ing into, and others in the Chicago area, complete with statistical
data and matters which may be of interest to this committee, and it
is certainly germane to the inquiry here.
The Chairman. The statement may be submitted to the committee
for its inspection under the rules of the committee. It will not go
into the record at this time. When Mr. Blakeley is able to come and
testify, if he desires to read the statement
13092 IMPROPER ACTIVITIES IN THE LABOR FIELD
Mr. Callahan. It wasn't our intention to read it into the record.
The Chairman. You said to put it into the record. We will accept
it, gladly accept it, whatever you wish to present. But I could not
put it into the record at this time unless it was sworn to.
I am sure Mr. Blakeley later will testify and at that time he can
read it. In the meantime, we have a rule that if he is going to read a
prepared statement, he would have to present it 24 hours in advance.
So if you wish to leave it, you may file your copies with the committee,
and they will remain on file until such time as Mr. Blakeley can be able
to testify.
Mr. Callahan. Thank yon, sir.
The Chairman. That will be all right.
While counsel assures the committee that he is confident that
though Mr. Blakeley is not able to testify this afternoon, I think it
would be well for you to give us a report on his situation in the
morning.
Mr. Callahan. I certainly will.
The Chairman. We will not convene in the morning as early as
we have been. The Chair has to attend another meeting earlier. We
hope to be through by noon tomorrow.
The committee will convene in the morning at 10 : 30 in this
room.
("Wliereupon, at 3 : 05 p. m,, the hearing was recessed, to reconvene
at 10 : 30 a. m., Friday, July 18, 1958, with the following members
present : Senators McClellan and Church.)
INVESTIGATION OF IMPROPER ACTIVITIES IN THE
LABOR OR MANAGEMENT FIELD
FRIDAY, JULY 18, 1958
United States Senate,
Select Committee on Improper Activities
IN the Labor or Management Field,
Washington, D. C-
The select committee met at 10: 30 a. m., pursuant to Senate Reso-
S! T o ' '''^'■^^^ ^"^ January 30, 1957, in the caucus room. United
states Senate, Senator John L. McCleUan (chairman of the select
committee) presiding.
Present: Senator Jolm L. McClellan, Democrat, Arkansas; Senator
J^rank Church, Democrat, Idaho; Senator Karl E. Mundt, Repub-
lican, South Dakota; Senator Carl T. Curtis, Republican, Nebraska
Also present : Robert F. Kennedy, chief counsel ; John J. McGovern
assistant counsel; LaVern J. Duffy, investigator; James P. Kelly in-
ve^s^t^gator; James Mundie, investigator; Euth Young Watt, chief
(At the convening of the session, the following members were pres-
^^^'i ?,^^^'^ McClellan, Curtis, Church, and Mundt.)
The Chairman. The committee will come to order
Mr. Kennedy. Mr. Chairman, the first witness this morning was
to be, once again, Mr. Blakeley. He is the international vice prestdent.
Mis attorney is here to make a statement about Mr. Blakelev
Mr. Callahan Mr Chairman, I did not want to make the announce-
me.it yesterday that Uv Blakeley had a heart attack, because of his
wife but she flew here last night and is now with him. We have a
win h'^'^^'J''''"^ m Washington, and he will prepare a report which
will be made a matter of record with this committee. Mr. Blakelev
has had a heart condition for a great number of years. That report
as to his past condition will also be made a matter of record
He is presently confined to his bed, and, when possible, will return to
Cliicago, where he will go into a hospital there.
requLrs! howe™^'^^' ^"^ ^^' committee at any time the committee so
miftPP W 'r W ^ '^^!? yesterday that the chief counsel of the com-
B ntflJ l««ked into the matter and was fully satisfied that Mr.
Blakeley was not able to appear yesterday
report '"''" ^'''' "''"""'^ '"'" ^'^^^ yesterday afternoon and gave me a
.Mr. Callahan. I told you ih^ results of the electrocardiogram, yes,
sir.
Tlie Chairman. Of course this committee would never undertake to
compel people to appear to testify before us when it might endange?
13093
13094 IMPROPER ACTIVITIES IN THE LABOR FIELD
their life. We will just have to defer hearing Mr. Blakeley until such
time as his health improves. The committee will have a continuing in-
terest in him and in his testimony. We trust that you as counsel for
him will keep in touch with the staff and keep us advised of the
progress he makes toward recovery.
Mr. Callahan. I want to thank you for 3'our consideration, Sen-
ator. I will return to Chicago now, but I will have the documents
delivered to the committee. Thank you, sir.
Mr, Kennedy. Mr. Chairman, we also had expected, or wanted to
have, Mr. Moony Giancana, from Chicago, who is among the first
three in the Chicago area in the underworld, and he has important
information he can give to the committee. We have been looking for
}iim for a period of some 3 months. We have been unable to find him.
He has left his usual places of operation in Chicago. We have tried
to subpena him at home and have been unable to do so. But we did
subpena his daugliter, however, to see whether she could give us any
information about the activities of the restaurants in Chicago and the
labor unions. His daughter's attorney is here now with a statement
to make.
Mr. Fitzgerald, ISIr, Chairman and Mr, Counsel
The Chairman, Will you identify yourself?
Mr, Fitzgerald, My name is Benedict F, Fitzgerald, Jr,, attorney
at law.
The Chairman. May I inquire if a copy of his statement has been
submitted ?
Mr. Kennedy. I believe it is a letter ; is it ?
Mr. Fitzgerald. That is right. I have submitted a motion to quash
the subpena, your honor, together with a copy of the statement fur-
nished by Dr.' William F. Parelli, M. D. I represent this little lady.
I don't represent her father, I have never had the privilege of meet-
ing her father. But she seems to be pretty ill. I have a statement
here which indicates that fact.
The nature of her illness is such that, if Your Honor reads this and
refuses this, you will be probably wanting to return this to me and not
insert it in the record. That was requested by the doctor. He told
me not to let this out of my hands. But I thought I would show it to
you anyway. If you want any further interrogation on it
The Chairman, I think, if you have a document there that involves
possibly confidential or privileged information as between doctor and
patient, that it may be submitted to the members of the committee for
their inspection, and, if satisfied that it is a document of that nature,
or proper propriety dictates it should not be placed in tlie record, the
committee will not place it in the record. But I cannot pass judgment
on it until, at least, the committee has seen it.
Mr. Fitzgerald, Yes; surely. I would like to pass it over at this
time.
The Chairman. Do you have extra copies ?
Mr. Fitzgerald. No ; I don't, Mr. Chairman. I might say that the
doctor is available in Chicago, if any of you gentlemen want t/O have
your investigators contact him.
The Chairman. On the basis of the information contained in this
doctor's certificate, the commitee will defer the hearing of the witness
IMPROPER ACTIVITIES IN THE LABOR FIELD 13095
named in the statement, unless there is objection. The Chair hears
none. The hearing of this witness will be deferred.
Mr. Fitzgerald. Thank yon, sir.
The Chairman. Thank you. Proceed, Mr. Kennedy.
Mr. Kennedy. Mr. Chairman, we have had some testimony in the
past regarding some of the wage scales that have been paid in some of
these restaurants in Chicago.
We have a compilation of those wage scales paid in restaurants, and
the differential between the wage scales that are paid and the ones that
are contained in the union's pamphlet or book on what the waitresses,
waiters, and so forth, should be paid. I would like to call Mr. Gotsch
to have him insert this wage scale in the record so that it would be
available to the committee.
TESTIMONY OF GERALD GOTSCH— Resumed
Mr. GoTSCH. Mr. Kennedy, do you want the detail ^
Mr. Kennedy. Mr. Chairman, I don't think it has to be read into the
record. It has been referred to during the course of the hearing.
The Chairman. This is a compilation of the restaurants you have
investigated that have been testified to here, where they either Join the
union or some of them join the union, and where the union wage was
not paid, and, by that calculation, where they were paid below union
wages, you made a calculation that, on that basis, the restaurant saved
so much annually ?
Mr. GoTSCH. That is correct, Senator.
The Chairman. Or the proprietor saved so nmch annually. This
is simply upon that basis of calculation. It does not take into account
those instances where there may have been fringe benefits or fringe
payments provided, or some benefits provided, that may have offset
altogether or, at least, then, in part some of these so-called profits or
gains made by that arrangement.
Mr. GoTscH. That is correct. Senator.
Mr. Kennedy. We want to point out that some of these restaurants
might be paying their waitresses, with the fringe benefits, more than
the union scale. But this is based strictly on the union book as to what
they should be paid if the union enforced the contract; if the union
enforced the contract, this is how much more it would cost the employer
to have paid union scale over a jDeriod of a year.
The Chairman.. In other words, this tends to emphasize again, as
I have pointed out, that, so far as the union being really interested or
concerned about the people it forced to join or caused management to
force to join or to put into the union any pay dues on, it simply empha-
sizes that they were not concerned about wages or working conditions,
but simply to get the money.
Mr. Gotsch. That is correct, sir.
Mr. Kennedy. Some of the restaurants we have discussed are not
contained in here ; is that correct ?
Mr. Gotsch. Eight.
Mr. Kennedy. And that is where we have found that they are pay-
ing union scale or approximately union scale.
Mr. Gotsch. That is correct. Some are also included that have paid
union scale.
13096 IMPROPER ACTIVITIES IN THE LABOR FIELD
The Chairman. This compilation may be made exhibit No. 36.
(The document referred to was mai-ked "Exhibit No. 36" for refer-
ence, and may be found in the files of the select committee.)
Senator Mundt. So that Ave can get it in a proper perspective, is this
a union scale that is national, or is it a union scale applicable only in
Chicago? It is a national union scale averaging out for cities of the
size of (liicago ?
The Chaikmax. It has been testified that was the union scale in
Chicago.
Senator Mundt. No. 2, this being the union scale in Chicago, is i^
a union scale which has been arrived at by the type of union leaders
that we have called before our connnittee who have taken the fifth
amendment and have refused to testify ? Or is this a union scale ar-
rived at by some reputable union ?
Mr. GoTscii. It is by the joint local board, Senator.
Senator Mundt. That does not answer my question. The question
is: Is this a union scale arrived at by unions led by the officials who
have come here and refused to testify?
Mr. GoTSCH. Yes.
Mr. Kennedy. Not completely.
Mr. GoTscii. Not completely. We haven't talked to Mr. Blakeley
yet.
Senator Mundt. Then, speaking for myself alone, Mr. Chairman,
I protest against the insertion of this as evidence. I think it is
manifestly unfair to any restaurant man to have him alleged to be
refusing to pay union wages arrived at by thugs and racketeers who
refuse to testify before this committee. To me, I give no credence
whatsoever to any so-called union scale arrived at by thieves, thugs,
crooks, and racketeers unwilling to testify before this committee even
as to whether or not they are a citizen. I don't think we should smear
any restaurant or any hotelman or anybody on the basis of the failing
to pay tribute to the kind of racket.
Senator Curtis. Mr. Chairman ?
Senator Mundt. That is my OAvn personal opinion and I wanted
that in before the evidence is made public. If the rest of the com-
mittee desires to use it, O. K., but I protest against it.
Senator Curtis. Mr. Chairman ?
The Chairman. Senator Curtis.
Senator Curtis. Has any witness appeared and explained the union
scale and has defended it ?
The Chairman. I beg your pardon ?
Senator Curtis. Has any witness appeared to explain the union
scale, its application, and defended its accuracy ?
The Chairman. Yes. They testified, as I recall, witnesses testified,
that this union scale was published and handed out.
Senator Curtis. That was not my question. Has any witness ap-
peared here, described this union scale, testified as to it's application^
and defended it as being a scale properly arrived at?
The Chairman. I don't know how it was arrived at. I can't
answer that. It is the one in use, whether arrived at wisely or not.
Senator Curtis. My recollection is that the only union witnesses
that have been here while I have been here have been of the type de-
scribed by Senator Mundt. It is a group that cannot be relied upon.
IMPROPER ACTIVITIES IN THE LABOR FIELD 13097
They are definitely of the hoodhim type. Every other witness that
was asked about this union scale found fault with it, criticized the
way it was made up. They criticized the allowance made for gratui-
ties.
Every other witness that was asked about this challenged the thesis
that the restaurants had a yearly savings that could be tabulated. My
observation, listening to these hearings, is that no one had a saving, by
reason of their clash with these outlaws in Chicago. Perhaps it should
be tabulated, the damage that they have done. Here we have in union
activity, one restaurant owner telling that part of the harassment
that he suffered was that they would transport several carloads of
derelicts to his restaurant, give them money, and send them inside,
and they would go in there and fall asleep and keep out other
customers.
How are you going to put a value on that, what that cost him ? I
join Senator Mundt's protest in a tabulation of what a restaurant
owner saves by not making further concessions to racketeers like this.
I think it is totally misleading. I do not challenge Mr. Gotsch's
mathematics in the thing. I know he followed instructions.
Mr. Kennedy. My instructions.
Senator Curtis. Yes. But I think that the way it happens, in
the light of all the other testimony, it will be a document that will
be quoted by others, completely out of context. Therefore, I join
in Senator Mundt's protest.
Senator Church. Mr. Chairman.
The Chairman. Senator Church.
Senator Church. It seems to me that the revelant inquiry here is
not who computed this scale nor their general standards of conduct
in handling tlieir particular locals. I think the evidence is replete
that these particular locals are handled by people that would not
have the approval nor approbation of members of this committee
nor of the public generally. But I really do believe that the relevant
inquiry is whether or not this particular union scale that exists in
Chicago is in line with union scales for comparable work done in
cities of comparable size. Much testimony was given that the scale
in Chicago, the union scale, for waitresses was 67 cents an hour. That
does not seem to me to be a very large or excessive w^age. I would
like to inquire of our counsel and members of the committee whether
or not the union scale in Chicago is in line with union scales existing
elsewhere in cities of that size for this kind of work.
I think that is the relevant inquiry as to the validity of the scale that
is in question here.
Mr. Kennedy. Mr. Chairman, I believe that Mr. Duffy of the
committee staff has been sworn and can give you an answer to that
question.
Mr. Duffy. Senator Church, we have not made a detailed study
on this, but we have been told that the union wage scales in Chicago are
lower than in other cities of comparable size, generally.
Senator Church. That the scale we have been talking about here
is generally lower than scales prevailing elsewhere for comparable
types of work in cities of comparable size ; is that correct ?
Mr. Duffy. That is correct.
31243 — 58 — pt. 34 16
13098 IMPROPER ACTIVITIES IN THE LABOR FIELD
Senator Church. In the light of that, Mr. Chairman, I should
think there would be no objection, and certainly I have no objection,
to the inclusion in the record of this table.
The Chairman. The Chair would make this observation again. I
think the force of significance of this document is simply that it shows
the union, the union officials, were not in good faith. It is a part of
their scheme, it is a part of the fraud that the}^ were perpetrating on
these people out there. That is the interpretation that I give to it.
Tliey were not sincere, they were not concerned, w^iether honest
people or crooks or whoever established the scale, they show no con-
cern about it.
Senator Muxdt. Mr. Chairman, to explain my point a little further,
I commend the chairman on the fact that through these hearings, to
the fullest extent possible, we have avoided smearing innocent people
or even reciting facts that can be misrepresented by others. I know
nothing about these restaurants that are listed here. They may all
be running sweatshops, as far as I know, or they may be entirely
reputable. But we have perhaps 20 or 30 restaurants which it is
proposed now to pillory on the press of the city of Chicago under the
heading "Yearly Savings to 27 Restaurants in the Chicago Area Due
to Wages Paid Below Union Scale."
I submit that the union scale, so-called, in Chicago, set up by these
racketeers, was a scale to exact tribute. It is entirely possible that we
are smearing people who refused to knuckle under to some of these
racketeers. It is entirely possible that this could be interpreted as a
smear for failing to pay a union scale, fictitiously arrived at, with no
relationship to the types of services rendered.
Mr. Duffy said we have made no study of comparable union scales
in comparable cities, but we have been told it's lower.
Now, if we are going to put this kind of list out, I think the least we
could do is to make a complete study of union scales in other cities so
that we know that we are on solid ground.
I, for one, reiterate the fact I have no confidence whatsoever, I give
no credence whatsoever, to union scales contrived by crooks, to a union
scale which it is proposed to apply by men who refuse to testify before
this committee whether they are citizens or not, the fakers who take
the fifth amendment on every question that is asked. And I want no
part of publishing a list which conceivably could be used to smear
people because they refuse to knuckle under to or cooperate with that
kind of racket in the city of Chicago.
The Chairman. Has each one made all the statements he wants to
make?
Senator Church. Mr. Chairman, I will make this one additional
statement. I have to express my disagreement, again, with Senator
Mundt. It seems to me that it is not entirely accurate to say that the
inclusion of this evidence in the record will be a smear against restau-
rant owners w^ho have refused to knuckle under to these racketeering
locals in Chicago. I think the evidence will bear out that in almost
all of these cases, these restaurants have knuckled under in the sense
that they have entered into arrangements with these particular locals,
whereby they pay on a certain number of employees to these unions
and do in this sense pay tribute to these unions. But these very unions
are so unconcerned about the employees in these very restaurants that
IMPROPER ACTIVITIES IN THE LABOR FIELD 13099
they don't undertake to enforce the union rate or the union scale that
has been established in the union contracts.
The point of this, it seems to me, is quite apart from smearing these
restaurants. The point of this is to demonstrate that restaurants that
are engaged in paying tribute on a portion or proportion of their
employees and getting by, by not paying the union scale that in many
cases is set up in the contracts that are not enforced, are actually
realizing savings thereby.
Senator Curtis. Will the distinguished Senator yield for a
question ?
Senator Church. Yes ; I yield.
Senator Curtis. Isn't it true that the heading of this document does
not say anything about the failure of unions to protect the employees ?
Neither does it say anything about unions' failing to collect their
contract. The document I have here puts the stigma on restaurant
owners. It says that tliey save so much on this transaction.
Senator Church. Well, I would say in reply to that, that this is one
of many documents that has been entered into the record in the context
of hearings that have lasted several days. This is exhibit No. 37. It
is being placed in the record within the context of hearings that cover
this whole field. I do not think, since it appears as part of a record
that brings the whole story to light, that it will be taken out of per-
sjjective. In the perspective of the hearings, this merely bears out
what the testimony here has indicated, namely that there are a number
of restaurants that are paying tribute to locals that are unconcerned
about the welfare of the employees, and are not enforcing union scale,
and that certain savings are being effected thereby. I think this is a
reflection on the locals. I think it also indicates that in some instances,
at least, management is also profiting by this arrangement.
Therefore, I think it is pertinent to the inquiry, and when taken into
the context of the hearings of the last 2 or 3 days, it is not misleading.
The Chairman. The Chair will state this, and I hope we can go on,
that this is a compilation of testimony that has been given here, and
the Chair has simply made it an exhibit. I have not ordered it printed
in the record.
It is for whatever information and value it has. I take the position
that the primary reflection is upon the union that would go out and
compel these folks to join, and many of them did have to join to stay
in business, and that this showed very definitely that the union was
not concerned. If it had been enforcing its contracts, these folks
would have had to pay out that much money.
Is there anything further ?
If not, we will move on.
All right, call the next witness.
Mr. Kennedy. Mr. Chairman, we have been looking for Mr. Joey
Aiuppa for a long period of time. We were finally able to locate him.
He is here today and I would like to call him as a witness.
The Chairman. Mr. Aiuppa.
Be sworn, please. You do solemnly swear the evidence you shall
give before this Senate select committee shall be the truth, the whole
truth, and nothing but the truth, so help you God ?
Mr. Aiuppa. I do.
13100 IMPROPER ACTIVITIES IN THE LABOR FIELD
TESTIMONY OF JOSEPH AIUPPA, ACCOMPANIED BY COUNSEL,
MAURICE WALSH
The Chairman. State your name, your place of residence, and your
business of occupation.
Mr. Walsh. Before the testimony begins, may I make a request of
the committee ?
The C1LA.1RMAN. When the witness has properly identified himself,
the Chair will hear counsel.
Mr. AiuppA. Joseph Aiuppa, 4 Yorkshire Drive, Elmhurst, 111.
The Chairman. What is your business or occupation, Mr. Aiuppa?
Mr. Aiuppa. I decline to answer on the ground that my answer
might tend to incriminate me.
The Chairman. You have counsel present ?
Mr. Aiuppa. Yes, sir.
The Chairman. Do you know your counsel ?
]\Ir. Aiuppa. Yes, sir.
The Chairman. Counsel, will you identify yourself for the record,
please?
Mr. Walsh. My name is Maurice Walsh. I am admitted to prac-
tice law in the State of Illinois and several Federal courts.
Senator Mundt. Mr. Walsh, you failed to give your address.
Mr. Walsh. 105 West Adams Street, Chicago, 111. In accordance
with rule 8 of the rules of procedure of the select committee, which
reads :
A witness may request on grounds of distraction, harassment, or physical dis-
comfort, that during his testimony, television, motion picture, and other cameras
and lights shall not be directed at him, such request to be ruled upon by the
committee members present at the hearings.
Mr. Aiuppa informs me that the television camera and other lights
will be distracting to him, will harrass him, and will cause him physi-
cal discomfort, and I miglit say that that light is quite uncomfortable
to me. But in support of that, I would like to urge the decision of
the district court in The United States v. Kleinman ( 107 Federal Supp.
407), where Mr. Kleinman refused before the Kefauver committee,
and the district court found that he should not have been compelled
to undergo the lights. In additional support, I should like to cite a
statute of the State of Illinois, numbered paragraph 57 of chapter 51,
Smith-Hurd Illinois Statutes, annotated, which reads:
No witness shall be compelled to testify in any proceeding conducted by a court,
commission, administrative agency, or other tribunal in this State if any portion
of his testimony is to be broadcast or televised or if motion pictures are to be
taken of him while testifying.
I suggest that the only television sliowing of this proceeding that I
am aware of is directed to Chicago, 111., and in a sense the broadcast-
ing company is evading that statute. That is the extent of our request.
The Chairman. Mr. Walsh, you do not contend that the Illinois
statute controls a Senate investigating committee, do you?
Mr. Walsh. I am merely urging that as persuasive matter, to show
what a State legislature has done. That was their judgment of the
matter.
The Chairman. Are you also familiar with the policy that I
think has been firmly established by the committee, where witnesses
IMPROPER ACTIVITIES IN THE LABOR FIELD 13101
cooperate with the committee, and if they are in good faith in making
the request that we grant it, and if a witness' purpose is only to sit
here and take the fifth amendment, the committee has held that we
could see no reason why a little light would detract from his being able
to repeat that over and over.
Mr. Walsh. Well, I don't know that that calls for any reply from
me. I have an opinion on it, but I wouldn't state it unless you suggest
that I do.
The Chairman. laskedif you were familiar with that.
Mr. Walsh. I have heard it announced, yes, sir, by watching
television.
The Chairman. I will ask this witness this question : Is it your in-
tention to cooperate with the committee and give the committee such
information as you may have that is pertinent to this inquiry ?
Mr. AiuppA. I decline to answer on the ground that the answer
might tend to incriminate me.
The Chairman. Senator Mundt?
Senator ISIundt. Mr. Chairman? In view of that, I think that the
chairman might well rule, as I am sure he is going to rule, that the
lights cannot possibly distract a witness who is going to hide behind
the fifth amendment, and in fact they might be helpful to him, be-
cause it makes it easier for him to read that monotonous response with
the dark glasses he is wearing. We are trying to help the witness, so
I suggest we keep the lights on.
(The witness conferred with his counsel.)
The Chairman. The Chair has in the past ruled each time that there
could be no possible serious distraction at least by reason of the lights
being on if all the witness is going to do is take the fifth amendment. I
will say this : If the witness and his counsel will now agree to fully co-
operate with the committee, as the Chair has suggested, by giving in-
formation pertinent to this inquiry, information within his knowledge
and about which he may be interrogated, if the witness will agree to
do that, we will be most happy to grant his request.
Well, let the record show the witness and counsel remain silent.
The request is overruled. We will proceed.
Proceed, Mr. Kennedy.
Mr. Kennedy. Mr. Aiuppa, could you tell us what your association
or relationship has been with local 450 of the Hotel and Restaurant
Workers Union ?
Mr. AiUPPA. I decline to answer.
Mr. Kennedy. Would you give the reasons that you decline to
answer when you decline to answer, please ?
Mr. Aiuppa. It may tend to incriminate me.
Mr. Kennedy. Mr. Chairman, we have had some testimony regard-
ing Mr. Aiuppa's connection with local 450.
The Chairman. Before we proceed further, may I ask the witness :
Were you born in the United States ?
Mr. Aiuppa. I decline to answer.
The Chairman. You have counsel. I am not going to take the
burden upon myself to instruct you how to answer properly, if you
really have in mind to invoke the fifth amendment. So I am going to
let your answers stand as you make them. I will ask you the ques-
tion : Were you born in the United States ?
13102 IMPROPER ACTIVITIES IN THE LABOR FIELD
Mr. AiuppA. I invoke the fifth amendment.
The Chairman. Are you now a citizen of the United States ?
Mr. AiuppA. I decline to answer.
(The witness conferred witli his counsel.)
The Chairman. Do yon honestly believe that if you gave a truthful
answer to the questions "Were you born in the United States," and
"Are you now a citizen of the United States," that a truthful answer
to those questions or to either of tliem might tend to incriminate you?
Mr. AiuppA. I decline to answer on the ground that my answer may
tend to incriminate me.
The Chairman. With the approval of the committee, the Chair
orders and directs the witness to answer the question : Do you honestly
believe that if you gave a truthful answer to the questions "Were you
born in the United States" and "Are you now a citizen of the United
States," that a truthful answer might tend to incriminate you?
Mr. Walsh. Mr. Chairman, we have one additional objection that
I would like to state, and that is that the question is not pertinent to
the inquiry, and we ask for a statement of its pertinency and the con-
nective reasoning.
The Chairman. The Chair will state its pertinency. We are try-
ing to determine about improper practices in management-labor rela-
tions, and to determine how much criminals, underworld characters,
have infiltrated into both legitimate labor and management in this •
country, where management-labor relationships exist. We are trying
to determine whether that infiltration is by citizens who owe an obli-
gation to this country or if it is by people in some instances who are
not citizens of this country who are taking advantage of tlieir pres-
ence here to engage in improper practices and even criminal acts to
exploit the American citizen and to prey upon innocent people in this
country.
Senator Mundt. To which you could add, Mr. Chairman, that part
of our responsibility is to make suggestions to the Senate, to the Con-
gress, as to how these improper practices may be alleviated. If it de-
velops that they are being engaged in, in the main, by people who are
not citizens of the United States, one of the ways to correct the situa-
tion is to tighten up the deportation proceedings and to expedite them.
So a question is most pertinent and most relative which directs itself
to the question of whether or not the man on the witness stand is a
citizen of the United States, and, as such, entitled to live here, and re-
gardless of any crimes he may commit. If he is not a citizen of the
United States, he is subject to deportation if he is involved in criminal
activities. So as an attorney, Mr. Walsh, I am certain you recognize
the pinpoint pertinency of these questions.
The Chairman. The Chair was going to add, Senator Mundt, that
the ultimate objective of this investigation, as everyone knows, is,
after discovering and exposing or learning where improper practices
exist or are engaged in, to recommend to the Congress legislation to
correct the evils that we may fuid to exist. That would include, of
course, if we found that peo])le not citizens of this country were over
here taking advantage of their presence here to exploit American
citizens or to engage in improper activities or criminal acts, that the
laws may need to be tightened with respect to deportation, as Senator
Mundt stated.
IMPROPER ACTIVITIES IN THE LABOR FIELD 13103
Senator Curtis.
Senator Curtis. Mr. Chairman, I might add that it is very likely
that the Congress and the legislative committees may want to con-
sider the question of whether or not they should, by law, provide
that union officers and agents must be citizens. Any information that
we can provide in these hearings on that serves a definite legislative
purpose, and is very much pertinent to our inquiry, and would in no
way incriminate the witness.
His is just a defiance of the committee.
The Chairman. That is very true. Senator.
Senator Church, have you any comment ?
Senator Church. No. I have nothing to add. I do think the in-
quiry is pertinent and within the jurisdiction of the committee.
Therefore, it is a proper question.
The Chairman. With the approval of the committee, the Chair
again directs to tlie witness the question: Do you honestly believe
that if you gave a truthful answer to the question of were you born
in the United States and are you now a citizen of the United States,
or either of these questions, that a truthful answer thereto might tend
to incriminate you ?
Mr. AiuTPA. I refuse to answer on the ground it may tend to in-
criminate me.
The Chairman. The order and direction of the Chair to the wit-
ness with respect to these two questions will continue throughout your
appearance on the witness stand.
Proceed, Mr. Kennedy.
Mr. Kennedy. Mr. Chairman, so that we have a complete under-
standing of the connection of Mr. Aiuppa with local 450, 1 would like
to call again Mr. Kelly who referred to this briefly in the first day of
the hearings, and also to get some background on Mr. Aiuppa.
The Chairman. Let me ask Mr. Aiuppa 1 or 2 other questions.
Mr. Aiuppa, are you now a member of any labor organization?
Mr. Aiuppa. I refuse to answer on the ground that the answer may
tend to incriminate me.
The Chairman. Have you been a member of a labor union organiza-
tion at any time in the past ?
Mr. Aiuppa. I decline to answer on the ground that the answer may
tend to incriminate me.
The Chairman. Are you now an officer or have you been an officer
of a labor organization in the past ?
Mr. Aiuppa. I decline to answer.
The Chairman. Are you a member or have you been a member of
any trade or business association ?
Mr. Aiuppa. I decline to answer on the ground that the answer may
tend to incriminate me.
The Chairman. Mr. Aiuppa, I ask you the question : Do you hon-
estly believe that if 3^ou gave a truthful answer to the question whether
you are now a member of any labor organization, or whether you have
been a member of any labor organization, whether you are now or have
been an officer of any labor organization, whether you are now or have
been a member of any business or trade association, that a truthful
answer thereto, or to either of these questions, might tend to incrim-
inate you ?
13104 IMPROPER ACTIVITIES IN THE LABOR FIELD
Mr. AiTjppA. I decline to answer on the ground that the answer
might tend to incriminate me.
The Chairman. The Chair, with the approval of the committee,
orders and directs you to answer that question.
Mr. AiuppA. I decline to answer that question.
The Chairman. The orders and directions of the Chair will con-
tinue to you throughout the remainder of your appearance on the wit-
ness stand.
Proceed, Mr. Kennedy.
TESTIMONY OF JAMES P. KELLY
Mr. Kennedy. Mr. Kelly, you testified on the first day regarding
the connection of Mr. Aiuppa with local 450 ?
Mr. Kelly. That is correct.
Mr. Kennedy. Would you briefly restate it so we will have it in the
right context today ?
Mr. Kelly. In June of this year, INIr. Kemiedy, I visited the inter-
national headquarters in Cincinnati, Ohio, and researched the records
on local 450, the Suburban Miscellaneous local in Cicero. My in-
vestigation reveals, and it has been entered into the record as exhibit
15, that the application for charter of affiliation for this local lists
Joseph Aiuppa as secretary. The charter is dated in August — August
12, 1935.
Mr. Kennedy. Mr. Aiuppa, could you tell us how you happened
to enter the labor movements in 1935 ?
Mr. Aiui'PA. I decline to answer on the grounds that the answer may
tend to incriminate me.
Mr. Kennedy. Could you tell us why the union would grant you a
charter at that time ?
Mr. Aiuppa. I decline to answer that question.
Mr. Kennedy. Isn't it correct, Mr. Kelly, at that time, that Mr.
Aiuppa was known as a gunman for the Al Capone mob in Chicago ?
Mr. Kelly. Yes, sir, and prior to that he had been known as the
supplier of machineguns for the Dillinger-Carper-Barker mob in
Chicago.
Mr. Kennedy. That was at the same time he received a charter for
a union ?
Mr. Kelly. That is correct.
Mr. Kennedy. Would you just give us a summary of Mr. Aiuppa's
background as far as his criminal activities are concerned ?
Mr. Kelly. His record shows, Mr. Kennedy, that as early as 1936
he became a partner in the Taylor Manufacturing Co., in Cicero, 111.,
which manufactured gambling supplies, including loaded dice. His
partners in this operation were Claude Maddox, also known as John
Moore, who was also connected with local 450 in Cicero, and a Kobert
Ansoni, also known as Eobert Taylor. Aiuppa, the witness here, was
also a partner of Ansoni and Maddox in the operation of the Paddock
Lounge in Cicero. He has recently been listed on the records of the
Turf Club, which is the successor to the Paddock Lounge in Cicero,
with the same John Moore; his record shows that in 1935 he was
arrested and charged with assault to kill. He was turned over to
the State's attorney's office and released. Three days later he was
IMPROPER ACTIVITIES IN THE LABOR FIELD 13105
arrested again on general principles. On July 5, 1945, Aiuppa was
fined $50 and costs by a justice of the peace in Willow Springs court
on a charge of accepting horserace bets. He and two others were
arrested for operating a handbook at the Post Time Tavern, 4824
West Cermak Road, in Cicero. When Matt Capone, brother of Al
Capone, was arrested for the slaying of a racetrack character known
as James D. Larkum, on April 17, 1945, the body of Larkum was found
in an alley in Cicero and it was indicated that he had been shot in
Capone's Tavern following a drinking spree at the Paddock Lounge,
which was then owned by Aiuppa.
Aiuppa and Ansoni, reported owners of this, were arrested by
Highway Patrol Chief McGinnis in connection with this murder and
were subsequently charged with misconduct. On March 29, 1951,
Aiuppa was cited for contempt for refusing to answer the questions
of a subcommittee of the United States Senate. On April 13, 1951,
he was turned over to the United States marshal in Cleveland, Ohio.
On February 7, 1952, he was found guilty and sentenced to 6 months
and a $1,000 fine. On October 13, 1954, he was again in custody of
the United States marshal in Chicago, charged with shipping unreg-
istered gambling devices interstate. In this case, his codefendant was
John Edward Moore, known as Claude Maddox. On this particular
case, he was sentenced and received a term of 1 year and 1 day in the
United States prison at Terre Haute, Ind.
Mr. Kennedy. Isn't it correct that in the very year he received the
charter in 1935, he was known as the contact man for the Dillinger
gang in Chicago?
Mr. Kelly. That is correct, Mr. Kennedy.
Mr. Kennedy. The very year he received the charter for local 450 ?
Mr. Kelly. That is correct.
Mr. Kennedy. Is that correct, that you were the Chicago contact for
the Dillinger mob in Chicago, in 1935?
Mr. Aiuppa. I decline to answer on the grounds that the answer
might tend to incriminate me.
Mr. Kennedy. Could you tell us how you
Mr. Walsh. May I further state the objection that under the fifth
amendment no person is to be brought to trial or to be compelled to
answer for an offense without the presentment of a grand jury. I
believe that is what is occurring now.
The Chairman. Proceed.
Mr. Kennedy. Could you tell us how it was that you were able to
get in both activities during the year 1935, get a union charter and
also be the contact for the Dillinger mob ?
Mr. Aiuppa. I decline to answer that question.
Mr. Kennedy. On what ground ?
Mr. Aiuppa. On the ground it may tend to incriminate me.
Mr. Kennedy. Isn't it correct also, Mr. Kelly, that Mr. Aiuppa is
known as an expert bank robber and was also known as the trigger-
man for Claude Maddox ?
Mr. Kelly. That was his police reputation, that is right, sir.
Mr. Kennedy. Are you an expert bank robber ?
]Mr. Aiuppa. I decline to answer that question on the ground it may
tend to incriminate me.
13106 IMPROPER ACTIVITIES IN THE LABOR FIELD
Mr. Kennedy. And also have you been the triggerman for Claude
Maddox, also known as John Edward Moore ?
Mr. AiuppA, I decline to answer that question.
Mr. Kennedy. On what grounds ?
Mr. AiuppA. On the grounds it may tend to incriminate me.
Mr. Kennedy. John Edward IMoore was also associated with local
450. "Was he not?
Mr. AirppA. I decline to answer that question.
Mr. Kennedy. You tell me why ?
Mr. AiuppA. On the grounds it might tend to incriminate me, or lead
to incriminate me.
Mr. Kennedy. And I believe you said that he supplied the machine-
guns for the Dillinger mob ?
Mr. Kelly. That is correct.
Mr. Kennedy. And is also known as Joey O'Brien ?
Mr. Kelly. He was known as Joey O'Brien, which was an alias as-
sumed when he was a boxer, back in the 1930*s. He also squeezed that
in.
Mr. Kennedy. Mr, Aiuppa is the individual that you tried to serve,
is that right ?
Mr. Kelly. That is correct, Mr. Kennedy.
Mr. Kennedy. And Mr. Aiuppa is the one that almost hit you in the
automobile i
Mr. Kelly. That is correct, sir.
Mr. Kennedy. Did you do that, Mr. Aiuppa ?
Mr. Aiuppa. I decline to answer that question.
Mr. Kennedy. On what ground ?
Mr. Aiuppa. On the grounds it might tend to incriminate me.
Mr. Kennedy. AVere you trying to run over Mr. Kelly ?
Mr. Aiuppa. I decline to answer that question.
Mr. Kennedy. Why, Mr. Aiuppa ?
Mr. Aiuppa. On the ground it might tend to incriminate me.
The Chairman. If you didn't do it, you couldn't be incriminated,
could you?
Mr. Walsh. Is that a question ?
The Chairman. Can you sa}' no, that you did not do it ?
Mr. Aiuppa. I decline to answer the question.
The Chairman. Do you realize that if you said no truthfully, that
such a truthful answer would not tend to incriminate you ?
Mr. Aiuppa. I decline to answer on the grounds that it might tend
to incriminate me.
The Chairman. All right.
Proceed.
Mr. Kennedy. We also find that Mr. Aiuppa is a close associate
of Tony Accardo ?
Mr, Kelly. Yes, sir. He was at Accarclo's lawn party.
Mr. Kennedy. In what year ?
Mr. Kelly. He has seen there in 1955; he was seen in conversa-
tion with such people as Paul "The Waiter" Kicca, and Claude Mad-
dox, or John Edward Moore, Joey Glimco.
Mr. Kennedy. Joey Glimco is Local 777 of the Teamsters ?
Mr. Kelly. That is correct, sir.
EVIPROPER ACTIVITIES EST THE LABOR FIELD 13107
Mr. Kennedy. Are you a friend of Paul "The Waiter" Ricca, too,
Mr. Aiuppa ?
Mr. Aiuppa. I decline to answer that question.
Mr. Kennedy. And Mooney Giancana ?
Mr. Aiuppa. I decline to answer it on the ground it might tend to
incriminate me.
Mr. Kennedy. And also present was Sam "Golf bag" Hunt?
Mr. Kelly. Without the golf bag.
Mr. Aiuppa. I invoke the fifth amendment.
Mr. Kennedy. And Joey DeMarco, known as Little Caesar. He
has been a witness here. I wondered if you know him.
Mr. Aiuppa. I decline to answer that question on the ground it
might incriminate me.
Mr. Kennedy. Was he also present at Claude Maddox's daughter's
wedding in 1955 ?
Mr. Kelly. Yes, Mr. Kennedy, on January 23, 1955, Claude Mad-
dox, or John Edward Moore, as he was then known, had a reception
at the Club Hollywood, located, I believe, in Chillum Park. There
was a private parking area for the guests at this wedding reception.
Among the guests was the witness Mr. Aiuppa. There was also John
Accardo, brother of Tony Accardo, and prominent in Local 110, the
Motion Picture Operators Union. Frank Pantaleo, an associate of
Mr. Glimco; Michael DeBiase, who gave an address of 2137 South
Cicero Avenue, which is the address of local 450, the suburban local ;
Joseph Aiello, the operator of the International Hodcarriers Union,
in Chicago, and Mr. Raimondi, wiio is with the Produce Drivers'
Union, Local 703, Chicago.
Also Mr. Gagiione was there, who is connected with the Picture
Workers Union, Local 18-B, which is also under the influence of Mr.
Joey Glimco.
Mr. Kennedy. At that 1954 party, was Mr. Tampanaro present?
Mr. Kelly. Yes, he was the secretary-treasurer of local 88, of the
cooks union, and also a member of an officer of the local joint execu-
tive board of the restaurant unions in Chicago, was present at the
1954 party.
Mr. Kennedy. Could you tell us why all of these union officials have
been present at these parties ?
Mr. Aiuppa. I decline to answer on the ground my answer may
tend to incriminate me.
Mr. Kennedy. And these other individuals that attended, can you
tell us what kind of things you discuss at these various gatherings
that you attended ?
Mr. Aiuppa. I decline to answfer on the same ground.
Mr. I^NNEDY. What about local 450, do you receive any money
from local 450 at the present time ?
Mr. Aiuppa. I decline to answer on the ground that my answer
might tend to incriminate me.
Mr. Kennedy. Do you know John Lardino ?
Mr. Aiuppa. I decline to answer.
Mr. Kennedy. On what ground ?
Mr. Aiuppa. On the ground that it may tend to incriminate me.
Mr. Kennedy. He was also present at the party, was he not?
Mr. Kelly. That is correct.
Mr. Kennedy. That is all.
13108 IMPROPER ACTIVITIES IN THE LABOR FIELD
The Chairman. Is there anything further? Are there any ques-
tions ?
Senator Curtis. Who was the hoodlum that you said belonged to
a joint council?
Mr. Kelly, I said tliat Maurice Tampanaro, who was the secretary-
treasurer of local 88 of the Cooks and Pastry Cooks Union in Chicago,
was present at the 1954 lawn party given by Tony Accardo at 915
North Franklin Street, in Iliver Forest.
Senator Curtis. And what is the full description of that joint
council ?
Mr. Kelly. It is known as the local joint executive board of the
restaurant unions in Chicago, Hotel and Restaurant, and Bartender's
Unions.
Senator Curtis. Is that the group that formulated the union scale
of pay ?
Mr. Kelly. The union scale was formulated in the master contract,
Senator Curtis, by the local joint executive board.
Senator Curtis. That is all.
The Chairman. Is there anything further ?
The Chair will give tlie same instruction to the staff regarding con-
tempt proceedings against this witness that I have heretofore given
regarding others who refused to state whether they were citizens of
this counti-y, and answer other pertinent questions in that category.
All right, you may stand aside.
Call the next witness.
Mr. Kennedy. That is all, Mr. Chairman.
The Chairman. Is that all for today ?
Mr. Kennedy. Yes.
The Chairman. Since 2 or 3 witnesses whose testimony the com-
mittee desires, and since 2 or 3 of them are ill and are not able to attend
the hearings at this time, their testimony has been deferred and the
committee may desire to interrogate them later. One or two wit-
nesses that we have been searching for, I believe, have not been found
as of yet, and when they are served with a subpena, I am sure the com-
mittee will still have an interest in hearing their testimony. But
aside from that, we are bringing this particular series or pliase of the
committee's hearings to a close.
The Chair will make this concluding statement: We now close 2
weeks of hearings on the Chicago restaurant industry. Some 3 weeks
ago, this committee embarked on a series of public hearings, the pur-
pose of which was to discover the extent of racketeer infiltration into
legitimate labor and management enterprises. As was so grapliically
demonstrated in that first week's intjroductory hearing, this is not a
local problem. Rather, we are confronted here with a massive na-
tional conspiracy, the influence of which reaches and corrupts many
phases of the Nation's economic life.
In studying the Chicago restaurant industry we have shown the
corroding effect that racketeer influence can exert on one specific ele-
ment of community business and activity.
At the outset, the point should be made that in some instances neither
labor nor management in the restaurant industry in Chicago can point
the finger at the other and cry "Shame." The hearings clearly estab-
lished that a number of local unions in the Chicago area are and were
IMPROPER ACTIVITIES IN THE LABOR FIELD 13109
controlled by gangsters and hoodlums and individuals whose primary
interest is not in the welfare of the members but in the use of the union
as a source of income. Such unions as local 450 of the Hotel and Res-
taurant Workers' Union have been the creatures of gangsterism and
violence.
The honest and valid concepts of labor unionism have been perverted.
Union officials such as John Lardino, Dan Lardino, Frank Trungale,
James O'Connor, Louis Madia, and Danny Leonardi are obviously not
fit to hold any position as union officials.
The committee also feels that James Blakely, an international vice
president of the Hotel and Restaurant Workers' Union and also secre-
tary-treasurer of local 593 — the largest local in the Chicago area — has
failed to meet his responsibilities as a union official in condoning rack-
eteer infiltration into various locals.
By the same token, the Chicago Restaurant Association saw fit to use
men with extensive underworld connections for their own purposes
through the employment of such individuals as Abraham Teitelbaum
and Anthony Champagne who, in turn, employed people with long
criminal records such as Louis Romano and Sam English.
There can be no doubt that such heads of the Chicago Restaurant
Association as George Drake and Donald Kiesau were fully aware
of the activities of their labor-relations consultants Teitelbaum and
Champagne. Their sole interest was in making deals to keep their
restaurants from being picketed or unionized.
The shocking fact is that large sums were spent by and in behalf of
Chicago restaurants either to avoid improper picketing or to avoid
unionization. Much of this money was spent in outright payoffs to
unions and union officials. In the making of some of these payments
and deals between Chicago restaurants and labor organizations, these
restaurants were able to save some large sums annually in wages and
working conditions which they would legitimately have had to pay
and provide their employees had their union contracts been enforced.
Thus, as is the inevitable outgrowth of racketeer union-management
shakedown, it is the working people who, in the end, suffer the greatest
loss.
This is a deplorable situation. The employees in the restaurant
industry and the decent citizens of Chicago deserve far better condi-
tions.
As is the case in many of the hearings held by this committee, the
sordid situation revealed in Chicago cries out for remedial action which
is beyond the power of this committee. The committee hopes and trusts
that responsible governmental agencies on both the Federal and State
level will follow up on the information that has been presented here.
For instance, we have definite information that convinces us that
there is a protective society or organization made up of certain gang-
sters and hoodlums in Chicago to whom restaurant owners must pay
a certain tribute regularly. We know of a number of restaurants in
the Chicago area that are completely gangster and hoodlum run. At
least one of these restaurants at this very time is a center of vice and
racketeering in Chicago.
These are matters that we have learned during the course of our
investigation but which are not directly within our jurisdiction to
explore. This information we will be glad to give and cooperate with
13110 IMPROPER ACTIVITIES IN THE LABOR FIELD
any local agency where we have the assurance it will proceed in good
faith and that the firm and necessary steps that need to be taken will
be taken to deal with this problem.
The Chicago hearings have again demonstrated a problem which
has become apparent to us in previous hearings of this committee —
the existence of no man's land between union and employer in certain
industries. Many of the small employers in the New York area who
are victimized by the Teamster locals headed and controlled by
Johnny Dio and Anthony "Tony Ducks" Corallo found themselves
unable to take their problems to any State or Federal agency because
of the lack of jurisdiction of either Federal or State government over
their type of business.
This has again been highlighted by our Chicago restaurant hear-
ing over which the National Labor Relations Board has not exercised
jurisdiction and the State labor board will not exert jurisdiction.
The labor legislation already pavSsed by the Senate and currently
awaiting House action should go a long way toward solving this
particular situation as well as numerous other problems in the labor-
management field. Both management and union would then have
recourse to a duly constituted agency and not be left in a position
where they are at the mercy of unscrupulous racketeers.
It would appear that the representatives of the unions as well as
the managements in Chicago feel that there are no adequate remedies
open to them under State law, and that some State legislation should
be enacted also to cover these situations.
As this committee goes forward looking into different industries
in diiferent areas, I think it will be shown that what is happening in
Chicago is not an isolated incident.
The national scope of the racketeer problem is such that it calls
for stem Federal and State action to deal with it. It is not sufficient
for this committee merely to expose these activities and conditions.
After the original burst of publicity, attention must be given to the
constructive work of enacting legislation to deal with these matters
that we have brought to public attention.
In this respect, it should be determined whether or not the Federal
Bureau of Investigation has been hampered in its efforts to deal with
this problem because of a too limited scope of jurisdiction.
Thought should also be given to the possibility of establishing a
national crime commission to implement without in any way detract-
ing from the jurisdiction of the FBI to attack this cancerous problem
from a Federal level. This is in no way intended to infringe on the
rights of the States but the problem of racketeer infiltration and
domination of business and labor in my judgment must be attacked on
a Federal level to assure the desired solution.
The Federal Government realized this in the enactment of the Lind-
bergh law to deal with kidnaping. Legislation which would give
jurisdiction to the Federal Government to act in cases where racketeer
control has achieved an effect over interstate commerce I tliink should
be considered.
I again want to thank Mayor Richard Daley, of Chicago, for the
outstanding help and cooperation which he tendered to the committee.
Lt. Joseph Morris of the Chicago Police Department was most helpful,
and we are very grateful.
IMPROPER ACTIVITIES IN THE LABOR FIELD 13111
I also want to thank the members of our staff who participated in
this investigation : LaVern Duffy, James Kelly, Ralph Mills, Gerald
Gotsch of the General Accounting Office, and James Mundie of the
Treasury Department, and also Miss Ethel Appel of the Labor De-
partment in Chicago, 111.
Xow during the course of these hearings, station WBKB, a televi-
sion station of Chicago, and also the Chicago Sun-Times have by
mutual arrangement broadcast these hearings to the people in the
Chicago area.
We are very grateful to them for doing this. They have done it as
a public service. Broadcasting has not been sponsored, but it has
been done at their own expense simply to give that service and news
service to the people of that community to which they are entitled.
It is my regret that hearings such as this cannot be broadcast or
televised, live, all over the country. That is not out of any vain idea
that the members of the committee like to be seen on television. As
counsel pointed out here this morning, counsel for one of the witnesses
who didn't testify, I may say, these bright lights are not always com-
fortable. But it is the bright light of publicity, and, if the American
people can see this investigation just as it occurs, they will be better
informed of what is happening to our country, and of these elements,
how tliey operate, and the pernicious practices in which they engage,
and their parasitic imposition upon the public and upon innocent
victims and upon the economy of this country.
This would alert the public and arouse them to the point where
they would insist and where we, as legislators, as their representatives
here, I think, would be more diligent and concerned and would put
forth greater efforts to try to find the solution insofar as legislation
can remedy these conditions.
I would be glad for other members of the committee to comment.
Senator Muxdt. Mr. Chairman, I would like to associate myself
completely with what you have said in your words of appreciation to
the businesses responsible for televising and broadcasting and publi-
cizing these hearings as widely as possible. I, too, wish, they could
be brought to the attention of the country nationallv in live televised
hearings so that people everywhere would have the the same oppor-
tunity to sit in on these committee hearings as those who live close
to Washington.
I would see nothing wrong or inappropriate if such telecasts or
broadcasts were sponsored commercially, just as newspapers must be
sponsored commercially by the advertis'ing columns. It seems to me,
with certain limitations which would eliminate products which would
not be suitable to bring to the attention of youngsters in schools, that
programs of this type might well be sponsored and made available to
students m high schools studying current events and studying national
problems.
I also would like to associate myself with the statement made by
the chairman and call special attention to one sentence on which I
would like to dilate a little bit. The chairman said :
^v!^^ committee hopes and trusts that responsible Government agencies on both
the Federal and State level will follow up on the information which has been
presented here.
13112 IMPROPER ACTIVITIES IN THE LABOR FIELD
I join him in that aspiration. I think, included in tliose Federal
agencies, we should place high on the list the Congress of the United
States, however, and the citizens of the United States who elect Con-
gressmen. It seems to me both Congress and those responsible for
the people who sit in Congress must share the responsibility if no
action is forthcoming from hearings of this type.
Unionism in the United States operates in a climate of certain legal
cyclone cellars, which may be appropriate when, as, and if unionism
is led by responsible and honest and decent American citizens. But
these legal cyclone cellars provide a wonderful opportunity for gang-
sters and hoodlums to masquerade their activities and expand their
profits when the unions are led by dishonest or inappropriate leader-
ship.
For example, they have tax-exempt concessions, and they are exempt
from certain laws dealing with monopolies and antitrust practices.
They are permitted to employ a compulsory wage tax against em-
ployees of this country, wdiich they collect from people who work,
whether or not the people wlio work desire to pay this tribute.
They are living in an area where they have more leniency from law-
enforcement officials with regard to such activities as violence on
picket lines and striking procedures than is available to the ordinary
citizen engaging in property destruction or in personal vandalism.
I think the legislation passed by the Senate should be passed by the
House before this session adjourns, and that it should be strength-
ened. I believe it should be strengthened, in the light of these hear-
ings, with regard to the Chicago Restaurant Association. To the
Senate bill, it seems to me, must be added effective legislation provid-
ing for democratic practices, because only with democratic practices
and procedures can honest working men and women eliminate from
unionism the type of activities we have had related before this com-
mittee during the past 2 weeks.
That means that the Senate legislation, in my mind, should be
strengthened to provide for secret ballots which are honestly counted,
with a counting procedure which will guarantee to the men and women
in the unions who vote that the votes will be counted in accordance
with the manner in which they have been voted.
We have the disgusting spectacle, Mr. Chairman, of watching a
parade of "pygmy" Americans appearing before us taking the fifth
amendment. I am sure that this committee at its first executive session
will take the necessary committee action to cite for contempt all those
who have refused to answer questions regarding their American citizen-
ship, and I am confident we will do it early enough so that the Senate
itself can act on the contempt-citation resolution before Congress
adjourns.
I think that the international officers of the unions involved should,
summarily and now, lift the charters from the unions led by these dis-
reputable characters who have taken the fifth amendment and who
have these long criminal records.
In the first place, Mr. Chairman, I think a great responsibility rests
with the ethical practices committee of the CIO-AFL. They have
announced and proclaimed a policy that will not permit union officials
to take the fifth amendment before responsible Federal agencies of
Government or before the courts of the United States and, at the same
IMPROPER ACTIVITIES IN THE LABOR FIELD 13113
time, continue to hold their privileged union offices. I suggest to the
ethical practices committee the}^ have work to do. There is a great
group of these characters who have taken the fifth amendment before
this committee and, if they continue to hold office after so doing,
they hold office only because the AFL-CIO ethical practices committee
will have failed to follow through on the program which they have
established and announced.
The Chairman. Senator Mundt, in that connection, I don't have
the names of them, myself, but I am going to ask Mr. Kennedy, if he
will, to give us a report on what has happened so far.
Yesterday and, possibly, the day before, and I don't believe you
were here, as some of these witnesses testified whom we knew to be
officers, with some emphasis I called that to the attention of the inter-
national unions and the ethical practices committee, and some results
have been achieved, and I would like, if you will permit at this time,
Mr. Kennedy to give a report on what has occurred.
Senator Mundt. I think that will be fine, and I noticed, in reading
the daily transcript which comes to my office, that the Chair did call
that to the attention of the ethical practices committee very forcibly.
I commend him for it, and I certainly will be happy to hear the report
of progress that Mr. Kennedy has to make.
Mr. Kennedy. Mr. John Lardino, Mr. Dan Lardino, and Mr. Frank
Trungale, and James O'Connor have all resigned their positions as
union officials. In addition to that the international union has placed
in trusteeship local 394, and I understand that they have also placed
in trusteeship local 450, about which we had testimony yesterday, which
would mean that the other two officials who took the fifth amendment
before the committee, Louis Madia and Dan Leonardi, are also out
of their jobs.
Senator Mundt. That is very good.
Senator Curtis. Mr. Chairman, I wish to make a brief statement.
There are a few things I would like to call attention to for the record,
and I will try to be brief.
I think these hearings have served a very definite legislative purpose
even though many of the witnesses did not testify. Their failure to
testify revealed a great deal. We have the astounding experience this
morning of learning that back about 1935 a union charter was granted
to one of Dillinger's gangs that supplied the machineguns. Now, Mr.
chairman, the crux of this problem isn't that they gave a charter to
the wrong man; that is part of it. But that charter carried with it
too much power.
There were certain immunities and certain violations of the funda-
mental that all Americans should be treated alike. It is a violation of
the principle of equality before the law.
For instance, this union charter for all practical purposes gave the
recipient the right to picket. That is not a picket as defined properly
by law but to carry on unlawful picketing with immunities so far
as the courts and the officers were concerned. It gave the recipient
of that charter the right to harass people by slicing their tires, and
breaking their windshields, and nothing happened.
Other citizens camiot do that. Bad boys can't do it. It gave the
recipient of that charter the right to block streets and highway. We
have one witness that testified that the outlet to his place of business
21243—58 — pt. 34 17
13114 IMPROPER ACTIVITIES IN THE LABOR FIELD
was blocked by a truck and the police ordered it removed after the
union leader consented to it.
It gave the hoodlum recipients of union charters the right to carry-
on secondary boycotts, to boycott dairies and suppliers of food, and to
bring pressure against the place where the garbage is deposited so it
couldn't be taken out.
It gave tlie reci])ient of this charter the right to interfer with the
transportation and fioow of goods, some of which was in interstate
commerce.
Now all of these immunities and special rights and privileges given
to a vested group are responsibilities of Government and we aren't
solving this problem merely by directing our attention to the fact
that these special privileges were given to the wrong people. It is
too much to give to anybody.
All of this goes on because of the influence of unions with police,
with courts, with governors, and with Federal officials, and with
legislators both on the local. State, and Federal level.
Part of that influence is by reason of the widespread political
activities of unions, and their sizeable contributions to candidates for
office. I am not kidded or fooled by the fact that those contributions
are related through additional committee setup. They just do not
raise that amount of money by voluntary contributions.
So I think that here we have a very dramatic illustration of the
damage that is done to employees, to employers, and to the general
public and to our country by the failure of the Congress of the United
States to enact the laws that take away these special immunities and
powers. I think we have had a demonstration here of the need first to
remove the special immunities, including outlawing of the secondary
boycott, and I think we have also had a demonstration of the need
if we are going to have decent government in this country, to take
unions out of politics including effective laws to end their contribu-
tions to candidates which is carried on in spite of the fact that is pro-
hibited by law.
Because it is their political power that maintains the immunities in
the law, and gives them further immunities in the administration and
enforcement of the law. It is a hookup between politicians and unions.
It is an open invitation for the wrong people to want to be in the union
business. It isn't any wonder that one of Dillinger's boys wanted to
get in the union business. It has often been reported that a handful of
union officials could bring the great city of New York to its knees by
shutting off all supplies and stopping everything in a short while.
It is something that a foreign enemy couldn't do. We might wake
up sometime and find that a handful of Communists have done that
very thing.
Mr. Chairman, I hope that the lesson of these hearings will be felt
and that we will have some legislation that goes to the very problem
involved.
The Chairman. Senator Church.
Senator Church. Mr. Chairman, I have a few brief remarks to
make. I share the opinion of the chairman that these hearings have
been extremely beneficial in pointing up how certain racketeering
elements have infiltrated into certain locals and have used the guise of
legitimate unionism to cloak vicious shakedown practices.
IMPROPER ACTIVrriES IN THE LABOR FIELD 131 15»
I think that the hearings have been conducted in such a way as to
improve the prospects that something effective can be done in cleaning
up this problem in Chicago. Perhaps it will alert law enforcement
officers elsewhere in the country to investigate the possibility that
similar problems exist in other cities involving racketeering elements.
Perhaps it will serve as a prompter to State legislatures to enact
appropriate laws wherever necessary to give better protection against
these practices. And also, of course, it serves as a basis for congres-
sional action in this field. In order to do all of this, it is necessary that
these hearings be public hearings and it is necessary that the press
follow them carefully and accurately, and I think it is altogether
appropriate that these hearings be televised.
But lest my silence in the matter be regarded as an assent, I do have
to state my disagreement with the proposal or the suggestion that was
made that hearings of this kind might properly be commercially broad-
cast or broadcast under the sponsorship of a commercial advertiser.
In this I sharply disagree. This is the public's business. We are'
involved here as representatives of the public to look into problems
that may require laws and changes in the laws, and as such I think it
most inappropriate that the broadcasts ever be supported on other
than a public service basis.
• Now, I think in this case where the newspaper and television station
were involved it is entirely appropriate, but we are not engaged in sell-
ing products, and I think these hearings ought not to be used in any
way so that the public attention and interest in them could be focused
to the advantage of commercial advertisers.
I would like to say finally that the work that the unions themselves
have undertaken in efforts to clean up locals that are dominated by
racketeers to which Mr. Kennedy referred a few minutes ago have
also been undertaken to my best information by the bar association
in Illinois in connection with the activities of two attorneys, Mr.
Teitelbaum, and Mr. Champagne, who represented the Employers'
Restaurant Association in Chicago.
_ Here again is indication of the right kind of action within a respon-
sible organization pointed toward eliminating in the bar attorneys
who apparently are engaging in improper conduct.
Again let me close, Mr. Chairman, by commending the members
of the committee staff for the investigations that made these dis-
closures possible, and also for those witnesses, restaurant owners, and
waiters, and waitresses who cooperated with the committee and some
of whom came down in spite of threats being made to give the com-
mittee and the Government the benefit of their testimony.
The Chairman. Counsel Kennedy, you had a brief statement?
Mr. Kennedy. Mr. Chairman, during the hearings last week, I
referred to Mr. Champagne and I believe I stated about his criminal
record. Mr. Champagne has no criminal record that I know of and
I would like to correct that at this time, and also what I meant to
say at that time was his criminal associates. But I did say, as I
understand it, criminal record, and I would like to take this oppor-
tunity to correct the record and I will so do in the written transcript.
The Chairman. The permanent record may be corrected accord-
ingly. The Chair will state in conclusion, first, I wish to thank, of
course, the staff, and certain of my colleagues on the committee for
13116 IMPROPER ACTIVITIES IN THE LABOR FIELD
their cooperation and their presence. I know we all have so many
other duties that it is difficult for each member to be here all of the
time.
I know how much I have to sacrifice in my other work to be here
and try to be present at each session. But the committee members
who cooperate and work together to try to accomplish a worthwhile
objective and serve our country in this unpleasant task are to be
commended.
I would point out that the final good, other than legislation, that
may result from this committee's efi'orts and the things it reveals and
discloses in its investigation — the final good and the maximum good
results can only come from law enforcement officers and those having
responsibility for the enforcement of laws in their locality will pur-
sue the clues and the information that we develop here, to the end
that those who are engaged in criminal acts or who have committed
criminal acts, who have exploited, and bribed, and committed other
offenses, arson, and sometimes murder, and personal violence, and
criminal assault — if they will pursue it and meet their responsibility
and bring these folks to the bar of justice so that they may be judged
by their deeds and rewarded or punished accordingly.
The committee stands adjourned.
(Whereupon, at 12 : 15 p. m., the committee adjourned, subject to
the call of the Chair.)
INVESTIGATION OF IMPROPER ACTIVITIES IN THE
LABOR OR MANAGEMENT FIELD
THUKSDAY, JULY 31, 1958
United States Senate,
Select Committee on Improper Activities
IN the Labor or Management Field,
Washington^ D. G.
The select committee met at 10 :30 a. m., pursuant to Senate Resolu-
tion 74, agreed to January 30, 1957, in the caucus room. United States
Senate, Senator John L. McClellan (chairman of the select commit-
tee) presiding.
Present : Senator John L. McClellan, Democrat, Arkansas ; Senator
Irving M. Ives, Republican, New York; Senator Barry Goldwater,
Republican, Arizona ; Senator Carl T. Curtis, Republican, Nebraska.
Also present : Robert F. Kennedy, chief counsel ; Pierre E. G. Salin-
ger, investigator; James Mundie, investigator; Ruth Young Watt,
chief clerk.
The Chairman. The committee will come to order.
(Members of the committee present at the convening of the session
were Senators McClellan, Ives, Curtis, and Goldwater.)
The Chairman. I am informed that we have been able to find one
witness in the Chicago restaurant matter that was not available to us
in the previous series of hearings, and before we open the new series
this morning we will call that witness and take his testimony, and
then we will proceed into another phase of the hearing.
Mr. Kennedy. Mr. Gussie Alex.
Senator Goldwater. Mr. Chairman, on the ticker a few days ago
there was an item that gave me some concern, and I probably have
no reason to be concerned about it and I don't even remember the gen-
tleman's name, but it involved one of the public prosecutors in Chi-
cago or in Illinois,
There was some indication from the press release or the ticker that
there might be some argument between the committee and this par-
ticular body. I was hoping that that was not true because I wanted
to see us continue as we have in the past, to help these enforcement
officers or organizations who are willing to take our records and go
ahead cleaning out the hoodlums and gangsters such as we saw hap-
pened down in Tennessee.
Was there anything to that, Mr. Kennedy ?
The Chairman. The Chair would like to make this observation
first, that I have only had just a few moments with the chief counsel
since I arrived. I will let him make a statement regarding it, but I
want to say for the benefit of that gentleman, whoever he is, and for
13117
13118 IMPROPER ACTIVITIES IN THE LABOR FIELD
everyone else, that this oommittee will cooperate with all law-enforce-
ment officials throughout the country, but it is not this committee's
job to prosecute.
Now, we cannot nurse prosecuting attorneys and United States
attorneys and other law-enforcement officials. We make a record here
and it is a public record and anyone who says the record is not made
available to him is simply not telling the truth. The public record
is available to everyone.
After that record is available if the committee has further informa-
tion that in its discretion and judgment feels it can release with profit
to the work we are doing, and also as a service or further public serv-
ice, we will do it. I don't recall the man's name, and we can supply
that for the record, but so far as I know at this moment I never heard
from him.
If there is anything in the committee files we will find what it is,
and it will receive the same courteous and appropriate attention that
we have tried to give in the past. If this is a case of somebody just
sniping at the committee, I am not worried about snipers. The com-
mittee will always be oblivious, I hope, at little people who snipe at
us.
Senator Curtis. At a time when the chairman has had an oppor-
tunity to give this a little more thought, I may have some thoughts on
it that I would convey to the chairman because I feel that we all hope
the publicity is brushed away, this committee still is very anxious to
be cooperative with every law-enforcement agency it can, and I may
have some suggestions to take up with the chairman at a later time.
The Chairman. As far as the chairman is concerned, the committee
will not only cooperate but it will go out of its way to cooperate where
others are trying in good faith to execute the laws.
Senator Goldwater. A member of the staff tells me that the indi-
vidual concerned, and I think the name was Adamowski, had pub-
lished an apology in the paper last night, and I inadvertently missed
it, in which he said that the material had been on his desk and he
hadn't opened it. Had I seen that I wouldn't have had cause to make
a comment.
The Chairman. Well, I have faith in this staff, and I know we have
a tremendous load and the staff may at times overlook something
which comes to its attention. But it had not even come to my atten-
tion and the circumstances will be understood.
Who is the witness ?
All right, we will call the witness.
Do you solemnly swear that the evidence, given before this Senate
select committee, shall be the truth, the whole truth, and nothing but
the truth, so help you God ?
Mr. Alex. I do.
TESTIMONY OF GUSSIE ALEX, ACCOMPANIED BY HIS COUNSEL,
BARNEY J. KEEAN
The Chairman. May I inquire your name, and your place of resi-
dence, and your business or occupation, please ?
Mr. Alex. My name is Gussie Alex and I am born and raised in
Chicago, 111., as an American citizen.
IMPROPER ACTIVITIES IN THE LABOR FIELD 13119
The Chairman. That is splendid. Wliat is your occupation, sir?
Mr, Alex. Under the fifth amendment to the Constitution of the
United States, I decline to answer on the ground that my answer may
tend to incriminate me.
The Chairman. You state under oath that you honestly believe if
you gave the committee the information regarding your present busi-
ness or occupation, that such truthful information might tend to
incriminate you ?
Mr. Alex. Under the fifth amendment to the Constitution of the
United States, I decline to answer on the ground that my answer
honestly may tend to incriminate me.
The Chairman. All right, Mr. Kennedy, proceed.
Mr. Kennedy. Mr. Chairman, Mr. Alex came to our attention
through the information furnished to the committee by Lieutenant
Morris of the Chicago Police Department. From their investigation,
they found that Mr. Alex was the contact for this group of Weinberg
and Labriola, who were going to set up these trade associations, and
Mr. Gussie Alex was one of those who was to be contacted in Chicago
in order to bring some of the restaurants into line.
The Chairman. Just a moment, may I interrupt counsel. I forgot
to ascertain if the witness has counsel and have counsel identified.
Dou you have counsel ?
Mr. Alex. Yes, I do, Senator.
The Chairman. All right, identify yourself.
Mr. Keran. Mr. Chairman and members of the committee, my name
is Barney J. Keran, and I am a member of the bar of Virginia, and
the District of Columbia.
The Chairman. Thank you. Proceed.
Mr. Kennedy. What made Mr. Alex of particular interest to us
is his connection with this trade association as developed by Lieu-
tenant Morris and the fact that he is and has been for some years one
of the leading if not the leading gunman for the old Capone mob in
Chicago.
Do you want to turn around and look at us, we can't see your face?
Senator Ives. Some of us are over here and they are not away down
at the end, and some of us are down here. Will you face me for a
change, will you do that ?
Mr. Alex. I am doing the best I can.
Senator Ives. Can't you get around in your chair? Swing aromid
a little more. Swing aroimd. Now, look straight ahead.
The Chairman. Proceed.
Mr. Kennedy. Is that correct, Mr. Alex, that you have acted as the
gunman for the old Capone mob, in Chicago ?
Mr. Alex. Under the fifth amendment to the Constitution of the
United States, I decline to answer on the ground that my answer
may tend to incriminate me.
Senator Ives. May I interrupt there again. Wlien the counsel was
first bringing that matter up, you were headed that way with your
head, and smiling in a very peculiar manner, and nodding your head
"No." Wliy were you doing that when you decline to answer ?
Mr. Alex. Under the fifth amendment to the Constitution of the
United States, I decline to answer on the ground that my answer may
incriminate me.
13120 IMPROPER ACTIVITIES EST THE LABOR FIELD
Senator Ives. You have already answered by gesture, don't forget
that.
The Chairman. Proceed.
Mr. Kennedy. Now, starting back some years ago, you have also
handled a good deal of the gambling in the Chicago area, Mr. Alex ?
Mr. Alex. Under the fifth amendment to the Constitution of the
United States, I decline to answer on the ground that my answer may
tend to incriminate me.
Mr. Kennedy. You were connected with Hymie Levin, at the gam-
bling establishment called the Dome, in 1944, isn't that correct?
Mr. Alex. Under the fifth amendment to the Constitution of the
United States, I decline to answer on the ground that my answer may
tend to incriminate me.
Mr. Kennedy. Now, starting in 1946, weren't you the head of the
disciplinary section of the Capone mob in Chicago, Mr. Alex ?
Mr. Alex. Under the fifth amendment to the Constitution of the
United States, I decline to answer on the ground that my answer may
tend to incriminate me.
Mr, Kennedy. And you were responsible for all of the rough work
that was done by the enforcement division of the Capone mob?
Mr. Alex. Under the fifth amendment to the Constitution of the
United States, I decline to answer on the ground that my answer may
tend to incriminate me.
Mr. Kennedy. And in 1947, you were the bodyguard for Jake
Guzik, is that right ?
Mr. Alex. Under the fifth amendment to the Constitution of the
United States, I decline to answer on the ground that my answer may
tend to incriminate me.
Mr. Kennedy. And when Jake Guzik died, you took over his posi-
tion, did you not, Mr. Alex ?
Mr. Alex. Under the fifth amendment to the Constitution of the
United States, I decline to answer on the ground that my answer may
tend to incriminate me.
Mr. Keran. May the record show that each time this witness de-
clines to answer, it is on the ground that he honestly believes that his
answers might tend to incriminate him and he asserts his privilege
under the fifth amendment.
The Chairman. The counsel may advise his client how he wants
him to answer the question. The witness makes the record by his
answers, and the record will reflect what the witness says.
Mr. Kennedy. Now, Mr. Alex, in addition to our interest in you
because of your connection with these trade associations, we are also
interested in you because of your relationship with Joey Glimco of
local 777, of the Teamsters. I can't see your face.
Mr. Alex. Excuse me.
Mr. Kennedy. What is the situation as far as that is concerned?
Do you know Mr. Glimco ?
Mr. Alex. Under the fifth amendment to the Constitution of the
United States, I decline to answer on the ground that my answer may
tend to incriminate me.
(At this point, the following members were present: Senators
McClellan, Ives, Goldwater, and Curtis. )
Mr. Kennedy. Are you related in any way to Joey Glimco?
IMPROPER ACTIVITIES IN THE LABOR FIELD 13121
Mr. Alex. Under the fifth amendment to the Constitution of the
United States, I decline to answer on the ground that my answer may
tend to incriminate me.
Mr. Kj:nnedt. Is Joey Glimco's brother married to your sister,
Mr.Alex?
Mr. Alex. Under the fifth amendment to the Constitution of the
United States, I decline to answer on the grounds that my answer
may tend to incriminate me.
Mr. Kennedy. Isn't it correct that Frank Glimco is married to
your sister Dorothy ?
Mr. Alex. Under the fifth amendment to the Constitution of the
United States, I decline to answer on the grounds that my answer may
tend to incriminate me.
The Chairman. Do you have a sister named Dorothy ?
Mr. Alex. Under the fifth amendment to the Constitution of the
United States, I decline to answer on the grounds that my answer
may tend to incriminate me.
The Chairman. Do you think it is incriminating to have relatives?
Mr. Alex. Under the fifth amendment to the Constitution of the
United States, I decline to answer on the grounds that my answer may
tend to incriminate me.
The Chairman. Are you ashamed of them ? Or are they ashamed
of you, and that is the reason you don't want to identify them ?
Mr. Alex. Under the fifth amendment to the Constitution of the
United States, I decline to answer on the grounds that my answer
may tend to incriminate me.
The Chairman, All right, Mr. Kennedy, make the record.
Mr. Kennedy. Isn't it correct that Mr. Joey Glimco of Teamster
Local 777 is the contact between the criminal element in the labor
movement in Chicago, and with the underworld in Chicago?
Mr. Alex. Under the fifth amendment to the Constitution of the
United States, I decline to answer on the grounds that my answer
may tend to incriminate me.
Mr. Kennedy. Could you tell us what your source of income at the
present time is, Mr. Alex ?
Mr. Alex. Under the fifth amendment to the Constitution of the
United States, I decline to answer on the grounds that my answer
may tend to incriminate me.
Mr. KJENNEDY. You travel a good deal around the country, do you
not, Mr. Alex ?
Mr. Alex. Under the fifth amendment to the Constitution of the
United States I decline to answer on the grounds that my answer
may tend to incriminate me.
Mr. Kennedy. You spent a good deal of tiqae in Miami, Los Angeles,
and Las Vegas, have you not ?
Mr. Alex. Under the fifth amendment to the Constitution I decline
to answer on the grounds that my answer may tend to incriminate me.
Mr. Kennedy. Could you tell us where you get the money to make
those trips ?
Mr. Alex. Under the fifth amendment to the Constitution of the
United States, I decline to answer on the ground that my answer
may tend to incriminate me.
13122 IMPROPER ACTIVITIES IN THE LABOR FIELD
Mr. Kennedy. According to our information, you are on the payroll
of the Blatz Brewing Co. of Chicago, 111,, as of 1956. Could you tell
us about that ?
Mr. Alex. Under the fifth amendment to the Constitution of the
United States, I decline to answer on the grounds that my answer
may tend to incriminate me.
Mr. Kjjnnedy. Could you tell us why the Blatz Brewing Co. would
hire somebody with your background, Mr. Alex?
Mr. Alex. Under the fifth amendment to the Constitution of the
United States, I decline to answer on the grounds that my answer
may tend to incriminate me.
Mr. Kennedy. You received some $12,000 from the Blatz Brewing
Co. in 1956 and approximately the same amount in 1955, did you not,
Mr. Alex?
Mr. Alex. Under the fifth amendment to the Constitution of the
United States, I decline to answer on the grounds that my answer
may tend to incriminate me.
Mr. Kennedy. And could you tell us what other sources of income
you had other than the Blatz Brewing Co. ?
Mr. Alex. Under the fifth amendment to the Constitution of the
United States, I decline to answer on the grounds that my answer
may tend to incriminate me.
Mr. Kennedy. On occasion you described yourself as a speculator.
Can you tell us what that means, Mr. Alex ?
Mr. Alex. Under the fifth amendment to the Constitution of the
United States, I decline to answer on the grounds that my answer
may tend to incriminate me.
Mr. Kennedy. I would like to ask you about some of your asso-
ciates. For instance, we have information that you are a close asso-
ciate of Anthony Accardo ; is that right ?
Mr. Alex. Under the fifth amendment to the Constitution of the
United States, I decline to answer on the grounds that my answer
may tend to incriminate me.
Mr. Kennedy. Paul "The Waiter" Eicca?
Mr. Alex. Under the fifth amendment to the Constitution of the
United States, I decline to answer on the grounds that my answer
may tend to incriminate me.
Mr. Kennedy. The people that we know that you have been asso-
ciated with or presently associated with include names that I men-
tioned, Tony Accardo, Paul Ricca, Murray Humphrey, Louis
Campagna, Jake Guzik, Charlie Fishetti, Ralph Capone, Sam Golfbag
Hunt, Ralph Pierce, Edward Goble, Rocco Fishetti, Hymie Levin ; is
that right?
Are those some of your friends ?
Mr. Alex. Under the fifth amendment to the Constitution of the
United States, I decline to answer on the grounds that my answer
may tend to incriminate me.
Mr. Kennedy. And as the gunman and triggerman for the old
Capone mob, you had something to do with the killing of James Regan
in 1946, did you not ?
Mr. Alex. Under the fifth amendment to the Constitution of the
United States I decline to answer on the grounds that my answer
may tend to incriminate me.
|- IMPROPER ACTIVITIES IN THE LABOR FIELD 13123
Mr. Kennedy. Could you tell us how much you charged to kill
somebody, Mr. Alex?
Mr. Alex. Under the fifth amendment to the Constitution of the
United States, I decline to answer on the grounds that my answer
may tend to incriminate me.
Mr. Kennedy. Does it depend on who the person is ?
Mr. Alex. Under the fifth amendment to the Constitution of the
United States, I decline to answer on the grounds that my answer
may tend to incriminate me.
The Chairman. Do you honestly believe that if you have not been
engaged in such activities, that a truthful answer would tend to
incriminate you?
Mr. Alex. Under the fifth amendment to the Constitution of the
United States, I decline to answer on the grounds that my answer
honestly may tend to incriminate me.
The Chairman. You are the best judge of it.
Proceed.
Mr. Kennedy. That is all for now, Mr. Chairman.
The Chairman. Do you have any questions, Senator Goldwater ?
Senator Goldwater. No.
The Chairman. Senator Ives ?
Senator Ives. I have no questions, Mr. Chairman.
Mr. Kennedy. I just wanted to emphasize again, Mr. Chairman,
that the trade association that we spoke of, as it was developed, are
going to tie up closely with some of these unions in Chicago, which
force the restaurant owners, the tavern owners, to join up.
Was that part of the arrangement, Mr. Alex ?
Mr. Alex. Under the fifth amendment to the Constitution of the
United States, I decline to answer on the grounds that my answer may
tend to incriminate me.
Mr. Kennedy. Then, of course, the other major point of interest to
us, Mr. Chairman, is his relationship with Joey Glimco, who will play
a very important role in the hearings as we go along.
The Chairman. Mr. Alex, you are making a record here that is
permanent, a record that the public, the American people, the decent
American citizens, are quite interested in, and on subject matters they
are quite concerned about.
You stated that you were an American citizen. Do you have enouo-h
love and respect for your country that you would in any way and to
any degree cooperate with your Government and those who are trying
to preserve the very freedoms you exercise and now enjoy?
Is there one little measure of cooperation that you will give in our
efforts here to get information to enable the Congress of your country
to legislate? "^
Can you think of one little bit of cooperation you would give ?
(At this point. Senator Ervin entered the hearing room )
TT^.^"^^^^' ^^^f t^^ fif^h amendment to the Constitution of the
United States, I decline to answer on the grounds that my answer
honestly may tend to incriminate me.
(At this point. Senator Curtis withdrew from the hearing room )
The Chairman. Well, I just don't believe that anyone could be in-
criminated by acknowledging he had a little respect for his govern-
ment, a little love for his country, and by confessing that he would
13124 IMPROPER ACTIVITIES IN THE LABOR FIELD
cooperate even to a small degree in helping his government, in helping
it to be preserved, and the liberties that it vouchsafes to its citizens,
that those liberties might be preserved, I just can't see how that could
possibly tend to incriminate even the lowest who may be honored, un-
deserving honor at that, sometimes, by citizenship in this country.
I don't believe you believe that a truthful answer to that question
would tend to incriminate you. If you want to leave the record the
way it is, it is your life, it is your record. This is our country, and I
can assure you that there are those of us, not just this committee but
the teeming millions of fine people in this country who want to preserve
it and who will cooperate.
Ultimately, ultimately, I think, your kind is going to find the road
a little rougher and a little liarder and a little more difficult. The
American people will not stand for this much longer.
Senator Ives. I would like to ask Mr. Alex if he laiows anything
about the meeting that was held in Appalachin last November.
Mr. Alex. Under the fifth amendment to the Constitution of the
United States, I decline to answer on the grounds that my answer
may tend to incriminate me.
Senator Ives. I would now like to ask the witness if he heard any-
thing about it, at the time it occurred or thereafter. It was in the
press. Did you read the press at the time ?
Mr. Alex. Under the fifth amendment to the Constitution of the
United States, I decline to answer on the grounds that my answer may
tend to incriminate me.
Senator I\ts. Do you mean to tell me if you weren't present or
didn't hear anything about it, didn't know anything about it, that to
say "No" would incriminate you ?
Mr. Alex. Under the fifth amendment to the Constitution of the
United States, I decline to answer on the grounds that my answer
may tend to incriminate me.
Senator Ives. All right, Mr. Counsel.
That is all I have.
The Chairman. Senator Ervin ?
Senator EmT:N. I have no questions, Mr. Chairman.
The Chairman. You may stand aside, but before you do, you will
remain under the present subpena subject to being recalled by the
committee at such time as it may desire further testimony from you.
Mr. Alex. Thank you, Senator.
The Chairman. With that understanding, you are acknowledging
that recognizance, you may be excused for the day, when you acknowl-
edge it. Do you acknowledge it, that you will return to the committee
for further interrogation upon reasonable notice ?
(The witness conferred with his counsel.)
Mr. Alex. Yes, Senator.
The Chairman. You may stand aside. Call the next witness, Mr.
Counsel.
Mr. Kennedy. Now, Mr. Chairman, we have a different phase of
our investigation.
The Chairman. We will now go to another phase of the hearings.
(Whereupon, at 11 a. m., the hearing recessed, to proceed to other
matters.)
X
©os
.to»*,
pO'
,eoch;
A©^
pSd
\
9999
'os^si
02^
Live Music Archive
Librivox Free Audio
Metropolitan Museum
Cleveland Museum of Art
Internet Arcade
Console Living Room
Books to Borrow
Open Library
TV News
Understanding 9/11