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INVESTIGATION OF IMPROPER ACTIVITIES IN THE
LABOR OR MANAGEMENT FIELD
ii
HEARINGS
BEFORE THE
/ SELECT COMMITTEE
ON IMPEOPER ACTIVITIES IN THE
LABOR OR MANAGEMENT FIELD
EIGHTY-SIXTH CONGRESS
FIRST SESSION
PURSUANT TO SENATE RESOLUTION 44, 86TH CONGRESS
MAY 5, 6, 7, AND 8, 1959
PART 51
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-SIXTH CONGRESS
FIRST SESSION
PURSUANT TO SENATE RESOLUTION 44, 86TH CONGRESS
MAY 5, 6, 7, AND 8, 1959
PART 51
Printed for the use of the Select Committee on Improper Activities in the
Labor or Management Field
UNITED STATES
GOVERNMENT PRINTING OFFICE
WASHINGTON : 1959
<^a^
^f^B^I. II3A 516'
LJoston Public Library
Superintendent of Documents
DEPOSITORY
SELECT COMMITTEE ON IMPROPER ACTIVITIES IN THE LABOR OR
MANAGEMENT FIELD
JOHN L. McCLELLAN, Arkansas, Chairman
KARL E. MUNDT, South Dakota, Vice Chairman
JOHN F. KENNEDY, Massachusetts BARRY GOLDWATER, Arizona
SAM J. ERVIN, Jr., North Carolina CARL T. CURTIS, Nebraska
FRANK CHURCH, Idaho HOMER E. CAPEHART, Indiana
Robert F. Kennedy, Chief Counsel
Ruth Young Watt, Chief Clerk
CONTENTS
Newspaper and Mail Deliverers' Union of New York and Vicinity
Appendix 18326
Testimony of —
Adlerman, Jerome S 18166
Aiges, Louis 18207
Bacr, Joseph 18196
Bitz, Irving 18149
Bradford, Amory H 18241
Breslow, Henrv 18209
Chenicek, ChaVles E 18214. 18239
Chiari, Joseph 18207
Cofini, Robert J 18167, 18172, 18179. 18185
Cohen, Herbert C 18318
Ertis, Irving 18195. 18258
Feldman, Alexander 18192
Feldman, Louis 18192
Feldman, Sam 18196
Fello, William J 18165, 18167. 18168
Finamore, Anthony J 18196, 18203
Fontana, Joseph E 18274
Gavnor, James 18184
Geifand, Benjamin 18184
Gervase, J. J 18214
Greene, Robert W 18154, 18162
Gross, Harold 18296, 18302
Hathaway, Alan 18154, 18162
Hillbrant, William 18214
Kelly, James P 18287, 18290
Kelly, Warren 18261
Klinghoffer, Sam 18184
Kopecky, George M 18218
Lang, Joseph 18169, 18177
Langer, Abraham 18192
Lawrence, John, Jr 18196
Lehman, Stanley J 18196
Levine, Solomon 18258
Lubischer, John, Jr 18207
McQuade, John J 18212
Noonan, Cornelius J 18284
Nostramo, Frank 18289
Padulo, John J 18267
Porter, Harry 18196, 18203
Reben, Irvin A 18205
Ricciardi, Joseph 18205
Scanlon, Nicholas 1 8205
Schneider, Al 18207
Setteducato, Vincent 1 8205
Sheridan, Walter J 18218, 18285, 18294, 18304
Simons, Joseph 18141
Thackrey, Theodore 18132, 18147
Tierney, Paul J 18152, 18162, 18259
Walsh, John P 18310
Walsh, William 18209
Waltzer, Harrv 18196
Weinberg, Abraham 18169, 18177
Weinstein, Harry 18196, 18203
Weinstock, Harold 18169, 18177
III
IV CONTENTS
EXHIBITS
Intro-
duced Appears
1 . Leaflet issued by the Mail Deliverers Union to newsdealers,
"Union Picket Signs versus Xewsday's Shotguns". ___ 18158 18326
2. Letter dated January 5, 1959, to Newsday, Garden Citv,
N.Y. written on stationery of O'Donnell & Schwartz,
attorneys, counsel to the Newspaper and Mail Deliv-
erers' Union of New York and Vicinity ,. 18158 (*)
3. Newspaper and Mail Deliverers' Union Bulletin, December
1958 issue.. 18163 (*)
4. 48 checks for the year 1958, payable to cash in various
amounts, drawn by Metropolitan News Co 18174 (*)
5. 100 checks for years 1956, 1957 and 1958, payable to cash,
in various amounts, drawn by Lang News Co 18180 (*)
6. Letter dated October 10, 19-16, addressed to Mr. Harold
Hall, the New York Times from Fred Stewart, vice
president, Neo Gravure Printing Co., with attachments. 18245 (*)
7. Cash and check record of Octobpr 1946 18245 (*)
8. Memorandum for the file — HH to JY, "Teamsters Strike"
beginning September 1, 1948, through September 11,
1948 18248 (*)
9A. Memorandum for the file, initialed "H. H." to "J. C,"
dated September 15, 1948 18249
9B. Memorandum dated September 23, 1948, from Joseph P.
Alduino to General Adler 18249
9C. Memorandum dated October 25, 1948, from Harry H.
Weinstock to Mr. Dreyfuss 18249
10. Memorandum dated September 16, 1948, from Warren
Kelly to Charles J. Weindorf, subject: Neo Gravure
bill 18261 (*)
11. Pen-written memorandum dealing with the 1946 strike... 18265 18327
12. Memorandum dated May 11, 1952, from O. T. Bondy to
Mr. John J. Padulo, with carbon copies to J. E. Fontana
and J. C. Sacchia, re: Cuneo invoice No. A.W.-l for
producing American Weeklv issue May 11, 1952 18282 (*)
13. Bills from the Cuneo Press and checks drawn on the ac
count of American Weekly 18282 (*)
14A. Letter dated November 11, 1958, addressed to Mr. George
H. Bender, chairman, Anti-Racketeering Commission
from Bernard Derow, secretary-treasurer, Local Union
320 18298 18328
14B. Letter dated December 5, 1958, addressed to Mr. Bernard
Derow, secretarv-treasurer, Local Union 320, Miami
Beach, Fla., from George H. Bender 18298 18329
14C. Letter dated October 23, 1958, addressed to Mr. Joseph
W. Morgan, secretarv-treasurer. Teamsters Local Union
320, North Miami Beach, Fla., from George H. Bender. 18299 (*)
15. Bills from the Seagull Hotel for Barney Baker covering the
period October and November 1958 18308 (*)
Proceedings of —
Mav 5, 1959 18131
May 6, 1959 18203
May 7, 1959 18267
May 8, 1959 18323
•May be found in the files of the select committee.
INVESTIGATION OF IMPROPER ACTIVITIES IN THE
LABOR OR 3IANAGEMENT FIELD
TUESDAY, MAY 5, 1959
U.S. Senate,
Select Committee on Improper Activities in the
Labor or Management Field,
Washington^ B.C.
The select committee met at 10 :30 a.m., pursuant to Senate Resolu-
tion 44, agreed to February 2, 1959, in room 3302, Senate Office Build-
ing, Senator Jolin L. McClellan (chairman of the select committee)
presiding.
Present : Senator Jolin L. McClellan, Democrat, Arkansas ; Senator
Sam J. Er\dn, Jr., Democrat, North Carolina ; Senator Barry Gold-
water, Republican, Arizona.
Also present : Robert F. Kennedy, chief counsel ; Jerome S. Adler-
man, assistant chief comisel ; Paul J. Tiemey, assistant counsel ; Ruth
y. Watt, chief clerk.
The Chairman. The committee will be in order.
(Members of the select committee present at the convening of the
session were Senators McClellan, Ervin, and Goldwater.)
The Chairman. This morning the committee begins hearings on
the New York Newspaper and Mail Deliverers Union.
This is an independent union representing some 4,500 drivers en-
gaged in delivering newspapers and magazines in the Metropolitan
New York City area, a radius of 50 miles. This membership com-
prises approximately 3,800 regular members, 200 extra or nonbook
members who are employed irregularly, and 500 members on pension,
making a total of some 4,500 members.
It is a democratic union with officers elected annually by secret
ballot. These annual elections are supervised by the Honest Ballot
Association and the members use voting machines. In addition, all
contracts and all major activities must be approved by the vote of
the rank and file members of the union. The union is said to be noted
for the frequency with which its membership overrides the policies
of its officers.
Historically, this union was established by the publishers them-
selves. In the period of at least the last decade, however, the union
has become independent and is no longer controlled by the New York
newspapers.
Besides officials of the New York Newspaper and Mail Deliverers
Union, the hearing is also expected to involve some Teamster Union
officials as well as officials of other unions in the New York City area.
During this hearing we will hear testimony from representatives
of various newspaper publishing companies as well as some of the
18131
18132 IMPROPER ACTIVITIES IN THE LABOR FIELD
wholesalers who handle the distribution of newspapers and magazines
in the New York area.
The union deals principally with five groups in the New York area.
These are the Newspaper Publishers Association, the Suburban News
Dealers Association, Inc., the Evening Wholesalers Group, the Morn-
ing Wliolesalers Group, and the Magazine Association Group.
Between 40 and 50 percent of the union members are employed by
37 wholesalers. These wholesalers purchase the newspapers or maga-
zines from the publishers and resell them on the newsstands. The
wholesaler's profit is obtained through the prices he pays for the
newspapers. For instance, a morning newspaper may retail for 5
cents ; the wholesaler may pay 3% cents for it and sell it to the news-
stand for 41/^ cents. The latter, in turn, sells it to the public for
5 cents.
The bulk of the remaining union members, not covered by the
wholesaler group, are employed by the New York Newspaper Pub-
lishers Association, which comprises the major New York City morn-
ing and afternoon papers, excluding trade papers and foreign lan-
guage newspa])ers.
It is the committee's intention to inquire as to whether representa-
tives of these newspaper association and wholesaler groups have
made any payments to any officials of this union. In addition, the
committee will also inquire as to whether, in the quest for labor peace,
payments were made to any labor group in the New York area.
Are there any questions or any comments?
All right, Mr. Kennedy, call the first witness.
Mr. Kennedy. Mr. Theodore Thackrey.
The Chairman. Will you be sworn?
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. Thackrey. I do.
TESTIMONY OF THEODORE THACKREY
The Chairman. State your name, your place of residence, and your
business or occupation, please.
Mr. Thackrey. My name is Theodore Thackrey, and I live at 307
East 44th Street, in New York City, and I am employed by a public
relations consulting firm in New York City, at 130 East 59th Street.
The Chairman. Is that firm Ruder & Finn, Inc. ?
Mr. Thackrey. That is correct.
The Chairman. Do you waive counsel, Mr. Thackrey ?
Mr. Thackrey. I do.
The Chairman. All right. Proceed, Mr. Kennedy.
Mr. Kennedy. Mr. Thackrey, you were the former publisher and
president of the newspaper known as the New York Daily Compass;
is that right?
Mr. Thackrey. That is correct.
Mr. Kennedy. They began publication on May 16, 1949?
Mr. Thackrey. That is right.
Mr. Kennedy. And discontinued in the fall of 1952; is that right?
Mr. Thackrey. In 1952 ; that is right.
IMPROPER ACTIVITIES IN THE LABOR FIELD 18133
Mr. Kennedy. And it was established principally through your
own efforts?
Mr. Thackrey. Principally through my efforts ; yes.
Mr. Kennedy. By whom was it financed ?
Mr. Thackrey. It was financed by several thousand stockholders,
and the major stockholder was myself, and the chief financing came
from Mrs. McCormack-Blaine, of Chicago.
Mr. Kennedy. Prior to the initial publication date, had you made
arrano:ements through the Metropolitan Newspaper Co. for the dis-
tribution of the Compass in Manhattan ?
Mr. Thackrey, The Metropolitan News Co. and some 16 other
distributors; the Metropolitan News Co. was the prime distributor
in Manhattan.
Mr. Kennedy. And the arrangement called for them to pick up the
newspapers at the dock of the Compass, and handle the delivery?
Mr. Thackrey. We made an effort to get them to agree to pick up
newspapers at the dock. However, we found that none of the dis-
tributors could pick up the newspapers directly from the docks of the
Compass because their union contracts forbade that particular activity.
We also discovered that we must use the services of the Newspaper
and Mail Deliverei*s Association in order to make our deliveries to
the Metropolitan News Co.
Mr. Kennedy. Wlien you say Newspaper Deliverers Association,
what do you mean ? Do you mean the union ?
Mr. Thackrey. I mean the union.
Mr. Kennedy. The Mail Deliverers Union ?
Mr. Thackrey. That is correct.
Mr. Kennedy. Wliy couldn't the wholesaler, Metropolitan News
Co., pick up the newspapei-s at the dock ?
Mr. Thackrey. It is my undei-standing that their contracts with
the union prevented them from doing so, and from receiving news-
paper deliveries from any except the Newspaper and Mail Deliverers
Union.
Mr. Kennedy. So what is it that was required of you ?
Mr. Thackrey. Among other things, we needed a contract with the
Mail Deliverers Union in order to deliver papers from our dock to
the Metropolitan News Co., which in turn made deliveries to other
news distributors for us.
Mr. Kennedy. Did you proceed to make such a contract?
Mr. Thackrey. We did.
Mr. Kennedy. Did you have any difficulty making the contract ?
Mr. Thackrey. We had some difficulty. Our early negotiations
developed insistence by the union that we institute, as I recall it, some
approximately 30 direct delivery routes.
Most of the morning newspapers at that time, and all, I think, of
the evening newspapers, made direct deliveries with trucks manned
by members of the union to various newsstands in the city. Most of
them also had supplemental deliveries by Metropolitan and other dis-
tributors. We had determined in a publishing program that we did
not include direct delivery by us to any newsstand or news outlet.
Previous newspapers published from the same plant from which
we operated, operated from 30 to some 40 to 45 direct delivery routes.
The union felt that we should institute the same routes, which would
18134 IMPROPER ACTIVITIES m THE LABOR FIELD
have involved employing some 60 men, drivers and helpers, and we
were economically unable to do so, and found time was getting short
if we were not able to come to an agreement to hire deliverers only to
take a truck from our papers to Metropolitan alone.
The union felt that we must have a direct delivery of some kind
and the last figure I recall was that we should institute direct delivery
to about 30 stands.
Mr, Kennedy. Then this was a major problem for you.
Mr. Thackrey. It was a major problem.
Mr. Kennedy. Did you search around to get some solution to the
problem ?
Mr. Thackrey. Yes.
Mr. KJENNEDY. Did you talk to some individuals who made some
suggestions to you ?
Mr. Thackrey. I talked to a number. Among them was James
Gettleson, who had been circulation director at the time when I was
the editor and associate publisher of the Post in New York.
Mr. Kennedy. Had you tried prior to that to get ahold of the
union ?
Mr. Thackrey. I tried to. We had some meetings in the period of
2 weeks to 15 days prior to our date of publication. The last meet-
ing we had we seemed to be at an impasse. After that time I made
a phone call or two to the union headquarters but not successfully.
Mr. Kennedy. So then you got in touch with Mr. Gettleson. and
you discussed with him your problem, did you ?
Mr. Thackrey. That is right.
Mr. Kennedy. And what did he suggest ?
Mr. Thackrey. He said he knew of a man who was reputed to have
considerable influence with the union, and he was a somewhat dif-
ficult man to deal with, and he didn't reconmiend particularly that
I deal with him, but if I was in great trouble and wanted to talk
with him, he would be glad to see if he could get in touch with
him and ask him to call me.
Mr. Kennedy. Did he identify who that individual was ?
Mr. Thackery. Yes. He said his name was Ii-ving Bitz.
Mr. Kennedy. Did you then get in touch with Mr. Bitz?
Mr. Thackrey. Mr. Bitz called me and I made an appointment
with him and met him and talked with him.
Mr. Kennedy. Did you know who Mr. Bitz was at the time?
Mr. Thackrey. Only in tlie most general way. There was a de-
scription of him by Mr. Gettleson.
Mr. Kennedy. JDid you know of his background ?
Mr. Thackrey. Something of his background.
Mr. Kennedy. Wliat did you know of his background ?
Mr. Thackrey. I laiew that he had been under arrest several times,
and I believe on a charge of homicide, whicli was dismissed. I un-
derstood that he had a considerable reputation for dealing with vari-
ous difficult union situations. Most of that reputation was revealed
to me ])y Mr. Gettleson and one or two others.
The Chairman. That is this fellow Bitz ?
Mr. Thackrey. That is correct.
Mr. Kennedy. Did you understand or know that he also had been
convicted a number of times as well as having been mider arrest?
IMPROPER ACTIVITIES IN THE LABOR FIELD 18135
Mr. Thackery. No, I wasn't aware of his convictions, I knew
he had been arrested a number of times.
Mr. Kennedy. And associated with the underworld; did you un-
derstand that?
Mr. TiiACKREY. It was my understanding.
Mr. Kennedy. So he called you and you met with him then?
Mr. Thackrey. That is correct.
Mr. Ivennedy. Would you relate to the committee what happened
at the meetino; ?
Mr. Thackrey. I told him our circumstances, and he said, "Well,
I can deliver a contract for you. I will take a contract to get you a
contract, but it will cost you."
I asked him liow much it would be, and he named various figures,
and he finally settled on the figure of $10,000, which he said was
the mininunn he could take in order to take on a contract to get us
a contract that would be satisfactory to us.
The Chairman. He started off with a higher fee?
Mr. Thackrey. He started off with a higher fee, and he started
off with, I believe it was $20,000, and then $15,000, and finally he
said, "At $10,000 I can't make any money, and I can't have anything
left over for myself, and I have got to have 10 or it is no deal."
Mr, Kennedy. Did you agree to pay him the $10,000 ?
Mr. Thackrey, I did,
Mr. Kennedy. Was that in the form of a check or by cash?
Mr. Thackrey. Wlien we reached our agreement, he said that there
is another thing, "I can't have any checks or anything like that, and
this has got to be in cash."
I said, "Well, don't tell me it has got to be in $5 dollar bills."
He said, "No, that is no problem. But it has to be in cash."
Mr. Kennedy. Did he say he had to pass some of this money on to
other individuals ?
Mr. Thackrey. He strongly indicated so, and he said, "At this rate
I wouldn't make any money at all; you ought to get this ante up
somewhere, somehow, I have got to make some money myself out of
this."
The Chairman. Did you believe that statement, that he wouldn't
make anything out of it on a $10,000 basis ?
Mr, Thackery. It didn't seem reasonable to me.
The Chairman, It doesn't to me either. Go ahead.
Mr, Kennedy, Did you agree at that first meeting to make the
payment of $10,000 in cash ?
Mr. Thackery. I did.
Mr. Kennedy. And you went back then, and did you call Mr.
Gettleson ?
Mr. Thackery, I called Jim and I said, "I have no idea what kind
of a man I am dealing with here, really," and I said, "There is a little
hitch here. He wants $10,000 in cash, and he says he will give no re-
ceipt, and among other things that concerns me is that I will turn
over $10,000 and that will be that, and I still will be without a con-
tract."
He said, "Well, my understanding is that if Bitz says he is taking
a contract from you to get you a contra(;t, you will get it. I don't
think you need to worry about that part of it."
18136 IMPROPER ACTIVITIES IN THE LABOR FIELD
The Chairman. Who were you talking to at that time ?
Mr. Thackery. James Gettleson.
The Chairman. He is the one who recommended Bitz to you?
Mr. Thackery. Well, perliaps that is a little strong, Senator, to
say he recommended him. He is the one who advised him to call me.
The Chairman. He is the one that you went through, and he was
the middleman between you and Bitz ?
Mr. Thackery. That is correct.
The Chairman. What was his position at that time ?
Mr. Thackery. He was then the circulation director of the New
York Post, and a personal friend.
The Chairman. I see.
Mr. Kennedy. You had formerly been what with the New York
Post?
Mr. Thackrey. I had been formerly its editor and associate pub-
lisher and general manager.
Mr. Kennedy. So you decided that you would pay Bitz the $10,000
and you made arrangements to meet him again ?
Mr. Thackrey. That is correct.
Mr. Kennedy. You obtained the $10,000 ?
Mr. Thackrey. That is correct.
Mr. Kennedy. Where did you get the $10,000 from ?
Mr. Thackrey. I am not certain whether that came from a com-
pany check or from the sale of bonds which had been paid to the com-
pany for shares. I issued an order for it to the secretary-treasurer
of tiie company, Bernard Goldstein, and on the same day received the
money in cash in an envelope. I am not absolutely certain whether
that was an issue by check or from the sale of bonds, or what.
Mr. Kennedy. It was company money ; is that correct ?
Mr. Thackrey. Sir?
Mr. Kennedy. It was company money ?
Mr. Thackrey. I am not even absolutely sure that it was company
money, Mr. Kennedy.
Mr. Kennedy. You went to the treasurer, did you, of the company,
to get the $10,000?
Mr. Thackrey. That is correct.
Mr. Kennedy. Where else would he get it other than the company
money ?
Mr. Thackrey. Some of those funds could have been my personal
funds, and they were intermingled at that time with company funds.
I sometimes advanced money to the company from my own account.
The Chairman. That would be a loan, if you advanced money to
the company.
Mr. Thackrey. That is correct.
The Chairman. Then it became company money.
Mr. Thackrey. The eventual construction would be company
money, sir ; yes.
Mr. Kennedy. Then did you go and visit with Mr. Bitz ?
Mr. Thackrey. I did, and he met me outside the Compass Build-
ing, at Duane and Hudson Streets, in his own car, and I met him and
paid him the $10,000 in cash.
Mr. Kennedy. You gave him the $10,000 in cash ?
Mr. Thackrey. I did. He counted it, and verified it, and put it in
his pocket.
D^IPROPER ACTIVITIES IN THE LABOR FIELD 18137
The Chairman. You gave him the money riglit at that point, or
did you drive off somewhere ?
Mr. Thackret. We then drove to Brooklyn.
The Chairman. Did he take the money at that point ?
Mr. Thackrey. Yes ; he took the money at that point and put it
in his pocket.
The Chairman. You gave it to him and sat in the car with him ?
Mr. Thackrey. That is right.
Mr. Kennedy. All right now. Did you get in the car with him ?
Mr. Thackrey. I did.
Mr. Kennedy. Will you tell us what happened, please?
Mr. Thackrey. We drove to Brooklyn and made a telephone call,
and he stopped in front of the home of the man he described as Joseph
Simons, the president of the union, and a man came out whom I sub-
sequently identified as Simons, and by this time, when he made the
phone call, I got in the back seat of the car, and Mr. Simons came
out on the steps of the house, and I presume his home, and got in
the car, and they began a conversation.
The opening words of the conversation I can't remember exactly,
but I remember when Bitz said he had taken a contract to get me a
contract with the union. He also suggested that Mr. Simons' asthma
was troubling him unduly, and that he advised a trip to Miami.
At that point he suggested that perhaps I would not like to hear the
rest of the conversation, and I think that he said, "You might want
to walk around the block," which I did not do, but got out of the car
and I walked about half a block away and smoked a cigarette and
came back when Mr. Simons left the car and went into his house.
Mr. Kennedy. What did you understand the statement by Mr.
Bitz to Mr. Simons to mean, when he said that he should take a trip
to Florida?
Mr. Thackrey. The only phrase that I overheard that might have a
bearing on it or that seemed to me to have a bearing on it was to the
effect that if Mr. Simons didn't care to go to Miami, he wasn't going
anywhere.
Mr. Kennedy. Meaning what ? And what did you understand the
context of that to be ?
Mr. Thackrey. If the statement had been made to me, I would
assume that I was being threatened.
The Chairman. What was the advantage, or what was the pur-
pose of having him go to Florida ?
Mr. Thackrey. I have no idea.
The Chairman. Just to get away from the transaction ?
Mr. Thackrey. I have no idea about that.
The Chairman. Proceed.
Mr. Kennedy. Was it the idea that he had some money and that he
could take a trip to Florida ?
Mr. Thackrey. I really can't say. I would have to speculate about
it.
Mr. Kennedy. You got back in the car then ?
Mr. Thackrey. I got back in the car, in the front seat, and we
drove back to Manhattan.
Mr. Ivennedy. What did Mr. Bitz say about the meeting with Mr.
Simons ?
18138 IMPROPER ACTIVITIES IN THE LABOR FIELD
Mr. Thackrey. He said, "Well, we have three more to go, and I
am not going to come out of this with any money, and you ought to
get up something for me out of this."
He said, "This is too tough." Then he told me, or we discussed
various things, and he discussed the prospect of the future for his
son, who was then about 8 or 10 years old, as I remember, and much
of our discussion centered on his hope to be able to enter his son in
West Point, and part of it was his fear of going home, and he said
he promised his wife to paint the back porch and hadn't done it, and
he didn't think that he would go home at all.
Mr. Kennedy. What is that ?
Mr. Thackrey. He promised his wife that he would paint the back
porch, and he had failed to do it, and therefore he thought that he
would say in town for that night, and meanwhile he had some other
people to see, and did I want to go with him to see them, and I said,
"No, thank you very much, I have had enough," and asked him to
drop me at the subway, which he did, and I went on home.
Mr. Kennedy. Who was Simons? I don't recall his identity.
Mr. Thackrey. Mr. Joseph Simons at that time was president of the
Drivers Union.
Mr. Kennedy. President of the union ?
Mr. Thackrey. That is correct.
Mr. Kennedy. That is the one you were trying to get a contract
from?
Mr. Thackrey. Of the union we were trying to get a contract from;
yes, sir.
Sometime after midnight I had a telephone call from Mr. Bitz.
Pie said, "It is all set ; but you have got tliree routes."
I said, "I thought our contract was that all we needed was a truck
to carry our papers from the dock to Metropolitan."
He said, "Well, that is just too tough. The contract you have got
calls for three routes. You ought to be happy about it. Like I told
you, couldn't you get up at least $500 for me ? I am not making any
monej^."
I said, "I could not."
He said, "Well, 1 said I would take a contract, and that is it. You
have got it, and don't worry about it."
INIr. Kennedy. Did you get it? Did you have conversations with
the union officials subsequently ?
Mr. Thackrey. Within the next 2 or 3 days; yes, sir.
Mr. Kennedy. Did they agree on this contract ?
Mr. Thackrey. They did.
Mr. Kennedy. And you signed it ; is that correct ?
Mr. Thackrey. That is correct.
Mr. Kennedy. And you were in business ?
Mr. Thackrey. We were in business.
The Chairman. How did you regard this transaction? You had
been trying for how long to get in touch with the union to try to deal
with them? How long had you been making an effort?
Mr. Thackrey. Not very long. Senator. We had had some
meetings.
The Chairman. Give us some idea. "Very long" might mean a
year in one instance, and might mean a couple of hours in another. Let
us see what we were talking about.
IMPROPER ACTIVITIES IN THE LABOR FIELD 18139
Mr. Thackrey. Well, we had decided to publish the Compass only
about 21/^ months before its publication date.
The Chairman. How long after that or before you actually brought
out your first issue did you realize that you were going to have a union
contract for the delivery 'i
Mr. Thackrey. About 2 weeks, roughly, 2 to 21^ weeks.
The Chairman. In other words, for 2% weeks before your contract
with Bitz ; is that right ? You had been trying to get that ?
]Mr. Thackrey. That is right.
The Chairman. For 21^ weeks before you contacted Bitz, you had
been trying to get this ?
Mr. Thackrey. We had had some meetings. Senator, two or three as
I recall it, and we were unable to reach an agreement.
The Chairman. Wlio is that ?
Mr. Thackrey. Between the union and myself, representatives of
the union.
The Chairman. You had been in touch with them, and you had
been trying to get a contract ?
Mr. Thackrey. That is right.
The Chairman. This same union representative ?
ISIr. Thackrey. That is correct.
The Chairman. And you were making no progress ?
Mr. Thackrey, No progress.
The Chairman. And how did j^ou happen to get to that stage?
How did you happen to conceive the idea that this fellow Bitz could
help you ?
Mr. Thackrey. I didn't know what kind of help I might need or
whether I could get any. In discussing my problem, I turned to
Gettleson, who was my friend as well as a man who had worked for
me.
The Chairman. Wlien you had reached what looked like an impasse
or you had made no progress, and realizing your publication date was
rapidly approaching, you turned to your friend and asked his advice ?
Mr. Thackrey. That is correct.
(At this point Senator Ervin withdrew from the hearing room.)
The Chairman. That is Gettleson ?
Mr. Thackrey. Yes.
Tlie Chairman. And it was out of that contact with him that you
finally got in touch with Bitz ?
Mr. Thackrey. Yes.
Tlie Chairman. And it was he Avho first suggested Bitz to you ?
Mr. Thackrey. That is right.
The Chairman. All right.
Mr. Kennedy. Then you obtained a contract and you stayed in
existence for about 2 years ; is that right ?
Mr. Thackrey. We had no difficulty with the contract or with the
union from that point until we suspended publication.
Mr. Kennedy. The Compass, editorially, was very critical of many
situations here in the United States, as I remember ; were they not ?
Mr. Thackrey. Of some situations.
Mr. Kennedy. Did you feel that making this kind of a payment
was slightly hypocritical in view of the editorial policy of the Compass
during this period of time ?
18140 IMPROPER ACTIVITIES IN THE LABOR FIELD
Mr. Thackret. That is correct.
The Chairman. Did you regard this just as a shakedown payment,
or how did you regard it, from the standpoint of your company or your
publication, and proper ethics? How did you regard this $10,000
payment ?
Mr. Thackrey. Well, Senator, I always had a hard time kidding
myself. This is the kind of deal that I have heard described a good
many times as a perfectly legitimate business deal in which special
counsel or people with special persuasive powers are hired on a fee to
get a job done. I regarded it as a shakedown, and I was very ashamed
of my own part in it.
The Chairman. Upon reflection, you regarded it as a shakedown ?
Mr. Thackrey. That is correct.
The Chairman. In fact, the man whose influence you purchased, or
presumably purchased, did not have the reputation or stature of a
man using ethical influence or influence in an ethical manner to obtain
the results you desired ; is that correct ?
Mr. Thackrey. That is correct.
The Chairman. You regarded him as a hood, a kind of racketeer,
and a muscle man ?
Mr. Thackrey. I regarded it as the kind of transaction that I would
not ask anybody else in my employ to undertake. I felt it was my
responsibility and my decision and that I had better do it myself. In
the ordinary transaction I would have turned it over to any one of
my associates.
The Chairman. Wliat is your conclusion about whether you would
have ever received a contract except that you made a payoff like that?
Mr. Thackrey. At that time, and under those circumstances, I
don't think that we would have received a contract we could have lived
with.
The Chairman. You don't think that you could have gotten a con-
tract that would have permitted you to operate ?
Mr. Thackrey. Not on those terms.
The Chairman. Except on almost impossible terms ?
Mr. Thackrey. That is correct.
The Chairman. This is a kind of a bad situation in American busi-
ness and in our economy, when people undertake to go into a legitimate
business and find that they need to resort to such payments and the
employment of such characters in order to be able to make proper
contracts associated with services that are incidental to the business
which they are engaged in, isn't it ? It is a kind of sad situation in our
economy when such conditions prevail.
Now, do you think, and I am sure you agree, that for businessmen
to yield to such pressure or to voluntarily seek such services and make
such payments, it is a reflection upon management and business inter-
ests in this country, for those who do it ? Is that correct ?
Mr. Thackrey. I do. I think that is correct.
The Chairman. I am sure I haven't been very restrained in con-
demning what I regard as racketeering of some labor bosses and people
who are in the position where they have a responsibility and an
■obligation to people who work in this country, to people who have
to belong to unions in order to pursue a livelihood.
EVIPROPER ACTIVITIES UST THE LABOR FIELD 18141
Now, I have been pretty severe in some of my judgment and criti-
cism of those who misuse that trust. It seems to me that businessmen
who resort to such tactics are not in a position to call the kettle
black. Do you agree ?
Mr. Thackrey. I agree.
The Chairman. All right. Proceed.
Senator Goldwater. Mr. Thackrey, you are now with Ruder &
Finn?
Mr. Thackrey. Yes.
Senator Goldwater. Is that public relations ?
Mr. Thackrey. That is correct.
Senator Goldwater. Does your firm or has your firm ever engaged
in political campaigns ?
Mr. Thackrey. If so, I am not aware of it. I am a fairly new
employee in that organization, Senator.
Senator Goldwater. You know of no case of that kind ?
Mr. Thackrey. I know of my own contacts, and that is all, my
own accounts.
Mr. Kennedy. Mr. Thackrey, we have interviewed Mr. Simon and
he denies receiving this money or meeting with you at that time, and
we are going to call him as a witness. Would you stand by, please?
Mr. Simon?
(Members of the select committee present at this point: Senators
McClellan and Goldwater.)
The Chairman. Will you 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. Simons. I do.
TESTIMONY OF JOSEPH SIMONS, ACCOMPANIED BY COUNSEL,
SAMUEL DUKER
The Chairman. State you name, your place of residence, and your
business or occupation, please.
Mr. Simons. Joseph Simons, S-i-m-o-n-s, 1815 East 29th Street.
The Chairman. What is your business or occupation, Mr. Simons ?
Mr. Simons. Newspaper driver.
The Chairman. You are head of the Newspaper Drivers Union ?
Mr. Simons. Newspaper Drivers Union ; yes ; employed by the Daily
News.
The Chairman. You are employed by the Daily News ?
Mr. Simons. Yes, sir.
The Chairman. You have counsel present, Mr. Simons ?
Mr. Simons. Yes, sir.
The Chairman. Mr. Counsel, identify yourself for the record.
Mr. Duker. Samuel Duker, D-u-k-e-r, 11 West 42d Street, New
York.
The Chairman. Thank you very much.
All right, Mr. Kennedy.
Mr. Kennedy. Mr. Simons, you were formerly president of the
Newspaper and Mail Deliverers Union ?
Mr. Simons. For several years.
18142 IMPROPER ACTIVITIES IN THE LABOR FIELD
Mr. Kennedy. During what period of time ?
Mr. Simons. On and off, sir, and I haven't got the records.
Mr. Kennedy. You were president, however, in 1949 ; is that right?
Mr. Simons. I would say to the best of my recollection, yes.
Mr. Kennedy. Now, Mr. Thackrey has just testified, Mr. Simons,
that in order to obtain a contract he made a $10,000 payoff through
Mr. Irving Bitz ; and that shortly after the $10,000 in cash had been
paid, Mr. Bitz took him in his automobile and visited you ; and that you
then got into the automobile and had some conversations with both
Mr. Bitz and Mr. Thackrey; is that correct?
Mr. Simons. "W^iat year was that you are talking about ?
Mr. Kennedy. In 1949.
Mr. Simons. Well, listening to whatever little I got from Mr.
Thackrey, I
The Chairman. Counsel, you may move your chair up closer if you
wish.
(The witness conferred with his counsel.)
Mr. Simons. I am really confused, and listening to such testi-
mony— — -
Mr. Kennedy. Just answer the question.
Mr. Simons. Well, it is confusing to me and this is a brand new
thing and I am very much disturbed about it.
(The witness conferred with his counsel.)
Mr. Simons. I refuse to answer the question, and it may incrimi-
nate me.
Tlie Chairman. Is that because of your confusion ?
Mr. Simons. Well, Senator, I will be frank to tell you this is so
fantastic to me that I don't want to say something that might con-
fuse me.
The Chairman. I wouldn't want you to get confused. Is wliat
has been testified to here absolutely correct?
Mr. Simons. Ten years is a long time.
The Chairman. Just a moment.
Mr. Simons. And I feel that way.
(The witness conferred with his counsel.)
Mr. Simons. I refuse to answer on the ground it may incriminate
me, but I beg your pardon, sir, counsel knows tlie situation 100 per-
cent on contracts, and I have not been president for a long while,
and it is something different, and counsel can answer something that
probably I wouldn't remember.
Tlie Chairman. I expect so, but he can probably answer some
things that you wouldn't know about, and you can probably answer
some, things tliat he wouldn't know about. But I would suggest to
you, now, that you say you decline to answer instead of refuse, and
you don't mean to show disrespect for the committee, I am sure.
Mr. Simons. I have the greatest respect for you, sir.
The Chairman. If you will just say then, "I respectfully decline
to answer on the ground of the fifth amendment," or something to
indicate just what you mean.
Now, then, I do want to ask you two or three questions in tliis
regard. You talked to the members of the staff of the committee
here a number of times, didn't you ?
Mr. Si:\roNS. I talked to who?
IMPROPER ACTIVITIES IN THE LABOR FIELD 18143
The Chairman. Members of the staff of the committee, Mr. Alder-
man and others, and you know Mr. Alderman and you talked to him
a number of times, didn't you ?
Mr. Simons. No. I was called to the office in New York one time.
The Chairman. You just talked to him one time; is that correct?
Mr. Simons. That is correct.
The Chairman. At that time you told him that you had not, and
also, as late as this morning I believe you talked to him again.
Mr. Simons, That is correct.
The Chairman. You told him that you had not received any money
and so forth, didn't you, at those times'?
Mr. Simons. Well, I did tell him that, sir.
The Chairman. Well, were you telling him the truth then? You
are under oath now, of course.
Mr. Simons. That is right.
(The witness conferred with his counsel.)
Mr. Simons. I refuse to answer any further questions on that^
because it may incriminate me.
The Chairman. That leaves us in a pretty awkward situation.
That leaves us a pretty kettle of fish here. You have been denying
all of the time until you got under oath that anything like this hap-
pened. That is even as late as this morning. Now you come here,
and we get under oath, and you say you can't answer the question
because a truthful answer thereto might tend to incriminate you.
Do you want to straighten us out on that any ?
(The witness conferred with his counsel.)
Mr. Simons. Counsel has advised me even a truthful answer may
incriminate me.
The Chairman. I am sure you and the counsel know more about
that than I do, and I just wanted to point out here, in the course of
our trying to investigate through the staff', to ascertain whether there
was any truth to Mr. Thackrey's statement, he had been telling us
through the staff about this transaction, paying off $10,000, and this
fellow giving it partly to you and telling you you had better take a
trip to Florida. He has testified to that under oath.
Now we call you in here and you have been denying it all of the
time; but when you get up here on the witness stand under oath,
you take the fifth amendment. Now, that is the way you want to
leave it ?
Mr. Simons. The reason why I take that is because I listened to
his testimony, which is so fantastic to me that I am confused, and I
take the fifth amendment because I might incriminate myself, of all
of the things he said. That is the point.
The Chairman. You realize that you are leaving the record pretty
much confused by taking the fifth amendment, don't you ?
Mr, Simons. I can't answ^er that.
The Chairman. You just can't answer any more ?
Mr. Simons. That is correct.
The Chairman. Do you honestly believe if you answered the ques-
tion truthfully — and I will ask the question : Did ^Mr. Bitz contact
you with reference to the union granting a contract to the Compass,
the New York Daily Compass, some time in 1949 ?
Mr. Simons. I refuse to answer ; it may incriminate me.
36751r— 59— pt. 51 2
18144 IMPROPER ACTIVITIES IN THE LABOR FIELD
The Chairman. Do you honestly believe if you answered that ques-
tion truthfully that a truthful answer might tend to incriminate you ?
Mr. Simons, That is correct, sir.
The Chairman. All right.
Did you know anything about $10,000 having been paid by Mr.
Thackrey to Mr. Bitz to secure a union contract for the Daily Com-
pass ? Did you know anything about that ?
Mr. Simons. The same thing.
The Chairman. The same thing what ?
Mr. Simons. The same thing as I said before — it may incrimi-
nate me.
The Chairman. It might incriminate you if you answered that?
Mr. Simons. That is correct.
The Chairman. Do you honestly believe that a truthful answer
might incriminate you ? Do you honestly believe that ?
Mr. Simons. I don't understand this whole thing.
The Chairman. You know what honesty means, don't you ?
Mr. Simons. I know what honesty means.
The Chairman. Do you honestly believe if you gave a truthful
answer to that question that the truth might tend to incriminate you ?
Mr. Simons. Back in my same argiuuent, the whole thing to me,
with Mr. Thackrey here, what he says, is fantastic.
The Chairman. Sometimes the truth is fantastic.
Mr. Simons. Well, I think he is not telling the truth, as far as I am
concerned.
The Chairman. You don't think that he is ?
Mr. Simons. That is correct, sir.
The Chairman. Is he telling the truth ?
Mr. Simons. I beg your pardon.
The Chairman. Is he telling the truth ?
Mr. Simons. I wouldn't know.
The Chairman. You know so far as you are concerned.
Mr. Simons. As far as I am concerned, for myself personally, I
take the fifth amendment ; that is correct.
The Chairman. All right, you take the fifth.
Are there any further questions ?
Mr. Kennedy. There was just an election, was there not, in the
Mail Deliverers Union ?
Mr. Simons. Recently ; yes, sir.
Mr. Kjennedy. And did you run for president ?
Mr. Simons. That is correct.
Mr. Kennedy. But you were defeated ; is that right ?
Mr. Simons. That is correct.
Mr. Kennedy. You came in No. 2 ?
Mr. Simons. That is correct.
Mr. Kennedy. Just so there won't be any confusion on this, this is
a very simple question that I have to ask you.
Did you receive any money in connection with the contract that
was signed with the Compass in 1949? Did you? That is very
simple.
Mr. Simons. I said before, it is fantastic.
Mr. Kennedy. Oh, no. Just tell me. And it is not confusing.
Mr. Simons. I received no money in 1949 or any other day.
IMPROPER ACTIVITIES IN THE LABOR FIELD 18145
Mr. Kennedy. You did not receive any money ?
Mr. Simons. I had no dealings with anybody.
Mr. Kennedy. Did you receive any money from Mr. Bitz ?
Mr. Simons. Mr. Bitz or anybody else, in all of my dealings as
president of the union, and I can prove that.
Mr. Kennedy. All right, then prove it.
Mr. Simons. On every contract
Mr. Kennedy. Then you don't take the fifth ?
Mr. Simons. If you will listen, Mr. Kennedy, I am trying to get
myself straightened out here. Maybe you people have me confused
by this man here.
Every contract that this union makes must be brought before the
membersliip, the executive board, and a written contract must be rati-
fied. Whether president or any other person, he couldn't deliver a
contract if he wanted to without the general membership OK'ing
the contract.
Mr. Kjennedy. I understand that.
Mr. Simons. That is correct, sir.
Mr. Kennedy. These contracts, and we are not questioning these
contracts of the Mail Deliverers Union with the various wholesalers
and the newspapers in the city of New York, there isn't any question
about that. But now that we have it straight, did you not receive any
money as Mr. Thackrey has testified ? You did not receive any money
in connection with this ?
Mr. Simons. I had no dealings with anybody in the Compass case
other than going through the regular channels, as I so stated.
Mr. Kennedy. Did you meet with Mr. Bitz and Mr. Thackrey in the
automobile ?
Mr. Simons. Definitely not.
Mr. Kennedy. You did not ?
Mr. Simons. No.
Mr. Kennedy. You did not meet with them in the automobile ?
Mr. Simons. Well, with Mr. Thackrey.
Mr. Kennedy. With Mr. Thackrey and Mr. Bitz ?
Mr. Simons. I don't recall meeting anybody.
Mr. Kennedy. Did you? Is your testimony correct that you did
not meet with them in the automobile ?
Mr. Simons. I am confused.
Ml'. Kennedy. No ; you are not confused and this is very simple.
Mr. Simons. I will take the fifth amendment on that, it might in-
criminate me, and it might incriminate me to say something, and so
I take the fifth amendment.
Mr. Kennedy. This isn't confusing.
Mr. Simons. Oh, yes, it is ; to me it is.
^ Mr. Kennedy. It is just a question, a very simple question in connec-
tion with your meetings with Mr. Bitz. Do you know Mr. Bitz ?
Mr. Duker. May I be heard ?
The Chairman. You may address the Chair.
Mr. Duker. Mr. Chairman, while I realize that it is only through the
courtesy of the committee that Mr. Simons is represented by counsel,
and I have no right to make objections, it seems to me that if a witness
has asserted his constitutional rights it should not be the object of
counsel for the committee to try to trap him into something which
would be a violation of his assertion of constitutional rights.
18146 IMPROPER ACTIVITIES IN THE LABOR FIELD
The Chairman. Well, we are not trying to trap him. We are
simply trying to get at the truth. The man, if he wants to just say
he takes the fifth amendment and he honestly believes that any state-
ment he might make would tend to incriminate him, that is one thing.
But in the course of the interrogation here he has given some an-
swers, and, of course, as you know, that opens up the whole field. You
know that.
Mr. DuKER. I wouldn't charge anyone with trying to entrap him,,
but to my provincial mind, it seemed that there was a tendency in that
direction.
Mr. Kennedy. I am just trying to get the record straight.
The Chairman. We have a pretty hard time getting the truth, and
I think you can appreciate that.
Mr. DuKER. I will tell you something. Sitting there and listening
to Mr. Thackrey testify under oath as to matters which were matters
of public record, I would say that he was not telling the truth, not
deliberately, but simply didn't know the facts.
The Chairman. Then your client probably knows the facts, and
will you advise him to open up and tell the truth ?
Mr. DuKER. I know the facts better than my client, on the points
where I found Mr. Thackrey in error.
The Chairman. Do you want to be sworn and tell the truth ?
Mr. DuKER. I don't object to testifying to anything.
The Chairman. If you will have him answer, then I will permit
you to be sworn.
Mr. DuKER. Senator, it goes right back to what I said. I wasn't
present at any of these so-called meetings.
The Chairman. All right, proceed.
Mr. Kennedy. I just want to get straight about it.
The Chairman. Let him answer or take the fifth amendment.
Mr. Kennedy. Did you know Mr. Bitz, Mr. Irving Bitz ?
Mr. Simons. Yes.
Mr. Kennedy. Did you know Mr. Bitz ?
Mr. Simons. Yes, sir.
Mr. Kennedy. Did you meet with him in connection with the-
contract ?
ISIr. Simons. It may incriminate me, and I refuse to answer,
Mr. Kennedy. Did you meet with Mr. Bitz and Mr. Thackrey in
connexition with that ?
Mr. Simons. I refuse to answer that it may incriminate me.
Mr. Kennedy. Did you meet in an automobile with those two
gentlemen?
Mr. Simons. I refuse to answer ; it may incriminate me,
Mr. Kennedy. Was there any discussion about you taking a trip
to Florida?
Mr. Simons, I refuse to answer ; it m,ay incriminate me.
Mr. Kennedy. Did you receive any money in connection with
it?
Mr. Simons. I refuse to answer; it may incriminate me.
The Chairman. You have forgotten the admonition of the Chair.
You would be in a little better position here if you respectfully de-
cline to answer, instead of refusing, don't you think ?
Mr. Simons. I refuse to answer, but first of all the lies that were-
told
IMPROPER ACTIVmES ITST THE LABOR FIELD 18147
Mr. DuKER. I don't think that you made your point very clearly,
and I will try to make it clear to him.
The Chairman. Let me tiy to rmi tliis end of it.
The Chair just simply suggests to you and now can you hear
me?
Mr. Simons. That is a little better.
The Chairman. Is this still better ?
Mr. Simons. Yes.
The Chairman. The Chair suggested to you a while ago, unless
you wanted to show some disrespect to the committee that it would
be better for you to say that you decline, and that you respectfully
decline to answer on the ground of the fifth amendment, mstead of
saying you refuse to answer. It sounds a little better.
Mr. Simons. Well, you can understand how confused I am. I
respectfully refuse to answer on the ground it may incriminate
me.
The Chairman. As long as you respectfully refuse, I will let your
refusal stand.
Mr. Simons. I respect you like you respect me, and it goes both
ways, sir.
Mr. Kennedy. Now, Mr. Chainnan, I would like to call Mr.
Mr. Thackrey around again just to make sure of the identification.
The Chairman. Let the record show that Mr. Thackrey is being
recalled.
TESTIMONY OF THEODORE THACKREY— Resumed
Mr. Kennedy. Let me ask, is this the gentleman whom you met in
the automobile with Mr. Bitz ?
Mr. Thackrey. Yes.
Mr. Kennedy. There was discussion at that time about taking a
trip to Florida, as you have testified ?
Mr. Thackrey. That is correct, and Mr. Simons came from his
home, sometmie after dusk, and got in the front seat of the car with
Mr. Bitz, and I sat in the back seat, and I left for perhaps 5 or 10
minutes.
Mr. Kennedy. There is no question in your mind that this gen-
tleman was the man that met with you ?
Mr. Thackrey. We were parked in front of Mr. Simons' home in
Brooklyn, and he came, I assmne — this I don't know — Mr. Bitz made
a telephone call which he told me was to Mr. Simons' home, and fust
before we drove to it from the drugstore 3 or -i blocks away.
We parked in front of the house and Mr. Simons came out almost
immediately and he got in the front of the car and had a conversation
and I returned to the car and Mr. Simons left and went back into tlie
house.
Mr. Kennedy. There is no question about these facts ?
Mr. Thackrey. No, Mr. Simons did come out of the house.
The Chairman. Are there any further questions ?
Mr. Kennedy. That is all, Mr. Chairman.
The Chairman. All right. Are there any further questions of Mr.
Simons ?
Mr. Kennedy. That is all, Mr. Chairman.
18148 IMPROPER ACTIVITIES EST THE LABOR FIELD
The Chairman. Call the next witness.
Mr. Simons. The only question I would like to ask —
To answer this man here, I never met a more profound liar in all
of the history of my life, period.
The Chairman. Now, since you are going to open up that angle,
you may be able to answer some of these questions, and I am not
going to sit here and let you show contempt for this committee.
Mr. Simons. I would like to get a little off my chest.
The Chairman. We will help you get it off your chest and I am
going to giA^e you time to answer these questions now and order you
to answer them.
Mr. Simons. This man here
The Chairman. Just a moment here. You wait until I get
through.
Mr. Simons. I have been up on my feet.
The Chairman. You heard me, and I said wait.
All right, after all, I have shown you every courtesy liei'e this
morning and
Mr. Simons. I respect you sir, and it got under my skin, and
The Chairman. You are getting under my skin right at the moment.
Mr. Simons. I am human, too, and I don't want anybody tiymg
The Chairman. Will you make a complete record of this, and I am
warning you now that you can be cited for contempt.
Mr. Simons. I apologize to you, sir.
The Chairman. Now, you apologize and show your apology by
hushing a moment, will you ?
Mr. Simons. All right, sir.
The Chairman. Ask him those questions again, and I am going to
order you to answer them now, and you want to take this attitude.
Ask him the questions.
Mr. Kennedy. Mr. Thackrey has testified that he met with you
and Mr. Bitz in an automobile outside of your home in Brooklyn in
1949 in connection with the contract of the Compass newspaper; is
that correct ?
Mr. Simons. I will go back and say I respectfully decline to answer.
It may incriminate me.
The Chairman. The Chair, with the approval of the committee
orders and directs you to answer the questions, since you want to say
that the man who said it is a liar, and now I order and direct you to
answer the question.
Mr. Simons. I respectfully decline to answer and it may incriminate
me.
The Chairman. Proceed.
Mr. KJENNEDY. And that conversation in the automobile did you
discuss or did Mr. Bitz discuss with you the fact that you should take
a trip to Florida and get out of town ?
Mr. Simons. I respectfully decline to answer that. It may in-
criminate me.
The Chairman. With the approval of the committee, the Chair
orders and directs the witness to answer the question, and these orders
and dii'ections continue until you leave the witness stand.
DvIPROPER ACTIVITIES IN THE LABOR FIELD 18149
]\Ir. Simons. I respectfully refuse to answer on the ground it might
incriminate me.
Mr. Kennedy, Did you receive any money from Mr. Bitz ?
Mr. Simons. I refuse to answer, or I respectfully refuse to answer,
and it may incriminate me.
Mr. Kennedy. That is all.
The Chairman. The Chair, with the permission of the committee,
orders and directs you to answer the question. The orders and direc-
tions of the Chair will continue.
Mr. Simons. I respectfully decline to answer because it may in-
criminate me.
The Chairman. The order and direction of the Chair remains.
Are there any other questions ?
Mr. Kennedy. That is all.
The Chairman. The witness may stand aside.
Call the next witness.
Mr. Kennedy. Mr. Bitz.
The Chairman. You will remain here, and the witness is not ex-
cused for the day. You will remain here subject to being recalled.
Mr. Bitz, 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. Bitz. I do.
TESTIMONY OF IRVING BITZ, ACCOMPANIED BY COUNSEL,
LOUIS HAIMOFF
The Chairman. Please state your name and your place of residence
and your business or occupation.
Mr. Bitz. Irving Bitz, 8 Bedford Drive, Long Island.
The Chairman. Do you have any occupation ?
Mr. Bitz. I respectfully decline to answer that question on the
ground it might incriminate me.
The Chairman. Do you have counsel ?
Mr. Bitz. I have, sii\
The Chairman. Mr. Counsel, identify yourself for the record.
Mr. Haimoff. Louis Haimoff, 501 Fifth Avenue, New York City.
The Chairman. Thank you very much.
Proceed, Mr. Kennedy.
Mr. Kennedy. Now, Mr. Bitz, you are vice president of the Bronx
County News Co. ; is that right ?
Mr. Bitz. I respectfully decline to answer that question on the
ground it might incriminate me.
Mr. Kennedy. ^Vliich is a magazine wholesaler distributing most
of the major magazines in the Bronx County and all of the newspapers
in New York. You have control over the distribution of the news-
papers of New York, all except the New York Daily News; isn't
that correct, Mr. Bitz ? You make the deliveries in the Bronx County ?
Mr. Bitz. I decline to answer that question on the ground that it
might incriminate me.
Mr. Kennedy. You are also secretary-treasurer of the Bi-County
News Co., which is a magazine wholesaler distributing magazines in
Nassau and Suffolk Counties ; is that right ?
18150 IMPROPER ACTIVmES IN THE LABOR FIELD
Mr. BiTz, I respectfully decline to answer that question on the
the ground it might incriminate me.
Mr. Kennedy. You are a member of the Newspaper and Mail Deliv-
erers Union as well ?
Mr. BiTZ. I respectfully decline to answer that question on the
ground it might incriminate me.
Mr. Kennedy. You are also laiown as Morris Grossman and you
were bom on April 17, 1904, in Poland ; is that right?
Mr. BiTZ. I respectfully decline to answer that question on the
ground it might incriminate me.
Mr. Kennedy. Isn't it correct that you are currently under de-
portation proceedings which were brought originally in 1953, as an
undesirable alien because of your criminal activities, but you have
escaped deportion as Poland refuses to take you ?
Mr. BiTz. I respectfully decline to answer that question on the
ground it might incriminate me.
Mr. Kennedy. Up until 1949 you were employed as an inspector
for the New York Journal American ; is that right ?
Mr. BiTz. I respectfully decline to answer that question on the
ground it might incriminate me.
Mr. Kennedy. That was up until the time when you pled guilty to
a lottery conspiracy charge; isn't that right?
Mr. BiTZ. I respectfully decline to answer that question on the
ground it might incriminate me.
Mr. Kennedy. Your partner was also in that conspiracy charge,
Mr. Gordon ; isn't that right ?
Mr. BiTz. I respectfully decline to answer that question on the
ground it might incriminate me.
Mr. Kennedy. The other conspirators included Daniel Zwillman,
who was a cousin of Longy Zwillman, and Anthony Strollo, also
known as Tony Bender, as well as yourself and Gordon; isn't that
right?
There was a policy racket involving the rigging of numbers assur-
ing a minimum payoff and you entered a plea of guilty on January
10, 1950, and were sentenced to 6 months; isn't that right?
Mr. BiTZ. I respectfully decline to answer that question on the
ground it may tend to incriminate me.
Mr. Kennedy. Isn't it correct that that was the largest numbers
racket case that has been brought in New York ?
Mr. BiTz. I respectfully decline to answer that question on the
ground it might incriminate me.
Mr. Kennedy. You have been arrested five times on charges of
narcotics violation, unlawful entry, petty larceny, and bail jumping,
as well as the lottery conspiracy ; is that right ?
Mr. BiTZ. I respectfully decline to answer that question on the
ground it might incriminate me.
Mr. Kennedy. And you were convicted of the narcotics charge and
sentenced to 1 year and 1 day, petty larceny with a gun, and the bail
jumping, being sentenced to 3 to 6 years, as well as the lottery con-
spiracy charge ; isn't that correct ?
Mr. BiTZ. I respectfully decline to answer that question on the
ground it might incriminate me.
The Chairman. Is this man presently connected with a labor union?
IMPROPER ACTIVITIES IN THE LABOR FIELD 18151
Mr. Kennedy. He is in tlie labor union, but he is presently one of
the biggest operators in the New York area for the distribution of
newspapers and magazines, and he is the gentleman that has been
identified as the one to whom the $10,000 was paid.
As we will see, he plays a very important role in the New York
area, in connection with the distribution of newspapers and magazines.
We haven't got all of that evidence in, but we expect to have it before
the end of the hearing.
You also played a role as a go-between during the time of the Lind-
bergh kidnaping, did you not ?
Mr. BiTz. I respectfully decline to answer that question on the
ground it might incriminate nie.
Mr. Kennedy. We have already had some testimony, Mr. Chair-
man, regarding Mr. Bitz, in connection with the testimony of Merrill
Hermanson, w4io testified in the New York paper local case, and
testified that he was introduced to Johnny Dioguardi as a labor con-
sultant by Irving Bitz.
Do you know Jolinny Dioguardi, Mr. Bitz?
Mr. Brrz. I decline to answer that question on the ground it might
incriminate me.
The Chairman. Does that show the connection between these folks
up there, with manipulating this racket ?
Mr. Kennedy. It shows the strong role that the underworld has in
this operation. Mr. Bitz, as will go into it, plays an important role;
but, as the testimony of the first witness also shows, it was through
Mr. Bitz that the Compass newspaper was able to obtain a contract
with the union, when prior to the time when they made the $10,000
payment to Mr. Bitz they had been unable to get one.
The Chair^ian. This testimony here this morning is not the first
linking Mr. Bitz with some of this manipulation that has been going
on, this racketeering in union atfairs?
Mr. Kennedy. Not at all.
The Chairman. He was the go-between in the Johnny Dio matter
with the paper locals ?
Mr. Kennedy. AYliere a company having difficulty with a labor
union went to Johnny Dioguardi as a labor relations consultant to get
a contract, Mr. Bitz is the one that made the contact for Mr. Herman-
son with Mr. Johnny Dioguardi, which then led to a favorable con-
tract with the employer through the efforts of Johnny Dioguardi.
It shows the manipulations and maneuverings of some of these in-
dividuals who have these gangster connections, because Mr. Bitz, of
course, has a serious criminal record of his own, as well as close ties
with major criminal figiires in the New York area.
The Chairman. All right; proceed.
Mr. Kennedy. I want to ask him about the $10,000.
Did you receive the $10,000 from Mr. Thackrey, Mr. Bitz?
Mr. Bitz. I decline to answer that on the ground it might in-
criminate me.
Tlie Chairman. Wliy do you think it would be incriminating?
Mr. Bitz. I decline to answer that on the ground it might incrimi-
nate me.
The Chairman. Do you think if you told the truth it might incrim-
inate you ?
18152 IMPROPER ACTIVITIES IN THE LABOR FIELD
Mr. BiTz. I decline to answer that question on the ground it might
incriminte me.
The Chairman. I will ask you, do you honestly believe that if you
gave a truthful answer to these questions that the truth might tend to
incriminate you ?
Mr. BiTZ. Yes, sir.
The Chairman. All right.
Mr. Kennedy. Do you know Mr. Joseph Simons, the former presi-
dent of the Newspaper Handlers Union ?
Mr. BiTz. I respectfully decline to answer that question on the
ground it might incriminate me.
Mr. Kennedy. Mr. Chairman, could I just call Mr. Tierney briefly
to put in what Mr. Bitz receives from these various companies.
The Chairman. All right.
Do you solemnly swear the evidence you shall give before this Sen-
ate select committee shall be the truth, the whole truth, and nothing
out the truth, so help you God ?
Mr. Tierney. I do.
TESTIMONY OF PAUL J. TIERNEY
The Chairman. State your name and your present business or
occupation.
Mr. Tierney. My name is Paid J. Tierney, and I am assistant
counsel for this committee.
The Chairman. All right, proceed.
Mr, KJENNEDY. Wliat does Mr. Bitz receive from his various com-
panies? You made an investigation of this, did you ?
Mr. Tierney. I have.
Mr. Kennedy. Or people under your direction ; is that right ?
Mr. Tierney. Yes, sir,
Mr, Kennedy. Do you hav6 the information in connection with
what moneys JMr. Bitz receives from the various companies?
Mr. Tierney. I do.
Mr, Kennedy. Will you tell us that ?
Mr, Tierney, He received a salary as vice president of Bronx
County Newspaper Co., Bronx County News Co., a wholesale distrib-
utor of magazines in Bronx County, N.Y. As vice president he
receives a salary of $35,000 a year, and expenses of $120 weekly, plus a
car allowance of $30 weekly.
He is also president of Bi-County Newspaper Corp., a wholesale
distributor of magazines in Long Island, and Nassau and Suffolk
Counties, for which he receives a salary of $300 a week.
Mr. Kennedy. And his partner is who ?
Mr. Tierney. The three principal officers of Bronx County News, in
addition to Irving Bitz, are Charles Gordon and Selig Goldberg.
Charles Gordon receives a salary of $35,000 annually, and Selig
Goldberg a salary of $32,000 annually. They each received an expense
account of $100 a week,
Mr, Kennedy, This is from the company ?
Mr, Tierney, Yes,
Mr, Kennedy. I wanted to get these figures in the record. Would
you give that also for the Bi-County News?
IlVrPROPER ACTIVITIES IN THE LABOR FIELD 18153
Mr. TiERNEY. The two officers of Bi-County News, in addition to
Irving Bitz, are William Felio and Charles Gordon, each of whom
received a salary of $300 weekly and an expense allowance of $30
a week.
The Chairman. All right. Are there any further questions?
Mr. Kennedy. That is all, Mr. Chairman.
The Chairman. Do you want to comment or deny any of these
statements of the witness ?
Mr. BiTZ. I decline to answer on the ground it might incriminate
me.
The Chairman. You can say yes or no to that ; you can say whether
you want to comment or not.
Mr. BiTZ. I don't want to answer.
The Chairman. What is that ?
Mr. Bitz. No, sir.
The Chairman. Is there anything further?
Mr. Kennedy. We are going to have some other testimony about
this witness.
Mr. Haimoff- May I suggest this witness has made it clear that
he does not intend to be a witness against himself in this proceeding,
and so may I ask in the Senator's judgment if it would serve any
useful legislative purpose to bring him back again and continue
the same procedure ?
The Chairman. I want him to be present; we might want to in-
terrogate him further. Let him remain here for today, until such
time as we can get through.
I don't know just what other testimony may develop, and maybe I
would want to ask him a question.
Mr. Haimoff. We would appreciate your consideration.
The Chairman. Call the next witness.
Mr. Kennedy. We mentioned the name of Mr. Fello, and I would
like to call now two witnesses in connection with the activities of
Mr. Fello.
This affidavit is from Mr. Bernard Goldstein, residing at Queens,
N. Y., and it is sworn to on the 8th day of April 1959, and he states :
I was the assistant treasurer and controller of the New York Star, a news-
paper which went out of business in 1949. At about that time, the Daily
Compass was organized and I started to work for the Compass as assistant
treasurer in 1949.
To the best of my recollection, just before the paper was to be first published,
we ran into difficulties with the Newspaper Deliverers Union and we were given
to understand that they would not permit the delivery of our newspaper
to the distributors, such as the Metropolitan News Co.
I do not recall whether I had the power to sign checks at that time, or
whether Mr. William Peyton Marin, who was treasurer of the company at that
time, had that power.
However, I do recall that there were same discussions relative to paying
off the union ofiicials. It is also my recollection that the amount was in the
neighborhood of .$10,000 and it is my recollection that this amount was with-
drawn from one of the bank accounts of the Compass in cash and that the cash
was given to Mr. Theodore Thackrey, who I believe paid off the union officials.
The transaction took place in 1949.
The Compass liquidated its business either at the end of 1952 or early 1953, at
which time the books and records, including the check books and check stubs,
canceled checks, et cetera, were stored in the AAAAAA American City Wide Ex-
press Service, located at 1135 Tiffany Street, Bronx. The storage charges were
prepaid for a period of 2 or 3 years. I recall that at the end of this period I re-
18154 IMPROPER ACTIVITIES IN THE LABOR FIELD
ceived either a telephone call or a letter from the storage warehouse stating
that if further charges were not paid, the papers would be destroyed. Since the
company was liquidated and there was no money available for further storage
charges, I so informed the storage company and it is my belief that the records
were destroyed.
I have been advised that the above statement will be used in a public hearing
before the Senate select committee and that the statements contained herein are
true to the best of my knowledge and belief.
Bernard Goldstein.
Sworn to before me this 8th day of April 1959, New York City.
Robert J. Cofini,
Notary Public, State of New York, No. 60-57S26S0, Qualified in West-
chester County, Certificate filed in New York County.
Commission expires March 30, 1960.
Mr. Alan Hathaway and Mr. Robert Greene.
(At this point Senator Goldwater left the hearing room and Senator
Ervin entered the hearing room.)
The Chairman. Do you and each of 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. Hathaway. I do.
Mr. Greene. I do.
TESTIMONY OF ALAN HATHAWAY AND ROBERT W. GREENE
The Chairman. Beginning on my left, will you state your name,
your place of residence, and your business or occupation, please, sir.
Mr. Greene. My name is Robert W. Greene, 4 Ardmore Place, Kings
Park, Long Island, N.Y. I am a reporter employed by Newsday, a
newspaper in Garden City, New York.
The Chairman. Thank you very much.
And will you please state your name, your place of residence, and
your business or occupation, please, sir.
Mr. Hathaway. Alan Hathaway, 44 Dog Leg Lane, Rosslyn
Heights, Long Island. Managing editor of Newsday.
The Chairman. Do you gentlemen waive counsel ?
Mr. Greene. Yes, sir.
Mr. Hathaway. Yes, sir.
The Chairman. Proceed.
Mr. Kennedy. Mr. Hathaway, from 1940 until December 5, 1958,
the Rockaway News Co. handled all deliveries of Newsday; is that
correct ?
Mr. Hathaway. That is correct.
Mr. Kennedy. And Rockaway News had a collective bargaining
agreement with the Newspaper and Mail Deliverers?
Mr. Hathaway. That is correct.
Mr. Kennedy. And Newsday had no direct contract with them?
Mr. Hathaway. No.
Mr. Kennedy. Now, on December 5, 1958, Newsday was advised that
members of the Newspaper and Mail Deliverers Union would refuse to
work for Rockaway ; is that correct ?
Mr. Hathaway. We were advised late on the night of December 4
that the drivers would not on the following day deliver as they cus-
tomarily had.
Mr. Kennedy. For what reason was that ?
IMPROPER ACTWITIES IN THE LABOR FIELD 18155
Mr. Hathaway. Because of the difference between the union and
Rockaway.
The Chairman. What is that? Because of what ?
Mr. Hatilvway. Because of the difference the union and Rockaway
News.
JNIr. Kennedy. Was Rockaway in financial difiicuhies at the time ?
Mr. Hathaway. I believe they were.
Mr. Kennedy. And did they subsequently go bankrupt?
Mr. Hathaway. Yes, sir ; they have gone bankrupt.
Mr. Kennedy. They had handled all of your deliveries up until
that time ?
Mr. Hathaway. They had.
Mr. Kennedy. And then they got into financial difficulties, and dif-
ficulties with the union, and they were notified by the union that the
union would no longer handle the newspapers ?
Mr. Hathaway. It was a notification to the company ; we were not
notified. We were told, and not officially notified, by a union member.
Mr. Kennedy. What steps did you take then to deliver your news-
papers ?
Mr. Hathaway. We sent our circulation department supervisory
personnel to the garage which housed the Hertz trucks, which were
rented by Rockaway, and had been rented by them and had them drive
those trucks to our office approximately 2 hours earlier than our nor-
mal schedule, and we also stepped up our press run 2 hours to avoid
any difficulties we might have. We had previously suffered because
of difficulties between Rockaway and this union.
Mr. Kennedy. So you got the Hertz rental trucks that they had
formerly used to deliver your newspapers ?
Mr. Hathaway. That is correct.
Mr. Kennedy. And that continued for how long ?
Mr. Hathaway. That continued until about December 29.
Mr. Kennedy. On the moiTiing of December 5, 1958, did a com-
mittee of union officials come to see you ?
Mr. Hathaway. Three union officials, Joe Baer, John Lawrence,
Jr., and Harry Waltzer, appeared at Newsday, approximately at 7
o'clock, which would have been 30 minutes before our normal press
time. As I recall, Waltzer was a little late, and Baer and Lawrence
were the fii-st to arrive, and asked to see John Mullin, our circulation
director.
As a matter of courtesy and specifically stated not to negotiate, the
executive staff present and our counsel met with them.
Mr. Kennedy. Would you relate briefly what happened at that
meeting ? What did they want ?
Mr. Hathaway. Baer opened the conversation by saying that "they
are here to negotiate a contract with you." We informed him that we
had a contract with Rockaway and we still did have a contract with
Rockaway, which was not then in bankruptcy, and we had had no
formal notification from anyone that Rockaway could not or should
not deliver our papers as they had.
Mr. Kennedy. They wanted to sign a contract directly with you ?
Mr. Hathaway. Then and there, on the spot.
Mr. Kennedy. And you told them that you had this contract ?
Mr. Hathaway. That is risrht.
18156 IMPROPER ACTIVITIES IN THE LABOR FIELD
Mr. Kennedy. They left the meeting then ?
Mr. Hathaway. There was further conversation during the meet-
ing, and Baer said, and Waltzer also said, "We will not do business
with Kockaway. We want to do business directly with you." And
we told them that there was no situation that existed that permitted
any conversation that would be tantamount to negotiation.
Mr. Kennedy. Did you have any employees who were in the union
at that time ?
Mr. Hathaway. No, sir ; we did not.
Mr. Kennedy. Nevertheless they wanted to sign a contract directly
with you ?
Mr. Hathaway. That is correct.
Mr. Kennedy. After they left the meeting on that same day, was a
picketline placed in front of your newspaper ?
Mr. Hathaway. It was.
Mr. Kennedy. Would you relate what happened then? Did you
receive further contact from them asking for a contract directly with
you?
Mr. Hathaway. We did not receive further direct contact from
the union aside from the existence of the picket line that was outside.
We did receive contact from wholesalers. We received continuing
contact from Rockaway, who kept telling us that they would have
everything straightened out. We received contact from Woodhaven
News Co., which is headed by Alex Feldman.
Mr. Kennedy. Just relate what happened. Did you try to get them
or was there some discussions about having them handle the deliveries
for you?
Mr. Hathaway. We left that in their hands, and it was their prob-
lem to make their peace with the union, and we were not in a position
to negotiate with the union.
Mr. I^nnedy. Were you notified that the union wouldn't allow
anybody to handle this for you ?
Mr. Hathaway. We were notified orally at various times.
Mr. Kennedy. That the union wouldn't allow the Woodhaven News
or anybody else or any other wholesaler to handle your newspapers ;
is that right ?
Mr. Hathaway. That is right.
Mr. KJENNEDY. They wanted you to handle the newspapers your-
self and make a contract with them directly ?
Mr. Hathaway. That is right.
Mr. IvENNEDY. And not go through an intermediary or wholesaler ;
is that correct ?
Mr. Hathaway. That is right.
Mr. Kennedy. They wouldn't allow you to go through a whole-
saler ?
Mr. Hathaway. That is correct.
Mr. Kennedy. They wanted to make the contract directly with
you?
Mr. Hathaway. That is right. There was a subsequent conversa-
tion between the president of Newsday, the circulation director, and
counsel for Newsday, who is present here today, with Sam Feldman,.
president of the union. I cannot testify as to this because I was not
present at the meeting.
IMPROPER ACTIVITIEiS IN THE LABOR FIELD 18157
Mr. Kennedy. But from what you learned, either directly or in-
directly, it was acknowledged and understood that the union wanted
to make a contract directly with your newspapers?
Mr. Hathaway. Yes, that is correct. Waltzer or Baer said, "This
is our goal and aim."
I^Ir. IvENNEDY. What is the reason that the union wanted to make
a contract directly rather than through the wholesalers?
Mr. Hathaway. We believed tliat the union feels it would have
more direct control over the operations of a newspaper and can on
far less pretext stop deliveries of the newspaper than it can wlien it
works through a wholesaler or wholesale association.
Mr. Kennedy. Finally, on December 29, 1958, and not being able
to solve the difficulties and not being able to go through a wholesaler
and not wishing to deal directly with the union because you had no
employees that could be covered by such a contract, you then made
a contract with Libco, Inc., to handle the wholesale operations; is
that right ?
Mr. Hathaway. That is correct.
Mr. Kennedy. And they were a nonunion company; is that cor-
rect ?
Mr. Hathaway. As far as we knew, they were nonunion, and we
were not assured at that time whether the individual drivers were
running their own trucks under the overall operation of Libco, Inc.,
at that point or later, or whether they hired all nonunion drivers.
Mr. Kennedy. But you made a contract with them at that time?
Mr. Hathaway. That is correct.
Mr. Kennedy. Then did acts of violence begin, as far as you were
concerned ?
Mr. Hathaway. Acts of violence began immediately.
Mr. Kennedy. Would you relate what happened ?
Mr. Hathaway. Within a matter of half an hour or an hour after
the trucks began to roll, cars of drivers and deliverei*s union began
to assemble across the street from Newsday. They started following
our trucks. We arranged all of the protection we could for the men
wlio were driving those trucks.
On the return trip, in the early afternoon, two of the ti-ucks stop-
ped at a gas station, approximately one mile from Newsday, to refuel
before coming back to the plant where we were going to park the
trucks under guard at night, and four men jumped out of a car and
approached the drivers and menaced them with icepicks, and slashed
the tires of two of these trucks, ^
The Chairman. Were they ever prosecuted ?
Mr. Hathaway. They are now under indictment, sir.
The Chairman. For that act?
Mr. Hathaway. Yes.
Mr. Kennedy. They include Joseph Baer, Waltzer, and Lawrence,
Jr.; is that right?
Mr. Hathaway. Not Waltzer; no.
Mr. Kennedy. Just Baer and Lawrence, Jr. ?
Mr. Hathaway. Baer, Lehman, Lawrence, Jr., and a driver nanued
Hollahan, who is not an officer ; and the other three are officers of the
union.
The Chairman. That is two of the men who came to negotiate the
contract about whom you have testified ?
181 58 IMPROPER ACTIVITIES IN THE LABOR FIELD
Mr. Hathaway. That is correct.
Mr. Kennedy. Now, on December 30, 1958, you obtained a restrain-
ing order from the court prohibiting further picketing by the union ?
Mr. Hathaway. That is correct.
Mr. Kennedy. You haven't had picketing since that time?
Mr. Hathaway. No, sir.
Mr. Kennedy. We have some documents here that I would like to
have identified, please.
The Chairman. Mr. Hathaway, I hand you here what purports to
be a circular or document, "Union Picket Signs Versus Newsday
Shotgun." That is the title of it. I will hand that to you and ask
you to identify it. It appears to be a photostatic copy of the docu-
ment.
(The document was handed to the witness.)
Mr. Hathaway. Yes, sir.
The Chairman. Do you identify it ?
Mr, Hathaway. I do, Senator.
The Chairman. What is it ?
Mr. Hathaway. This is a throwaway published by and distri-
buted by the Mail Deliverers Union to newsdealers, particularly, in
what we felt sure was a mass attempt to intimidate newsdealers and
stop them from handling Newsday.
The Chairman. That was distributed during the time of this
controversy ?
Mr. Hathaway. Yes, sir, on December 5, 1 believe.
The Chairman. Those were distributed on December 5 ?
Mr. Hathaway. Yes, sir.
The Chairman. It may be made Exhibit No. 1.
(Document referred to was marked "Exhibit No. 1" for reference
and will be found in the appendix on p. 18326.)
The Chairman. Now, I hand you here what purports to be a copy
of a letter dated January 5, 1959, written on the stationery of O'Don-
nell & Schwartz, attorneys, and ask you to examine this photostatic
copy and state if you identify it.
(The document was handed to the witness.)
Mr. Hathaway. Yes, I do identify this.
The Chairman. It is a photostatic copy of a letter of that date ?
Mr. Hathaway. Which was delivered by certified mail, return
receipt requested.
The Chairman. To whom was it delivered ?
Mr. Hathaway. This was delivered to our business manager,
Harold Ferguson, and it was addressed just to Newsday, but he was
the officer of the company who received it.
The Chahiman. The letter is authentic?
Mr. Hathaway. That is correct, sir.
The Chairman. And it may be made exhibit No. 2.
(Document referred to was marked "Exhibit No. 2" for reference
and may be found in the files of the select committee.)
The Chairman. Could I have the exhibit here, for further refer-
ence, please?
(The document was handed to the Chair.)
Mr. Kennedy. May I read some excerpts from this, please? This
is exhibit No. 1, which refers to the shotguns, and signed "Newspaper
DiIPROPER ACTrVITIES IN THE LABOR FIELD 18159
and Mail Deliverers Union of New York and Vicinity," and it states
in here, Mr. Chairman, very clearly, the point of Mr. Hathaway's
testimony, and it says :
We feel very strongly that we shall not and will not work for any employer
whom Newsday wishes to choose as a successor to Rockaway News Supply Co.
The Chairman. What was the purpose of that? What is your
understanding of that? Was it to force you to make a direct
contract ?
Mr. Hathaway. To force us to make a direct contract which we
had never at any time had.
The Chairman. You had had contracts with those who actually did
the service for you.
Mr. Hathaway. I beg your pardon ?
The Chairman. Your previous contracts had been with those dis-
tributing agencies that actually rendered the service?
Mr. Hathaway. That is right. And Kockaway News, that is the
only one.
The Chairman. None of your own employees were members of
this union?
JMr. Hathaway. We had no employees members of the union.
The Chairman. And yet the union was trying to force you, al-
though you had no employees members of the union, to make a con-
tract directly with them ?
Mr. Hathaway. That is correct.
The Chairman. And this circular or throwaway as you call it, was
published and distributed in connection with that issue ?
Mr. Hathaway. That is right.
Mr. Kennedy. And in this letter, Mr. Chairman, of January 5,
1959, exhibit No. 2, signed by O'Donnell & Schwartz, counsel to the
union, it states over here on the top paragraph on page 2 :
This will advise you that we are not entering into any discussions or ne-
gotiations with any news company concerning the delivery of Newsday.
So even if this other company, Libco, or the employees, wished to
join the union, the Newspaper Union, as has been indicated here, he
wouldn't even take them in.
Mr. Hjvthaway. That would be our underetanding, Mr. Kennedy,
and I would like you to note that the dates of those two communica-
tions there, they are a month apart.
Mr. Kennedy. This is January 5, 1959.
Mr. Hathaway. Yes, sir; the first throwaway is December 5, and
the letter is January 5, which to us would clearly indicate that there
was no change in the attitude of the union during this period.
The Chairman. What did this mean, this paragraph here in this
letter of January 5, which says :
This will advise you that we are not entering into any discussions or negoti-
ations with any news company concerning the delivery of Newsday.
Mr. Hathaway. It would indicate to us. Senator, that they had
no intention of attempting to organize the drivers who were legiti-
mately handling under contract the distribution of Newsday.
The Chairman. Was this still a part of the pressure to compel you
to sign up without having any members ?
Mr. Hathaway. Yes, sir.
36751— 59— pt. 51 3
18160 IMPROPER ACTIVITIES IN THE LABOR FIELD
The Chairman. This was still a part of that pressure ?
Mr. Hathaway. Yes, sir.
The Chairman. All right. Proceed.
Mr. Kennedy. Now, Mr. Greene, you had some experiences in con-
nection with this situation also ?
Mr. Greene. Yes, sir.
Mr. Kennedy. I might say, Mr. Chairman, as you know, Newsday
has been of great assistance to this committee during the course of its
investigations. A number of the hearings that we have held have
come from leads and from work that has been done originally by
Newsday. Newsday also was kind enough to lend Mr. Greene to the
staff of the committee on an important investigation that we held the
first year.
The Chaieman. May I ask this gentleman, do you attribute any of
this problem you have had with the miion to the fact that you have
cooperated with this committee in any way ?
Mr. Hathaway. I do not believe we have any such evidence, Sena-
tor McClellan, and I think they would be out there trying to get News-
day in any event.
The Chairman. You think they would be after you anyhow ?
Mr. Hathaway. Yes.
Mr. Kennedy. All right, Mr. Greene, would you relate to the com-
mittee what the situation was as you found it, and what approaches
were made to you ?
Mr. Greene. On December 30 — or the 29th, as Mr. Hathaway re-
lated— the trucks or tires of trucks of Libco Co. were slashed.
In connection with that, the Nassau County Police Department
made an investigation and determined by questioning that four per-
sons should have further questioning in connection with this tire
slashing. They were Lawrence, Lehman, Baer, and Hoolahan.
During the course of this procedure, Mr. Lawrence was requested
by the Nassau County Police Department to appear at the third pre-
cinct. I understood that this was going to happen and I went over
to the third precinct to wait and see what might transpire further.
Mr. Lawrence arrived at the precinct accompanied by Mr. William
Fello.
Mr. Kennedy. Who is Mr. William Fello ?
Mr. Greene. I was later able to identify, or we had known already,
that Mr. Fello was an overseer of the Bi-County News Co.
Mr. Kennedy. And therefore a partner of Mr. Irving Bitz?
Mr. Greene. That is right. The Bi-County News Co. had opened
up right beliind Newsday's plant, in Garden City.
I asked Detective Curran about that when he came downstairs,
since in a sense we were also a part of the investigation, and De-
tective Curran said that Mr. Fello had accompanied Mr. Lawrence
and had said that he was a good friend of Mr. Lawrence and he was a
local businessman, and he was coming over with Mr. Lawrence to see
what was going on, and he remained upstairs with Mr. Lawrence when
Mr. Lawrence was being questioned for the first half an hour.
Then he came downstairs in the precinct.
At that time he stood off to one side in the lobby and I went over
to him and I asked him first about a Mr. Wallace J. Miller, whom we
had understood was also an officer of Bi-County News Co. He said
IMPROPER ACTIVITIES IN THE LABOR FIELD 18161
that Mr. Miller wasn't with them any more and he seemed as though
he wanted to talk to me, and I then asked him how it was that he,
connected with a ncAvs distributing company, was here with Mr. Law-
rence who was in the union.
He said, or he referred to Mr. Lawrence as "Junior," and he said,
"Well, I have known Junior's father for many, many years, and I
worked with him," and he said, "I Imow this kid, and I have watched
this kid's career in the union, and I have hel^Ded him all I could, and
I have sort of helped bring him up in the union," and he said, "I have
watched his career, and he is like a son to me. That is why I am
here with him."
So then he said, and he volunteered this question : "What kind of
trouble is this whole thing?" And he was referring, of course, to
the Newsday-union problem.
I said, "Well, I understood — I only worked for the paper — but I
understood that the union wanted us to go into a direct contract with
them, and we couldn't use any contractor whether it be union or not."
So then there was a pause, and then he said, "Well, you know, we
are in the newspaper business, too, and we have our plant right behind
you, and you know, Kockaway used to work for you, and we have taken
over all of Rockaway News magazine delivery."
And so he said, "We could deliver for you."
And I said, "Well, I understood from conversations which I had had
with officials of our company, that the union wasn't allowing any
distributor to deal for us."'
The Chairman. That is whtit they had said in this letter?
Mr. Greene. That is right, sir. The letter, however, was after
this conversation.
The Chairman. You had had advance information from them
about that?
Mr. Greene. That throwaway we got on the 5th of December had
come 25 days before.
At this point he said, "Well, I said I don't think that you could do it,
because of the union." So he looked upstairs, Mr. Lawrence was still
being questioned upstairs, and he sort of shrugged his head towards
upstairs, and he said, "Don't worry; we won't have any trouble
with the union."
So he said, "I think I will get to work on that right away, and who
shall I call up over in your company, which person ? "
So I said, "Well, probably Mr. Ferguson, who is our business
manager."
So he said "All right, I'll get after him this afternoon as soon as
I go back."
Then I waited for Mr. Lawrence to come downstairs, and he and
Mr. Lawrence departed together from the precinct.
Mr. Kennedy. Did you later hear from Bi -County ?
Mr. Greene. Mr. Ferguson inform,ed us that he had gotten a call
from Mr. Gordon that afternoon, to inquire about handling our
delivery.
Mr. Kennedy. How v/as it handled by Newsday then, or what posi-
tion did Newsday take about it ?
Mr. Greene. Mr. Ferguson said that he informed Mv. Gordon that
we had a contractor working for us, Libco, and our deliveries were
being: handled.
18162 IMPROPER ACTIVITIES EST THE LABOR FIELD
Mr. Kennedy. Did you know of the background of the Bi-County
Co.? " ^
Mr. Greene. Yes, sir; we did, and that is what interested me in
Fello in the first place, because we had gotten information that Mr.
Bitz was involved in some wa}^ in this whole union problem, and then
as a result of our own investigations we had determined that Bi-
County had opened up not too long before right behind Newsday.
Mr, Kennedy. Did Bi-Comity subsequently get much of the deliv-
eries on Long Island, the Long Island area ?
Mr. Greene. This I do not know, although Mr. Fello told me that
they handled now most of Eocka way's magazine stuff, and they were
geared to handle newspapers.
Mr. I^NNEDY. They opened up just as Rockaway was going out of
business ?
Mr. Greene. Rockaway, as I understand, was in the process of back
and forth for almost a year, but during that time I understand — and
I don't know this of my own knowledge — they were picking up most
of Rocka way's magazine business.
TESTIMONY OF PAUL J. TIEENEY— Resumed
Mr. IvENNEDY. Mr. Chairman, could I just ask Mr. Tierney about
what the records show as far as Bi-County is concerned, whether they
were able to get deliveries in that area ?
Mr. Tierney. Yes ; that is right.
Mr. Kennedy. Of both newspapers and major magazines?
Mr. Tierney. Just magazines, and the great bulk of magazines with
two exceptions, S. & M. publications and Hillman publications.
]Mr. Kennedy. What magazines would it include that they now
have ?
Mr. Tierney. It would include Hearst publications and Curtis pub-
lications, and similar major publications, all of them with the excep-
tion of those two I mentioned.
Mr. I^nnedy. They have that business at the present time?
Mr. Tierney. Yes,
TESTIMONY OF ALAN HATHAV/AY AND EOBEET W. GEEENE—
Eesumed
Mr. Kennedy. Was your reluctance, or part of your reluctance to
do business with them because of tie-in of Mr. Bitz and some of these
other individuals ?
Mr. Greene. Well, since I wasn't involved at all in the negotiations,
Mr. Hathaway could answer that.
Mr. Kennedy. Would that be one of the things ?
Mr. Hathaway. We had no desire to have any contract of any sort
with any organization headed by Inking Bitz, or any man of his
criminal record.
Tlie Chairman. I gather from this testimony that there is indica-
tion that this Bitz organization was possibly putting on this pressure
through the union to try to put some folks out of business and to get
into this operation themselves, to take over a lot of this deliA^ery;
is that coiTect ?
IMPROPER ACTIVITIES IN THE LABOR FIELD 1S163
Mr. Hathaway. We did not think that the location of their pLant
within a few hundred feet of Newsday was a complete coincidence. I
think so, Senator; yes. Of our own knowledge we could not say.
The Chairmax. 1 understand, but there is indication of it.
Mr. Hathaway. Certainly I would say so.
The Chairman. Here again there was collusioii between a union
and a business interest to apply pressure of this nature in order to put
one fiiTn out of business, so to speak, and put anotlier firm in business;
is that correct ?
Mr. Hathaway. I would say that was a sound inference, Senator.
Mr. Greene. This certainly "^in our own mind at least crystallized
as a fairly good speculation, when every wholesaler had told us that
they couldn't deliver for us because the union wouldn't allow them to,
and here in the police station with the union business agents, Mr.
Bitz' partner shows up and says, "We can handle your business with-
out any trouble from the union."
The Chairman. You would have no trouble with the union and
all of the others in that business were being barred by the union, and
they so stated in their letter to you.
Mr. HL\TiiAWAY. That is correct.
The Chairman. And so stated in the circular.
Mr. Hatha v/AY. Yes, sir.
The Chairman. So it looked like collusion here between the Bitz
group on the one side, on the business side of the issue, and the union
by these tacticR to harass the paper, and also others, and compel the
business to be delivered to them.
Mr. Hathaway. Yes; and I think it is further borne out by an
exhibit which I am quite sure you gentleman have in a union paper
which comments on the Bitz taking over the magazine distribution,
and their great satisfaction with that.
Mr. Kennedy. I don't think that we are familiar with it.
The Chair3ian. We may check our files, and if we have it, or if
you have it to make it available, I would like to have it.
Mr. Hathaway. I believe we have a photostat of it, but I think
that you will find such a letter in your files, or it is not a letter, but
a regular union publication.
Mr. Kennedy. Perhaps this is it.
The Chairman. I hand you here what purports to be a photostatic
copy of an issue of the bulletin of December 1958. I think it is
December 11.
I will ask you to examine this and see if this is the newspaper to
which you refer.
(The document was handed to the witness.)
Mr. Hathaway. Yes, sir.
The Chairman, That photostatic copy of the newspaper may be
made exliibit No. 3.
(Document referred to was market "Exhibit No. 3" for reference
and may be found in the files of the select committee. )
The Chairman. Do you want to read the pertinent part of it, of
the article ?
Mr. Hathaway. It is quite some time since I have read this, and it
is lengthy, Senator, but I will see if I can find it.
18164 IMPROPER ACTIVITIES IX THE LABOR FIELD
Mr. Kennedy. Perhaps Mr. Greene could look for that while I ask
you this question : Was this a further attempt by the union to control
this industry in and around New York ?
Mr. Hathaway. This had nothing directly to do with the news-
paper distribution. This was the magazine distribution.
Mr. Kennedy. I am not talking about this newspaper article, but I
am talking about the eft'orts by the union in connection with your
newspaper.
Would you see it as a further effort by the union to control the
industry in the New York area ?
Mr. Hathaway. Yes ; I would.
Mr. Kennedy. Isn't it correct that the union pretty well determines
what wholesaler is going to hajidle newspapers or magazines in the
New York area ?
Mr. Hathaway. Very greatly.
Mr. Kennedy. It has a major role to play ?
Mr. Hathaway, It has a major role and it imposes whatever restric-
tions it desires at any time.
Mr. Kennedy. Ordinarily they can put pressure on magazines or
newspapei"S to take a particular company, as a wholesaler; is that
right?
Mr. Hathaway. I believe that is correct, sir.
Mr. Kennedy. Certainly there was an effort in your particular case.
Mr. Hathaway. In our particular case, yes; there is no question
about it.
Mr. Kennedy. To make the policy for the newspaper in this in-
stance.
Mr. Hathaway. It is further a fact that in the distribution of mag-
azines currently going on by Bi-County, they forced newsdealers to
take magazines that had been determined to he salacious and are not
wanted by the newsdealers. The dealers get them whether tliey want
them or not.
The Chairman. They are now being forced to take them ?
Mr. Hathaway. That is still going on, and I have been told by
some individual dealers.
The Chahiman. In other words, that is a form of coercion, com-
pelling them to take them and otherwise they won't get deliveries ?
Mr. Hathaway. Yes, sir, and dealers have told us that Bi-County
tells them that —
We package them this way, and you have to take it that way, and if you don't
sell them, return them, but rebates on the returns are slow if they are in
existence.
Mr. Greene. This newspaper bulletin deals with the problem of
certain companies taking over Rockaway News' business. The three
paragraphs I think illustrate the point Mr. Hathaway made. The
first paragraph is the union has won a critical victory in protecting the
job opportunities of its members in the publishing industry.
For months the industry was buzzing with rumors concerning the
loss by Rockaway News Co., Inc., of its magazine franchises.
Then it goes on to say how one company was attempting to go non-
union or have its deliveries nonunion in some way, and then it says —
On Wednesday, November 19, the union received word that S. & D. finally re-
versed itself and assigned its franchises to Periodical Distributors, Bi-County
News, and Pacific News Ck).
IMPROPER ACTIVITIES IN THE LABOR FIELD 18165
Also it says,
All of the men laid off by Kockaway News have been placed in these three
companies. The satisfactory disposition of this matter contrasts sharply with
the injunction which S. & M. News succeeded in obtaining? against this union
in 1952.
So the placing of their men with Bi-County, as one of the three
companies, and the business, was evidently satisfactory to the union,
which, of course, is what Mr. Hathaway said.
The Chairman. Is there anything further ?
Mr. Kennedy. That is all.
The Chairman. Thank you very much.
The committee will stand in recess until 2 o'clock.
(Members of the select committee present at time of recess : Senators
McClelland and Ervin.)
(Whereupon, at 12:25 p.m. the select committee recessed, to recon-
vene at 2 p.m. the same day.)
afternoon SESSION
(The select committee reconvened at 2:15 p.m., Senator Jolm L.
McClellan (chairman) presiding.)
The Chairman. The committee will be in order.
(Members of the select committee present at time of reconvenmg:
Senators McClellan and Ervin.)
The Chairman. Call the next witness.
Mr. Kennedy. This afternoon we hope to get through some 30
witnesses, so we will have to have a number at one time.
The Chairman. We have a very ambitious and optimistic counsel,
I believe.
Mr. Kennedy. Shall we start? The first witness is Mr. William
Fello.
The Chairman. All right, Mr. Fello, will you be sworn ?
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 yon God ?
Mr. Fello. I do.
TESTIMONY OF WILLIAM J. FELLO, ACCOMPANIED BY COUNSEL,
LOUIS HAIMOFF
The Chairman. State your name and your place of residence and
your business or occupation.
Mr. Fello. William J. Fello, 31-03 90th Street, Jackson Heights,
New York City.
The Chairman. What is your business or profession?
Mr. Fello. I respectfully decline to answer the question on the
grounds that it might tend to incriminate me.
The Chairman. You have counsel. Mr. Counsel, will you identify
yourself for the record ?
Mr. Haimoff. Louis Haimoff, 501 Fifth Avenue, New York City.
The Chairman. All right ; proceed.
Mr. Kennedy. Now, Mr. Fello, you were president of the Bi-County
News Co., is that right, a wholesaler of magazines in Nassau and
Suffolk County?
18166 IMPROPER ACTIVITIES IN THE LABOR FIELD
Mr. Fello. I respectfully decline to answer the question on the
ground that it might tend to incriminate me.
Mr. Kennedy. And you were also a member of the Mail Deliverers
Union, which has the collective bargaining agreement with Bi-County
News; is that right?
Mr. Fello. I decline to answer on the ground that it might tend to
incriminate me.
Mr. Kennedy. Could I ask Mr. Adlerman a question in connection
with the background of this question ?
The Chairman. Will you be sworn ?
You do solemnly swear that the evidence you shall give before this
Senate select committee shall be the truth, the whole truth, and noth-
ing but the truth, so help you God ?
TESTIMONY OF JEROME S. ADLERMAN
The Chairman. State your name and your connection with this
committee.
Mr. Adlerman. My name is Jerome Adlerman, and I am assistant
chief counsel to the committee.
The Chairman. Proceed.
Mr. Kennedy, Now, Mr. Adlerman, the records of the Bi-County
News Co. show it was organized in April of 1958.
Mr. Adlerman. That is correct.
Mr. Kennedy. And by whom was it organized ?
Mr. Adlerman. It was organized by Mr. William Fello, as presi-
dent, and I believe he was the sole stockholder at this time, except
for the pro forma stockholders necessary to organize.
Mr, Kennedy. Shortly afterwards the controlling interest of Bi-
County was purchased by Irving Bitz and Mr. Gordon; is that right?
Mr. Adlerman. That is correct.
Mr. Kennedy, What is Mr. Gordon's full name ?
Mr, Adlerman. It is Mr. Charles Gordon; his former name was
Abraham Goldberg.
The Chairman, Do I understand that Mr, Fello, Mr, Bitz, and Iklr.
Gordon are the owners of Bi-County News Co. ?
Mr. Adlerman. They are, sir.
The Chairman. All right.
Mr. Kennedy. So Mr. Fello and Mr. Miller owned it originally,
and then just at the time they got the union contract the controlling
interest was purchased by Bitz and Gordon ; is that right ?
Mr. Adlerman. Prior to the time that Bitz and Gordon became
members of the firm, or partners, or owners of the firm, it was owned
by Mr. John Walsh and Mr. William Fello.
Mr. Kennedy. And Mr. Walsh, according to our information, was
then forced out of the company ; is that correct ?
Mr. Adlerman. He was forced out according to his testimony.
Mr. Kennedy. Or his statement ?
Mr. ADLER3IAN. His statement ; yes.
IMPROPER ACTIVITIES IN THE LABOR FIELD 18167
TESTIMONY OF WILLIAM J. FELLO, ACCOMPANIED BY COUNSEL,
LOUIS HAIMOFF— Resumed
Mr. Kennedy. Now, Mr. Fello, could you tell us how Mr. Irving
Bitz and yourself got into this company ?
Mr. Fello. I decline to answer on the ground that it might tend to
incriminate me.
Mr. Kennedy. Could you tell us how you obtained control over the
distribution of the magazines on Long Island, for instance?
Mr. Fello. I respectfully decline to answer on the gromid that it
may tend to incriminate me.
Mr. Kennedy. Could you tell us wliy Mr. Walsh was forced out of
the company ?
Mr. Fello. I respectfully decline to answer on the gromid that it
may tend to incriminate me.
Mr. Kennedy. According to the testimony this morning, you accom-
panied Mr. Lawrence to the police station at the time he was being
questioned. Could you tell us or give us the reason for that ?
Mr. Fello. I decline to answer the question on the ground it might
tend to incriminate me.
Mr. IvENNEDY. Then j^ou indicated to Mr. Greene, according to his
testimony, that 3^ou could get matters straightened out with the
union. Could you tell us about that ?
Mr. Fello. I respectfully decline to answer on the groimds that the
answer may tend to incriminate me.
Mr. Kennedy. According to the records of the company, you
loaned between May 5, 1958, and July 3, 1958, to the Bi-County News
Co., some $40,000. Could you tell us what the source of that money
was?
Mr. Fello. I respectfully decline to answer the question on the
ground that it might tend to incriminate me..
Mr. KJENNEDY. Mr. Chairman, could we swear Mr. Cofini of the
staff just to put the documents in ?
The Chairman. Do you solemnly swear that the evidence you shall
give before this Senate select committee shall be tlie truth, the whole
truth, and nothing but the truth, so help you God ?
Mr. CoFiNi. I do.
TESTIMONY OF ROBERT J. COFINI
The Chairman. Will you speak a little louder so we can hear you ?
I think we can do just as well without this paraphernalia of loud-
speakers here as we do with them.
State your name, please.
Mr. CoFiNi. Robert J. Cofini.
The Chaieman. What is your business or occupation ?
Mr. CoFiNi. I am a supervisoiy accountant with the U.S. General
Accounting Office.
The Chairman. On loan to this committee?
Mr. CoFiNi. That is right.
The Chairman. All right ; proceed, Mr. Kennedy.
Mr. Kennedy. Mr. Cofini, you have made an examination of the
books and records of Bi-County ?
18168 IMPROPER ACTIVITIES IN THE LABOR FIELD
Mr. CoFiNi. I have.
Mr. IvENNEDY. Have you found that Mr. Fello lias made certain
loans to the company ?
Mr. CoriNi. Yes, he has.
Mr. IvENNEDY. And during the period that I just mentioned, did
he make loans amounting to some $40,000 ?
Mr. CoFiNi. Yes, sir; that is correct.
Mr. Kennedy. Would you tell us the source of that, Mr. Fello?
Mr. Fello. I rspectfully decline to answer the question on the
ground that it might tend to incriminate me.
The Chairman. May I inquire of you, Mr. Cofini, did the money
come into the possession of the company, into its treasury, by means
of checks or by means of cash? Could you determine from your
examination ?
Mr. CoFiNi. In some cases we were able to detennine and in some
cases we were not. Now, we were able to find out only in two
instances and they were de|X)sits of checks.
The Chairman. In two instances they were deposits of checks.
Now, as part of the money that Mr. Fello advanced to the company ?
Mr. CoFiNi. That is correct.
The Chairman. In how many instances were there? You have
mentioned only two.
Mr. ConNi. In one case Mr. Fello made a loan from the Manu-
facturers Trust Co., some $15,000, which he in turn received a cashier's
check from the bank and turned over to Bi- County News.
Mr. Kennedy. Where did he receive the money to purchase the
cashier's check ?
Mr. Cofini. It was a loan from the bank.
Mr. Kennedy. A loan from the bank ?
Mr. CoFiNi. Yes, a secured loan.
The Chairman. He, in effect, borrowed the money from the bank
and loaned it to the company ?
Mr. CoFiNi. That is correct.
Mr. Kennedy. What about the others ?
Mr. CoFiNi. The other instance was also a loan from a bank,
amounting to $11,500.
Mr. Kennedy. It was handled in the same fashion ?
Mr. CoFiNi. It was handled in the same fashion.
Mr. Kennedy. What about the other loans he made ?
Mr. CoFiNi. I was unable to trace whether or not they were cash or
check deposits.
TESTIMONY OF WILLIAM J. FELLO, ACCOMPANIED BY COUNSEL,
LOUIS HAIMOFF— Resumed
Mr. Kennedy. Could you tell us about that, Mr. Fello ?
Mr. Fello. Sir, I respectfully decline to answer the question on the
ground that it might tend to incriminate me.
The Chairman. Does this company have any legitimate business
at all?
Mr. Fello. I respectfully decline to answer the question on the
ground that it might tend to incriminate me.
The Chairman. Are we to underetand that it is a kind of a racket-
eering and gangster-dominated organization or business enterprise?
IMPROPER ACTIVITIES IN THE LABOR FIELD 18169
Mr. Fello. I respectfully decline to answer the question on the
ground that it might tend to incriminate me.
The Chairman. It might, if it is that kind. Proceed.
Mr. Kennedy. That is all, Mr. Chairman.
The Chairman. Are there any other questions ?
Senator Er\t[n. 1 have no questions.
Mr. Kennedy. Now, Mr. Harold Weinstock, Mr, Joseph Lang, and
Mr. Abraham Weinberg.
The Chairman. Do you and each of you solmnly 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. LanCx. I do.
Mr. Weinberg. I do.
Mr. Weinstock. I do.
TESTIMONY OF JOSEPH LANG, ABEAHAM WEINBERG, AND HAROLD
WEINSTOCK, ACCOMPANIED BY COUNSEL, EDWIN P. KORKUS
AND SOL GELB
The Chairman. The witness, accompanied by their counsel, will
please find chairs.
Beginning on my left, state your name, your place of residence, and
your busines or occupation, please.
Mr. Lang. Joseph Lang, 310 East 44th Street, Manhattan. Whole-
sale newspaper distributor.
The Chairman. Thank you very much.
And the next one ?
Mr. Weinberg. Abraham Weinberg, 5 Putnam Koad, Scarsdale,
N.Y. Wholesale newspaper distributor.
Mr. Weinstock. Harold Weinstock, 1111 Park Avenue, N.Y.
Wholesale newspaper distributor.
The Chairman. Gentlemen, you have counsel, do you ?
Counsel, will you identify yourself ?
Mr. KoRKus. Edwin F.Ivorkus, 11 Park Place, New York City.
Mr. Gelb. Sol Gelb, 30 Broad Street, New York 4, N.Y.
The Chairman. All right. Proceed.
Mr. Kennedy. Now^, you gentlemen, I will start with Mr. Weinstock,
you are a member of the Morning Wholesalers Group ; is that correct ?
Mr. Weinstock. Yes.
Mr. Kennedy. And you have how many wholesalers in the Morn-
ing Wliolesalers Group ?
Mr. Weinstock. Ten, I believe.
Mr. Kennedy. Some 10 of them ?
Mr. Weinstock. I haven't actually counted them.
Mr. Kennedy. Approximately 10. And you handle the news-
papers, do you ?
Mr. Weinstock. Yes, sir.
Mr. Kennedy. Do you handle any magazines ?
Mr. Weinstock. Some of them.
Mr. Kennedy. All of the metropolitan iieAvspapers in the city of
New York?
Mr. Weinstock. Not all ; but some.
Mr. Kennedy. What ones do you handle?
18170 IMPROPER ACTIVITIES IN THE LABOR FIELD
Mr. Weinstock. The New York Times, New York Tribune, Sun-
day American, Journal of Commerce, Wall Street Journal. That sort
of describes it. And other foreign language newspapers.
Mr. Kennedy. The New York Post ?
Mr. Weinstock. No, sir.
Mr. Kennedy. Herald Tribmie ?
Mr. Weinstock. Yes, sir.
Mr. Kennedy. The Journal American ?
Mr. Weinstock. On Sunday.
Mr. Kennedy. Wlio handles these other papers? For instance,
the Journal American, on the other days.
Mr. Weinstock. Its publishers handle it directly.
Mr. Kennedy. In what areas does your group "handle the wholesal-
ing of the newspapers ?
Mr. Weinstock. I would say the four boroughs of the city of New
York, generally speaking.
Mr. Kennedy. What are they ?
Mr. Weinstock. Bronx, Manhattan, Queens, Brooklyn.
Mr. Kennedy. Is it 4 out of the 5, or do you handle it on all of them?
Mr. Korkus. There is some delivery in Suffolk County.
Mr. Weinstock. And also in Nassau County.
Mr. Kennedy. You personally are the largest distributor in the
metropolitan area, are you not ?
Mr. Weinstock. No, sir. The Metropolitan Newspaper Co., and
not I personally.
Mr. Kennedy. That is larger ?
Mr. Weinstock. I am employed by the Metropolitan News Co.
Mr. Kennedy. But that company is the largest, are they ?
Mr. Weinstock. I believe so, and I am not certain.
Mr. Kennedy. What is the Suburban Newspaper Association?
Are you familiar with that ?
Mr. KoRKus. That is another attorney who is present and his
clients are present.
Mr. Kennedy. I just want to ask you to differentiate. What is
the Suburban News Dealers Association ? What do they do, or where
do they do their work ? Do you know anything about their opera-
tions ?
Mr. KoRKUs. If you please, Mr. Kennedy, I would prefer, or re-
spectfully request, that you do not question these witnesses about an
association which is here present and has its attorney here, and we
would prefer not to answer the questions about the makeup of that
association.
Mr. Kennedy. I just want to get the whole picture in, that there
are a number of different associations, and I am not going into detail
with them. But there is another association, known as the Suburban
News Dealers Association ?
Mr. Weinstock. Yes, sir.
The Chairman. We are trying to fill a pattern here.
Mr. Weinstock. It is a question of geography.
Mr. Kennedy. Where do they operate generally ?
Mr. Weinstock. Suburban New York — ^Westchester, Jei^ey, and
what we call Greater New York, outside of New York.
I\Ir. Kennedy. There is a magazine group which handles maga-
zines ; is that correct ?
IMPROPER ACTIVITIES IN THE LABOR FIELD 18171
Mr. Weinstock. Yes, I suppose so.
Mr. Kennedy. What is the Evening Wholesalers Group ?
Mr. Weinstock. The same thing.
Mr. Kennedy. What do they handle? Magazines, or what?
Mi\ Weinstock. I am not familiar with their operations.
Mr. Kennedy. Don't they also handle newspapers ?
Mr. Weinstock. Yes, I believe so.
Mr. Kennedy. Don't you know that to be a fact ?
Mr. Weinstock. Well yes, they handle evening newspapers, that
is why they are called evening newspaper wholesalers.
Mr. Kennedy. So you handle the newspapers in the morning, by
and large, in the five boroughs in New York, and there is another
group that handles the outside in the suburban areas, and there is
another group that handles magazines, and there is another group
that handles the evening newspapers ; generally, that is the situation,
is it?
Mr. Weinstock. Yes.
Mr. Kennedy. And your company is the Metropolitan News Co.?
Mr. Weinstock. Yes, sir.
Mr. Kennedy. How many drivers do you have, approximately?
Mr. Weinstock. Approximately 100.
Mr. Kennedy. That is all right. You have about 100 permanent
drivers and maybe 50 to 75 extra drivers; is that right?
Mr. Weinstock. About. And it is very vague.
Mr. Kennedy. I just asked 3^ou approximately.
Mr. Weinstock. Appi oximately.
Mr. Kennedy. Now, the other officers are Charles Hertzig, who is
president and director ; and Abraham Kosen, who is the treasurer ; is
that right?
Mr. Weinstock. Yes, sir.
Mr. Kennedy. You also have control in the same capacity of the
Kings County Delivery Co. ; is that right ?
Mr. Weinstock. Yes, sir.
Mr, Kennedy. What is the Kings County Delivery Co. ?
Mr. Weinstock. It does the same work as the Metropolitan, in a
different area; in Brooklyn.
Mr. Kennedy. They distribute newspapers and periodicals in
Brooklyn, N.Y.; is that right?
Mr. Weinstock. That is correct.
Mr. Kennedy. Now, the gross sales for the Metropolitan News Co.
is approximately $9.5 million; is that right?
Mr. Weinstock. I don't have the vaguest idea.
Mr. Kennedy. Don't you have any idea ?
(The witness Weinstock conferred with his counsel.)
Mr. Kennedy. Would you talk to me rather than your attorney?
He might be interested, but I am interested, too.
(The witness Weinstock conferred with his counsel.)
Mr. Weinstock. It is nearer to seven, I would say. That is a
rough guess.
Mr. Kennedy. You believe it is around $7 million?
Mr. Weinstock. That is a rough guess, sir.
Mr. Kennedy. Do you know what the gross sales for Kings County
News Co. is?
18172 IMPROPER ACTIVITIES IN THE LABOR FIELD
Mr. Weinstock. No.
Mr, Ken^nedy. Is it about $1 million?
Mr. Weinstock. I think approximately, and I have no way at the
moment of knowing that.
Mr. Kennedy. Now, let me ask you this: Have you used any of
the company funds to pay off any union officials ?
Mr. Yv^EiNsrocK. I respectfully decline to answer on the grounds
that it might tend to incriminate me.
The Chairman. What is your official capacity with this company?
Mr. Weinstock. I am secretary of the corporation, and a director.
The Chairman. Do you draw checks on the corporation in your
official capacity? Do you write checks or sign checks on the
corporation ?
Mr. Weinstock. Yes, sir.
The Chairman. You do ?
Mr. Weinstock. Yes, sir.
The Chairman. In that capacity, have you drawn out any money
out of the company by check or in cash to pay off union officials?
Mr. Weinstock. I respectfully decline to answer that question on
the grounds that it might tend to incriminate me, sir.
The Chairman. Is there something about this operation, anything
about the newspaper business, buying and distributing of papers or
magazines, that should be looked upon as an impropriety or anything
Avrong with it ?
It is a perfectly legitimate business, and if there is some connection
where you have to pay out money, extortion money or bribe money
or money to buy peace with labor or something — if there is something
like that going on, we would like to know it. You business people
certainly ought to be able to tell us.
Is there something about your operations that you can't talk about
without the possibility of self-incrimination ?
Mr. Weinstock. I respectfully decline to answer, sir, on the ground
that my answer might tend to incriminate me.
The Chairman. That would mean that your answer is "Yes," if it
is going to incriminate you. It wouldn't incriminate you to say "No,"
obviously. And if you say no, that can't incriminate you, and I just
asked if there is something about your business and the way you han-
dle it, or the way you operate it, that involved the paying off of some
labor leaders or representatives, and you say you can't answer that
without possible self-incrimination ; is that correct ?
Mr. Weinstock. Yes, sir.
The Chairman. All right. Proceed.
Mr. KJENNEDY. I would like to ask Mr. Cofini, Mr. Chairman, some
questions now about the records.
Mr. Cofini, you made a study of the records of the Metropolitan
News Co.
TESTIMONY OF ROBERT J. COFINI— Resumed
Mr. Cofini. Yes, I have.
j\Ir. Kenney. Do you have any figures, rough figures, as far as
their gross business is concerned ?
Mr. Cofini. Yes.
The gross sales average about $9.5 million a year, according to a
statement prepared by their certified public accountants.
IMPROPER ACTIVITIES IN THE LABOR FIELD 18173
Mr. I^NNEDY. That is about $9.5 million and not $7 million, Mr.
Weinstock.
What about the Kings County News Co. ?
Mr. CoFiNi. That is about $1 million a year, gross.
Mr. Kennedy. That makes them the largest company, does it not ?
Mr. CoFiNi. In the Metropolitan New York area ; that is correct.
Mr. IvENNEDY. Now, do we find from an examination of the books
of the Metropolitan News Co., that large smns of money were with-
drawn from their account each year ?
Mv. CoFiNi. Yes, sir.
Mr. I\JENNEDY. And that this money was withdrawn in weekly in-
tervals ?
Mr. CoFiNi. That is right ; weekly checks.
Mr. I^NNEDY. Could you tell us about that? You made an ex-
amination from 1956 through 1958 ?
Mr. CoFiNi. That is correct.
Mr. Kennedy. How much was withdrawn weekly during that
period of time ?
Mr. CoFiNi. Weekly during that time, there were checks averaging
about $585 a week, which over the 3-year period amounted to $107,768.
The Chairman. Over a period of 3 years, they amounted to how
much ?
Mr. Cofini. $107,768.
The Chairman. That is over a period of how many years ?
Mr. Cofini. 3 years.
The Chairman. But tliese withdrawals were regularly made and
periodically ?
Mr. Cofini. Every week, every single week.
The Chairman. And there was a check for cash and withdrawal
of that much money ?
Mr. Cofini. A check made payable to cash.
The Chairman. Was there any voucher showing what it was ex-
pended for ?
Mr. Cofini. No vouchers were available.
The Chairman. No record was kept of the expenditure of it?
Mr. Cofini. No, sir.
The Chairman. What does it sliow that it was taken out of the
treasuiy for?
Mr. Cofini. It was charged to an account called "Miscellaneous
travel expenses."
The Chairman. Miscellaneous traveling expenses ?
Mr. Cofini. Yes, sir.
The Chairman. That isn't something they used to send them down
to Florida, is it ?
Mr. Cofini. It could be.
The Chairman. OK.
Mr. Ivennedy. You have some of those cliecks, have you not?
Mr. Cofini. Yes, sir.
Mr. Kennedy. Mr. Chairman, would vou like to have those identi-
fied?
The Chairman. Let me have a few of them.
(The documents were handed to the Chair.)
18174 IMPROPER ACTIVITIES IN THE LABOR FIELD
The Chairman. I have here about 15 or 18 photostatic copies of
checks which you have just handed me.
Are these all of the checks tliat you have ?
Mr. Conisri. No, I have more here.
The Chairman. This is just a sample, is it? Let me have all of
them.
Mr. CoFiNi. These are all for the year 1958.
The Chairman. Mr. Witness, you have just handed me a bundle of
photostatic copies of checks, probably running 40 or 50 checks?
Mr. Cofini. That is correct.
The Chairman. What does this group of checks that I have repre-
sent?
Mr. CoFiNi. Those are the checks made payable to cash, upon which
usually endoi-sed by the president, Charles Hertzig, who goes down
to the bank and cashes it, and disposes of the money in some fashion.
The Chairman. These were all drawn on this Metropolitan News
Co.?
Mr. CoFiNi. That is right.
The Chairman. And apparently they are drawn once each week.
Mr. CoFiNi. Once each week.
The Chairman. They may be made exhibit No. 4 in bulk,
(Checks referred to were marked "Exhibit No. 4" for reference and
may be found in the files of the select committee.)
The Chairman. I was just running through them, and I notice the
first one I looked at without giving the date of it.
They are all 1958 checks, are they ?
Mr. CoFiNi. Yes.
The Chairman. $592, $596, $597, $595, $595, $587, $590, $597, and
$595. And now I will skip on down here a way, and that one is $597,
and I will go further and find it is $590.
So the smallest, apparently, of those we have looked at so far range
from $587, and the high is $597.
Mr. Cofini. The average is $585.
The Chairman. What is that?
Mr. Cofini. $585.
The Chairman. That is what they average ?
Mr. Kennedy. For the 3 years.
Mr. Cofini. Yes, sir.
]\Ir. Kennedy. For the period of time ?
Mr. Cofini. Yes, sir.
Mr. Kennedy. And they are all within this range ?
Mr. Cofini. Yes, sir.
The Chairman. Did you interrogate any of the officials of this
company about these expenditures.
Mr. Cofini. I didn't do it, but it was done by another staff member.
The Chairman. But you found the checks and found this routine
drawing out $580 or $590 a week ; is that right ?
Mr. Cofini. That is right.
The Chairman. Now, I present this exhibit No. 4 to this witness,
Mr. Weinstock.
Will you please examine exhibit No, 4 and state if you identify
those photostatic copies ?
(Exhibit No. 4 was handed to the witness Weinstock.)
IMPROPER ACTIVITIES IN THE LABOR FIELD 18175
Mr. Weinstock. They appear to be photostatic copies.
The Chairman. You recognize them as apparently being photo-
static copies of checks, issued on your company ; is that correct ?
Mr. Weinstock. Yes, sir.
The Chairman. Now, will you tell us what those checks were issued
for?
Mr. Weinstock. I respectfully decline to answer on the ground that
my answer might tend to incriminate me.
The Chairman. Were they payoff moneys drawn in cash and paid
out to some union officials, or for some other improper purpose?
Mr. Weinstock. I respectfully decline to answer that question on
the grounds that my answer might tend to incriminate me.
The Chairman. This business of newspaper distributing company
has become so infiltrated with those elements that you have to engage
in business in this fashion with secret withdrawals or covered up
withdrawals of money from the treasury, and paying out without
receipts or vouchers, in order to stay m business ; has it reached that
point up there in jSTew York ?
Mr. Weinstock. I respectfully decline to answer.
The Chairman. If you have to do it you ought to help us clean it
up and expose the racket, and you don't want to do that ? You are a
businessman, and you are on the business side of the fence. Don't
you want to help clean it up and expose this, and let us get at the
bottom of it ?
Mr. Weinstock. I respectfully decline to answer, sir, on the ground
that my answer might tend to incriminate me.
The Chairman. I think business people who hide and cover up this
way, are just as repreliensible as a labor racketeer who goes out and
exploits and extorts. It is all the same.
Mr. Kennedy. Mr. Cofini, we want to get the record straight now
on this $585. Isn't it included in these checks, included in the $107,000,
two checks that were written at Christmastime in 1956, and Christmas-
time in 1957?
Mr. CoFiNi. That is correct.
Mr. Kennedy. So it is the $585, plus two checks, which total $15,000 ;
is that right ?
Mr. Cofini. That is right.
Mr. Kennedy. Actually, the $585 average comes to some $92,7G8.
Mr. Cofini. That is right.
Mr. I^nnedy. We had better get that straight.
The Chairman. Do you have the two checks that total $15,000 ?
Mr. Cofini. No, we don't have those. We don't have those available.
Mr. Kennedy. You have the records and you have examined the
records. What do the records indicate ?
Mr. Cofini. The records indicate that on December 6, 1956, a check
for $7,500 made payable to cash, was issued.
Mr. Kennedy. What was that charged to ?
Mr. Cofini. Christmas gifts.
Mr. Kennedy. And then in December of 1957 ?
Mr. Cofini. A similar check made payable to Christmas gifts. It
was issued and marked "Christmas gifts."
Mr. Kennedy. All of this money was deducted, was it not ?
Mr, Cofini. It was.
36751— 59— pt. 51 4
18176 IMPROPER ACTIVITIES IN THE LABOR FIELD
Mr. Kennedy. And it was taken as an expense by tlie company ?
Mr. CoriNi. It was taken as an expense by the company.
Mr. Kennedy. This totals, in 1956, some $38,000; in 1957 some
$38,000; in 1958 some $31,000. In each one of those 3 years some of
this was disallowed ; is that correct ?
Mr. CoFiNi. Yes.
Mr. Kennedy. How much was disallowed ?
Mr. CoFiNi. $12,500 in each year.
Mr. Kennedy. But all the rest was allowed as legitimate expenses if
Mr. CoFiNi. Yes.
Mr. Kennedy. Yet in our examination we found not one voucher to
support any of these expenses ?
Mr. CoFiNi. That is correct.
Mr. Kennedy. And from the beginning, in our interviews of the
officials of this company, they refused to tell us where this money went ?
Mr. CoFiNi. That is correct.
Mr. Kennedy. And you refuse under oath to give us any accounting
of this $107,000.
Mr. Weinstock. I respectfully decline to answer.
The Chairman. Let me ask you this question: Who made those
allowances? Do you mean the Internal Revenue Service?
Mr. CoFiNi. The Internal Revenue, upon examining the tax returns.
The Chairman. Without anv vouchers or anvthing to substantiate
it at all?
Mr. CoFiNi. That is correct.
The Chairman. Now we have the person here who is probably re-
sponsible as one of the officials, saying he can't tell without possible
self-incrimination ?
Mr. CoFiNi. That is correct.
The Chairman. Mr. Counsel, I suggest that the record be directed
to the Internal Revenue Service and the Department of Justice. There
may bs hidden taxes here.
Mr. Kennedy. At least they refuse to tell us where the money went.
This is not the whole situation, because the same kind of operation
to a lesser extent exists in the other company, Kings County ; is that
correct ?
Mr. CoFiNi. Yes.
Mr. Kennedy. They withdrew checks to cash periodically there?
Mr. CoFiNi. Yes.
Mr. Kennedy. Every week ?
Mr. CoFiNi. Every week.
Mr. Kennedy.. AVhat did they amount to there?
The Chairman. This is the other company ?
Mr. CoFiNi. Kings County News ; that is correct.
The checks they would draw weekly averaged about $100 a week.
Mr. Kennedy. Actually a little bit more than $100 ?
Mr. CoFiNi. Yes. Occasionally you will see one for $250 or $200,
but the average is $100 a week.
The Chairman. Thatis not out of line with the 500-and-some-odd
dollars because this company had, as you say, about $1 million income
a year, and the other had $9i^ million.
Mr. CoFiNi. That is correct.
Tlie Chairman. Naturally, I guess the exaction would be a little
less in the smaller companies.
UVIPROPER ACTIVITIES IN" THE LABOR FIELD 18177
Mr. Kennedy. How mucli did that total for each year, 1956 and
1957 ?
Mr. CoFiNi. The total was $18,950.
Mr. Kennedy. x\nd that includes tlie Christmas o-ifts ?
Mr. CoFiNi. That includes the Christmas gifts ; that is right.
Mr. Kennedy. How much were the Christmas gifts ?
Mr. CoriNi. The Christmas gift in this instance is $1,000 a year.
Mr. KENNEDY. For 1956, 1957, and 1958 ?
Mr. CoFiNi. 1956, 1957, and 1958.
Mr. Kennedy. So in 1956 the total was $6,200, in 1957 $6,400, in
1958 $6,350, and that includes $1,000 each year for Christmas gifts?
Mr. CoriNi. That is correct.
The Chairman. Do we find the same situation here with respect to
no vouchers ?
Mr. CoFiNi. Yes, an identical situation.
The Chairman. No invoices ?
Mr. Cofini. Yes, sir.
The Chairman. Nothing on which to base this ?
Mr, CoFiNi. No support whatsoever.
The Chairman. All of the checks were cashed and the money un-
accounted for ?
Mr. CoFiNi. Yes.
Mr. Kennedy. In addition to Kings County, there were other checks
that were drawn to cash, were there?
Mr. CoFiNi. No ; that is all.
Mr. Kennedy. That is right. So that makes a total for the two
companies of $126,718 in the 3-year period ?
Mr. CoFiNi. That is correct.
TESTIMONY OF JOSEPH LANG, ABRAHAM WEINBEEG, AND HAEOLD
WEINSTOCK, ACCOMPANIED BY COUNSEL, EDWIN P. KOEKUS AND
SOL GELB— Eesumed
Mr. Kennedy. Would you tell us what you did with any of that
money ?
Mr. "VVeinstock. Sir, I respectfully decline to answer on the ground
that my answer might tend to incriminate me.
Mr. Kennedy. Did you give it to any of the union officials in con-
nection with the Mail Deliverers Union ?
Mr. Weinstock. I respectfully decline to answer on the ground
that my answer might tend to incriminate me.
Mr. Kennedy. The major newspapers of the New York area, such
as the New York Times and the other papers that you have mentioned,
were they aware of the fact that you were making these huge with-
drawals of cash each week ?
Mr. Weinstock. Sir, I respectfully decline to answer on the ground
that my answer miglit tend to incriminate me.
Mr. Kennedy. Did you discuss with any of them as to whether it
was necessary to make any payoffs to any union official in connection
with your work ?
Mr. Weinstock. I respectfully decline to answer on the ground
that my inswer might tend to incriminate me.
Mr. Kennedy. Mr. Joseph Lang, you are in the same association,
Mr. Lang?
18178 IMPROPER ACTIVITIES EST THE LABOR FIELD
Mr. Lang. In the Morning Group ; yes.
Mr. Kennedy. What newspapers do you handle ?
Mr. Lang. Times, Herald Tribune, Sunday Journal American, and
the various miscellaneous papers.
Mr. Kennedy. And you employ some 22 men ; is that correct ?
Mr. Lang. That is correct.
Mr. Kennedy. And 10 extra men on part time ?
Mr. Lang. Yes.
Mr. Kennedy. Your year's gross sales amount to about $1,500,000 ?
Mr. Lang. Yes.
Mr. Kennedy. Did you make any payments to any union official;
that is, from your company funds ?
Mr. Lang. I respectfully decline to answer that question on the
ground the answer might tend to incriminate me.
Mr. Kennedy. Mr. Joseph Lang is the sole owner of the Lang News
Co., which is another major company in the New York area, Mr.
Chairman.
You will give us no information in connection with any payments
that you have made to any union official ?
Mr. Lang. I would have to decline to answer that.
The Chairman. Tell me, just what is your coimection with the
papers or publications? You contract with them to distribute their
papers, do you?
Mr, Lang. That is correct.
The Chairman. In other words, you have a contract whereby you
become the sole distributor and you carry that out in distributing the
papers to the retail markets ?
Mr. Lang. That is correct, sir.
The Chairman. That is a negotiated contract or a bid contract ?
Mr. Lang. It is not a bid contract.
The Chairman. It is more or less negotiated ?
Mr. Lang. My company is 58 years old.
The Chairman. How old ?
Mr. Lang. Fifty-eight years old.
The Chairman. It is an old, established company ?
Mr. Lang. An old, established company.
The Chairman. I would say, having been in business that long, you
would assume it to be a reputable company ?
Mr. Lang. I would say so ; yes, sir.
The Chairman. And you are handling the morning publications in
New York? ^
Mr. Lang. Only morning newspapers.
The Chaikman. That would include the New York Times, the Her-
ald, and what other morning papers ?
Mr. Lang. The Sunday Journal American, which is morning on
Sunday, if you get what I mean. It comes out in the morning on
Sunday.
The Chairman. Yes.
Mr. Lang. And various miscellaneous publications such as the Wail
Street Journal, the Journal of Commerce, and some 10 or 12 foreign-
language newspapers.
The Chairman. Mr. Lang, it does seem to me, and it might seem
that way to the public, which is interested in this problem that engagas
IMPROPER ACTIVITIES IX THE LABOR FIELD 18179
the committee's time and effort, that a reputa))le company, which has
been in business that long, would be assumed not engaged in any kind
of operation that it w^ould likely incrimmate one of its officers to testify
to its financial transactions.
Do you want to leave the impression there that you cannot testify
to this financial transaction of what has become of this money, with-
out possibly incriminating yourself ?
Mr. Lang. Yes.
The Chairman. That is the impression you want to leave. Well,
it may be accurate, but I am just trying to get the picture of this thing.
Here are the largest metropolitan papers in the country. Maybe
they are wholly innocent in this thing. But they are having contracts
with people who ma}^ have to, I don't know— but you ought to say so
if you do — have to pay tribute somew^iere or pay off somebody in order
to engage in a legitimate business in this country.
These are the things that we are trying to ferret out here, trying
to bring out, to find out where the evil is, what the improper prac-
tices are, in order to give the Congi'ess the information so that it might
legislate to prevent it and make the countiy safe for legitimate busi-
ness enterprises, and legitimate labor unions to operate without hav-
ing to pay illegal tribute to anyone.
That is what we are trying to do. It seems to me like good citizens
would want to help us in this job. Wouldn't you like to help?
Wouldn't you like to step out boldly and help us clean this thing up ?
Mr. Lang. I would, but I still have to answer the way I did.
The Chairman. You would like to, but you can't. We have a lot
of business people, I assume, and a lot of "labor people, too, who are
under some kind of compulsion, such as you feel here now, some kind
of compelling restraint that makes it advisable to them from. their
viewpoint, at least, that they not cooperate, that they not tell us what
they know, that they withhold from their Government information
that it needs to properly legislate in this field.
That is what we are confronted with, isn't it? It is a pretty sad
commentary on America, when we have a situation like that existing
in the country. I think down in your heartfi whatever you can do or
not do liere, I think you would like to see this thing cleaned up.
Vv^ouldn't you ? Or do you prefer it this way ? Take your choice.
Mr. Lang. If you will pardon me. Senator, I can't make any com-
ment on that.
The Chairman. Well, it is a pitiful situation, if you can't.
Proceed.
TESTIMONY OF ROBERT J. COFINI— Resumed
Mr. I^NNEDY. Mr. Cofini, you made a study of the Lang News Co.
Mr. CoFiNi. Yes.
Mr. ICennedy. Did we also find cash withdrawals from this com-
pany ?
Mr. CoriNi. Yes ; we do.
Mr. ICennedy. Would you relate what you found ?
Mr. CoFiNi. We examined the records for a 4-year period, from
1955 through 1958, and we found checks drawn payable to cash
amounting to a total of $19,320 which were all charged to an account
18180 IMPROPER ACTIVITIES IX THE LABOR FIELD
called promotional expenses, for which, again, there were no sup-
porting vouchers of any kind.
Mr. Kennedy. Do you have any of those checks ?
Mr. CoFiNi. Yes, I do.
Mr. KJENNEDY. Could you tell us how you used this money, Mr.
Lang?
Mr. Lang. I must decline to answer that respectfully on the ground
my answer might tend to incriminate me.
Mr. Kennedy. These are periodic withdrawals of cash, are they?
Mr. CoFiNi. Yes, they are.
Mr. Kennedy. Did you pay any of this $19,000 to any union official,
Mr. Lang?
Mr. Lang. I must decline to answer that on the same ground.
Mr. Kennedy. Could we have these identified for the record, Mr.
Chairman ?
The Chairman. I hold in my hand a packet of photostatic docu-
ments which you have just handed up, Mr. Witness. What are they?
Mr. CoFiNi. These are checks drawn payable to cash by Lang News
Co.
The Chairman. Do you know how many there are? Are there
some 40, 50 or 60?
Mr. CoFiNi. About 60 checks.
The Chairman. About 60 checks ?
Mr. CoFiNi. That is right.
The Chairman. They may be made Exhibit No. 5 in bulk.
(Checks referred to were marked Exhibit No. 5 for reference and
may be found in the files of the select committee.)
The Chairman. I now present them to the witness Mr. Lang.
I ask you to examine them and state if you identify them as photo-
static copies of the oriignal checks of your company.
( The documents were handed to the witness. )
Mr. Lang. Yes ; they are.
The Chairman. They range in what amount, Mr. Cofini ?
Mr. Cofini. The amounts vary from $100 to $750. There is no set
pattern here, as there was in the previous instance.
The Chairman, Except periodically, regularly, once a week?
Mr. Cofini. Well, not quite as often as once a week.
The Chairman. I beg your pardon ?
Mr. Cofini. Not quite as often as once a week.
The Chairman. But what does it total over a period of time? You
may have already stated it.
Mr. Cofini. For a period of 4 years, from January 1, 1955, to
December 31, 1958, they totaled $19,320.
The Chairman. How much ?
Mr. Cofini. $19,320.
The Chairman. This is on a smaller scale. This is a smaller op-
eration, the Lang Co. ?
Mr. Cofini. Yes ; it is.
The Chairman. A smaller operation ?
Mr. Cofini. Yes.
Tlie Chairman. But do 3''ou find this running through all these
distributors ?
Mr. Cofini. Yes, I do.
IIVIPROPER ACTIVITIES IN THE LABOR FIELD 18181
The Chairman. In otlier words, there is some pattern, some fixture
or something that attached, apparently, to all of them ^
Mr. CoFiNi. To all of the distributors ; that is correct.
The Chairman. They all are operating, at least, in this fashion,
drawing out checks periodically for cash and you find no vouchers
for them, no invoices, and you can't get them to tell you what goes
with the money ?
Mr. CoFiNi. That is correct.
Mr. IvENNEDY. Mr. Weinberg, you are the partner of the Wein-
berg News Co. ; is that right ?
Mr. Weinberg, That is right.
Mr. Kennedy. You have about 30 unionmen working for you?
Mr. Weinberg. Approximately.
Mr. Kennedy. You are a member of the Morning Wliolesalei-s
Group ; is that correct ?
Mr. Weinberg. I am.
Mr. Kennedy. Recently you expanded your enterprise and formed
a new^ company known as the Long Island News Co. ?
Mr. Weinberg. That is correct.
Mr. Kennedy. And you distribute morning newspapei-s in Nassau
and Suffolk Comities ; is that right ?
Mr, Weinberg. In Nassau.
Mr. Kennedy. What ?
Mr. Weinberg. In Nassau.
Mr. Kennedy. Not Suffolk?
Mr. Weinberg. Not Suffolk.
Mr. Kennedy. In connection with the activities of either one of
these companies, have you taken any of the company funds to pay
off any union official ?
Mr. Weinber(5. I respectfully decline to answer that question on
the gi'ound the answer might tend to incriminate me.
Mr. Kennedy. Mr. Cofini, could you tell us what the examination
of his books showed ?
Mr. CoFiNi. We examined the records of Weinberg News Co., for
the period January 1, 1954, to December 31, 1958. In the case of
Weinberg News, we didn't find any checks drawn payable to cash,
and most of the expenditures are made through a petty cash fund,
where they are actually taken out in cash and the amount is charged
to a promotion expense account.
The Chairman. Charged to what?
Mr, Cofini. Promotion expense.
The Chairman. Promotion expense?
Mr. CoFiNi. That is correct.
Mr. Kennedy. What was the total for that period of time?
Mr. CoFiNi. The total for that period was $11,589.97.
The Chairman. What is the net income of this company, approxi-
mately, or what is the gross income or whatever it is ?
Mr. Lang. The gross business he gave.
Mr. Gelb. He gave the gross business.
The Chairman. That is what I mean.
Mr, Kennedy, Maybe you can tell us if you know,
Mr, Weinberg, I would sav roughly, to my best recollection, a})out
$1,800,000 or $1,700,000,
18182 UMPROPER ACTIVITIES IN THE LABOR FIELD
Mr. Kennedy. And you handle the same neAvspapers we have
discussed here ?
Mr. Weinberg. In the city, in the Weinberg News Co., I handle
the same papers as Mr. Lang and Mr. Weinstock.
Mr. Kennedy. What about out further ?
Mr. Weinberg. There we have other publications.
Mr. Kennedy. Such as what ?
Mr. Weinberg. Such as the Mirror, the Press, the Inquirer, the
afternoon papers, the Telegram, the Post, the Press.
The Chairman. Let me ask you gentlemen tliis question, and I
want each of you to answer or refuse to answer as you care to do.
Do the publishers of these papers, the people with whom you make
your contract, with whom you negotiate your contract, know of these
'money manipulations? Are they familiar with the fact that you
may have to pay out some of this money in the fashion that you do ?
Mr. Lang. Do you w^ant me to answer first ?
The Chairman. Yes.
Mr. Lang. I decline to answer on the same gi-ounds, respectfully.
The Chairman. Who do you make your contract with ? Who do
you negotiate with? Who represents the publication? Give me the
names of some of them,
Mr. Lang. In each newspaper it is usually the circulation director.
The Chairman. The circulation director of these papers?
Mr. Lang. That is right.
The Chairman. How about you ?
Mr. Weinberg. I don't make a contract.
The Chairman. I cannot hear you.
Mr. Weinberg. By the term "contract,'- what do you mean?
The Chairman. Well, that you have a right, where they contract
with you to make these deliveries.
Mr. Korkus. I can help you, if you will let me. May I help you,
Senator ?
I represent all these people for many years, and my father before
me. There is no contract with the large publications, such as the
Times or the Herald Tribune or any of those jjapers.
The Chairman. No contract?
Mr. Korkus. No contract. It simply is a day-to-day arrangement.
Any time that the publisher desires
The Chairman. There may be an oral contract.
Mr. Korkus. Well, it simply goes on, so long as the publisher is
willing to let this company handle that publication in that district.
Any time the publisher desires to take away that delivery from any
particular company, it does so.
The Chairman. Well, it is not a time contract.
Mr. Korkus. I didn't want you to be misled, because you are talk-
ing about negotiating and a lawyer and all of that. This is not
negotiated.
The Chairman. It is an implied contract to continue until one of
the parties decides to quit it.
Mr. Korkus. I wanted you to understand it.
The Chairman. An oral contract ?
Mr. Korkus. That is right. And in the foreign publications there
are written contracts.
IMPROPER ACTIVITIES IN THE LABOR FIELD IS 183
The Chairman. Tliere has to be some agreement, expressed, im-
plied, or understood. If you are working for somebody and they pay
you, you do the work and they pay you. That is a contractual rela-
tionship.
Wliat I am trying to determine is if the circulation manager or
whoever you deal with in these papers, is he cognizant of the fact or
is he advised or informed or does he know that you have to handle
certain moneys in tlie fashion of these checks in order to operate
without trouble or for whatever purpose the money is used ?
Mr. Weinberg. I respectfully decline to answer on the ground that
the answer may tend to incriminate me.
The Chairman. What do you say about it ?
Mr. Weinstock. I say, sir, I respectfully decline to answer that
question on the ground that my answer might tend to incriminate me.
The Chairman. I should think, and I may be mistaken, that the
circulation managers or personnel or whoever you deal with for these
papere would want the record cleared up. I hope they are not under
the restraint that you are, that they can't clear up the record. They
possibly know nothing about it ; I don't know.
If they don't, I would like to establish that because here is being
presented the evidence, and the record is being made, that those who
think that when one takes the fifth amendment on a business trans-
action of this kind, you get the impression that there may be some-
thing wrong with the transaction.
There are those who think that, and I am inclined to think some
will think that. If there is nothing wrong with it, and if the papers,
the publications and their representatives are wholly innocent in it,
I should think they would want to straighten out this record. I hope
they will come forth and do that.
Do you agree with me, Senator Ervin ?
Senator Ervin. I was thinking that George Washington was in-
augurated as the first President of the United States in New York
City. If he looks down from the spirit world on that city and sees
that its businessmen are paying tribute in some form to some invisible
government and haven't the courage to stand up and tell the Congre^
of the United States the tiiith about it so that they can do something
to put an end to it, he must sometimes think that he was a blamed
fool for suffering as he did at Valley Forge in order that this country
might be free.
The Chairman. Proceed, Mr. Kennedy.
Mr. Kennedy. That is all for these witnesses.
The Chairman. I certainly don't want to reflect on the finest pub-
lications in this country. If they are innocent in this thing, I would
like them to step forth and say so. It just cannot help but make a
sordid picture for the country to look at, people dealing with these
papers, the distributors who come up here with a bundle of checks
like this for cash in each instance, being scattered around with no
explanation of it, nothing to justify it so far as records are concerned.
When you ask about it, they say, "Well, I can't talk. I might in-
criminate myself." It is a kind of sordid picture.
Senator Ervin. I think businessmen ought to realize that the leg-
islators cannot pass any laws to put an end to things of this cliar-
acter unless they find out what is happening and who is doing these
18184 IMPROPER ACTIVrriES IN THE LABOR FIELD
things. If businessmen prefer to pay tribute rather than to assist
their Government, they have only themselves to blame.
The Chairman. Is there anything further of these witnesses?
Mr. Kennedy. No ; that is all.
The Chairman. I will give you one last chance. Do any of you want
to tell us the truth about this matter ? How about you ? This is your
last chance ? Do you want to tell the truth about it ?
Mr. Lang. I can't say anything more than I have.
The Chairman. How about you ?
Mr. Weinberg. No.
The Chairman. How about you ?
Mr. Weinstock. No, sir.
The Chairman. Stand aside.
Call the next witness.
Mr. Kennedy. Mr. Gaynor, Mr. Gelf and, Mr. Klinghoffer.
Mr. Chairman, we also expected to have the Somykas here today,
but they are not here. We will put some testimony in connection with
them into the record. They know they have had a chance to testify
and they probably will be called tomorrow.
The Chairman. We have three witnesses now. Hold up your
hands and be sworn, each of you.
Do you and each of 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. Gaynor. I do.
Mr. Gelfand. I do.
Mr. Klinghoffer. I do.
TESTIMONY OF SAM KLINGHOFFER, JAMES GAYNOR, AND BEN-
JAMIN GELFAND, ACCOMPANIED BY COUNSEL, JULIUS KASS
The Chairman. Beginning on my left, will you give us your name,
your plac€ of residence, and your business or occupation.
Mr. Klinghoffer. Sam Klinghoffer.
The Chairman. Spell it, please.
Mr. Klinghoffer. K-1-i-n-g-h-o-f-f-e-r.
The Chairman. Your residence and your business or occupation.
Mr. Kj.inghoffer. Newark Newsdealers Supply Co., distributors
of newspapers. I am president of the company.
The Chairman. All right.
Next?
Mr. Gaynor. James Gaynor, G-a-y-n-o-r, 2575 Overlook Road, New
Rochelle; Avholesale distributor of newspapers and magazines.
Mr. Gelfand. Benjamin Gelfand, 321 North Fifth Avenue, High-
land Park, N.J. ; wliolesale distributor of newspapers and magazines.
The Chairman. Counsel, identify yourself.
Mr. ICvss. Julius Kass, 261 Madison Avenue, N.Y.
The Chairman. Proceed.
Mr. Kennedy. Mr. Chairman, this is a second group. We are go-
ing to have representatives from each group before the committee.
The Chairman. What does this group represent?
Mr. Kennedy. This is the suburban news group.
Mr. I^ss. The Suburban Wholesalers Association is the correct
IMPROPER ACTIVITIES IX THE LABOR FIELD 18185
The Chairman. Thank you.
Mr. Kennedy. Mr. Gayiior, you handle newspapers, do you?
Mr. Gaynor. Yes, I do.
Mr. I^nnedy. In what area? That is the Suburban Wholesalers
News.
Mr. Gaynor. In Westchester and Connecticut.
Mr. Kennedy. What newspapei-s do you handle ?
Mr. Gaynor. The Times, Tribune, News, Mirror, American.
Mr. Kennedy. Both morning and afternoon papers?
Mr. Gaynor. Yes.
Mr. Kennedy. That is in the suburban area outside of New York
City and outside of Long Island ?
Mr. Gaynor. That is correct.
Mr. Kennedy. How many are in your organization, approximately?
Mr. Gaynor. I would say about 10.
Mr. Kennedy. About 10.
Your company, the Gaynor News Co., and its subsidiaries, which
are the Standard News Co.; United Magazine Distributors, Inc.;
United Magazine Deliverers of Connecticut, Inc. ; and the Unity News
Co., Inc.; the Gaynor News Co., and these subsidiaries do approxi-
mately $8 million a year in gross business ?
Mr. Gaynor. Approximately.
Mr. Kennedy. Your company employs about 100 union employees?
Mr. Gaynor. I would say approximately.
Mr. Kennedy. How long has your company been in operation ?
Mr. Gaynor. I would say since about 1910, somewhere around
there.
Mr. Kennedy. Have you used any of the company money to pay
to any union official ?
Mr. Gaynor. Upon advice of counsel, I respectfully refuse to be
a witness against myself, and claim the protection of the Bill of Rights
of the U.S. Constitution.
TESTIMONY OF ROBERT J. COFINI— Resumed
Mr. Kennedy. Mr. Cofini, could you tell us what the situation is?
The Chairman. What is the name of this witness' company ?
Mr. CoriNi. Gaynor News Co., Inc.
Mr. Kennedy. Would you tell us the situation ?
Mr. CoFiNi. Yes. Here we have the situation where there are five
companie^s involved. During my examination, which was from the
period January 1, 1955, to December 31, 1958, we found a total of
$64,750 in checks which were drawn payable to James B. Gaynor.
The only support for these checks was a voucher which Mr. Gaynor
prepares, which he just marks expenses, or expenses with publishers,
and that is about it, without any other support of any kind.
Mr. Kennedy. No supporting vouchers or independent vouchers?
Mr. CoFiNi. That is correct.
Mr. IvENNEDY. Just a voucher or statement submitted by him that
he had expenses amounting to three, four, five, or six hundred dollars ?
Mr. CoFiNi. That is correct.
Mr. Kennedy. For the period of time of 1955 through 1958, to Mr.
Gaynor alone there were payments of $64,750 in that fashion.
18186 IMPROPER ACTIVITIES IN THE LABOR FIELD
Mr. CoFiNi. That is correct.
Mr. Kennedy. That was in that fashion ?
Mr. CoFiNi. In that fashion ; rij^ht.
The Chairman. Is this in addition to his salary or other compen-
sation ?
Mr. CoFiNi. This is in addition to salary.
The Chairman. All of this is some statement he signed, just expense
without any identification or inventory of it ?
Mr. CoFiNi. That is correct. They were all charged to an account
called agent's expense.
The Chairman. Called what ?
Mr. CoFiNi. Agent's expense.
The Chairman. Was anything else charged to that account?
Mr. CoFiNi. No. Well, there were other men who draw agent's
expense, but they seem to be legitimate.
Mr. Kennedy. Could you tell us what you did with that money, or
any part of it ?
Mr, Gaynok. Upon advice of counsel, I respectfully refuse to be a
witness against myself, and claim the protection of the Bill of Eights
of the U.S. Constitution.
The Chairman. This thing gets a little intriguing. Is there some
collusion up there between management and labor officials whereby
the people who do the work are not fully protected and both manage-
ment gets some advantage of it as well as the labor leader or boss who
may be paid off? Is there a situation like that? Can you deny that
that situation exists?
Mr. Gaynor. Upon advice of counsel, I respectfully refuse to be a
witness against myself, and claim the protection of the Bill of Eights
of the U.S. Constitution.
The Chairman. All of your employees are members of this union,
are they not, so far as you know ? Is that correct ?
(Witness conferred with his counsel. )
Mr. Gaynor. All regular situation holders.
The Chairman. All your regular employees are members of the
miion.
Is that true with each of you ?
Mr. Gelfand. Yes.
Mr. Klinghoffer. Yes.
The Chairman. Is that true with yours ?
Mr. Gelfand. Yes, sir.
The Chairman. So then, if this money is paid to some miion offi-
cial or union representative, will you tell us how the union member,
the worker, gets any benefit from this payment? Can you think of
anytliing that he might benefit in any way from it?
Mr. Gaynor. Upon advice of counsel, I respectfully refuse to^ be a.
witness against myself, and claim the protection of the Bill of Eights
of the U.S. Constitution.
The Chairman. Will you be a witness for the workingman one time
and tell us about it on that basis?
Mr. Gaynor. Upon advice of counsel, I respectfully refuse to be a
witness against myself, and claim the protection of the Bill of Eights
of the U.S. Constitution.
Mr. Kennedy. We find also in addition to the $64,000, there were
checks made payable to cash by the Gaynor News Co., Inc.?
IMPROPER ACTIVITIES IN THE LABOR FIELD 18187
Mr. CoFiNi. Yes, there was.
Mr. IvENNEDY. They were during 1954, 1955, 1956, 1957, and 1958,
and they totaled $24,000 ?
Mr. CoFiNi. $24,000 ; that is correct.
Mr. Kennedy. Were tliere any vouchers for them ?
Mr. CoFiNi. No, there were no vouchers supporting them at all.
Mr. Kennedy. Tliese checks were all drawn at the beginning of
each and every month during the 4-year period ?
Mr. CoFiNi. That is correct.
Mr. Kennedy. All in the same amount ?
Mr. CoFiNi. Yes.
Mr. Kennedy. $200 per month ?
Mr. CoFiNi. $200 for Gaynor News.
Mr. Kennedy. And $100 for each of the other companies?
Mr. CoFiNi. That is correct.
Mr. Kennedy. They were all charged to promotional expensas with
no vouchers and they totaled to $24,000 ?
Mr. CoFiNi. That is correct.
Mr. Kennedy. Would you tell us what you did with the $24,000 ?
Mr. Gaynor. Upon advice of counsel I respectfully refuse to be a
witness against myself and claim the protection of the Bill of Eights
of the United States Constitution.
Mr. Kennedy. These checks as well as the other checks, they were
all cashed ?
Mr. CoFiNi. That is correct.
Mr. Kennedy. And the other checks were cashed, the $64,000, taken
to the bank?
Mr. CoFiNi. Taken to the bank or through the petty cash fund of
Gaynor News. That is right.
The Chairman. Are each of these gentlemen officials in that com-
pany?
^Ir. Kennedy. That is the one company.
Mr. CoFiNi. Mr. Gaynor is president of Gaynor News.
The Chairman. The other two are from other companies?
Mr. CoFiNi. Yes.
The Chairman. Mr. Gaynor is president of this company you have
been talking about on $64,750 and $24,000?
Mr. CoFiNi. That is correxit.
The Chairman. Is that right ?
Mr. CoFiNi. That is correct.
The Chairman. In other words, as president, Mr. Gaynor, you
don't claim that you don't know anything about it, do you?
Mr. Gaynor. Upon advice of counsel, I respectfully refuse to be a
witness against myself and claim the protection of the Bill of Rights
of the United States Constitution.
The Chairman. Did Mr. Gaynor have to sign the checks as presi-
dent?
Mr. CoFiNi. No, sir, he doesn't.
Mr. Kennedy. But he received the $64,000 ?
Mr. CoFiNi. He received it, yes. The checks were made payable
to James B. Gaynor and endorsed by him.
The Chairman. And charged to promotional expense?
Mr. CoFiNi. The checks made payable to him were charged to
agent's expense.
18188 IMPROPER ACTIVITIES IN THE LABOR FIELD
Mr. Kennedy. But on the $24,000, his initials cappear on those
checks.
Mr. CoFiNi. His initials appear on those checks, yes, sir.
The Chairman. So he is bound to know about it. In one instanco
he got the money and in the other instance he initialed the check for
the money.
Mr. CoFiNi. That is correct.
The Chairman. All right.
Mr. Kennedy. Mr. Gelf and, you are president of the Union County
Newsdealers, Elizabeth, N.J. ; the Jei-sey Coast News Co., Asbury
Park, N.J. ; and the New Brunswick Newsdealers Supply Co., New
Brunswick, N.J. ; is that correct?
Mr. Gelfand. Yes, sir.
Mr. Ivennedy. Those companies are engaged in the distribution
of magazines and morning and evening newspapers through the New
Jei^ey area ?
Mr. Gelfand. Yes, sir,
Mr. Kennedy. The companies jointly employ some 80 union drivers
and about 16 extra employees; is that right?
Mr. Gelfand. I would say so.
Mr. Kennedy. Approximately ?
Mr. Gelfand. Approximately.
Mr. Kennedy. The gross sales for these companies amoimt to some
$5.5 million, approximately ?
Mr. Gelfand. I would say so, approximately.
Mr. Kennedy. All of the companies are members of the Suburban
Wholesalers Association ; is that right ?
Mr. Gelfand. Yes, sir.
Mr. Kennedy. Do you handle New Jersey newspapers as well as
New York newspapers ?
Mr. Gelfand. Yes.
Mr. Kennedy. What newspapers ?
Mr. Gelfand. In certain areas. The Newark Ledger and Newark
News, and possibly local papers also, the New Brunswick papers.
Mr. Ivennedy. What magazines ? Do you handle magazines ?
Mr. Gelfand. We handle magazines also.
Mr. Kennedy. ^Yliat magazines ?
Mr. Gelfand. Various national distributors and publisliers.
Mr. Kennedy. Like what?
Mr. Gelfand. S.M., Hearst, McFadden, and most of the othei-s.
Mr. Kennedy. Have you made any payments to any miion officials
in connection with the operations of your company ?
Mr. Gelfand. Upon advice of counsel I respectfully refuse to be a
witness against myself and claim the protection of the Bill of Rights
of the United States Constitution.
Mr. Kennedy. Mr. Cliairman, we have not been able to go into all
of the companies in the New York area. We have just taken some at
random. Mr. Cofini will not testify on all of them.
With some of them, we are in the midst of conducting the investiga-
tion but have not finished. Mr. Cofini will only be able to testify
on those which he has completed.
The Chairman. Have you completed the investigation of this com-
IMPKOPER ACTWITIES IN THE LABOR FIELD 18189
Mr. CoFiNi. No, sir, we have not.
The Chairman. Have you the checks to find out how much has
been paid. ?
JMr. CoFixi. We have part of them.
The Chairman. As far as you have gone, do you find substantially
the same pattern ?
Mr. CoFiNi. No, sir.
The Chairman. You have not gone that far?
Mr. CoFiNi. No, sir.
The Chairman. You cannot say yet ?
Mr. CoFiNi. I cannot say yet.
Mr. Kennedy. We have not come up with anything at least as of
the present time which shows the same kind of a situation?
Mr. CoFiNi. That is correct.
Mr. Kennedy. That is, the same checks to cash ?
Mr. CoFiNi. That is correct.
Mr. Kennedy. We have not finished the investigation, but at least
at tlie present time we have no information on which to base any
questions ; is that correct ?
Mr. CoFiNi. That is correct.
Mr. Kennedy. But we will ask you if you have used any of these
company funds in order to make payments to union officials.
Will you tell me that?
Mr. Gelfand. Upon advice of counsel, I respectfully refuse to be a
witness against myself and claim the protection of the Bill of Rights
of the U.S. Constitution.
Mr. Kennedy. Mr. Klinghoffer, you are president of the Newark
Newsdealers Supply Co., Inc. ?
Mr. Klinghoffer. Yes, sir.
Mr. Kennedy. And you are engaged in the business of distributing
morning and evening papers and magazines in Essex, Morris, and
Sussex Counties in New Jersey ?
Mr. Klinghoffer. Yes, sir.
Mr. Kennedy. You have been a member of the union since 1928 ;
is that correct?
Mr. Klinghoffer. That is right, sir.
Mr. Kennedy. Your company hires about 135 regular union drivers
and approximately 30 extra or part-time drivers ; is that right ?
Mr. Klinghoffer. Yes.
Mr. Kennedy. Your gross sales were over $6 million a year?
Mr. Klinghoffer. Yes, sir.
Mr. Kennedy. What newspapers do you handle ?
Mr. Klinghoffer. All New York newspapers and the Newark
Ledger.
Mr. Kennedy. And you are a member of the Suburban Wholesalei-s
Association ?
Mr. Klinghoffer. Yes, sir.
Mr. Kennedy. Have you used any of your company funds to make
payoffs to any union officials ?
Mr. Klinghoffer. Upon advice of counsel, I respectfully refuse
to be a witness against myself, and claim the protection of the Bill of
Rights of the U.S. Constitution.
18190 IIVIPROPER ACTIVITIES IN THE LABOR FIELD
Tlie Chairman. Let me ask you folks this question, each of you:
The papers that you represent, or the magazine companies, do they
have any knowledge of these payoffs ?
Mr, Klinghoffer. Upon advice of counsel, I respectfully refuse to
be a witness against myself, and claim the protection of the Bill of
Rights of the U.S. Constitution.
Tlie Chairman. What do you say ? The same thing ?
Mr. Gaynor. The same thing.
The Chairman. You don't want to be a witness against yourself.
Would you be a witness against them if they know about it?
Mr. Gaynor. On advice of counsel, I respectfully refuse to be a
witness against myself, and claim the protection of the Bill of Rights
of the U.S. Constitution.
The Chairman. Do you say the same thing ?
Mr. Gelfand. Yes, sir.
The Chairman. You can't testify either, without possible self-in-
crimination on this point ; is that right?
Mr. Gelfand. That is right.
The Chairman. Name the papers and the magazines, these publica-
tions, that you handle, please.
Mr. Klinghoffer. Well, I handle the New York Times, the Herald
Tribune, the New York Daily News, the New York Mirror.
Tlie Chairman. Tlie same ones as testified to before? The morn-
ing group ?
Mr, Klinghoffer. That is right.
The Chairman. Is that true with all of you ?
Mr. Kennedy. And the afternoon also,
Mr. Klinghoffer. And the afternoon also.
Mr. Kennedy. These people handle both.
The Chairman. You handle both?
Mr. Klinghoffer. Yes.
The Chairman. In addition to the morning group, give us the
afternoon group that you handle.
Mr. Klinghoffer. New York World Telegram, New York Journal
American, New York Post.
The Chairman. Those would be the afternoon papers ?
Mr. Klinghoffer. Yes.
The Chairman. And your testimony with respect to whether they
know about this little dark, deep secret, whether they know about it,
your testimony would be the same as the others, that you can't talk
about it without possible self-incrimination; is that right?
Mr. Klinghoffer. That is right, sir.
The Chairman. Does that apply to all of you gentlemen?
Mr. Gelfard. Yes, sir,
Mr. Gaynor. Yes, sir.
The Chairman. All right.
Mr. Kennedy. Because of a mixup, we do not have Mr. Somyak
here. Mr. Arthur Somyak was former president of the Rockaway
News Supply Co., and Mr. William Somyak was a former vice presi-
dent of the Rockaway News Supply Co.
But we have given them a number of opportunities to explain the
situation as far as their companies are concerned. We expect to have
them as witnesses tomorrow. But they were members prior to the
IMPROPER ACTIVITIES IN THE LABOR FIELD 18191
time tliat this company went into bankruptcy, they were members of
the Suburban group.
Mr. Arthur Somyak was the former president of the Kockaway
News Supply Co.
I would like to ask Mr. Cofini whether we found in their company
large sums of money that were unexplained.
Mr. CoFiNi. Yes, I did.
The Chairman. What is the name of this company ?
Mr. Kennedy. Rockaway News Supply Co.
The Chairman, While you are on the witness stand, testify as to
what you found with respect to them.
Mr. CoFiNi. We examined their records from January 1, 1955, to
August 31, 1958, which is approximately the time they went out of
business. That is approximately 3i^ years.
The Chairman. All right.
Mr. Kennedy. Give it for each year.
Mr. CoFiNi. In each year, starting with 1955, we found a total
of $71,364 in 1955 ; in 1956, $46,700 ; 1957, $36,630 ; and 1958, $24,600.
The Chairman. How much does that total for 3^^ years ?
Mr. CoFiNi. That is $179,295.
The Chairman. $179,000?
Mr.CoFiNi. And $295.
The Chairman. How^ was it handled ; this same fashion ?
Mr. Cofini. It was handled in the same fashion. The checks were
either made payable to cash or they were drawn payable to the order
of one of the Somyaks, and without any supporting vouchers and
just charged to travel and entertainment accounts.
The Chairman. Were there any actual vouchers for it ?
Mr. Cofini. There were no actual vouchers for it; no, sir.
The Chairman. There was nothing, except what the author liim-
self may have written ?
Mr. Cofini. That is correct.
The Chairman. Or the fellow who withdrew it ?
Mr. Cofini. That is right.
The Chairman, Nothing outside reported whatsoever?
Mr. Cofini, Nothing whatsoever.
The Chairman. Was it in a pattern of regularly once a week or
once a month ?
Mr. Cofini. No, there was no pattern. It was the occasional draw-
ing of a check.
The Chairman. In other words, that wasn't at any stated intervals ?
Mr. Cofini. There was no set pattern for the drawing.
The Chairman. That is a pretty big withdrawal, 170-odd thou-
sand dollars.
Mr. Cofini. That is right. It certainly is.
The Chairman. Is that the largest taken in the same period of
time for any that you found ?
Mr, Cofini, Yes, sir ; it is.
The Chairman. Actually, I was just recalling the testimony here
so far. In other words, this Rockaway Co,, apparently, had more
withdrawals than any of the others.
Mr. Cofini. That is correct, sir,
36751— 59— pt. 51—5
18192 IMPROPER ACTIVITIES IN THE LABOR FIELD
The Chairman. How about the volume of its business as compared
to the others ?
Mr. Kennedy. It was one of the Largest single distributors on the
eastern seaboard.
Mr. CoFiNi. That is correct.
Mr. Kennedy. It had some 300 employees ?
Mr. CoFiNi. That is correct.
Mr. Kennedy. Do you know what its gross business was?
Mr. CoFiNi. I would say it was aromid $8 million, if I recall cor-
rectly.
The Chairman. We had one here of $9.5 million.
Mr. CoriNi. I am not too certain of that.
The Chairman. You can't be sure ?
Mr. CoFiNi. No, sir.
The Chairman. It must have been one of the larger ones, with the
pattern being unfolded here.
Mr. CoFTNi. Yes, it was one of the larger ones.
The Chairman. That is, from the aggregate or total amount ex-
pended.
Mr. CoFiNi. Yes, it was one of the larger ones.
Mr. Kennedy. That is all, Mr. Chairman.
The Chairman. You may stand aside.
Mr. Kennedy. Now we will have the evening wholesaler groups,
Mr. Chairman.
Mr. Alexander Feldman, Mr. Al Langer, and Mr. Lou Feldman.
The Chairman. Be sworn, please.
Do you and each of 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. Danger. I do.
Mr. Alexander Feldman. I do.
Mr. Louis Feldman. I do.
TESTIMONY OF ABRAHAM LANGER, ALEXANDER TELDMAN, AND
LOUIS FELDMAN, ACCOMPANIED BY COUNSEL, EDWIN KORKUS
The Chairman. Beginning on my left, state your name, your place
of residence, and your business or occupation, please.
Mr. Langer. Abraham Langer, L-a-n-g-e-r, 28 Strathmore Koad,
Great Neck, N. Y. I am with the Al Langer News Co., Inc., in Jamaica,
Mr. Alexander Feldman. Alexander Feldman, Crescent Beach
Road, Glen Cove, Long Island, N. Y.
Mr. Louis Feldman. I am Louis Feldman, 506 Longacre Avenue,
Woodmere, Long Island. I am the sole owner of the Feldman News
Co., one of the evening distributors.
The Chairman. Let the record show the same counsel appears, one
of the same, as previously.
Mr. KoRKUs. Edwin F. Korkus.
The Chairman. Proceed.
Mr. Kennedy. Mr. Al Feldman, you are the sole owner of the Wood-
haven News Co. in Jamaica ?
Mr. Alexander Feldman. Yes.
IMPROPER ACTIVnnEiS IN THE LABOR FIELD 18193
Mr. Kennedy. You employ some 16 permanent news union mem-
bers and some 10 extra men on a part-time basis?
Mr. Alexander Feldman. Yes, sir.
Mr. Kennedy. And gross sales of $400,000 a year?
Mr. Alexander Feldman. Yes.
Mr. Kennedy. What newspapers do you handle ?
Mr. Alexander Feldman. All the evening newspapers and the bull-
dog editions of the Mirror
Mr. I^nnedy. Of New York City ?
Mr. Alexander Feldman. Yes.
Mr. Kennedy. That would include what ?
Mr. Alexander Feldman. The Telegram, the Post, and also the
Long Island Press, which is a local paper.
Mr. Kennedy. And the Journal American ?
Mr. Alexander Feldman. We handle that in one area, yes, and
bulldog editions in the evening, namely the Mirror, the Journal Ameri-
can, and the Herald Tribune.
Mr. Kennedy. You have recently expanded your business and
formed a new company called the Crescent News, to distribute news-
papers in Nassau and Suffolk County ?
Mr. Alexander Feldman. Evening and morning.
Mr. Kennedy. AVliat papers do you handle there ?
Mr. Alexander Feldman. All the morning newspapers, the Times,
Tribune, and all the evening newspapers.
Mr. Kennedy. Are you in any other association other than the eve-
ning wholesalers group ?
Mr. Alexander Feldman. The new company is now a member of
the morning wholesalers.
Mr. Kennedy. How long have you been in business ?
Mr. Alexander Feldman. Well, I have been in business since 1935,
and my father for many years before me.
Mr. Kennedy. How long has this company been in existence, the
Woodhaven News Co. ?
Mr. Alexander Feldman. The company itself for about 50 years.
Mr. Kennedy. Have you made any payments to any union officials
in connection with the operation of your company ?
Mr. Alexander Feldman. I respectfully decline to answer on the
ground that my answer might tend to incriminate me.
Mr. Kennedy. Were you approached about making any payments ?
That is, to any union officials ?
Mr. Alexander Feldman. I respectfully decline to answer on the
ground that my answer might tend to incriminate me.
The Chairman. What kind of impression do you think this is mak-
ing throughout the country ? Here are businessmen in the biggest city
in the comitry, representing what ought to be the highest of integrity,
the newspaper business. What kind of impression do you think this is
making over the country that you fellows are so involved in some
way that you can't talk about it without self-incrimination? Have
you any idea ?
Mr. Alexander Feldman. I am sorry, sir, but I respectfully decline
to answer on the ground that my answer might tend to incriminate me.
Mr. Kennedy. Mr. Langer, you are president of the A] Langer
News Delivery Corp. ?
18194 IMPROPER ACTIVITIES IN THE LABOR FIELD
Mr. Langer. I am.
Mr. Kennedy. You are engaged in the business of evening news-
paper distribution in the Borough of Queens ?
Mr. Langer. Evening, and what we call the bulldog.
Mr. Kennedy. As described by this witness ?
Mr. Langer. Yes.
Mr. Kennedy. You employ some five union drivers ?
Mr. Langer. Right.
Mr. Kennedy. Your gross sales are $110,000 a year, approximately ?
Mr. Langer. Yes.
Mr. Kennedy. You are a member of the Evening Wholesalers
Association ?
Mr. Langer. I am.
Mr. Kennedy. Have you made any payments to union officials out
of your company's funds ?
Mr. Langer. I respectfully decline to answer on the ground that
my answer might incriminate me.
Mr. Kennedy. Have you been approached to make any payments
to any union official ?
Mr. Langer. I respectfully decline to answer on the ground that
the answer may incriminate me.
Mr. Kennedy. Mr. Lou Feldman, you are the owner of the Feld-
man News Co. ?
Mr. Louis Feldman. That is right.
Mr. Kennedy. Of 2545 Atlantic Avenue, Brooklyn, N.Y. ?
Mr. Louis Feldman. That is correct.
Mr. Kennedy. You are engaged in the business of distributing eve-
ning newspapers in the Borough of Brooklyn ?
Mr. Louis Feldman. That is correct.
Mr. Kennedy. The newspapers that have been discussed here by
the previous witnesses ?
Mr. Louis Feldman. That is right.
Mr. Kennedy. You employ some six union drivers ?
Mr. Louis Feldman. That is correct.
Mr. Kennedy. And you have gross sales of approximately $100,000
a year ?
Mr. Louis Feldman. About $160,000.
Mr. Kennedy. You are a member of the Evening "Wholesalers
Association ?
Mr. Louis Feldman. I am, sir.
Mr. Kennedy. Have you made any payments to any union official ?
Mr. Louis Feldman. I respectfully decline to answer on the
ground that the answer might incriminate me.
Mr. Kennedy. Have you taken any of your company funds to make
payments to any union official ?
Mr. Louis Feldman. I respectfully decline to answer on the
grounds the answer might tend to incriminate me.
The Chairman. I thought you said about $160,000 or $170,000 a
year is our gross income.
Mr. Louis Feldman. That is right, sir.
The Chairman, Compared to the ones that got $li/^ million or $8i^
million or $91^ million, you are rather small in this particular indus-
try, are you not?
IMPROPER ACTIVITIES IN THE LABOR FIELD 18195
Mr, Louis Feldman. That is correct, sir.
The Chairman. So it is obvious that if — well, it seems obvious — if
they hooked the big ones and have them under their control, they also
liave the little operator, too, don't they, this group that you can't
talk about that I am talking about ?
]Mr. Louis Feldman. 1 respectfully decline to answer on the ground
that the answer might incriminate me.
The Chairman. It seems pretty obvious. I don't think it needs
an answer. Proceed.
Mr. Kennedy. Mr. Chairman, I left out one individual I wanted
to call in connection with this group, Mr. Irving Ertis. Well, he is
not with this group. I am finished with tliis group.
The Chairman. Has the record of these companies been checked?
Mr. CoFiNi. No, they have not.
The Chairman. Are they in process?
Mr. CoFiNi. Yes, sir; they are.
The Chairman. All right.
I don't want you to turn state's evidence, but I want you to tell the
truth.
Are you in a position to do that without incriminating yourself a
'little, eitlier one of you? Can you do it without hurting yourself a
little?
Mr. Alexander Feldman. Sorry, sir ; I can't.
The Chairman, You just can't. You are in that situation.
Well, stand aside.
Mr. Kennedy. This is the fourth and final group, Mr. Chairman,
the magazine association group, I would like to call in that connection.
We have already had Mr. Bitz, a member of that group. We have
had Mr. Fello. Mr. Charles Gordon, whom we expected to have, is ill,
so we can't have him.
Mr. Michael Spozate we cannot locate. We feel he is avoiding
service of the subpena. We have been looking for him for a number
of weeks. Actually, for some 2 months we have been searching for
him. The only one left is Mr. Irving Ertis.
The Chairman. Come forward, Mr. Ertis. Maybe you will be
helpful. Be sworn. You do solemnly swear the evidence you shall
give before this Senate select committe shall be the truth, the whole
truth, and nothing but the truth, so help you God?
Mr. Ertis. I do.
TESTIMONY OF IRVING ERTIS
The Chairman. Be seated. State your name, your place of resi-
dence, and your business or occupation.
Do you have counsel ?
Mr.' Ertis. I was supposed to have come tomorrow, the way I un-
derstood from my counsel. I was assured I would be called to-
morrow.
The Chairman. You do have counsel ?
Mr. Ertis. Yes, sir.
The Chairman. Your counsel is not here ?
Mr. Ertis. No, sir.
The Chairman. You had arranged for him to represent you?
Mr. Ertis. That is right.
18196 IMPROPER ACTIVITIES IN THE LABOR FIELD
The Chairman. You understood it to have been tomorrow ?
Mr. Ertis. That is right.
The Chairman. Then you will be excused until in the morning.
Be back in the morning at 10 :30.
Is there anything further this afternoon ?
Mr. Ertis. Yes, sir.
You will have your counsel here in the morning, I assume?
Mr. Kennedy. I would like to call, Mr. Chairman, the union offi-
cials. I would like to call Mr. Sam Feldman, Mr. Anthony Fina-
more, Stanley Lehman, John Lawrence, Harry Waltzer, Joseph Baer,
Heni-y Weinstein and Harry Porter.
The Chairman. How many are there?
Mr. Kennedy. There are eight.
The Chairman. P^ach of you hold up your right hand.
Mr. Kennedy. Aren't there eight?
Mr. Feldman ?
Mr. Feldman. I am here.
Mr. IvENNEDY. Mr. Finamore?
Mr. FiNAMORE. Right.
Mr. Kennedy. Lehman?
Mr, Lehman. Here.
Mr. Kennedy. John Lawrence ?
Mr. Lawrence. Here.
Mr. Kennedy. Waltzer?
Mr. Waltzer. Here.
Mr. Kennedy. Joseph Baer ?
Mr. Baer. Here.
Mr. Kennedy. Mr. Heni-y Weinstein ?
Mr. Weinstein. Here.
Mr. Kennedy. And Mr. Harry Porter?
The Chairman. Mr. Porter?
Call him in. We will proceed with these.
Do you and each of 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. Feldman. I do.
Mr. Finamore. I do.
Mr. Lehman. I do.
Mr. Lawrence. I do.
Mr. Waltzer. I do.
Mr. Baer. I do.
Mr. Weinstein. I do.
TESTIMONY OF SAM FELDMAN, ANTHONY J. FINAMORE, STANLEY
J. LEHMAN, JOHN LAWRENCE, JR., HARRY WALTZER, JOSEPH
BAER, HARRY WEINSTEIN, AND HARRY PORTER, ACCOMPANIED
BY COUNSEL, BENJAMIN SHEDLER
The Chairman. Begmning on my left, the witness to my left, will
you state your name, your place of residence, and your business or
occupation ?
Mr. Finamore. Anthony J. Finamore. I live at 2914 West 30th
Street, Brooklyn. I am vice president of the Newspaper Mail Deliv-
erers Union.
IMPROPER ACTIVITIES IN THE LABOR FIELD 18197
The Chairman. The one in the back ?
Mr. Baer. My name is Joseph Baer. I reside at 15 Casper Court
in Jersey City, N.J. I am the day business agent.
Mr. Feldman. My name is Sam Feldman. I reside at 41 Dorchester
Drive, Yonkers. I recently have been defeated as president. I only
have one moi-e week to sen^e.
Mr. Waltzer. My name is HaiTy Waltzer. I reside at 2 East 53d
Street, Brooklyn, N.Y. I am the night business representative of the
Newspaper and Mail Deliverers Union.
Mr. Lawrence. John Lawrence, 50-12 41st Street, Long Island
City, N.Y. ; New Jersey busmess representative in the Newspaper and
Mail Deliverers Union.
The Chairman. Mr. Porter, will you be sworn ?
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. Porter. I do.
The Chairman. Proceed.
Mr. Lehman. Stanley J. Lehman. I am the secretary of the News-
paper and Mail Deliverers LTnion. I reside at 140-06 13th Avenue.
Mr. Weinstein. My name is Henry Weinstein. I live at 337 First
Avenue, New York City. I am sergeant at arms.
The Chairman. What is your name, your place of residence and
place of business ?
Mr. Porter. Harry Porter, 330 Belmont Avenue, Newark, N.J.;
sergeant at arms.
The Chairman. Sergeant at arms of what ?
Mr. Porter. Newspaper and Mail Deliverers.
The Chairman. You keep order ; do you ?
Mr. Porter. Yes, sir.
The Chairman. All right. You have comisel ?
Mr. Shedler. Benjamin Shedler, 141 Broadway, New York.
The Chairman. You represent all of them?
Mr. Shedler. Yes, sir.
Mr. Kennedy. Mr. Feldman, you had been president from 1951,
is that correct, president of the union ?
Mr. Feldman. From 1952, Mr. Kennedy.
Mr. Kennedy. Until yesterday ?
Mr. Feldman. No. Up until 1955, when I was defeated by Joe
Simon, the former president. Then I was reelected in 1956 and then
I was defeated yesterday.
The Chairman. You have real politics, do you ?
Mr. Feldman. Yes, sir.
Mr. Kennedy. As president, you received $600 a month salary
and $200 for expenses ; is that correct ?
Mr. Feldman. Yes, sir.
Mr. Kennedy. And prior to holding your union office, you were
employed by the New York Post ?
Mr. Feldman. Yes, sir.
Mr. Kennedy. As what?
Mr. Feldman. As a driver.
Mr. Kennedy. The base pay of the union members is about $107 a
week ; is that right ?
Mr. Feldman. That is correct.
18198 IMPROPER ACTIYITIES EST THE LABOR FIELD
Mr. Kennedy. But most of the members average about $150 a week
because of overtime ?
Mr. Feldman. Well, I don't know about that. Some work on a
straight scale, some have overtime. I couldn't tell you.
Mr, Kennedy. Mr. Feldman, have you ever received any money
from any of the wholesalers while you were president of the union ?
Mr. Feldman. I respectfully decline to answer under constitu-
tional rights.
The Chairman. Including the fifth amendment ?
Mr. Feldman. Yes, sir.
The Chairman. All right.
Mr. Kennedy. You have been convicted on one occasion; is that
right?
Mr. Feldman. I have never been convicted.
Mr. Kennedy. You were arrested ?
Mr. Feldman. I was never arrested, Mr. Kennedy.
Mr. Kennedy. You have no criminal record at all ?
Mr. Feldman. No, sir.
Mr. Kennedy. Have you ever approached any of the wholesalers
to receive any money from them, Mr. Feldman ?
Mr. Feldman. I respectfully decline to answer on the constitu-
tional grounds.
Mr. Kennedy. Have you ever approached any representatives of
any of the newspapers directly to receive any money from them?
Mr. Feldman. I respectfully decline to answ^er under my constitu-
tional rights.
Mr. Kennedy. Mr. Lehman, you were secretary-treasurer of the
union ?
Mr. Lehman. Yes, sir.
I\Ir. Kennedy. And you also received $600 a month and $200 ex-
penses ; is that right ?
Mr. Lehman. I get $150 a week salary.
Mr. Kennedy. How much ?
Mr. Lehman. $150 a week salary.
Mr. Kennedy. Do j^ou know Mr. Irving Bitz ?
Mr. Lehman. Yes, sir.
Mr. Kennedy. Have you ever received any money from him ?
Mr. Lehman. I respectfully decline to answer under my constitu-
tional rights.
Mr. Kennedy. Have you ever received any money from any whole-
saler in the New York area ?
Mr. Lehman. I respectfully decline to answer under my constitu-
tional rights.
The Chairman. We had testimony this morning that this fellow
Bitz is pretty powerful. Is he the kingfish over all of you ? Is that
what you w^ould say ?
Mr. Lehman. I wouldn't know, sir.
The Chairman. You don't know. Proceed.
Mr. Kennedy. ]Mr. Lawrence, you were business agent for the
union?
Mr. Lawrence. Yes, sir.
Mr. Kennedy. And, as such, you received a salary of some $500 a
month and $200 expenses?
IMPROPER ACTIVITIES IN THE LABOR FIELD 18199
Mr. Lawrence. Yes, sir.
Mr. Kennedy. You have recently been arrested in connection with
the alleged slashing of tires on Long Island ?
Mr. Lawrence. Yes, sir.
Mr. Kennedy. Do you know Mr. AVilliam Fello ?
Mr. Lawrence. Yes, sir.
Mr. Kennedy. Did Mr. "William Fello accompany you at the time
that you were brought down to the police department for questioning?
Mr. Lawrence. I decline — I respectfully decline to answer on my
constitutional rights.
Mr. Kennedy. Did you have an arrangement with Mr. Fello to
permit him to take over the distribution of the newspapers in Long
Island?
Mr. Lawrence. I respectfully decline to answer on my constitu-
tional rights.
The CHAiRivrAN. Did you hear him testify this morning ?
Mr. Lawrence. Wliat was that. Senator ?
The Chairman. Did you hear him testify here this morning ?
Mr. Lawrence. "VYlio is that, Senator ?
Mr. Kennedy. Mr. Fello.
Mr. Lawrence. Yes, sir.
The Chairman. There was some testimony about — who was that?
He said he raised this boy and he felt like a son to him. That all
happened down there on that occasion when you were down there ?
Mr. Lawrence. I respectfully decline to answer.
The Chairman. I wanted to know whether you were the boy or
the papa. Could you tell me? I am trying to get straightened out as
m,uch as we can.
All right. Proceed.
Mr. Kennedy. Would you answer any questions about your finances
at all, IVIr. Lawrence?
Mr. Lawrence. I respectfully decline to answer on my constitu-
tional rights.
Mr. Kennedy. Mr. Feldman, would you answer about any of your
finances ?
Mr. Feldman. I respectfully decline to answer on my constitutional
rights.
Mr. Kennedy. Mr. Lehman ?
Mr. Lehman. I respectfully decline to answer under my constitu-
tional rights.
Mr. Kennedy. Mr. Waltzer?
Mr. Waltzer. Yes, sir.
Mr. Kennedy. You are business agent for the union, at a salary of
$500 a month and $200 expenses ?
Mr. Waltzer. Yes, sir.
Mr. Kennedy, You have been a member of the union since 1930?
Mr. Waltzer. Yes, sir.
Mr. Kennedy. You were elected business agent 1937 to 1942, and
1949 to 1951, and 1953 to date ; is that right ?
Mr. Waltzer. Eight.
Mr. Kennedy. While business agent, you were arrested with an-
other business agent, Mr. Buddy Walsh, in an attempted extortion in
connection with the Armstrong publications in 1942 ?
18200 IMPROPER ACTIVITIES IN THE LABOR FIELD
Mr. Waltzer. I respectfully decline to answer on the grounds that
the answer may tend to incriminate me.
Mr. Kennedy. You were convicted and sentenced to 21/^ to 5 years
in — what was it — Sing Sing ?
Mr. Waltzer. I respectfully decline to answer on the Constitution.
The Chairman. Wliat was the date of that ?
Mr. Kennedy. 1942.
After your release from jail, you were reelected buisness agent of
the local?
Mr. Waltzer. I went to work for the Daily News, and after my time
expired after paying my penalty, I ran for office- and was reelected.
Mr. Kennedy. So that you did go to j ail ?
Mr. Waltzer. I decline to answer, respectfully, sir.
The Chairman. You already answered. All right; proceed.
Mr. Kennedy. While you were in jail, did you receive any money
from the union ?
Mr. Waltzer. I respectfully decline to answer.
Mr. Kennedy. Isn't it correct that while you were in jail your
salary was paid ?
Mr. Waltzer. I respectfully decline to answer.
Mr. Kennedy. On what ground ?
Mr. Waltzer. On the gromid that the answer may tend to incrim-
inate me.
Mr. Kennedy. Have you received any money from any wholesaler
or newspaper representative of the New York area ?
Mr. Waltzer. I respectfully decline to answer on my constitutional
rights.
Mr. Kennedy. I just want to ask Mr. Baer a question.
You are a business agent and receive the same salary and expenses ?
Mr. Baer. Yes, sir.
Mr. Kennedy. Have you received any money from any wholesaler ?
Mr. Baer. No, sir.
Mr. Kennedy. You have never received any money ?
Mr. Baer. No, sir.
Mr. Kennedy. You never approached any wholesaler to receive any
money ?
Mr. Baer. No, sir.
Mr. Kennedy. Mr. Baer has that reputation, Mr. Chairman.
Mr. Baer. Mr. Kennedy, I heard a couple from the News, rep-
resenting Newsday, make statements this morning about our meeting
out at Garden City.
The Chairman. If you want us to cooperate, don't take the fifth
amendment.
Mr. Baer. Senator, I want the whole truth to come about Newsday
and what a labor-busting paper Newsday is. This organization of
ours has been delivering Newsday for 18 years. They cradled the
paper. In other words, when it was born.
The Rockaway News Co. went out of business through bankruptcy.
On December 4 or December 5 we came down to Newsday -
The Chairman. I am sorry. I would like to stay to hear it, but
I can't.
Mr. Baer. Senator, you only heard a unilateral report.
The Chairman. I will hear you in the morning.
IMPROPER ACTIVITIES IN THE LABOR FIELD 18201
Mr. Baer. I want to make a prima facie case for the union.
The Chair]man. The committee will have to stand in recess mitil
10 :30 in the morning. I can't help it. You can give it to the press,
but I have to leave.
The session in the morning will be in room 318 in the Old Senate
Office Building.
We will stand adjourned until then.
(Members of the select committee present at time of recess: Sen-
ators McClellan and Ervin.)
(Whereupon, at 3:50 p.m., the select committee recessed, to re-
convene at 10 :30 a.m., Wednesday, May 6, 1959, in room 318, Senate
Office Buildinjr.)
INVESTIGATION OF IMPROPER ACTIVITIES IN THE
LABOR OR MANAGEMENT FIELD
WEDNESDAY, MAY 6, 1959
U.S. Senate,
Select Committee on Improper Activities,
IN the Labor or Management Field,
Washington, D.C.
Tlie select committee met at 10 : 40 a.m., pursuant to Senate Reso-
lution 44, agi^eed to February 2, 1959, in the caucus room of the
Senate Office Building, Senator Jolm L. McClellan (chairman of
the select committee) presiding.
Present : Senator John L. McClellan, Democrat, Arkansas ; Senator
Karl E. Mundt, Republican, South Dakota; Senator Frank Church,
Democrat, Idaho.
Also present : Robert F. Kennedj^, chief counsel ; Jerome S. Adler-
man, assistant chief counsel; P. Kenneth O'Donnell, administrative
assistant; Paid J. Tierney, assistant counsel; George M. Kopecl^y,
assistant counsel ; Walter R. May, assistant counsel ; Walter J. Sheri-
dan, investigator; Robert J. Cofini, investigator; Ruth Y. Watt, chief
clerk.
The Chairman. The committee will be in order.
(Members of the Select Committee present at the convening of
the session were Senator McClellan and Mundt.)
The Chairman. Call the next witness.
Mr. Kennedy. Mr. Chainnan, could we have Mr. Finamore, Mr.
Weinstein, and Mr. Porter, return to the witness stand. We had not
finished with them yesterday.
The Chairman. All of you be seated, please.
TESTIMONY OF ANTHONY J. FINAMORE, HAERY WEINSTEIN,
AND HARRY PORTER, ACCOMPANIED BY COUNSEL, BENJAMIN
SHEDLER— Resumed
The Chairman. The witnesses were sworn yesterday, were they
not?
Mr. Kennedy. Yes.
The Chairman. You will remain under the same oath that you took
yesterday, and as you further testify today.
Proceed.
Mr. Kennedy. Mr. Finamore, you are formerly vice president of
the union ; is that right.
Mr. Finamore. Up until tomorrow.
Mr. Kennedy. You are still vice president ?
Mr. Finamore. Seven years I have been in there.
18203
18204 IMPROPER ACTIVITIES IN THE LABOR FIELD
Mr. Kennedy. Have you ever received any money from any of
Mr. FiNAMORE. I respectfully decline to answer on the ground that
it may tend to incriminate me.
The Chairman. Let the record show, Mr. Keporter, the same counsel
appears today as of yesterday.
Mr. Kennedy. Let me repeat my question.
Have you received any money from any of the wholesalers or any
of the newspapers in New York ?
Mr. FiNAMORE. I respectfully decline to answer on the ground that
it may tend to incriminate me.
Mr. Kennedy. Would you give us any information on any of your
finances, Mr. Finamore ?
Mr. FiNAMORE. I respectfully decline to answer on the same grounds.
Mr. Kennedy. Mr. Weinstein, you are sergeant-at-arms of the
union ?
Mr. Weinstein. Yes, sir.
Mr, Kennedy. Have you received any money from any of the whole-
salers or any of the newspapers ?
Mr. Weinstein. I respectfully decline to answer on my constitu-
tional rights.
Mr. Kennedy. Would you give the committee any information on
your finances 1
Mr. Weinstein. No.
Mr. Kennedy. On what grounds ?
Mr. Weinstein. My constitutional rights.
Mr. Ivennedy. Mr. Porter, you are sergeant-at-arms of the union ?
Mr. Porter. Yes.
Mr. Kennedy. Have you received any money from any of the whole-
salers or any of
Mr. Porter. I respectfully
Mr. Kennedy. Would you wait until I finish ?
Any of the wholesalers, or newspapers or magazines of the New
York area ?
Mr. Porter. I respectfully decline to answer on my constitutional
rights.
Mr. Kennedy. Would you give the committee any information re-
garding your finances ?
Mr. Porter. I respectfully decline to answer.
Mr. Kennedy. Mr. Chairman, that is the nine officers of the union,
and only one of them is prepared to say that he has not received any
money from any of the wholesalers or any of the newspapers or
magazines, and of course, yesterday we also had the wholesalers
appear before us.
The Chairman. I believe only one of the wholesalers agreed that
he had paid money.
Mr. Kennedy. That was a newspaper publisher.
The Chaiioian. Only one representing management would open up
and testify.
Mr. Kennedy. All of the others took the fifth amendment.
The Chairman. We have just about a balance here between manage-
ment and labor in this particular field as to the necessity they feel for
invoking the fifth amendment.
Mr. Kennedy. Yes, sir.
IMPROPER ACTIVITIES IN THE LABOR FIELD 18205
The Chairman. I am sure it makes a pretty spectacle out over the
country to have such characters either in business or in hxbor and
certainly when they conspire together the public doesn't benefit from
it.
All right. Proceed.
Mr. Kennedy. That is all, Mr. Chairman.
Senator Mundt. I have no questions.
Mr. Kennedy. I would like to call the executive comicil of the
miion, Mr. Chairman : Irvin Keben, Joseph Ricciardi, Nicholas
Scanlon, and Vincent Setteducato.
The Chairman. The four witnesses will be sworn.
Do you and each of 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. Reben. I do.
Mr. RicciARDi. I do.
Mr. Scanlon. I do.
Mr. Setteducato. I do.
TESTIMONY OF IRVIN REBEN, JOSEPH RICCIARDI, NICHOLAS
SCANLON, AND VINCENT SETTEDUCATO, ACCOMPANIED BY
COUNSEL, BENJAMIN SHEDLER
The Chairman. Beginning on my left, state your name, your place
of residence, and your business or occupation.
Mr. Scanlon. Nicholas Scanlon.
The Chairman. How do you spell your last nan\e ?
Mr. Scanlon. S-c-a-n-1-o-n.
The Chairman. Give your place of residence and your business or
occupation.
Mr. Scanlon. Ninety 64th Street, West New York, N J.
The Chairman. What is your business or occupation ?
Mr. Scanlon. Route man for the New York World- Telegram and
Sun.
The Chairman. All right.
The next, will you identify yourself ?
Mr. RicciARDi. Joseph Ricciardi, R-i-c-c-i-a-r-d-i.
The Chairman. Your address ?
Mr. Ricciardi. 1858 80th Street, Brooklyn, N. Y.
The Chairman. Wliat is your business or occupation ?
Mr. Ricciardi. Route man for the Brooklyn Daily.
The Chairman. The next one, will you please give your name?
Mr. Setteducato. Vincent Setteducato, S-e-t-t-e-d-u-c-a-t-o.
The Chairman. I am asking you primarily to spell your names to
enable the press to get your names correctly. TJiey asked me, and
so I w411 ask you to cooperate with us at least to that extent, to get
your names spelled right. I like to see mine spelled correctly.
Mr. Setteducato 147 Beverly Road, Grasmere, Stanten Island,
N.Y.
The Chairman. "\^niat is your work or what do you do ?
Mr. Setteducato. Route man for the New York Daily Mirror,
The Chairman. And the next one?
Mr. Reben. Irving Reben, R-e-b-e-n, 81 Ocean Parkway, Brooklyn,
N.Y. I am a route man for the New York Journal American.
18206 IMPROPER ACTIVITIES IN THE LABOR FIELD
The Chairman. Thank you.
Proceed, Mr. Kennedy.
Let the record show there is the same counsel appearing for you as
appeared for the preceding witnesses.
Senator Mundt. May I ask Mr. Scanlon, and he can probably answer
for all of them. What is the meaning of the term ''route man"?
What does that mean ?
Mr. Scanlon. Delivering newspapers to various stands.
Senator Mundt. It has nothing to do with taking up subscriptions
or anything of that kind, but just delivering the papers on the route?
Mr. Scanlon. Yes.
Senator Mundt. That is the same for all of these gentlemen?
Mr. Scanlon. Yes, sir.
The Chairman. Let us get the relation here. Are you employed as
laborer or do you contract to do tliis work or do you simply buy the
papers and deliver them yourself ?
Mr. Scanlon. We are employed by tlie publisher.
The Chairman. You are an employee of the publisher ?
Mr. Scanlon. Yes, sir, the World Telegram.
Senator Mundt. That means each of the four of you have different
employers, you work for different newspapers ?
]Mr. Scanlon. Yes, sir.
Senator Mundt. You are competitors, as it were ?
Mr. Scanlon. That is right.
Mr. Kennedy. Mr. Reben, are you on the executive council ?
Mr. Reben. I was. I am off it now, as of tomorrow.
Mr. Kennedy. How long had you been a member of the executive
council of the union ?
Mr. Reben. I think it is 5 years.
Mr. Kennedy. And it is the executive council of the union ?
Mr. Reben. Yes, sir.
Mr. Kennedy. How many members are there on the executive
council ?
Mr. Reben. Ten.
Mr. Kennedy. These other three gentlemen are on it with you?
Mr. Reben. Yes.
Mr. Kennedy. Do you have any information regarding any pa}^-
ments that have been made by any of the wholesalers to any of tlie
union officials or members of the executive council?
Mr. Reben. I respectfully decline to answer on the constitutional
rights.
Mr. Kennedy. Have you yourself received any payments from any
of the wholesalers or from any of the newspapers other than your
salary ? Have you received any such payments ?
Mr. Reben. I respectfully decline to answer on my constitutional
riglits.
Mr. Kennedy. Mr. Ricciardi
The Chairman. Do you honestly feel, IMr. Reben, if you answered'
that question truthfully as to whether you had received money, that
a truthful answer might tend to incriminate you ?
Mr. Reben. Yes, sir.
The Chairman. You honestly believe that ?
Mr. Reben. Yes, sir.
The Chairman. Is that what you are swearing?
IMPROPER ACTIVITIES IN THE LABOR FIELD 18207
Mr. Reben. Yes, sir.
The Chairman. All right. Proceed.
Mr. KJENNEDY. Mr. Ricciardi, do you know of any payments made
to any union officials or members of the executive board?
Mr. Ricciardi. I respectfully decline to answer on the ground it
may tend to incriminate me.
Mr. Kennedy. Have you yourself received any such payments, Mr.
Ricciardi ?
Mr. Ricciardi. I respectfully decline to answer on the ground it
may tend to incriminate me.
Mr. Kennedy. Mr. Scanlon, do you know of any payments that
have been made by any of tlie wholesalers to any union officials or
members of the executive board ?
Mr. Scanlon. I respectfully decline to answer on the gi-ound it
may incriminate me.
Mr. IvENNEDY. Have you yourself received any such payments?
Mr. Scanlon. I respectfully decline to answer on the ground it
may incriminate me.
Mr. Kennedy. Mr. Setteducato, do you know of any pajaiients
made to any of the union officials or members of the executive board
by any of the wholesalers?
Mr. Setteducato. I respectfully decline to answer on my consti-
tutional rights.
Mr. Kennedy. Have you yourself received any such payments?
Mr. Setteducato. I respectfully decline to answer on my constitu-
tional rights.
Mr. Kennedy. That is all, Mr. Chairman.
The Chairman. Are there any questions, Senator Mundt ?
Senator Mundt. I have no questions.
The Chairman. All right, stand aside.
Call the next witness.
Mr. Kennedy. Mr. Lubischer, Mr. Aiges, Mr. Chiari, and Mr.
Schneider,
The Chairman. Stand and be sworn.
Do you and each of you solemnly swear that the evidence you shall
give before this Senate select committee shall be the truth, the whole
ti'uth, and nothing but the truth, so help you God ?
Mr. Lubischer. I do.
Mr. AiGES. I do.
Mr. Chiari. I do.
Mr. Schneider. I do.
TESTIMONY OF JOHN LUBISCHER, JR., LOUIS AIGES, JOSEPH
CHIARI, AND AL SCHNEIDER, ACCOMPANIED BY COUNSEL, BEN-
JAMIN SHEDLER
The Chairman. Give your name, your place of residence, and your
business or occupation, please.
Mr. Aiges. Louis Aiges, A-i-g-e-s, 700 Remsen Avenue, Brooklyn,
N.Y. My occupation is a route man for the New York Daily News,
The Chairman. And the next, please ?
36751— 59— pt. 51 6
18208 IMPROPER ACTIVITIES IN THE LABOR FIELD
Mr. LuBiscHER. John Lubischer, L-u-b-i-s-c-h-e-r, 37 Shady Lane,
Fanwood, N.J. I am a route man for the Newark News Dealers
Supply Co.
Mr. Schneider. A1 Sclineider, S-c-h-n-e-i-d-e-r, 2545 Valentine
Avenue, Bronx, N.Y. I am a route man for the New York Daily
News.
Mr. Chiari. Joseph Chiari, C-h-i-a-r-i, 474 Eighth Street, Brook-
lyn, N.Y. I am chauffeur for the New York Times.
The Chairman. You are a chauffeur ?
Mr. Chiari. Yes, a driver, a chauffeur route man.
The Chairman. I understand that. But these others are route men.
Is that what you call yourself ?
Mr. Chiari. It is practically the same thing. One serves the route
and one brings the papers to the route man.
The Chairman. I am just trying to get it straight, or the orienta-
tion on the thing.
Mr. Kennedy. Mr. Lubischer, you are a member of the executive
council, are you ?
Mr. Lubischer. Yes, sir.
Mr. ICJENNEDY. Of the union?
Mr. Lubischer. Yes, sir.
Mr. I^NNEDY. And these other three gentlemen are on the council
with you ?
Mr. Lubischer. Yes, sir.
Mr. Kennedy. As well as the four gentlemen that preceded you to
the witness stand ?
Mr. Lubischer. Yes, sir.
Mr. Kennedy. Could you tell us of any information that you might
have of any payments that have been made by the wholesalers to any
of the union officials or members of the executive board ?
_ Mr. Lubischer. I respectfully decline to answer on my constitu-
tional rights.
Mr. Kennedy. Have you yourself received any such payments?
Mr. Lubischer. I respectfully decline to answer on my constitu-
tional rights.
Mr. Kennedy. Mr. Aiges, could you tell us if you have any in-
formation regarding any payments made by any of the wholesalers to
any members of the executive board or any union officials?
Mr. Aiges. I respectfully decline to answer on my constitutional
rights.
Mr. Kennedy. Have you yourself received any such payments?
Mr. Aiges. I respectfully decline to answer on my constitutional
rights.
The Chairman. Do you honestly believe if you told the truth
about it, it might incriminate you ?
Mr. Aiges. Yes.
The Chairman. You do ?
Mr. Aiges. Yes.
The Chairman. All right.
Mr. Kennedy. Mr. Chiari, do you have any information about any
payments that have been made directly or indirectly to any union
official ?
IMPROPER ACTIVITIES IN THE LABOR FIELD 18209
Mr. Chiaki, I respectfully decline to answer on my constitutional
rights.
Mr. Kennedy. Do you know of any payments made to any member
of the executive board ?
IMr. Chiari. I respectfully decline to answer on my constitutional
rights.
Mr. Kennedy. Did you yourself receive any such payments ?
Mr. Chiari. I respectfully decline to answer on my constitutional
rights.
Mr. Kennedy. Mr. Schneider, do you know of any payments that
have been made by any of the wholesalers to any member of the
executive board or any union official ?
Mr. Schneider. I respectfully decline to answer on my constitu-
tional rights.
Mr. Kennedy. Have you, yourself, received any such payments?
Mr. Schneider. I respectfully decline to answer on my constitu-
tional rights.
Mr. Kennedy. That is all, Mr. Chairman.
The Chairman, Any questions. Senator Mundt ?
Senator Mundt. No.
The Chairjvian. Call the next witness.
Mr. Kennedy. Mr. Breslow, Mr. Walsh, and Mr. McQuade.
The Chairman. Stand and be sworn.
Do you and each of 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. Bresix>w. I do.
Mr. Walsh. I do.
Mr. McQuade. I do.
Mr. Shedler. Senator, will you let the record show I do not repre-
sent Mr. McQuade, but I do represent the other two witnesses?
Mr. KJENNEDY. We will have Mr. McQuade sit back then. He is in
a different category.
The Chairman. All right. This will be the testimony of Mr.
Breslow and Mr. Walsh.
TESTIMONY OF HENRY BRESLOW AND WILLIAM WALSH,
ACCOMPANIED BY COUNSEL, BENJAMIN SHEDLER
The Chairman. On my left, your name is Mr. Breslow ?
Mr. Breslow. Henry Breslow.
The Chairman. What is your residence ?
Mr. Breslow. 1504 Bell Boulevard, Queens, N. Y.
The Chairman. What is your occupation ?
Mr. Breslow. Routeman, World Telegram and Sun.
The Chairman. Mr. Walsh, state your name, your place of resi-
dence, and your business or employment.
Mr. Walsh. William Walsh, 17 Hillcrest Road, Hazlet, N.J.;
routeman for the New York Post.
The Chairman. You have counsel. Counsel sitting by you repre-
sents you ?
Mr. Walsh. Yes.
18210 IMPROPER ACTWITIES IN THE LABOR FIELD
The Chairman. Let the record so show, Mr. Reporter.
Mr. Kennedy. Mr. Breslow, you are on the executive council ?
Mr. Breslow. Yes.
Mr. Kennedy. And Mr. Walsh is on the executive council ?
Mr. Breslow. No, sir.
Mr. Kennedy. He is a business agent ?
Mr. Breslow. Former business agent.
Mr. ICennedy. Mr. Breslow, do you know of any payments that
have been made directly or indirectly by the wholesalers to any union
official, to any member of the executive board ?
Mr. Breslow. I respectfully decline to answer on constitutional
rights.
Mr. Kennedy. Have you, yourself, received any such payments?
Mr. Breslow. I respectfully decline to answer on constitutional
rights.
Mr. Kennedy. How long have you been on the executive board ?
Mr. Breslow. Three years.
Mr. Kennedy. Were you reelected ?
Mr. Breslow. I am the vice president-elect of the union,
Mr. Kennedy. You were just elected vice president ?
Mr. Breslow. I was just elected vice president.
The Chairman. Do they have any code of ethics in that union with
respect to people that so conduct themselves that when they are inter-
rogated about union affairs, about their connection with the union
affairs, that they feel constrained to take the fifth amendment to avoid
testifying against themselves ?
Do you have any ethical code in the union about that ?
( The witness conferred with his counsel. )
Mr. Breslow. I have no comment, Senator.
The Chairman. Well, I ask you to answer. Do you have any rule-
about it ?
Mr. Breslow. We have no rules on that.
The Chairman. All right.
Then, as I undei-stand, you do not adhere to the ethical code of the>
AFL-CIO in this union ; is that correct ?
Mr. Breslow. I wouldn't know about that, Senator.
The Chairman. Would you know what an ethical code is? Have'
you read it ? Would you ?
Mr. Breslow. Yes.
The Chairman. Well, do you know whether they adhere to the
ethical code of the AFL-CIO ?
Mr. Breslow. I wouldn't know, Senator.
The Chairman, You wouldn't know ? All right.
Senator Mundt. How many members are there in your union ?
Mr. Breslow. Around 4,500, Senator.
Senator Mundt. 4,500 ?
Mr. Breslow. 4,500.
Senator Mundt. 4,500. When was the election held t
Mr. Breslow. Monday, May 4.
Senator Mundt. How many votes were cast ?
Mr. Breslow. Approximately 3,400.
Senator Mundt. Did you have an opponent ?
Mr, Breslow. Three opponents.
IMPROPER ACTIVITIES IN THE LABOR FIELD 18211
Senator Mundt. Three opponents. How many votes did you get?
Mr. Breslow. I think approximately 1,100 ; maybe 17 or 18 short.
I don't know exactly.
Senator Mundt. Under your constitution, if you get the highest
vote plurality, that is sufficient?
Mr. Breslow. That is tantamount to election ; yes, Senator.
Senator Mundt. Do they vote with mail ballots or tellers or how do
they vote ?
Mr. Breslow. Machine ballot. Senator, with supervision of the
Honest Ballot Association.
Senator Mundt. Thank you.
Mr. Kennedy. It is an extremely democratic union ; is that right ?
Mr. Breslow. Boy, and how.
Senator Mundt. How do you get nominated — by petition ?
Mr. Breslow. No. You get a nominator and a seconder, and any
member of the union is entitled to run for office as long as he has his
dues paid up 3 months prior to the election.
Senator Mundt. There were four of you nominated ?
Mr. Breslow. That is right. Senator.
Mr. Kennedy. Mr. Walsh, you are former business agent ?
Mr. Walsh. Yes.
Mr. Kennedy. How long ago was that ?
Mr. Walsh. About 4 years ago ; 5 years ago.
Mr. Kennedy. You haven't held an office since then ?
Mr. Walsh. I didn't hear.
Mr. Kennedy. You haven't held any office with the imion since
then?
Mr. Walsh. No, sir.
Mr. Kennedy. Did you run for office this last time ?
Mr. Walsh. I did.
Mr. Kennedy. You were defeated then ?
Mr. Walsh. I was.
Mr. Kennedy. TVHiat position did you run for ?
Mr. Walsh. Business representative.
Mr. Kennedy. Would you know of any payments that have been
made to any of the union officials or any of the members of the execu-
tive board in this union by the wholesalers ?
Mr. Walsh. I respectfully decline to answer and rely on my con-
stitutional rights.
Mr. Kennedy. Did you receive any such payments when you were
business agent ?
Mr. Walsh. The same answer.
Mr. Kennedy. That is all, Mr. Chairman.
The Chairman. Any further questions ?
Senator Mundt. Mr. Vice President, is that a full-time job?
Mr. Breslow. Yes, Senator.
Senator Mundt. So you are not a routeman once you are vice presi-
dent?
Mr. Breslow. As of a week from Wednesday, that is right; that is
correct.
The Chairman. All right, call the next witness.
Mr. Kennedy. Mr, McQuade.
The Chairman. Mr. McQuade has been sworn.
18212 IMPROPER ACTIVITIES IN THE LABOR FIELD
TESTIMONY OF JOHN McQUADE
The Chairman. You may state your name, your place of residence,
and your business or occupation, Mr. McQuade.
Mr. McQuADE. John J. McQuade, 954 Van Ness Avenue, Bronx,
N.Y. ; newspaper deliverer for the New York Times.
The Chairman. Thank you very much.
Do you have counsel, Mr. McQuade ?
Mr. McQuade. No, sir.
The Chairman. You waive counsel ?
Mr. McQuade. Yes, sir.
The Chairman. Proceed.
Mr. Kennedy. Mr. McQuade, you were a member of the execu-
tive council ?
Mr. McQuade. Yes, sir.
Mr. Kennedy. Did you just run for office ?
Mr. McQuade. Yes, sir ; I ran for business agent.
Mr. Kennedy, Were you elected ?
Mr. McQuade. Yes, sir.
Mr. Kennedy. Mr. McQuade, do you know of any payments that
have been made by the wholesalers, directly or indirectly, to any
union official or any member of the executive board ?
Mr. McQuade. No, sir ; I do not.
Mr. Kennedy. Have you ever, yourself, received any such pay-
ments ?
Mr. McQuade. No, sir.
Mr. Kennedy. And I might add, Mr. Chairman, Mr. McQuade
has the reputation in the New York area for being completely honest.
This was confirmed when the members of the staff went to interview
him, and he answered all questions directly and indicated that when
he appeared before the committee he would also answer.
So we have one union official, Mr. Baer, who testified that he did
not receive payments, and we also have Mr. McQuade, who is a mem-
ber of the executive board, out of all of the officers and members of
the executive board.
Senator Mundt. Mr. McQuade, how long have you been a member
of the executive board ?
Mr. McQuade. Two years, sir.
Senator Mundt. Were these other gentlemen whose testimony you
just heard members of the board while you were a member of the
board ?
Mr. McQuade. Most of them were, sir.
Senator Mundt. Most of them were.
Did you, in running this time for business agent, replace some
business agent, or were your reelected ?
Mr. McQuade. I replaced a business agent, sir.
Senator Mundt. How many people voted for the position of busi-
ness agent ?
Mr. McQuade. There was 3,400 members voted.
Senator Mundt. And how many votes did you get ?
Mr. McQuade. I would say approximately 1,400.
Senator Mundt. Was this is in the same election as the vice presi-
dent who just testified was elected ?
Mr. McQuade. Yes, sir.
Senator Mundt. And the same union ?
IMPROPER ACTH-ITIES IN THE LABOR FIELD 18213
Mr. ISIcQuADE. Yes, sir.
Senator Mundt. And how many business agents are there ?
Mr. McQuADE. Three business agents.
Senator Mundt. How many vice presidents ?
Mr. McQuADE. One.
Senator Mundt. Just one ?
Mr. McQuADE. Yes, sir.
Senator Mundt. Does a business agent have to operate under the
direction of the president or the vice president, or are you sort of a
free agent, yourself ?
Mr. McQuade. Business agents more or less operate by themselves,
but he is under the supervision of the president and the executive board,
if he makes mistakes.
Senator Mundt. Are your rights and duties and powers set out in
your constitution ?
Mr. McQuade. Yes, sir.
Senator Mundt. Or are they subject to the direction of the president
and the vice president ?
Mr. McQuade. Subject to the constitution.
Senator Mundt. Subject to the constitution?
Mr. McQuade. Yes, sir. His duties are outlined there.
Senator Mundt. So there are certain rights and authorities that you
have as business agent that could not be altered or changed or modified
by direction of the president or vice president ; is that correct ?
Mr. McQuade. That is correct, sir.
Senator Mundt. Thank you.
The Chairman. Is there anything further ?
Mr. Kennedy. Does it disturb you at all, IVIr. McQuade, that your
fellow members of the executive board and fellow union officials all
appear before the committee, with the one exception of Mr. Baer, all
appear before the committee and refuse to answer any questions re-
garding payoffs ?
Mr. McQuade. I couldn't say, sir. I know most of these men and,
believe me, I think that most of them are good people. I have seen the
work they have done. It puzzles me. I can't figure it out.
The Chairman. You have no reason, yourself, you know you are
innocent, you haven't done anything, and you know there is no reason
why you can't say so under oath, that you know nothing about such
transactions and you haven't participated in such. That is your testi-
mony before us, is it not ?
Mr. McQuade. Yes, sir.
The Chairman. I want to highly commend you. I think you are
to be commended. You are in a union like this and in a business where,
apparently, these things are going on, and yet you are clean and you
can come in here with good conscience and before your country, before
your Government, and everyone, you can make a statement under oath
to the effect that you have not engaged in any such practices. I com-
mend you highly.
Mr. McQuade. Thank you very much, sir.
The Chairman. Call the next witness.
Mr. Kennedy. We are going into a different phase, now, of the
investigation and I would like to call Mr. Hillbrant, Mr. Chenicek. and
Mr. Gervase.
18214 IMPROPER ACTIVITIES IN THE LABOR FIELD
The Chairman. Be sworn, gentlemen.
Do you and each of 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. HiLLBRANT. I do.
Mr. Chenicek. I do.
Mr. Gervase. I do.
TESTIMONY OF CHARLES E. CHENICEK, J. J. OERVASE, AND WIL-
LIAM HILLBRANT, ACCOMPANIED BY COUNSEL, GEORGE CRAIG
The Chairman. Beginning on my left, will you state your name,
your place of residence, and your business or occupation, please?
Mr. Chenicek. My name is Charles E. Chenicek. My home resi-
dence is 801 Downing Street, Teaneck, N.J. I am vice president and
general manager of the Neo-Gravure Printing Co. That is at Wee-
hawken,N.J.
Mr. HiLLBRANT. I am William P. Hillbrant, treasurer, Neo-Gravure
Printing Co.
Mr. Gervase. My name is Joseph J. Gervase. I live at 66 Tal-
madge Avenue, Chatham, N.J. My position is assistant manager of
the Neo-Gravure Printing Co.
The Chairman. You have counsel. Mr. Counsel, will you identify
yourself ?
Mr. Craig. George Craig, of Craig, Summers & O'Hara, Washing-
ton, D.C.
The Chairman. All right, Mr. Kennedy.
Mr. Kennedy. Mr. Hillbrant, could you tell the committee what
the Neo-Gravure Co. does, Neo-Gravure Printing Co. ?
Mr. Hillbrant. We print under the rotogravure process Sunday
supplements for newspapers, magazines, catalogs, various things,
either in monotone or four color.
Mr. Kennedy. Do you do this work for a number of different news-
paper ? Just newspaper ; is that right ?
Mr. Hillbrant. The weekly supplements are for newspapers only.
Mr. Kennedy. What sort of weekly supplements do you print ?
Mr. Hillbrant. Currently, sir ?
Mr. Kennedy. Yes.
Mr. Hillbrant. American Weekly, a part of the print order; the
Mirror, the New York Herald Tribune, the Boston Herald.
The Chairman. May I inquire? I think I understand. That is
these magazines, something they buy that are distributed among
newspaper to be used in part of their circulation ?
Mr. Hillbrant. No.
The Chairman. You spoke of American Weekly. Many papei-s
purchase that and put it in their Sunday issue ?
Mr. Hillbrant. That is right.
The Chairman. That is what you print, such periodicals as that;
is that correct ?
Mr. Hillbrant. Yes.
The Chairman. I understand. All right.
Mr. Kennedy. How many copies of these supplements do you
print?
IIVIPROPER ACTIVITIES IN THE LABOR FIELD 18215
Mr, IIiLLBRANT. "VVe print in Weehawken approximately 4 million
copies of the xVmerican Weekly each week, and approximately 1,600,-
000 for the Mirror, and just short of 600,000 for the New York Herald
Tribune, and a little over 3:;(),000 for the Boston Herald.
Mr. Kennedy. You have in the past done some printing for other
newspapers; is that correct?
Mr. HiLLBRANT. Yes, sir.
Mr. Kennedy. How long has your company been in existence?
Mr. HiLLBRANT. The present company was organized in 1947.
Mr. Kennedy. Mr. Hill brant, did you hire a man by the name of
Mr, Gross some years ago ?
]\Ir. HiLijiRANT. I did not, myself; no.
Mr. Kennedy. Was Mr. Gross hired by your company ?
Mr. HiLLBRANT. He was.
Mr. Kennedy. By w^hom in your company was Mr. Gross hired ?
Mr. HiLLBRANT. I belicve he was hired by Mr. Gervase, as ap-
proved by Mr. Fred Stewart, who was then the vice president.
Mr. Kennedy. Mr. Gervase, you were the one who originally hired
Mr. Gross?
Mr. Gervase. Well, Mr. Stewart actually hired him.
Mr. Kennedy, What was Mr, Stewart's position at the time?
Mr, Gervase. He was vice president and general manager.
Mr. Kennedy, What did you know about the background of Mr.
Gross at the time he was hired? Did you know anything?
Mr. Gervase. No, I did not, except that he was an employee in our
shipping department.
Mr. Kennedy. And he was hired in what year — 1945 ?
Mr. Gervase. Approximately that; 1945 or 1946.
Mr. Kennedy. His full name is Mr. Harold Gross; is that correct?
Mr. Gervase. That is correct.
Mr. Kennedy. And he is still on the payroll of your company ?
Mr. Gervase. Yes, he is.
Mr. Kennedy. Over the period of at least the last year and a
half or 2 years, he has spent most of his time in Florida, has he not ?
Mr. Gervase. I w^ould say the last 6 months or so that I am
aware of.
Senator Mundt. Will you clear up for me what you mean when
you say you hired a man who was already on your payroll ?
Mr. Gervase. We hired him as a foreman of our shipping depart-
ment.
Senator Mundt. He had been in the shipping room and you hired
him as foreman?
Mr. Gervase. Correct.
Senator MuNixr. All right.
Mr. Kennedy. Mr, Hillbrant, is it correct that he has spent the
last year and a half or so in Florida, that has been his main head-
quarters ?
Mr. HiLLBRANT. He has spent considerable time there. I can't give
you the period of time. I haven't seen him in the office. I think the
last time I saw him was late December. I can't pin it down.
Mr. Kennedy. He keeps in touch with your company by telephone,
does he ?
Mr. HiLLBRANT. He does.
18216 IMPROPER ACTIVITIES IN THE LABOR FIELD
Mr. Kennedy. What salary does Mr. Gross receive at the present
time?
Mr. HiLLBRANT. Mr. Gross receives a weekly check of $143, 1 believe,
and 40 cents. I may have transposed a figured there, $34 or $43. He
also received a monthly check of $460.
Mr. Kennedy. What is the reason that he receives the weekly check
and then receives the extra amount per month ?
Mr. HiLLBRANT. All of our people are paid weekly, so the weekly
check is in accordance with usual procedures. He is paid a monthly
check for the services he renders in order that nobody will know in
the shipping platform, or shipping organization, his full remunera-
tion, because that is made separately.
Mr. Kennedy. So it is in order to conceal the full amount of money
that he receives ; is that correct ?
Mr. HiLLBRANT. From the rest of the organization.
Mr. Kennedy. From the rest of the organization.
Do you know what he is doing in Florida at the present time ?
Mr. HiLLBRANT. I do not.
Mr. Kennedy. Did you know that he was a president of a Teamsters
local down in Miami, Fla. ?
Mr. HiLLBRANT. I did not.
Mr. Kennedy. That he is president of Local 320 of the Teamsters
in Miami Beach, Fla. ?
Mr. HiLLBRANT. I did not know it.
Mr. Kennedy. And he has been president of that Teamsters local
since October 1958?
Mr. HiLLBRANT. I didn't know it.
Mr. Kennedy. You were not aware of that ?
Mr. HiLLBRANT. No, sir.
Mr. Kennedy. Let me ask Mr. Chenicek a question.
Do you know Mr. Gross ?
Mr. Chenicek. I do.
Mr. Kennedy. Wliat is your position in the company ?
Mr. Chenicek. Vice president and general manager.
Mr. Kennedy. In that capacity, have you worked with Mr. Gross ?
You are familiar with what his responsibilities are?
Mr. Chenicek. Surely.
Mr. Kennedy. Mr. Gross' main position, responsibility, is to main-
tain labor peace in the company ?
Mr. Chenicek. Well, Mr. Gross is foreman of the three shifts in
our shipping department, and it is his function to make sure that
that department functions properly.
Mr. IvENNEDY. Well, it is a little difficult while he is in Miami
Beach, Fla., to meet his responsibilities, while at the same time a
Teamster Union, to meet his responsibilties as foreman. What he
does, in eiiect, is to make sure that you have labor peace amongst your
employees ; is that correct ?
Isn't it correct ? Let me rephrase it. Isn't it correct that he was
hired because of the contracts and connections that he had among
certain union officials ?
Mr. Chenicek. Well, of course, I wasn't with the company at the
time of his original hiring.
IIVIPROPER ACTIVITIES IN THE LABOR FIELD 18217
Mr. Kennedy. Is it correct that he is kept on the payroll at the
present time because of his connections and contacts with certain labor
officials ?
Mr. Chenicek. Well, I would phrase it that he is kept on the pay-
roll because the department does function harmoniously, it functions
efficiently, and on that basis his services are retained.
The Chairman. That is what it actually amounts to. You wouldn't
have a foreman in Florida running a Teamsters Union unless you were
getting some influence and benefit from it, would you 'i
Mr. Chenicek. No, sir.
The Chairman. He is not there to personally supervise as a fore-
man should and would normally, is he ?
Mr. Chenicek. That is correct.
The Chairman. So he is off down in Florida running the Team-
sters Union while he is on your payroll to keep labor peace; that is
what it amounts to, isn't it ?
Mr. Chenicek. Yes, sir.
The Chairman. Thank you. Proceed,
Mr. IvENNEDY. Mr. Gross has arranged to have some of his rela-
tives placed on the payroll also, has he not ?
Mr. Chenicek. I believe so. I have no direct contact with the
department, but I understand that there are a few relatives that are
on the payroll ; yes.
Mr. KENNEDY. Mr. Gervase, did you know of Mr. Gross' criminal
record at the time he was hired ?
Mr. Gervase. I did not.
Mr. Kennedy. Mr. Chairman, maybe it would be helpful if we
placed in the record the amount of money that Mr. Gross received as
salary and what relatives are on the payroll, and also the situation
as far as other matters.
The Chairman. Have you a witness for that? If so, call him for-
Avard.
In the meantime, according to my calculation, Mr. Gross is paid
$143.40 per week.
Mr. Hillbrant. Yes.
The Chairman. And then $460 per month ?
Mr. Hillbrant. Per month.
The Chairman. That is a monthly check.
Mr. Hillbrant. Those are gross, before deductions.
The Chairman. That totals $1,0-33.60, in round numbers, per month,
based on a four- week month, and $460 monthly check. So it is over
$1,000 a month that he is receiving.
Mr. Hillbrant. That is right.
Mr. Kennedy. I would like to explain, Mr. Chairman, and place in
the record, that we have subpenaed all the books and records of this
company in connection with this matter, and they have made those
records available.
The information that we will have a member of our staff testify
to will be based on the records that have been made available under
subpena by this company.
The Chairman. I understand you are stating, in effect, that they
have cooperated with the committee in making this available, and
have otherwise tried to help the committee insofar as the committee
made requests of them ?
18218 IMPROPER ACTIVITIES IN THE LABOR FIELD
Mr. Kennedy. That is correct.
I want to explain also that we obtained information regarding the
activities of Mr. Gross from an independent source as we were making
an investigation of his activities in Miami Beach, Fla. It ultimately
led to this company.
We subpenaed their records. In this case, we are going to have
a witness testify from those records. We also learnt some other
information which we will have some testimony on.
The Chairman. Have you got the witness ?
Mr. Kennedy. Mr. Sheridan and Mr. Kopecky.
The Chairman. Do you and each of the 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. Sheridan. I do.
Mr. Kopecky. I do.
TESTIMONY OF GEORGE M. KOPECKY AND WALTER J. SHERIDAN
The Chairman. Each of you are members of the staff of this com-
mittee. As such you have been doing work in connection with this
particular phase of the investigation ?
Mr. Kopecky. Yes, sir.
The Chairman. In the course of that work, have you come in con-
tact with the activities or some of the work of a Mr. Gross ? Has that
come to your attention and under your surveillance, Harold Gross?
Mr. Kopecky. Yes, sir.
Mr. Kennedy. Mr. Sheridan, let me ask you first what you have
on the background of Mr. Harold Gross.
Mr. Sheridan. Mr. Gross was convicted in 1942 on a charge of ex-
tortion. This charge grew out of activities while Mr. Gross was
associated with Local 138 of the Teamsters Union. Local 138 at
the time was under the control of people affiliated with what was
then know as Murder, Inc.
Prior to that time, local 138 had been under the control of Lepke
Buchalter, a notorious gangster.
Mr. Kennedy. A number of the officials of local 138 had been sent
to the penitentiary for extortion, had they not ?
Mr. Sheridan. That is correct.
Mr. Kennedy. And also a number of them had been murdered in
gangland murders?
Mr. Sheridan. That is correct.
Mr. Kennedy. And it was labeled at that time, as a Teamsters
Union which was completely under the control and domination of
Murder, Inc. ?
Mr. Sheridan. Yes, sir.
Mr. Kennedy. And was accepted as such; is that correct?
Mr. Sheridan. Yes, sir.
Mr. Kennedy. And the whole function of the local at that time was
in connection with extortions ?
Mr. Shemdan. That is right.
Mr. Kennedy. And Mr. Gross himself, as an official connected with
the local, was convicted of extortion in one of these cases?
IMPROPER ACTr\-ITIBS IN THE LABOR FIELD 18219
Mr. Sheridan. Yes, he was.
Mr. Kennedy. And actually, of the officials of the union that were
convicted at that time, he received the highest sentence?
Mr. Sheridan. That is right.
Mr. Kennedy. And so he went to jail in 1942 ?
Mr. Sheridan. Yes, and he was paroled in May of 1945, and he went
to work for the Neo-Gravure Co. several months later.
Mr. Kennedy. Does he have any other criminal record that we
know of ?
Mr. Sheridan. He has arrests in 1937 for possession of burglary
tools, and for petty larceny, and he received a suspended sentence on
the petty larceny charge.
The ChairmxVN. What date was that ?
Mr. Sheridan. In 1937.
The Chairman. Has there been any since the extortion conviction
in 1942?
Mr. Sheridan. There are no convictions since 1942, Senator.
Mr. Kennedy. And he has been recently made the head of a Team-
sters Union ?
Mr. Sheridan. In October of 1958 he became head of Local 320 of
the Teamsters Union in Miami Beach, Fla.
Mr. Kennedy. And we will be going into that to some extent at a
later time.
Mr. Sheridan. Yes, we will.
Mr. Kennedy. Now, Mr. Kopecky, could you tell us what the records
show as far as the money that has been received by Mr. Harold Gross
directly ?
Mr. Kopecky. The records I have begin in 1946 and continue
through 1958, and the withholding forms obtained from the company
indicate that in that period of time Harold Gross has received a salary
of $98,459.85.
The Chairman. For what years ?
Mr. Kopecky. Beginning in 1946, through 1958.
Mr. Kennedy. Roughly in 1946 he received approximately $2,000,
and 1947 some $-4,000, and 1948, $4,000, 1949 some $6,000, in 1950 a
little less than $6,000, and 1951 a little less than $6,000, and 1952 $7,000,
nnd in 1953 a little less than $9,000, and in 1954 a little less than $9,000
and in 1955, $10,000, and in 1956 $10,UUU, and 1957 $12,400, and in
1958 $12,100 approximately.
Mr. Kopecky. All of those figures are approximately correct.
Mr. Kennedy. All adding up to some $98,000 ?
Mr. Kopecky. Yes, sir.
Mr. Kennedy. Was Harold Gross' brother placed on the payroll ?
Mr. Kopecky. Yes, Henry Gross, a brother of Harold Gross, is also
on the payroll, and during tlie same period of time, he has received
a salary totaling $64,314.27.
Mr. Kennedy. Then his son, Donald Gross, was on the payroll.
Senator Mundi\ What does Henry Gross do?
Mr. Gervase. He is what we call a checker on the third shift.
Senator Mundt. Does he work in New Jersey or Florida?
Mr. Gervase. Oh, in New Jersey, and he is on the job eveiy night.
Mr. Kennedy. Now, the son, Donald Gross, was on the payroll for a
short period of time.
18220 IMPROPER ACTIVITIES' IN THE LABOR FIELD
Mr. KoPECKY. He was on the payroll from 1952 through 1954, and
received a total of $5,172.57.
Mr. Kennedy. He only received $66 ; is that correct ?
Mr. KoPECKY. Yes, sir.
Mr. Kennedy. And in 1953 some $3,200, and in 1954 $1,800?
Mr. Kopecky. Yes, sir.
Mr. Kennedy. What did Donald Gross do?
Mr. HiLLBRANT. A regular platform loader.
Mr. Kennedy. Was that at the suggestion of Harold Gross that he
was placed on the payroll also ?
Mr. HiLLBRANT. I belicve so.
Mr. Kennedy. Then there is another son, Norman Gross, who was
on the payroll in 1957 and 1958.
Mr. Kopecky. Yes, and he received $1,218, and in 1958 $1,415, for a
total of $2,634.70. He is still on the payroll.
Mr. Kennedy. Then a brother-in-law, Mr. Mike Reiter, he was also
on the payroll.
Mr. Hillibrant. Yes.
Mr. Kennedy. What does he do, Mr. Reiter ?
Mr. HiLLBRANT. He occupies a position similar to Henry Gross ex-
cept that Mike Reiter is on the first shift and Henry Gross is on the
third shift.
Mr. Kennedy. Was that at the suggestion of Mr. Harold Gross?
Mr. HiLLBRANT. I bclieve so.
Mr. Kennedy. That is R-e-i-t-e-r. He was placed on the payroll
in 1949; is that correct?
Mr. Kopecky. He was on the payroll for a short period of time in
1946, and then he was off the payroll and continued or he began again
in 1949 and he has been on ever since, and I believe he is still on the
payroll at the present.
Mr. Kennedy. He receives now about $7,400 ?
Mr. Kopecky. $7,400 ; yes, sir.
Mr. Kenney. And he has received a total from the company of
some $56,000 ; is that right ?
Mr. Kopecky. That is correct.
Mr. Kennedy. So that makes a total for all of those individuals of
some $226,836.80.
Mr. Kopecky. Yes, sir.
Senator Mundt. A total of $226,000 all to the Gross family ?
Mr. Kopecky. The Gross family, and a brother-in-law.
Mr. Kennedy. Has Mr. Gross been paid any other sums of money,
other than this, these sums of money ?
Mr. HiLLBRANT. Yes, sir.
Mr. Kennedy. What other sums of money has he received ?
Mr. HiLLBRANT. Just a moment.
Mr. Kennedy. First, has he received any regular sums of money ?
Mr. HiLLBRANT. There has been an annual payment of $4,000 start-
ing around May of 1952 and continuing through 1958.
The Chairman. Is that in addition to this other $12,000 a year ?
Mr. HiLLBRANDT. It is in addition.
The Chairman. How is that paid — by check ?
Mr. HiLLBRANT. It was paid cash.
The Chairman. Paid in cash ?
IMPROPER ACTIVITIES IN THE LABOR FIELD 18221
Mr. HiLLBRANT. Yes.
The Chairman. That is a cash payment?
Mr. HiLLBRAXT. Yes, sir.
The Chairman, Tliat is an annual payment?
Mr. Hillbrant. Yes, sir.
The Chairman. We have weekly payments, $143 a week, and we
have a monthly payment of $460 a month, and then we have an annual
payment on top of that of $4,000 ; is that right?
Air. HiLLBRi\NT. Yes.
Senator Mundt. How was this annual $4,000 payment carried on
the books ? What is that for ?
Mr. Hillbrant. What is that ?
Senator Mundt. How is this annual payment of $4,000 carried on
your books ?
Mr. Hillbrant. The $4,000 first is a check payable to cash which is
cashed, and then paid over or was paid over after being cashed,
directly to Harold Gross. Then the $4,000, as far as our books were
concerned, was charged to "outside work," and billed then to American
Weekly on a Cuneo Press invoice.
The reason I brmg in that last statement is that the contract with
American Weekly is directly with the Cuneo Press, which is our
parent company, and we handle all of the billing in the Weehawken
office.
Senator Mundt. So that the description is "outside work ?"
Mr. Hillbrant. Outside work in order to offset it against increased
billing.
Senator Mundt. It looks like if he works at all, it is outside work
from Florida. It is kind of a push-button operation.
Mr. Hillbrandt. It is an accounting device in order to offset that.
Senator Mundt. It is charged as a business expense, anyhow,
Mr. Hillbrant. No. As far as we were concerned, there would be
no deductions claimed on our books, because the $4,000 paid out was
offset against increased billings.
Senator Mundt. It just means that somebody else ended up with it,
such as the American Weekly.
Mr. Hillbrant. We don't know on that.
Senator Mundt. It is just logical to assume that a business corpora-
tion paying out $4,000 deducts it. I mention this because I think that
our colleagues in the House who soon will be wrestling with labor
legislation ought to know this. Here we see a situation where, because
of the absence of apparently adequate labor laws, or because of the
absence of enforcement of the laws that we have, the Federal taxpayers
are really paying this extortion because Cuneo Press is no paper insti-
tution and its tax rate is relatively high. I am sure that your organ-
ization, too, is a successful organization.
Both are in the high brackets as far as corporate taxes are concerned,
so what we have here is an indirect sand-bagging of the American
taxpayer because of a labor situation that you find impossible to con-
tent with except through the various weekly, monthly, annual and
whatever other payments may be disclosed in the course of this in-
vestigation.
Mr. Craig. Would you please interrogate the witnesses further, to
disclose for the sake of this record that there was no deduction ever
18222 IMPROPER ACTIVITIES IN THE LABOR FIELD
taken by Cuneo or Neo-Gravure, and we don't know what American
Weekly did with theirs. I want that on the record if I may, please.
The Chairman. Counsel will bring that out.
Senator Mundt. I will follow that through, since I mentioned it.
I understand, Mr. Hillbrant, that the $143 weekly payment paid to
Mr. Gross is not charged as a business expense ?
Mr. Hillbrant. The weekly payments and the monthly payments
are charged as business expenses on our books and claimed as a deduc-
tion.
Senator Mundt. Then your counsel didn't quite have the facts in
mind when he asked us to interrogate further, because to the extent
that you pay the weekly payment and the monthly payment, Uncle
Sam's taxpayers are paying the salary — to the extent that this tax
deduction is taken for this man in Florida buying labor peace in New
Jersey ?
Mr. Craig. Just again, if I may speak to the Senator, the $4,000 is
what I made reference to and not the $140 nor the other payment. It
is the annual payment to which I made reference.
Senator Mundt. Let the record show that as far as this particular
Senator is concerned, that we have now established that the weekly
payment and the monthly payment are costs of doing business be-
cause of an unsavory labor practice which occurs up there, which are
paid for in large part by Uncle Sam's taxpayers, and that this Sonator
surmises that an examination of the books of the American Weekly
would indicate that it also is not an eleemosynary institution, but that
those $4,000 payments for which they are being billed undoubtedly
are charged back to the cost of doing business. They are not so
charged by your company ; is that correct ?
Mr. Kennedy. Now let me ask you, Mr. Chenicek, you are familiar
with this payment of the $4,000 that was made to Mr. Gross?
Mr. Chenicek. I am.
Mr. Kennedy. And this $4,000 was paid in cash to Mr. Gross?
Mr. Chenicek. That is correct.
Mr. Kennedy. And it was paid from what period of time to what
period of time ?
Mr. Chenicek. It started in May of 1952 and it continued through
May of 1958.
Senator Mundt. Let me ask, how did it start? Was it your idea
or was it his ? How did it originate ? How did you start making the
payment ?
Mr. Chenicek. Well, it is an involved story.
Senator Mundt. Just give us the facts.
Mr, Chenicek. The Cuneo Press signed a contract in October of
1951 which called for their assuming the printing of the American
Weekly, starting with the May 11, 1952, issue. The printing was dis-
tributed over three plants, our plant in New York, and at that time
we were making the transition to a new plant in Weehawken, and
a printing plant in Chicago, and then a printing plant that was to be
established on the west coast.
Our portion of that printing totaled approximately $10 million,
and we in Weehawken printed approximately 4 million each week.
As I recall at that time, there were 12 or 13 newspapers to whom
we were called upon to make delivery from the portion printed in
IMPROPER ACTIVITIES IN THE LABOR FIELD 18223
Weehawken. Those were the eastern cities where the distribution
costs would be lesser than if those copies were printed in the Mid-
west.
One of those papers to whom we were called upon to make delivery
was the New York Journal American. We approached the printing
date of the first issue and it developed that if we were to deliver those
copies, approximately 1 million or 1,1C0,000 to the New York Journal
American, that we would have a situation at the Journal American
plant created by the New York Newspaper & Mail Deliverers Union
whereby they would refuse to unload or accept on their platform the
copies we were delivering to them because the driver who manned
the truck with those deliveries was a member of local 807 and not a
member of their union.
Senator Mundt. This was a sort of secondary boycott situation
developing ?
Mr. Chenicek. I would assume that that would be an apt
description.
Senator Mundt. For jurisdictional purposes.
Mr. Chenicek. As a result of this arising problem, we were asked
by the American Weekly to see whether it would be possible to do
something to resolve that situation.
We in turn spoke with Harold Gross and asked him if there was
anything that could be done in connection with that situation, and
he said he would check into it.
Some time later, and I don't recall the period, a few days, he came
back and he stated that in return for an annual payment of $4,000
throughout the life of that American Weekly contract a driver from
the Newspaper & Mail Deliverers Union would be permitted to drive
the truck which otherwise would have been manned by an 807 driver,
and that deliveries would be made without any complications.
Actually, the way it worked out in practice, as I understand it, is
that the truck which handles the New York journal American deliv-
eries is hired from the same truck rental concern from whom we rent
our trucks, and it is paid for by either the Journal American or the
American Weekly, and I do not know, and it is manned by a member
of the Newspaper & Mail Deliverers Union.
That arrangement has continued through to this date, as far as
deliveries of the copies.
Senator Mundt. Wliose idea was it that the money be paid in fold-
ing currency instead of by clieck ?
Mr. Chenicek. Mr. Gross' idea.
Senator Mundt. As a businessman, what do you think is required
to eliminate a situation of this kind, which is certainly not a proper
business practice. Do you think new legislation is required, or do
you think that there are existing laws which would meet it if prop-
erly enforced or how do you think concerns like yours can best extri-
cate themselves fi^om such a situation? Our responsibility is in the
legislative field, and we want to find out if there is some legislative
business that can be done or should be done. It is entirely possible,
Mr. Chairman, that we have done it with this "hot cargo'" clause
enacted in the Kennedy-Ervin bill.
Mr. Kennedy. It would not take care of it, Senator,
Senator Mundt. Or are you happy with the situation as it is ?
36751— 59— pt. 51 7
18224 IMPROPER ACTIVITIES IN THE LABOR FIELD
Mr. Chenicek. We are far from happy. There was wrong in-
volved in this whole transaction, but the tragedy seems to me to be
the necessity for going through steps and procedures of this sort to
accomplish what should be a normal business function.
As to the corrective steps, of course it is far reaching and involved.
I frankly don't know what the proper steps would be, but quite obvi-
ously it calls for a drastic tightening of the legal things or the legal
aspects that apply to this or enable situations of this sort to come into
being.
Senator Mundt. In other words, you recognize that there is some-
thing seriously wrong when a business operation, in order to deliver
its merchandise, gets confronted with a sledge hammer situation like
this, and is compelled to pay what impolitely we would have to refer
to as a bribe in order to stay in business.
Mr. Chenicek. That is right.
Senator Mundt. If you refuse to do that, you would be stuck with
a lot of newspapers, or magazines, or rotogravure printing with no
way to get them delivered to your customer.
Mr. Chenicek. That is correct.
Senator Mundt. And your customer, in turn, would have no re-
course. He couldn't come and get the material as he was stopped by
this ruse.
Mr. Chenicek. Our customer was in the most difficult position
because they were obviously being influenced by factors of a similar
nature on their end of it.
Senator Mundt. I am very happy, Mr. Chairman, that this particu-
lar tj'^pe of improper practice is being exposed publicly at this junc-
ture, because there is still time for the House to act in a legislative
capacity on the bill which we have passed to meet this kind of
contingency.
It seems to me it is a very serious problem and I don't know what a
business can do, and I don't know what the publisher can do, but I
do think that Congress should be able to do sometliing to eliminate
this kind of a situation.
Mr. Chenicek. I think it might be well to add one point, that
actually it was the threatened work stoppage of the Journal American
wliich was the big concern. Actually, we had no problem on our end
of it, but they had a major problem over there in the form of a
threatened work stoppage if those deliveries were insisted on.
Senator JNIundt. Do you mean tliat this threat wliich came to you
involved something besides the nondelivery of papers — that they
were going to strike the plant itself or the newspaper plant of tlie
Journal American ?
Mr. Chenicek. The word "strike" was used in our discussions with
the American Weekly, yes; and their people, and I don't know, of
course personally, whether their platform workers used the word
"strike" in their discussions with the Journal American or American
Weekly, but I do know that there was fear of a strike in the plant in
the event that such deliveries were insisted upon.
Senator Mundt. This wasn't a question of 3^our using nonunion
help or scabs, as they call it. It happened that this driver belonged
to a different union ?
Mr. Chenicek. That is correct.
IMPROPER ACTIVITIES IN THE LABOR FIELD 18225
Senator INIundt. That aggravates the evil rather than alleviates it.
Mr. Chenicek. That is correct.
The Chairman. The Chair was just trying to get the connection,
if any, between the payments that you have been making here, that
you have been compelled to make, if you operated, and these unions
whose officials we have been interrogating here with respect to these
payoffs.
Mr. Counsel, will you state what the connection is? I want to get
this record clear with respect to the miion. What is the name of the
union ?
Mr. Kennedy. Mail Handlers.
The Chairman. We have been receiving testimony about it here,
or, rather, receiving the fifth amendment in greater volume than we
have received testimony, I may say. But I wanted to get the connec'
tion.
What is the connection between that union and what has happened
here with this fellow Gross, if any ?
I am trying to determine whether we are dealing here with some-
thing separate and apart, or whether it is all a part of the whole gen-
eral pattern of improper practices that prevail up there.
Will you tell us something about it ?
Mr. Kennedy. Mr. Chairman, it was a problem between these two
unions, the Mail Handlers Union and the Teamsters Union.
Is that correct.
Mr. Chenicek. That is correct.
Mr. KJENNEDY. It was a question of who was going to drive the
trucks. This was a dispute involving the American Weekly ; it was
not a dispute involving you people ; is that correct ?
Mr. Chenicek. That is correct.
Mr. Kennedy. Because of this jurisdictional dispute between the
two unions, the Teamsters and the Mail Handlers, they were not going
to get their deliveries, because the Teamsters insisted that the truck-
drivers that brought the magazines to the platforms should be Team-
sters; the Mail Deliveries insisted it should be delivered by a mail
deliverer.
Mr. Chenicek. That is correct.
Mr. Kennedy. And the trucks should be driven by a mail deliverer;
is that correct ?
Mr. Chenicek. That is correct.
Mr. Kennedy. So it was in orde,r to get a solution for that problem
that existed for the American Weekly that the American Weekly went
to you.
Mr. Chenicek. That is correct.
Mr. Kennedy. Of course, Mr. Chairman, it was the Mail Deliv-
erers officials that we have had before the committee.
Tlie Chairman. You were caught in an economic squeeze. That is
what it amounted to. You either had to pay off or make some arrange-
ments like this, or the Journal Amei-ican would simply not be able to
get your product.
Mr. Chenicek. That is correct.
The Chairman. That is what it amounted to ?
Mr. Chenicek. That is correct.
The Chairman. And you liave been paying all these years ?
18226 IMPROPER ACTIVITIES IN THE LABOR FIELD
Mr. Chenicek. That is true.
Mr. Kennedy. As far as you being caught in the squeeze, it was
really the American Weekly, was it not, rather than yourselves?
Mr. Chenicek. That is true.
Mr. Kennedy. As I understand from my conversations with you,
you were ready and prepared to make the deliveries, but it was their
problem at their end where the problem existed.
Mr. Chenicek. That is true.
Mr. Kennedy. They came to you and said : "Can you find a solution
to the problem?"
You went to Mr. Gross, and Mr. Gross said, "I can get a solution to
the problem if you give me $4,000 in cash every week."
Did you then go back to the American Weekly ?
Mr. Chenicek. Yes.
Mr. Kennedy. Did you explain that for a $4,000 payoff you could
get it fixed ?
Mr. Chenicek. I did.
Mr. Kennedy. Did they agree to make a $4,000 payoff ?
Mr. Chenicek. Yes.
Mr. Kennedy. Who was it in the American Weekly who agreed to
that?
Mr. Chenicek. At that time, McHenry Browne was the one I had
conversations with.
Mr. Kennedy. Did he say he would take it up with his superiors?
Mr. Chenicek. Yes.
Mr. Kennedy. Did you explain to him as Mr. Gross explained to
you that some of this money would have to be spread around and go to
other union officials ?
Mr. ('henicek. Yes.
Mr. Kennedy. You explained that to Mr. McHenry Browne ?
Mr. Chekicek. To the best of my recollection, yes.
Mr. Kennedy. Did he come back and tell you to go ahead and make
the payment ?
Mr. Chenicek. That is correct.
Mr. Kennedy. You made the first payment in May 1952 ?
Mr. Chenicek. I believe it was. Mr. Hillbrant could give the exact
date.
Mr. Kennedy. Did Mr. Gross come bn.ck each anniversary and ask
for the $4,000?
Mr. Chenicek. That is correct.
Mr. Kennedy. Did you go to the American Weekly each time and
get the $4,000 ?
Mr. Chenicek. Yes; I did.
Mr. Kennedy. They gave you an OK to make the payment ?
Mr. Chenicek. Usually what would happen would be that I would
talk with the business manager who was in that position at that par-
ticular time, and I assumed that he checked with whoever he would
check with internally, because he wouldn't right then and there give
me the go-ahead, but perhaps a day or two or three might elapse, and
then he would subsequently call me back and tell me to proceed with
the arrangement.
Senator Mundt. Just one question for clarification : It seems to me
you used the words "American Weekly" and "Journal American"
interchangeably. Are they under the same ownership ?
IMPROPER ACTIVITIES IN THE LABOR FIELD 18227
Mr. Chenicek. They are both Hearst publications ; yes.
Mr. Kennedy. Did you always make these arrangements solely with
McHenry Browne?
Mr. CiiENicEK. No. I don't recall in what year it was. Well, it
could only have been — I think the following year, by the time the
next annual period rolled around, I think Mr. McHenry Brow^ne left
somewhere around that time and Mr. John Padulo assumed the posi-
tion of business manager.
Mr. Kennedy. Did you have these discussions then with him?
Mr. Chenicek. In a similar vein, yes.
Mr. Kennedy. Each year ?
Mr. Chenicek. Yes.
Mr. Kennedy. Each year he came back and told you you could go
ahead and make the payment?
Mr. Chenicek. Yes.
Mr. Kennedy. Did you discuss it with anybody else in the Ameri-
can Weekly organization ?
Mr. Chenicek. No. But in due time, and again I don't recall the
year, in due time Mr. Padulo left, and his position w^as assumed by
Mr. Joseph Font ana, who continues to this date in the capacity of
business manager.
Mr. Kennedy. Did you discuss it with him ?
Mr. Chenicek. Yes, sir.
Mr. Kennedy. Each year?
Mr. Chenicek. Yes, sir.
Mr. Kennedy. You got the OK to make the payment ?
Mr. Chenicek. Yes. sir.
Mr. Kennedy. Each time it was understood what the payment was?
Mr. Chenicek. Yes, sir.
Mr. Kennedy. Did you discuss it with anyone else in the organi-
zation other than those three gentlemen ?
Mr. Chenicek. To the best of my recollection, I had one other
conversation with one other gentleman on the subject.
Mr. Kennedy. Who was that ?
Mr. Chenicek. That was Mr. Gortatowsky.
Mr. Kennedy. Wliat is his position ?
Mr. Chenicek. I believe he is the chairman of the board, of the
Hearst — I don't know the exact corporate title.
Mr. Kennedy. And you discussed this $4,000 payment at that time
with him?
Mr. Chenicek. Well, actually, what transpired was that in this
particular year, and I frankly don't recall offliand which year it was,
we had not
Mr. Kennedy. This, I believe, was probably in 1954.
Is it at the time payment was made in which there was a delay ?
Mr. Chenicek. That is correct.
Mr. Kennedy. You hadn't paid in May of 1954 as you had been
expected ; is that correct ?
Mr. Chenicek. That is correct.
Mr. Kennedy. All right.
Mr. Chenicek. I had not been reminded by Gross at about May 1
or thereabouts, the anniversary date, that that payment should be
forthcoming, and, as a result, naturally I did nothing, the American
Weekly did nothing, and it continued undisturbed for some period.
18228 IMPROPER ACTIVITIES IN THE LABOR FIELD
Then in due coui-se, Gross did come to me and say that that payment
would have to be forthcoming, and that a lot of time had elapsed since
the anniversary date.
So I, at that time, took it up with, I believe, at that time it was Mr.
Padulo. So he said that he would check into it and would let me
know.
As I recall the situation, apparently because of the delay in agreeing
to the payment, we reached the point where Gross was very insistent
that that payment be forthcoming rather promptly.
Mr. Kennedy. What did he say would happen if the payment did
not come ?
Mr. Chenicek. Well, that this arrangement would be disrupted, and
that, of course, would mean that the deliveries would not reach the
Journal American.
So I stressed to Mr. Padulo the necessity for reaching some decision.
This one particular day I received a phone call from Mr. Gorta-
towsky and he stressed very strongly the desire on their part to get
away from this situation, and in that conversation he assumed the
position that it actually was our company's responsibility to deliver the
copies to the New York Journal American. I told him that we were
ready, willing, and able to deliver those copies to the Journal Amer-
ican. He stated that if that were the case, then they would be faced
with a difficulty over at the Journal American.
Mr. Kennedy. When you talk about difficulty, you mean a strike?
Mr. Chenicek. Yes.
Mr. Kennedy. They wouldn't be allowed to make the deliveries
and take the magazines off the trucks ?
Mr. Chenicek. Yes.
So no conclusion was arrived at in that conversation.
Then, as I recall, it was a day or two or so later, that Mr. Padulo
called me and told me that I should proceed on the normal arrange-
ment, the $4,000.
Mr. Kennedy. You explained, as I understand it, to Mr. Gorta-
towsky, that this was not your prol3lem, that this was not a difficulty for
your company, but it was a difficulty for the American Weekly, that
you would make the deliveries and it was a problem for them.
So it was not your decision to make as to whether the $4,000 pay-
ment would be made, but it was up to them to make the payment.
Mr. Chenicek. That is correct.
Mr. Kennedy. Then they called later and told you to go ahead and
make the $4,000 payment ?
Mr. Chenicek. That is correct.
Mr. Kennedy. Did Mr. Gross ever come to you and say that they
could make different arrangements regarding the payments ?
Mr. Chenicek. Yes. I believe it was at the time that the 1956 pay-
ment was approaching due date, so to speak, when he reminded me
of that annual payment being due.
Four years of the 10-year American Weekly had already expired.
There were 6 years remaining in that contract.
Gross pointed out that with 6 years remaining, at an annual figure
of $4,000 each, in sum total $24,000, that would normally still be
forthcoming, that he thought that he could at that time settle on the
basis of one-half of that amount, that is, $12,000, and all future an-
IMPROPER ACTIVITIES IN THE LABOR FIELD 18229
nual payments would be discontinued, although the arrangements as
to physical movement of the materials would not be disrupted.
That information was passed on to, I believe, Mr. Fontana, business
manager at that time, and in due coui^e I received word that they
elected to proceed on the $4,000 basis.
Mr. Gross made the similar proposal the following year, and again
it was transmitted to the American Weekly, and again they paid the
$4,000.
Mr. Kennedy. \Vhy did it end, then, in 1958 ?
Mr. CiiENicEK. Then it was the following year, 1958, the payment
was made normally in May, or whatever the specific date was. In, I
believe it was, October of 1958, the Cuneo Press received a letter of
cancellation of the printing contract on the American Weekly which
was an option that the American Weekly had, and that letter also
stated that in the event that we desired to enter into negotiations on
the new contract or renegotiation, I forget the exact phraseology, they
would be glad to sit down and discuss the subject with us.
The contract negotiations were initiated and, as I recall, it was
sometime in December of 1958 that a new American Weekly contract
was consummated which, in effect, in return for an extension of the
period of the printing contract, was settled on the basis of a lower
price structure than had existed in the original contract. Not in
those negotiations as such, but in a conversation — I forget whether it
was actually at lunch — in some informal discussion, Mr. Fontana
pointed out to me that in the light of the American Weekly's
tightened economic picture, that certainly if there was some way of
avoiding a necessity for this $4,000 annual payment they would be
most happy if something could be done to escape it.
I talked with Harold Gross and I made a very strong point of the
fact tliat the American Weekly had felt the necessity of canceling its
contract because they were in a tightened economic picture, and we
in turn had to renegotiate a new contract on a tighter price structure
for ourselves, and that everybody was in the midst of a dire economic
pressure.
I told him that certainly if there was any way that it could be done,
then the American Weekly would certainly desire to escape this $4,000
annual payment.
So he said he would look into it.
Subsequently he advised me that the $4,000 payment which was
made in May of 1958 would be ther last $4,000 or any payment that
would be asked.
That is the way the matter rests.
The Chairman. That explains the $4,000 pretty well all the way
through.
Can you give us any explanation why he is still retained on your
payrolf at $143 a week and $460 a month ? That is, other than for
the fact that you are buying labor peace ?
Mr. Chenicek, For the same reason. Senator ; that we covered be-
fore. The reason for our retention of his services is no different than
it was at any earlier date.
The Chairman. In other words, it was not for the work that he
does at the plant as a supervisor or a foreman at all, but it is to avoid
labor trouble, and by that you mean strikes and other disruptions and
harassment, and so forth. That is what you mean ?
18230 IMPROPER ACTIVITIES IN THE LABOR FIELD
Mr. Chenicek. Yes, sir.
The Chairman. You still feel compelled to do that at the present?
Mr. Chenicek. Unfortunately, we do.
The Chairman. Thank you very much.
Senator Mundt. Have you any first-hand knowledge as to what hap-
pened to the $4,000 after it left your hands and went to Mr. Gross?
Mr. Chenicek. No, sir.
Senator Mundt. He has never told you what he did with that
money ?
Mr. Chenicek. No.
Senator Mundt. You don't know whether he keeps it or whether
it goes to somebody else in the union in New York ?
Mr. Chenicek. I honestly have no idea.
Senator Mundt. All right.
Mr. Kennedy. The problem, however, that he set out to settle was
settled?
Mr. Chenicek. Yes, sir.
Mr. Kennedy. And the platform workers now handle the de-
liveries ; is that correct ?
Mr. Chenicek. That is correct.
Mr. Kennedy. Mr. Kopecky, the records of the company show how
much was paid to Mr. Gross in this connection?
Mr. Kopecky. Neo-Gravure's records reflect that seven payments
were made totaling $28,000 from 1952 through May of 1958.
Mr. Kennedy. And in all that they were reimbursed by the
American Weekly : is that correct ?
Mr. Kopecky. There are also indications that there were reimburse-
ments by American Weekly for the $28,000 to Neo-Gravure.
Mr. Kennedy. Have you made any other payments to Mr. Gross?
Mr. Chenicek. Yes, sir. We made two cash payments, each in the
amount of $2,500, one in October of 1954 and one in October of 1955.
Mr. Kennedy. Wliat was that for ?
Mr. Chenicek. Those were cash payments asked for and received
by Mr. Gross in return for his services in connection with the nego-
tiation of the new platform workers 2-year contract.
The Chairman. Which side was he on, then; yours or the union?
Mr. Ckenicek. In this case he was representing management.
The Chairman. In this case he was representing management?
Mr. Chenicek. Yes. sir
The Chairman. Yet he was a member of the union ?
Mr. Kennedy. No.
The Chairman. He was not a member of the union ?
Mr. Chenicek. He was foreman. Frankly, I don't know whether
he is a formal member of the union or not.
The Chairman. You don't know whether he was a member of the
union at that time or not ?
Mr. Chenicek. No, sir.
Mr. KJENNEDY. It was because of his connections with the union;
is that correct ?
Mr. Chenicek. Well, he performed services that were valuable to
the company.
Mr. Kennedy. But he indicated also that he had these connections
with the union ?
IMPROPER ACTIVITIEiS IN THE LABOR FIELD 18231
Mr. Chenicek. Surely,
Mr. Kennedy. We don't know, Mr. Chairman, if at that time he
was a member of any union or not, and, if so, what union.
The Chairman. He was then your employee at the time as foreman ?
Mr. Chenicek. Yes, sir.
The Chairman. But you paid him a bonus of $2,500 each year to
help you handle the matter ?
Mr. Chenicek. That is correct.
The Chairman. From your standpoint, that is what it amounted
to?
Mr. Chenicek. Well, actually, the two payments were for having
negotiated or assisted in the negotiation of the beneficial 2-year con-
tract covering those 2 years.
The Chairman. In other words, it was for one contract but in two
payments ?
Mr. Chenicek. Yes, that is correct.
Mr. Kennedy. Was that by check or by cash ?
Mr. Chenicek. By cash.
Mr. Kennedy. Would you tell us what he was able to do in that
case?
Mr. Chenicek. Normally, the wage increases which would be real-
ized by our platform workers in a new contract followed the pattern
of wage increases that had been realized in the New York Teamsters
contracts which came up for negotiation shortly before our contract
expired. In the case of this 2-year contract, the wage increases which
our platform workers realized were lesser than those realized by the
New York Teamsters.
Mr. Kennedy. He was able to get a better contract than you would
have ordinarily gotten ?
Mr. Chenicek. That is correct.
Mr. Kennedy. At a lower wage rate for the employees ?
Mr. Chenicek. That is correct.
Mr. Kennedy. That is, than the Teamsters had obtained in New
York ; is that correct ?
Mr. Chenicek. That is correct.
Mr. Kennedy. Ordinarily you would follow the same pattern as
New York ?
Mr. Chenicek. That is true.
Mr. Kennedy. He was able to obtain a contract for a lower wage
rate?
Mr. Chenicek. That is correct.
Mr. Kennedy. For that, you gave him the $5,000 on two separate
occasions?
Mr. Chenicek. He asked for and received those payments.
Mr. Kennedy. The union that was involved at that time was local
1730?
Mr. Chenicek. That is correct.
Mr. Kennedy. That is the International Longshoremen's Associa-
tion, the ILA?
Mr. Chenicek. That is correct.
Mr. Kennedy. That is the union run by Mr. Connie Noonan, is it
not?
Mr. Chenicek. Yes.
18232 IMPROPER ACTIVITIES IN THE LABOR FIELD
Mr. Kennedy. Mr. Gross is a very close associate of Mr. Noonan,
is he not ?
Mr. Chenicek. They seem to be very closely associated.
Mr. Kennedy. On that $2,500, on the two separate occasions, did
Mr. Gross request cash ?
Mr. Chenicek. He did.
Mr. Kennedy. Has Mr. Noonan been paid any money directly by
the company ?
Mr. Cpienicek. I don't know that you would call it paid directly.
When I came with the company in 1949 I inherited a situation where-
by, at Christmastime each year, it had been the habit to give Mr.
Noonan a $200 cash payment. That practice has continued each year
since then, with one exception. I believe there was one $150 payment
or gift instead of $200. I don't recall.
Mr. Kennedy. Did Mr. Noonan show up each year to pick up his
$200?
Mr. Cpienicek. He usually dropped around during the Christmas
season, yes.
Mr. Kennedy. Were you the one who gave him the $200 ?
Mr. Chenicek. I think in all instances except one I did. In that
one case, I think I was on vacation at that time and Mr. Hillbrant
made the gift offering.
Mr. Kennedy. Was that always in cash ?
Mr. Chenicek. Yes, sir.
Mr. Kennedy. Was that in an envelope?
Mr. Chenicek. Yes.
Mr. Kennedy. Did you give it to him at Christmas of 1958 ?
Mr. Chenicek. Yes.
Mr. Kennedy. So it is just several months ago he was given that?
Mr. Chenicek. Yes.
Mr. Kennedy. What do the records show as to how much money
Mr. Noonan received ?
Mr. KopECKY. 1950 through 1958, he received a total of $1,550.
Mr. Kennedy. He is head of local 1730, Mr. Chairman, of the
Longshoremen's Union, and an important Longshoreman official.
Senator Mundt. Mr. Chairman?
The Chairman. Senator Mundt.
Senator Mundt. You said that the wages that you received in this
contract negotiated by Mr. Gross were less than the corresponding
wages in the Teamsters contract arrived at in New York.
Were they less by more than $2,500 annually ?
Mr. Chenicek. They were.
Senator Mundt. By how much more?
Mr. Chenicek. I frankly don't recall. To the best of my recollec-
tion, and this is just really a guess on my part, I would say that it
possibly represented say a half of that saving. I may be wrong.
Senator Mundt. A half of what?
Mr. Chenicek. Well, in other words, liad we concluded a contract
on a comparable basis as we normallj^ did, the additional cost to the
company would have run somewhere in the neighborhood of $5,000
additionally.
Senator Mundt. In other words, your company saved about $5,000,
the workers lost about $5,000 but Mr. Gross received $2,600?
IMPROPER ACTIVITIES IN THE LABOR FIELD 18233
Mr. CiiENicEK, That is correct.
Senator Mundt. How are these $200 payments to Mr. Noonan
carried on the companj^ books ?
Maybe you know, Mr. Kopecky.
Mr.' Kopecky. The records reflect they were cliarged to shipping
and delivery expense.
Senator Mundt. So we find Uncle Sam's taxpayers once again in-
volved in this and paying it as a cost of doing business. That is
correct, is it not ?
Mr. Chenicek. Mr. Hillbrant shoidd answer the question.
Mr. HiLLBiLVNT. Could I have the question again ?
Senator Mundt. Once again we find Uncle Sam's taxpayers getting
it in the neck because these $200 payments made to a union boss are
cliarged to shipping expenses, cost of doing business, and are a
deductible item ?
Mr. Hillbrant. It was claimed as a deductible item.
Senator Mundt. By your company ?
Mr. Hillbrant. By the company.
Senator Mundt. I think the general public ought to get increas-
ingly interested in this whole labor situation, Mr. Chairman, because
it shows here again that, among other things, one reason why taxes
are so high is that there are a lot of taxes that coi-porations might
be paying if it were not for these deductions which are claimed, grow-
ing out of unsavoiy labor practices, relationships and conditions.
llr. Kennedy, Actually, on tlie $5,000, there were really no nego-
tiations in that contract, were there? Doesn't Mr. Noonan show up
with the contract ?
Mr. Chenicek. Primarily it is a formality ; yes.
Mr. I^NNEDY. When we talk about Mr. Gross negotiating, actually
he was having a conversation with Mr. Noonan and Mr. Noonan
si lowed up with a contract ; isn't that correct ?
Mr. Chenicek. Yes.
Senator Mundt. Did Mr. Gross ever pick any Christmas gifts off
the company Christinas tree?
Mr. Chenicek. No, sir.
Senator Mundt. He thought he was well enough taken care of ?
Mr. Chenicek. Presumably.
The Chairman. He got his Christmas in May.
Mr. Kennedy. Were there any other payments other than the
weekly payments, the monthly payments, the yearly payments, and
the two bonuses of $2,500 apiece; were there any other payments
that were made ?
Mr. Chenicek. No.
Mr. Kennedy. That is, to Mr. Gross?
Mr. Chenicek, No.
Mr. Kennedy. Do you know of any other payments that were made
to Mr. Gross other than the payments I have enumerated ?
Mr. Hillbrant. Are you referring to the circumstance in 1948 ?
Mr. Kennedy. 1948.
Mr. Hillbrandt. There were additional payments made in 1948.
Mr. Kennedy. 1948 ?
Mr. Hillbrandt, 1948. They were made to either Connie Noonan
or Harry Gross.
18234 IMPROPER ACTIVITIES IN THE LABOR FIELD
Mr. Kenndt. Would you tell the committee how those payments
happened to be made to Mr. Gross and/or Mr. Noonan ?
Senator Mundt. May I ask the witness, Mr. Chenicek, why he said
no ? Was he not with the company ?
Mr. Chenicek. No, sir, I think it might be well to establish for the
record — we all came from the Midwest originally. For the record,
as to our inception with this company, I, myself, came to New York
in either March or April of 1949.
Senator Mundt. I was just wondering why you had said no, be-
cause your partner said yes. I can understand it now because you
were not with the company at that time.
Mr. Chenicek. I was not there at that time.
The Chairman. Let the others state Avhen they came with the
company.
Mr. HiLLBRANDT. I Came with the company in June 1947, with the
Neo Gravure Printing Co.
Mr. Gervase. I came with the Neo GraAiire Printing Co. in 1944.
Mr. Kennedy. Mr. Gervase, in 1948 there was a strike in New York
City of the Teamsters ?
Mr. Gervase. A general truck strike ; yes.
Mr. Kennedy. The primary local that was involved was Local 807,
but other unions recognized the picket line and it was what amounted
to a general strike ?
Mr. Gervase. Yes, sir. It was all truck lines, as far as I know.
Mr. Kennedy. All trucking was shut down ?
Mr. Gervase. Yes.
Mr. Kennedy. At that time you were doing work for newspapers,
including the New York Times ?
Mr. Gervase. That is correct.
Mr. Kennedy. And the New York Mirror ?
Mr. Gervase. That is right.
Mr. Kennedy. Were you delivering their supplements ?
Mr. Gervase. Yes. We were delivering their Sunday supplements
each week.
Mr. Kennedy. So a problem arose about getting the supplements
delivered ; is that correct ?
Mr. Gervase. That is correct.
Mr. Kennedy. And so it was a question of trying to work out an
arrangement whereby, even though the strike was in existence, the
supplements could be delivered to those two newspapers?
Mr. Gervase. Yes.
Mr. Kennedy. The trucking company that handled the supplements
was the Cannon Trucking Co. ; is that correct ?
Mr. Gervase. At that time, yes.
Mr. Kennedy. Did you have some conversations with Mr. Cannon
and also with Mr. Gross in connection with trying to get these supple-
ments delivered ?
Mr. Gervase. Yes. The trucks were on strike and we were print-
ing right along and had no means to deliver these printed sections.
I was told that Cannon, as the owner of the truck, could effect deliv-
eries if he drove the truck himself.
So I naturally put pressures on him to make whatever deliveries
he could, personally. I did go to Gross to see what he could do to
IMPROPER ACTIVITIES IN THE LABOR FIELD 18235
make movements of trucks. Then, of course, Mr. Keller was then
vice president and general manager. He made other arrangements
that did get trucks rolling at nighttime.
Mr. Kennedy. Were those arangements made with ^Mr. Gross and
Mr. Connie Noonan ?
Mr. Gervase. Mr. Keller actually made them.
Mr. Kennedy. Let me ask you, Mr. Hillbrant : Were those arrange-
ments made with Mr. Connie Noonan and Mr. Gross ?
Mr. Hillbrant. I received my instructions from Mr. Keller that the
payments would be made to the two.
Mr. Kennedy. Did you, in fact, make payments to Mr. Connie
Noonan and Mr. Gross?
Mr, Hillbrant. I did.
Mr. Kennedy. How much money, and during what period of time,
did you pay to Mr. Gross — let me establish something. The deliv-
eries went through for the New York Times and the Mirror ?
Mr. Hillbrant. Yes, sir.
Mr. Kennedy. And for those deliveries, payments were made to
Mr. Gross and Mr. Noonan ?
Mr. Hillbrant. That is correct.
Mr. Kennedy. The two newspapers were able to get their supple-
ments ; is that correct ?
Mr. Hillbrant. That is right.
Mr. Kennedy. And for that payments were made to Mr. Gross and
Mr. Noonan?
Mr. Hillbrant. That is right.
Mr. Kennedy. Ultimately you were reimbursed for those payments
by the New York Times and by the New York Mirror; is that correct?
Mr. Hillbrant. That is right.
Mr. Kennedy. Were those payments made to Mr. Gross and Mr.
Noonan in the form of cash ?
Mr. Hillbrant. They were all made in the form of cash.
Mr. Kennedy. Did Mr. Gross and Mr. Noonan charge so much per
truck?
Mr. Hillbrant. They did.
Mr. Kennedy. Originally, what was it ? $250 a truck ?
Mr. Hillbrant. $250 a truckload, and it was subsequently increased
to $375 a truckload.
Mr. Kennedy. How mucli was paid in the form of cash to Mr. Gross
and Mr. Noonan for this service?
Mr. Hillbrant. I think it was $45,750.
The Chairman. How much ?
Mr. Hillbrant. $45,750.
The Chairman. Is this in addition to the actual cost of operation,
in addition to salaries of the truck drivers, in addition to the cost ot
operating the truck? This is over and above all the normal costs?
Mr. Hillbrant. This is over and above.
The Chairman. $45,000 how much?
Mr. Hillbrant. It is $45,750.
The Chairman. Over what period of time?
Mr. Hillbrant. Well, according to the records I have, on either
September 3 or 4 I paid $5,500 out for the delivery of 22 loads at the
rate of $250 a load.
18236 IMPROPER ACTIVITIES IN THE LABOR FIELD
The Chairman. Over what period of time was the total of $45,750
paid?
Mr. HiLLBRANT. It was paid between the period of time September 3
and September 11, 1948.
The Chairman. September 3 and September 11 of 1948 ?
Mr. HiLLBRANT. Yes, sir.
The Chairman. That is about 8 days.
Mr. HiLLBRANT. That is right.
The Chairman. That was a pretty good haul, wasn't it ?
Mr. Kennedy. But they didn't work every day ?
Mr. HiLLBRANT. No, sir.
Mr. Kennedy. They worked only what — 4 or 5 days out of the 8 ?
Mr. HiLLBRANT. I would say there was 5 days' work there.
Mr. Kennedy. And actually it wasn't days. They just worked at
night ; is that correct ?
Mr. HiLLBRANT. Nights ; yes. I assumed you meant that.
Mr. KJENNEDY. Would you tell us, Mr. Kopecky, what the records
show?
Mr. Kopecky. Yes. It reflects that during this approximately 8-
day period, $45,750 in cash was cashed and the proceeds of the cash
was paid to Noonan and Harold Gross.
Ml-. Kennedy. $45,750. ^Vliat days were they paid ?
Mr. Kopecky. September 2, 1948, a check was cashed for $3,000;
Septem.ber 3, a check was cashed for $9,500 ; September 7 a check was
cashed for $4,500 ; September 9 a check was cashed for $10,000 ; Sep-
tember 10 a check was cashed for $11,500; September 11 a check was
cashed for $13,000, totaling $51,500.
Of this sum, over the period beginning September 3 through Sep-
tember 11, a total of $45,750 in cash was paid to these two men.
The Chairman. Do you know where that money went beyond them ?
Mr. HiLLBRANT. I would like to make one correction of his state-
ment.
Was there not, Mr. Kopecky, a redeposit of about $4,500 ?
Mr. Kennedy. I was just going to ask that.
Mr. Kopecky. The total of the checks that were cashed totaled
$51,500. The total that was paid in cash to Noonan and Gross totaled
$45,750. There was a redeposit of the excess cash of $4,505.38.
The Chairman. That would be for trucks that were not delivered?
In other words, there was a payment in advance ?
Mr. HiLLBRANT. No, we did not pay in advance. You see, these
trucks moved out at nighttime. The payoff was made the next day.
The Chairman. How did you overpay ?
Mr. HiLLBRANT. We did not overpay. We had the cash on hand.
The Chairman. You were withdrawing cash to pay them. You
weren't paying them by checks. You were writing the checks for cash,
withdrawing the cash, and when you got through you had $4,500 left
and you redeposited it ; is that right ?
Mr. HiLLBRANT. Yes.
Senator Mundt. What was the position that Mr. Gross had with
your company at that tim,e ? Was he a foreman then ?
Mr. HiLLBRANT. He was foreman of the shipping department.
Senator Mundt. Mr. Gross has been sort of an expensive luxury for
your company, it seems to me, hasn't he ? He gets a foreman's pay as
IMPROPER ACTIYITIES IN THE LABOR FIELD 18237
sort of a hunting license to prey around on your premises. $45,700, 1
presume, is charged on the books of the company as a cost of doing
business and deducted from taxes ; is that right '^
Mr. HiLLBRANT. The entire cost of $45,750, together with other
costs which were incurred, was billed in its entirety to either the New
York Times or the New York Mirror and we had no deduction on our
books.
Senator Mundt. So either the New York Times or the New York
Mirror undoubtedly charged that as a cost of doing business. Once
again Uncle Sam's taxpayers get rapped on the knuckles for a lot of
extra taxes because of deductions made in reporting to the Internal
Revenue Service.
Wouldn't that be a pretty good guess ? Has your company, to your
knowledge, made any other payments of any other kind to any union
officials which you have not yet disclosed ; that is, since you have been
with the com,pany ?
Mr. HiLLBRANT. There was a similar strike in 1946.
Senator Mltxdt. Tell us about that.
Mr. HiLLBRANT. That is where total payments of about $10,000
were made. I was not with the company at that time and I can't
Senator Mundt. You can't speak firsthand, but do you know who
got that $10,000?
Mr. HiLLBRANT. I do not know. I was not there at that time.
Senator Mundt. Are there any others ? Do you know ?
Mr. Gervase. I was there in 1946. I know that payments were
made, according to our records. But I don't know to whom they were
made because I didn't make them. At that time Fred Stewart was
our vice president and general manager. If there were payments
made
Senator Mundt. They were made on behalf of your company to
some union official, but you don't know who ?
Mr. Gervase. I don't know who.
Senator Mundt. Would you know who did make the payments ?
Mr. Gervase. I assume it was Fred Stewart. Fred Stewart was
our general manager at that time.
Senator Mundt. Back to Mr. Hillbrant.
Do you know of any other payments that the company had to make
to union officials?
Mr. HiLLBRANT. To the best of my knowledge and belief, no others.
Senator Mundt. How about you, sir ?
Mr. Gervase. I don't know of any others.
Senator Mundt. And you ?
Mr. Chenicek. No, sir.
Mr. Kennedy. On the 1946 occasion, on whose behalf were those
payments made?
Mr. Gervase. What do you mean by "on whose behalf"?
Mr. Kennedy. As I understand, it was the same problem or situa-
tion as in 1948. This wasn't your own money. You were reimbursed,
Mr. Gervase. The situation was similar to the 1948 situation.
Mr. Kennedy. So you were reimbursed ?
Mr. Gervase. We were reimbursed by the Time and the Mirror, and
I believe the Boston Herald for a small amount.
18238 IMPROPER ACTIVITIE& IN THE LABOR FIELD
Mr. Kenntjdy. The records are not complete for 1946, so we are
not able to break that down. But we are able to break it down for
1948 as far as how much each newspaper paid in connection with the
1948 strike.
Let's give it for 1948, the New York Times — give it for the New
York Times and the New York Mirror.
Mr. KoPECKY. The New York Times reimbursed in the sum of
$43,143.62, and the New York Mirror reimbursed in the sum of
$13,856.38.
Mr. Kennedy. That figure is larger than $45,000, but there were
other expenses amounting to some $11,600 ; is that correct ?
Mr. KoPECKY. That is correct.
Mr. Kennedy. That was apart from these cash payments that were
made to Gross and Noonan ?
Senator Mundt. Were the other expenses just the legitimate haul-
age charges, or was there some more racketeering ?
Mr. Kennedy. We can't tell.
Mr. KoPECKY. The records reflect various payments for labor and
supplies.
Senator Mundt. You didn't charge the newspapers for the legiti-
mate hauling charge that would normally be made ?
Mr. HiLLBRANT. We had to pay Mr. Cannon a greater amount for
haulage during that period while the strike was on than we would
normally have paid him.
Senator Mundt. Why ?
Mr. HiLLBRANT. I am not able to answer that question. I don't
know. I do know that it is higher. It was charged for at the rate of
60 cents a hundredweight.
Senator Mundt. I think counsel had a question.
Mr. Craig. It has been answered. Senator. I was wanting the
breakdown of the various amounts.
I am advised that the witness can give the $11,000 and what it con-
sists of, if you wish it.
Senator Mundt. Yes, I would like to have that.
Mr. Craig. We will have to dig into it, but we can get it out.
Senator Mundt. Mr. Chairman, I think we should have one of our
staff members either look at the books or review the records of the
New York Times and the Mirror in order to verify the statement
which I made off the cuff and which I am pretty confident is accur-
ate, that these extra costs were ultimately charged off as costs of
doing business so that the American public, the taxpayers, are the
ones who really paid this.
I think it is time the country finds out what happens when these
payments are made and who actually pays them, because if they are
in fact deductible expenses, this should be the concern of every work-
ingman who has withholding taxes taken from his paycheck, and
every taxpayer from the poorest to the richest in the country. I think
we should verify that to complete the record.
The Chairman. I imagine we can get it verified, if we haven't
already, by simply writing to the papers and asking them.
Senator Mundt. If it would be simpler to look at the income tax
returns, we can do it that way.
The Chairman. Their accountant would certify whether they
charged it off as a business expense or absorbed it.
IMPROPER ACTIVITIES IN THE LABOR FIELD 18239
Mr. Kjennedy. We were advised that the statement would be made
about the New York Times and the Mirror, and in order to complete
the record, in fairness to them, we have asked representatives of the
New York Times and Mirror to testify today. We expect they will
be witnesses this afternoon.
Senator Mundt. Very good. This will be one of the pieces of in-
formation that we will try to elicit.
Mr. Kennedy. And also the American Weekly.
The Chairman. Are there any further questions ?
Mr. Kennedy. Can we put the total of how much money has been
paid to Mr. Gross altogether ?
Mr. Kopecky. Well, that is
Mr. Kennedy (interrupting). Gross, Noonan and Gross' relatives.
Mr. Kopecky (continuing). Total payments to Harold Gross, Mr.
Noonan and members of the Gross family amount to $307,136.80.
Senator Mundt. I think you ought to divide that between Mr.
Noonan and the Gross family. Are they related ?
Mr. Kopecky. It is not possible to do that in certain circumstances,
because money was paid to both of them at the same time.
The Chairman. Anything further before we recess ?
We will stand in recess until 2 o'clock this afternoon.
(Members of the select committee present at time of recess: Sena-
tors McClellan and Mundt.)
(Whereupon, at 12 :30 p.m. the select committee recessed, to recon-
vene at 2 p.m. the same day.)
afternoon session
(The select committee reconvened at 2 p.m.. Senator John L. Mc-
Clellan, chairman, presiding.)
The Chairman. The committee will come to order.
(Members of the select committee present at time of reconvening:
Senators McClellan and Church.)
The Chairman. Call the next witness.
Mr. Kennedy. Mr. Chenicek.
TESTIMONY OF CHARLES E. CHENICEK, ACCOMPANIED BY COUNSEL,
GEOEGE CRAIG— Resumed
Mr. Kennedy. I just want to clarify one thing from the record this
morning.
Where was the dispute in connection with the American Weekly ?
At your platform or at the platform of the Journal American?
Mr. Chenicek. At the platform of the Journal American.
Mr. Kennedy. Not at your place of business ?
Mr. Chenicek. Definitely not.
Mr. Kennedy. This was a question of your trucks making de-
liveries to them and their people refusing to handle it ?
Mr. Chenicek. That is correct.
Mr. Kennedy. During the recess a representative of their paper
raised a question about it, and I wanted to be certain that it was clari-
fied in the record.
Mr. Chenicek. I see.
36751— 59— pt. 51 8
18240 IMPROPER ACTIVITIES IN THE LABOR FIELD
The Chairman. What it actually amounted to is that you acted as
agent, in a sense, in the sense of go-between, between the Journal
.^onerican and the racketeers ; is that true ?
Mr. Chenicek. That is true.
Mr, IvENNEDY. There was never any question in the conversations
that you had with the representatives that you mentioned this morn-
ing what the payment was for ; is that correct ?
Mr. Chenicek. Definitely not.
Mr. Kennedy. That this payment would be made to an individual
who would then go and spread it around to the various union officials
in order to achieve this result?
Mr. Chenicek. That is all.
The Chairman. Thank you. Call the next witness.
Mr. Kennedy. Mr. Amory Bradford.
The Chairman. The Chair may state that this morning I intended
to thank the three witnesses who were on the stand when we recessed
for their cooperation and commend them for coming down here and
testifying and giving us the facts as they have.
I think the time has come in this country if we are to stop this
racketeering and rascality that is going on, that is an imposition on
all decent, honest citizens in this country, and a burden on our econ-
omy, if we are to bring it to a stop, it is going to require that business-
men, honest, labor people, their leaders, all of us, stand up and be
counted in this thing.
It is absolutely disgusting. It is sickening to have these business-
men come in here by the dozens and take the fifth amendment because
they have been doing something they can't talk about. I wish they
would come in like the last three witnesses have, and just tell what
they have had to do, and how they have had to possibly pay off in
order to operate, and there is nothing commendable about doing it,
but when they feel they have to do it in order to operate, we have to
get that information out in the open and get it on this record, get it
officially under oath.
I think the Congress will have to take a lot of responsibility for
this situation in the final analysis. We ought to enact laws, first,
that are adequate to prohibit these conditions, and then the next meas-
ure of responsibility certainly rests upon law enforcement officials in
the community where these things are happening.
I appreciate very much, as chairman of this committee, the wit-
nesses who have just been on the stand.
Mr. Kennedy. Mr. Chairman, could I also say that we received a
great deal of cooperation from their attorney, (governor Craig, who
was very cooperative from the beginning of the investigation.
The Chairman. All right. Whatever the Chair said for them goes
for their attorney, too.
Be sworn, please.
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. Bradford. I do.
lAIPROPER ACTIVITIES IN THE LABOR FIELD 18241
TESTIMONY OF AMORY H. BEADFORD, ACCOMPANIED BY COUNSEL,
THOMAS F. DALY
The Chairman. State your name, your place of residence, and
your business or occupation, please.
Mr. Bradford. My name is Amory H. Bradford. I am vice presi-
dent and business manager of the New York Times, address, 229 West
4:3d Street, New York City.
The Chairman. You are business manager for the New York
Times?
Mr. Bradford. Yes, sir.
The Chairman. And you have counsel?
Mr. Bradford. Yes, sir. a
The Chairman. Please identify yourself.
Mr. Daly. Thomas F. Daly; Lord, Day & Lord, 25 Broadway,
New York City.
The Chairman. Proceed, Mr. Kennedy.
Mr. Ivennedy. How long have you been with the New York Times ?
Mr. Bradford, I have been with the New York Times since July
1947.
Mr. Kennedy. How long have you been vice president ?
Mr. Bradford. 2 years.
Mr. Kennedy. How long have you been business manager?
Mr. Brx\dford. Business manager also for 2 years.
Mr. Kennedy. Mr. Bradford, you have been contacted by the staff
of this committee in connection with the matters that were testified to
this morning ; is that correct ?
Mr. Bradford, I have.
Mr. Kennedy, You, yourself, have no personal information or
knowledge as to the payments that were made during the strikes of
1946 and 1948 ; is that right ?
Mr. Bradford. I personally had no knowledge of those payments.
Mr. ICennedy. You, at the request of the committee, and on service
of a subpena, liowever, were able to obtain some documentation in
connection with these payments?
Mr. Bradford. I was. We met with the committee staff for the
P.v t time the day ])efore yesterday, IMoTnlay morniug, and after liear-
iiig tlieir inquiry, we searched our tiles and records and were able to
produce a fairly coinf)lete record of what took place in 1948. Un-
fortunately, the individual who conducted that transaction on the
part of the Times, Mr, Harold Hall, who was then business manager
and who retired 2 years ago, died last summer, so that the principal
participant was not available to give us any direct personal recol-
lection.
Mr, Ivennedy. You have prepared a rough statement, giving a
summary of the situation as you found it in the records of the Times;
is that correct ?
Mr. Bradford. I have.
Mr. Kennedy. The witness has furnished a copy to the committee.
The Chairman. You are simply testifying from wliat your records
reflect ; is that correct ?
Mr, Bradfoiu). I am testifying entirely from what our records re-
flect, and all of those records have been turned over to tlie committee
staff.
18242 IMPROPER ACTIVITIES IN THE LABOR FIELD
The Chairman. Thank you very much.
You may proceed and read your statement, if you desire.
Mr. Kennedy. May I just ask you before you start, this question :
The records would appear to substantiate in summary the testimony
that was given this morning ; is that correct ?
Mr. Bradford. That is correct.
This statement was prepared simply as a summary of what we
found in our records and not as a normal statement. But I would be
glad to read it rather than going through the process of question and
answer.
The Chairman. This statement, then, you have read it and you
state that to the best of your knowledge it is correct?
Mr. Bradford. It is correct on the basis of the records we have.
The Chairman. This statement may be printed in full in the record
at this point.
(The statement referred to follows :)
My name is Amory H. Bradford. I am vice president and business manager of
the New York Times. I joined the New York Times staff on July 8, 1947, as
assistant to the publisher. I became secretary of the company on November 10,
1954, and took my present position on April 23, 1957.
The previous business manager of the Times was Harold Hall. He had been
business manager since May 1, 1941, and retired on April 15, 1957. He died on
July 12, 1958.
The business manager at the Times is responsible for dealings with outside
contract suppliers. One of the most important of these is the company which
does the Times rotogravure printing of our magazine section, book review and
other special Sunday sections, l^om April 1933 until January 1, 1950, this
printing was done for the Times by Neo-Gravure Printing Co., Inc., on 26th
Street in New York City.
The Times business manager is also responsible for handling labor relations.
The Times does not now and has not had any direct relation with the Teamsters
Union. It is, however, dependent on trucks driven by members of the Teamsters
Union for the delivery of its newsprint and the delivery to its building of copies
of the supplements printed by rotogravure, including the book review and
magazine.
The committee's subpena calls for information about incidents which occurred
some 10 and 12 years ago. The Times' business manager, Mr. Hall, who then
handled these matters, is no longer available. In an effort to supply the com-
mittee with as much information as possible we have thoroughly searched our
files in the limited time available, since we were asked about this and served with
one subpena, relating to 1948, day before yesterday, and the other, relating to
1946, only yesterday.
In August of 1946 negotiations were in process between all of the New York
teamsters locals and the various employer groups. On September 1 local 807
struck and this strike spread and resulted in a complete tie-up of all trucking
shipments in the New York area. The strike lasted until September 17.
The Times and all other newspapers had to eliminate most of their advertising
and print small newspapers containing only news. A large part of the book
review and magazine which had been printed in advance had to be dropped from
the issue of Sunday, September 15, 1946, and distributed on Sunday, September
22. Losses incurred as a result of this strike were extremely heavy, and
included an item of over $40,000 for adjustments to advertisers for the late
inclusion of the magazine and book review. The trucking company which deliv-
ered newsprint to the Times, Daniels & Kennedy, settled with the union earlier
than many others and the Times made their services available to the Herald
Tribune and other newspapers in order to make it possible for them to stay in
busin&ss.
We have searched our records with respect to the 1946 strike, in response
to the subpena from this committee requiring us to furnish all documents
showing reimbursements made to the Neo-Gravure Co. for payments made to any
labor officials in connection with the 1946 stiike. All that we have located is a
IMPROPER ACTIVITIES IN THE LABOR FIELD 18243
letter from Fi-ed Stewart, vice president of Neo-Gravure, to Harold Hall,
business manager of the New York Times, dated October 10, 1946, stating that
a checlc of Neo-Gravure was enclosed in the amount of $1,800 to cover amounts
drawn from the Times on September 0 and 7. Attached to this copy of Mr.
Stewart's letter are some receipts covering part of this amount and a penciled
note which reads "C. J. Noouan, president Motor and Bus Terminal Chok. (short
for 'Checkers') Plat, (short for 'platform')" and, in shortliand, "workers union
loc. 215102," the address "265 West 14," and a telephone number "Watkins
9-8403." I have checked with Mr. Pelz who delivered $1,000 of this amount to
Mr. Gervase of Neo-Gravure. He was at that time a clerk in the business
office and knew nothing of the reason for the money except that he understood
it was needed by Neo late one evening to make payments in connection with
deliveries to the Times which had been delayed by the strike.
We do not retain checks and vouchers beyond 7 years. However, our ex-
pense accounts for 1946 indicate that Neo-Gravure was paid a total of $20,837.71
for strike expense in October 1946. We have no records indicating whether
this was for anything other than the added costs incurred because of disrupted
schedules.
Mr. Stewart who signed the above letter was vice president of the Neo-
Gravure Printing Co. at the time the letter was written but left the company
at the end of December of the next year, 1947. He died on September 4, 1958.
In 1948 another Teamsters' strike occurred. During August 1948 substantial
progress had been made in negotiations between various Teamsters' Union
locals and the employer groups. Three locals and five associations had reached
contract agreement through mediators' efforts. These covered 40,000 drivers.
Local 807, however, refused to follow the settlements reached by the others and
a strike was called on September 1, which initially shut down all deliveries
in New York City. Some other locals continued to work, particularly those in
New Jersey.
On September 8, Local 807 began to seek individual pacts with different em-
ployers. This tactic proved successful and the operators began to sign up on
September 9. In the meantime some of the other Teamsters' locals had con-
tinued at work. The strike was finally settled on September 18, 1948.
The delivery of the Times Magazine and Book Review from Neo-Gravure
on 26th Street to the Times plant on 43d Street was interrupted by the strike
of Local 807 against the truckers which Neo used. Without these supplements
the Sunday Times delivered to readers would have been incomplete. Also,
they contained substantial advertising on which many Times advertisers were
depending for their fall business.
The negotiations with Neo-Gravure for delivery of the Times Magazine and
Book Review from Neo-Gravure's plant to the New York Times plant were
carried out by Harold Hall, the Times business manager. In response to the
committee's subpena, we have made available Mr. Hall's entire file relating to
this transaction. He kept a detailed record of the events as they developed
which reveals the following :
On Thursday, September 2, Mr. Hall discussed the situation with Mr. Keller,
vice president of Neo, and learned later from Keller that the Neo shop steward,
Gross, had said that Noonan, "can reach the proper people." Keller then
talked with Noonan who apparently quoted $300 a load "to cover everything and
everybody." Mr. Hall agreed to reimburse Neo for this payment contingent
upon complete delivery, Keller later was able to work out a lower price of
$250 a load. These amounts, which apparently were paid to Noonan by Neo-
Gravure, and later billed to the Times, appeared to have covered actual expenses
for the deliveries as well as what Mr. Hall characterized in his memoranda as
"tribute." As a result of this, the Book Review and Magazine for the issue
of Sunday, September 5, 1948, were delivered.
The next week, deliveries of the Book Review were held up until Thursday.
In the meantime, Noonan increased the charge per load to $375, explaining
that he had had to employ members of a New Jersey local. Under this arrange-
ment, the entire Times Book Review and Magazine for the issue of Sunday,
September 12, were moved in.
Since the Times records retention system provides for the destruction of old
checks and invoices after 7 years, we do not have the checks and invoices cover-
ing the 1948 payments to Neo-Gravure. The files of our auditing department,
however, do contain a memorandum dated September 23, 1948, referring to the
18244 IMPROPER ACTIVITIES IN THE LABOR FIELD
Neo-Gravure invoice covering tlie strike period and giving the details of the
payments. These include the following items :
For the issue of September 5, 1948 : Extra handling of magazine section
29 truckloads at $250 each, representing necessary payment to facili-
tate movement of trucks $7, 250
For the issue of September 12, 1948 : Extra handling of book review and
magazine sections 74 truckloads at $375 each 27, 750
Total 35,000
Additional charges for overtime, lunches, etc., brought the total payments in
connection with the strike to $43,143.62.
The Chairman. You may siumiiarize it, if you wish.
Mr. Bradford. The business manager of the Times is responsible
for its dealings with outside contract suppliers. One of the most
important of these is the company which does the Times rotogravure
printing of our magazine section, Book Review, and other special
Sunday sections.
From April 1933 until January 1, 1950, this printing was done for
the Times by the Neo-Gravure Printing Co., which at that time was
located on 26th Street in New York City, The Times business man-
ager is also responsible for handling labor relations. The Times
does not now and has not had any direct relationship with the Team-
sters Union.
It is, however, dependent on trucks driven by members of the
Teamsters Union for the delivery of its newsprint and the delivery
to its building of copies of the supplements printed by rotogravure,
including the Book Review and Magazine which, in 1948, were deli^'-
ered from 26th Street in Manliattan and which todny are delivered
from Hoboken, N.J.
The committee's subpena called for information about incidents
which occurred some 10 and 12 years ago. As I have said, the Times^
business manager, Mr. Hall, who handled these matters, is not avail-
able. We have searched our files carefully and the following is a sum-
mary of the matters which we found in our files in response to the
committee's subpena.
The first relates to the Teamsters' strike in August of 1946, when
negotiations were in process between all of the New York Teamsters'
locals and the various employer groups. A strike started with Local
807 on September 1 of that year, and the result was a complete tieup
of all deliveries in the New York City area.
At that time, the Times and other newspapers had to eliminate most
of their advertising and print small newspapers containing only news.
The Times Book Review, which had been printed in advance, and its
Magazine, were dropped from the issue of Smiday, September 15,^
1956, and distributed later on the 22d.
We have searched our records with regard to this strike, and have
found nothing that outlines in any detail anything in response to
the committee's questions concerning payments to labor leaders at
that time.
We did find a letter from Mr. Fred Stewart, who was then vice presi-
dent of Neo-Gravure, to Harold Hall, dated October 10, 1956, en-
closing a check from Neo in tlie amount of $1,800 to cover amounts
drawn from the Times on September 6 and 7. Attached to that were
some memoranda which were relatively meaningless, but one of them
IMPROPER ACTIVITIES IN THE LABOR FIELD 18245
listed the name of C. J. Noonan, president of the Motor and Bus Ter-
minal Checkers, and an address and tele]3hone number.
The Chairman. I hand you here what purports to be or what I
think may be photostatic copies of the documents to which you have
just referred.
Will you examine them and state if you identify them, please?
(The documents were handed to the witness.)
Mr. Bradford. Yes, these are photostatic copies of the letter dated
October 10, 1946, and the attachments which appeared in our file.
The Chairman. The letter and attachments thereto may be made
Exhibit No. 6.
(Documents referred to were marked "Exhibit No. G" for reference
and may be found in the files of the Select Committee.)
Mr. Bradford. I should make it clear that those attachments were
not enclosures with the letter, but were simply attached to the letter
in the file.
The Chairman. In other words, it was not indicated that they were
transmitted with the letter?
Mr. Bradford. That is correct. In fact, the letter would indicate
that they were not. These were receipts and a separate notation that
were in the same file.
The Chairman. But they all relate to the same subject matter?
Mr. Bradford. I assume so, sir, simply because they appeared in the
same file.
The Chairman. With that explanation, it may still remain as one
exhibit, exhibit No. 6.
Mr. Bradford. I have checked with the individual whose name ap-
pears on one of these vouchers, who was a clerk in the office at that
time, and he had no recollection or knowledge, in fact, his recollection
is clear that he had no knowledge, of the purpose for which the
$1,000 which he delivered to Neo-Gravure was to be used, except
that it had something to do with expediting shipments of the Maga-
zine, which were being held up because of the strike.
We were asked for checks and vouchers which we do not retain
for more than 7 years under our record retention system. We did find,
however, expense accomits in 1946 that indicated we made a payment
to Neo-Gravure on a voucher which is no longer in existence of
$20,837.71 which was coded in our accounts under a heading "Strike
Expense."
We have no records indicating whether this was for anything other
than added costs incun-ed because of disrupted schedules. I think
we supplied a copy of the accomiting record where that amount
appears.
The Chairman. I hand you a photostatic copy of your cash and
check records, the one of October 1946.
Will you examine this and state if you identify it as such?
(The document was handed to the witness.)
Mr. Bradford. This is a photostatic copy of that record on which
the next to last item is the one indicating the payment to the Neo-
Gravure Co. which I mentioned.
The Chairman. That may be made exhibit No. 7.
(Document referred to was marked "Exhibit No. 7" for reference
and may be found in the files of the Select Committee.)
18246 IMPROPER ACTIVITIES IN THE LABOR FIELD
The Chairman. You said there was not anything in your records
to indicate anything other than that this was for added cost incurred
because of disrupted schedules. That is your statement, I believe.
Mr. Bradford. That is correct.
The Chairman. Well, that could be literally true if the money was
paid for the purposes as testified to by the preceding witness ; is that
correct?
Mr. Bradford. It could be, sir, but what I meant to indicate is
that there is nothing in our files to support any interpretation of the
figure whatsoever. When I get onto the 1948 strike you will see
we did there have a detailed memorandum outlining the payment.
The Chairman. All right. Proceed.
Mr. Kennedy. The only documentation that you have in the 1946
strike that sIioavs any tie with the union official is the memorandum
that has the name C. J. Noonan and the fact that he is president of
this particular local ?
Mr. Bradford. That is correct.
(At this point Senator Church left the hearing room.)
The Chairman. I am very sorry, but we find ourselves temporarily
without a quorum.
Everyone will be at ease. We will have to suspend mitil another
Senator can be present.
^A short recess was taken.)
(At the expiration of the recess, the following members of the se-
lect committee were present: Senators McClellan and Mmidt.)
The Chairman. The committee will come to order.
Proceed, Mr. Kennedy.
Mr. Kennedy. Would you go ahead, Mr. Bradford, and continue
your statement, please ?
Mr. Bradford. I had finished covering the 1946 Teamsters' strike.
Mr. Kennedy. Just so that we identify Mr. Noonan, his local is
1730 of the ILA?
Mr. Bradford. I have no knowledge of what his local was. There
was an indication on that memorandum which you have in your file of
a local number.
Mr. Kennedy. It is the Terminal Workers Union, and this local's
number, Mr. Chairman, at the time the strike took place, was local
21510. It is the same local that then became local 1730 of the ILA.
So we have a number of different unions that are involved in the
discussion, the ILA, the Mail Handlers local, as well as the Teamsters
Unions. Those are the various unions we are discussing today, and
various locals of the Teamsters.
Would you continue, please ?
Mr. Bradford. Going on to 1948, in August 1948 negotiations were
again going on between the locals of the Teamsters Union in New
York and the various employer groups. By the contract end on August
31, three locals and five employer associations had reached contract
agreements through mediators' efforts. These agreements covered
about 40,000 teamsters.
Local 807, however, had not followed the settlements of the others,
and called a strike on September 1. This strike initially shut down
all deliveries in New York City, although some other locals did
continue to work sporadically, particularly in New Jersey.
IMPROPER ACTIVITIES IN THE LABOR FIELD 18247
On September 8, local 807 began to seek individual pacts with the
different employers. This tactic was successful and the operators began
to sign up on September 9. The strike was finally settled Sep-
tember 18.
The delivery of the Times Magazine and Book Review from Neo-
Gravure on 26th Street to the Times plant on 43d Street, was inter-
rupted by the strike of local 807 against the trucking company which
Neo-Gravure used. Without these supplements, the Sunday Times
delivered to its readers would have been incomplete. Also, they con-
tained substantial advertising on which many Times advertisers were
depending for their fall business.
Mr. Kennedy. Could I interrupt you there ?
Mr. Bradford. Yes.
Mr. Kennedy. What is the value of the Sunday supplement as far
as advertising is concerned ?
Mr. Bradford. There are two supplements involved here. One is the
Times Magazine, which at that time of year carries, I think, its peak
volume of the year, particularly the Sunday after Labor Day, includ-
ing advertising of all kinds, but particularly women's wear at that
season. The other section involved was the Times Book Review,
which contains all of the book advertising in the Sunday paper.
Mr. Kennedy. Can you give us any figures, approximate figures, as
to the value of the loss that would be incurred ?
Mr. Bradford. Yes. I made a quick calculation this morning. The
total advertising revenue in the four sections that were involved in
1948, that is, two Magazines and two Book Reviews, one for Sunday,
September 5, and the other for Sunday, September 12, was approxi-
mately $160,000.
Mr. Kennedy. That was the advertising ?
Mr. Bradford. That was the advertising income for those four sec-
tions.
Mr. Kennedy. And, of course, these supplements had already been
printed, had they not ?
Mr. Bradford. They had already been printed initially, or were
in the process of being printed for September 5. The ones for Sep-
tember 12 were in the process of preparation and were printed before
the delivery question was entirely resolved.
Mr. Kennedy. So this was going to be a loss that you would sustain ?
Mr. Bradford. If the sections were not delivered from Neo-Gravure
to the Times, we would have spent almost the entire cost of producing
them, aside from the cost of delivering them to the readers, and
would have received no income from the advertising.
The Chairman. How about if they had been delivered a week later ?
Mr. Bradford. We would have had
The Chairman. Would you have recouped ?
Mr. Bradford. The best way to answer that would be to describe our
experience 2 years earlier, in 1946, where we did deliver a substantial
part of the magazines which could not go out in the first Sunday of
the strike, with the Sunday after the strike ended, and our allowances
to the advertisers in that section came to a total of about $40,000.
The Chairman. In other words, if it does not go out on time, if the
advertising does not get distributed on time, you have to make an
adjustment?
18248 IMPROPER ACTIVITIES IN THE LABOR FIELD
Mr. Bradford. That is correct, sir.
Mr. IvENNEDY. Could you give us any figures as to what would have
been the loss if you would not have been able to get these two sections
out on the two Simdays ?
Mr. Bradford. Well, the loss would have been the advertising reve-
nue figure, the $160,000.
Mr. Kennedy. Then you also had the cost of printing.
Mr. Bradford. The cost of the printing we had incurred in any
•event.
Mr. Kennedy. If you knew you weren't going to get them out you
wouldn't have incurred the cost ?
Mr. Bradford. We might have stopped the printer. But you will
see why this was not done. We did make arrangements for delivering
the September 5 section so we then went ahead and also printed the
September 12 section.
Mr. Kennedy. Go ahead.
Mr. Bradford. The negotiations with Neo-Gravnre for delivery of
the Magazine and Book Review to the Times were carried out by
Harold Plall, the Times business manager. We have made available
to the committee staff, in response to the subpena, the entire file relat-
ing to this transaction, which had been kept in Mr. Hall's office.
The detailed record of the events as they developed in these mem-
oranda reveals the following, in summary — do you wish me to identify
the memoranda ?
Mr. Ivennedy. Maybe it would be well to read from the memoranda.
The Chairman. I hand you photostatic copy of what appears to be
a memo for the file, "H. H. to J. C, Teamsters Strike."
I ask you to examine it and to state if you identify this document,
this photostatic copy of a document.
(The document was handed to the witness.)
Mr. Bradford. Yes. This is a photostatic copy of the memorandum.
The Chairman. Of what ? Identif}'^ it for the record at this point.
Mr. Bradford. It is a memorandum for the files from H. H., which
is Mr. Hall's initials, to his secretary, J. C, James York.
The Chairman. From Mr. Hall to his secretary? That is what
the initials indicate ?
Mr. Bradford. Right. It is headed "Teamsters Strike" and "From
H. H.'s Notepad," and then a series of dates begin down the side
beginning with Wednesday, September 1, 1948, and running through
Saturday, September 11, 1948.
The Chairman. That may be made exhibit No. 8.
(Memo referred to was marked "Exhibit No. 8" for reference and
may be found in the files of the Select Committee.)
The Chairman. Now I hand you another series of memoranda
which appear to be dated — well, they seem to be from Mr. Hall to liis
secretarj^ — September 15, September 23, and October 25, 1958.
I will ask you to examine these three documents together with a
pen- written or penciled memorandum attached, and ask if you identify
those.
( The documents were handed to the witness. )
Mr. Bradford. I have before me, sir, one memorandum dated Octo-
ber 25, signed H. H. W. Those initials stand for Harry H. Wein-
. stock, who was then auditor of the Times. It is addressed to Mr.
IMPROPER ACTIVITIES IN THE LABOR FIELD 18249
Dreyfuss, dated October 25, 1958. Attached to it is a memorandum
dated September 23, 1948, addressed to General Adler, who was then
vice president and general manager of the Times, and signed with the
initials J. P. A., which stand for Joseph P. Alduino, who was then
assistant to the Times auditor.
Third is another memorandum for the files dated September 15,
1948, again with the initials H. H., for Harold Hall, to J. C, James
York, his secretary, also headed "Teamsters Strike."
The CuAiitiviAisr. These memoranda may be made exhibit No. 9 and
lettered in the order of their dates.
(Memos referred to were marked "Exhibit Nos. 9 A, 9B, and 9C" for
reference and may be found in the files of the Select Committee.)
Mr. Kennedy. I think the statement summarizes these memoranda ;
is that correct?
Mr. Bhadfcrd. Yes, sir; the statement I was reading summarizes
these memoranda and which cover, to some extent, matters other
than those called for in the subpena. Some of Mr. Hall's entries
refer to deliveries of newsprint and other aspects of the Teamsters
strike. Perhaps it would save the committee's time if I simply would
read the summary and respond to any questions you have.
Mr. Kennedy. All right.
Mr. Bralford. On Thursday, September 2, Mr. Hall discussed the
situation with Mr. Keller, vice president of Neo-Gravure, and learned
later from Keller that the shop steward at Neo, named Gross, had
said that one Noonan "can reach the proper people."
Keller then talked with Noonan, who apparently quoted $300 a
load to cover everything and everybody.
Mr. Hall agreed to reimburse Neo for this payment, contingent
upon complete delivery. Keller later was able to work out a lower
price of $250 a load.
These amounts which apparently were paid to Noonan by Neo-
Gravure and later billed to the Times — and I am summarizing my
own conclusion from going through this file, which is somewhat
different from the statement made by the Neo-Gravure officials this
morning.
It appeared to me that these amounts might have covered some
actual expenses for the deliveries as well as what Mr. Hall char-
acterized in his memoranda as tribute.
As a result of this, the Book Eeview and JMagazine for the issue
of Sunday, September 5, 1948, were delivered.
The next week, deliveries of the Book Review were held up until
Thursday. In the meantime, Noonan increased the charge per load
from $250 to $375, explaining that he had to employ members of
a New Jersey local. Under that arrangement, the entire Times Book
Eeview and Magazine for the issue of Sunday, September 12, were
moved in.
We have not retained the checks and invoices covering these pay-
ments from the Times to Neo-Gravure since we destroy all vouchers
after 7 years.
We did find, however, the memorandum dated September 23, 1948,
from the Times auditing department, which I just identified, which
referred to the Neo-Gravure invoice covering the strike period, of
which the total amount, and this total amount also appears in a
18250 IMPROPER ACTIVITIES IN THE LABOR FIELD
record of cash disbursements, of disbursements by check, which we
furnished the committee, was $43,143.62.
In the itemization of that amount, which included some payments
for overtime, supper for the men that were working overtime, et
cetera, there were identified the following specific items :
For the issues of September 5, 1948, extra handling of Magazine
section, 29 truckloads at $250 each, representing necessary payment to
facilitate movement of trucks, $^,250; for the issue of September
12, extra handling of Book Review and Magazine sections, 74 truck-
loads, at $375 each, for a total of $27,750.
The total of these two items comes to exactly $35,000.
Mr. Kennedy. I have a copy of this memorandum before me, and
I just want to ask you about some of the excerpts from it.
For instance, I think you make reference to it on August 2, 1948 :
I. M. Keller, of Neo, here from Chicago. Asked him to lunch. Told him
Times or Neo will be receiving overtures from a "fixer or two." (W. B. S. had
word that Noonan, business agent Platform Workers' Union, stood ready to
aid.)
WhoisW. B.S.?
Mr. Bradford. Let me correct your introductory statement. I
I think you said August 2. It was September 2.
Mr. Kennedy. Excuse me. September 2.
Mr. Bradford. W. B. S. stood for William B. Schleig, who was
then circulation manager of the New York Times. He left the Times
later that year.
Mr. Kennedy (reading) :
Keller on return to his office phoned me that Gross, shop steward of Neo's
platform workers, reported business agent Noonan "can reach the proper
people." Keller to talk with him.
Evidently that had reference to Harold Gross, or would you know
anything further ?
Mr. Bradford. Nothing in our files would identify Gross beyond
this statement.
Mr. Kennedy. Then at 7 o'clock on the same day, it says :
Keller phoned had satisfactory talk with Noonan, who quoted $300 a load "to
cover everything and everybody." Agreed this contingent upon complete de-
livery. Keller will seek to get price down.
Then on the next day :
Keller got price down to $250 a load each, Times and Mirror. Our share last
night about $3,750. (Keller just before leaving for Chicago reported a partial
payment made to Noonan this morning).
Then on September 8, 1948 :
At 5:30 p.m., Gervase, of Neo, reported "going to move." Quoted Noonan
"If street cleared, no question about it." Further conversations with McElroy
confirmed police arrangements. A captain came in at 6:30 and went over
details with me.
During night Noonan increased load charge to $375, explaining had to employ
members of Union 560 (Jersey) and evidently for a tribute to 807.
The Chairman. Wliat do you mean "tribute"? Is that a com-
mendation or a payoff ?
Mr. Bradford. Mr. Chairman, these are Mr. Hall's words. In a
later memorandum he identified the word "tribute" a little more ex-
plicitly and indicated he assumed this was a payment to union officials.
IMPROPER ACTIVITIES IN THE LABOR FIELD 18251
The Chairman. Sometimes ^ve pay a fellow a tribute, and then
again we pay him a bribe that we call a tribute.
Mr. Kennedy. There was no question, at least up to that time, that
there were fixers, as was mentioned here, and there were union officials
to whom money had to be paid ; is that correct ?
Mr. Bradford. I think that is the only possible conclusion you can
draw from this memorandum, Mr. Kennedy.
Mr. Kennedy. And it would appear, would it not, from the memo-
randum of September 11, 1948, the excerpts, that the New York Times
was being held up even after the strike was over; is that right?
Mr. Bradford. That certainly is a possible interpretation of that
rather involved description of what happened in the last night of the
strike.
Mr. Kennedy. Maybel will just
Mr. Bradford. I am unable to reach a firm conclusion except that it
is perfectly clear that for all of the trucks that brought in the Maga-
zine and Book Review, this $375 payment was made that night.
Mr. Kennedy. And it is also clear that this payment was — or at
least it appears from the memorandum that the payments were being
also made by the MiiTor as well as the New York Times.
Mr. Bradford. Yes. There is at least one reference to the Mirror.
As I understand it, the Mirror also had a section printed by Neo-
Gravure at this time, though I am not familiar with any of the
details.
The Chairman. It says your part of it was so much, where it men-
tions the Mirror, does it not ?
Mr. Bradford. Yes, sir. I assume this means that they paid the
same amount that we did, but nothing in our files would indicate it.
The Chairman. I mean, you don't know other than the fact that
the record shows it indicates there that there was so much total
between the Mirror obligation, the obligation of the Mirror and the
New York Times, and the New York Times part of it was so much.
Mr. Bradford. That is correct, sir.
The Chairman. Isn't that what it shows ?
Mr. Bradford. That is correct, sir.
Mr. Kennedy. Then on September 11, 1948, it says :
Word was around early last night that strike was over as far as 807 was
concerned with D. & K. and Cannon.
Cannon was the trucking company ?
Mr. Bradford. Yes, sir. D. & K., I believe, stands for Daniels and
Kennedy, a trucking company that handled newsprint, but it had no
relation to this situation. Nor to you. Cannon was the trucking
company which delivered our sections from Neo-Gravure.
Mr. Kennedy. I will just read this in for information :
Sat., September 11, 1948. — Delivery of Magazine completed at 5 :25 this a.m.
Word was around early last night that strike was over as far as 807 was con-
cerned with D. & K. and Cannon-Neo. Neo's delivery operation started early — •
first load was received at 8. No more came through though five loads were due
within an hour. Much conversation between 9 and 10, when four loads arrived.
Then another long wait. Gervase could not explain it at his end ; brought
Noonan to Schleig at 10 :05. Noonan said he wanted to be fair, everybody had
been good to him. However, he had put some people on for the complete job
and wondered if he was going to have to take care of them himself. There were
39 loads to come. After conferring with W.B.S. Gervase asked Noonan if
$3,000 would take care of it all. Noonan replied sure, and departed, ostensibly
18252 IMPROPER ACTIVITIES IN THE LABOR FIELD
to return to the Neo plant. Shortly afterwards, W.B.S. had word some trucks
that were on the way had been stopped at 9th Avenue at 34th Street by 807 men.
The trucks were off the police route for reasons unexplained. Cannon could not
find the shop steward, who earlier in the night had put 807 men on the trucks,
when Cannon said he would sign the contract. Cannon now could not get hold
of the shop steward, President Strong, or any official of 807. Nothing moved until
midnight. At that time Gervase found Noonan and asked what it was going to
cost to move the remainder of the delivery. Noonan said it would cost $375
a load, including those that came in — that was the best he could do. When told
it would be paid, he phoned Gross at the Neo plant "send them up" and trucks
arrived within 5 minutes, were fully accompanied by police. Noonan declared
the delivery would be completed at 5 :30 — it was, at 5 :25.
Cannon signed contract with 807 this forenoon.
So from this memorandum there was no question that payments
were being made to certain officials involved in this matter ?
Mr. Bradford. There is no question that the payments were made by
the Times to Neo-Gravure in the amounts indicated. It is a question
of what Neo-Gravure did in terms of passing this on to union officials
with whom their trucking company was dealing, I think, was covered
by their testimony tliis morning. Certainly this would confirm,,
though it doesn't, itself, show where the payments went.
The Chairman. These files certainly confirm that testimony this
morning, corroborate it very strongly, do they not ?
Mr. Bradford. I believe they do.
The Chairman. These are files out of the New York Times ?
Mr. Bradford. Everything that I have identified this afternoon are
from the New York Times files ; yes, sir.
The Chairman. I don't think we stated that earlier.
All right.
Mr. Kennedy. The memorandum would appear to indicate that
the representative of the New York Times was aware at the time as to.
where this money was going.
Mr. Bradford. I don't want to quibble about it, but it certainly was
aware that a man named Noonan said that for so much a truck these
trucks could be moved. I don't think this file indicates any clear-cut
awareness of the exact disposition of that money once it had been paid
by the Times to Neo-Gravure.
Mr. Kennedy. Again, 1 don't want to quibble either. Wliat I
want to determine is, for instance, the memorandum quoting that
money paid to Noonan and that he in turn can reach the proper
people, and in another place it mentions the fact that fixers would
be in toucli with the New York Times, and then it states that Noonan
was approached and said that for so nmch a truck he could get the
trucks through.
The payments, it shows from the memorandum, were made to Neo,
but it is also clear from the memorandum that the New York Times,
at least the representative of the New York Times who wrote this
memorandmn, was aware of the fact that these payments were being
made to these people.
Mr. Bradford. That is correct. The payments were made. Cer-
tainly it is a fair deduction that the payments were made from Neo-
Gravure to Noonan. The only thing I question is that I don't think
it is clear what happened beyond that.
Mr. Kennedy. I agree with you. I agree with you. The mem-
orandniu shows what you have just stated.
IMPROPER ACTIVITIES IN THE LABOR FIELD 18253
Mr. Bradford. That is rig-hl .
The Chairman. In other words, they don't know whether Noonan
went out and shot craps with it or whether he passed it around or
anything else.
Mr, Bradford. There is nothing to indicate what happened to it.
The CiiAiRiMAN. Not to indicate what happened to it after it
readied him, but he was tlie man to see that it got to the right people.
Mr. Kennedy. Do you feel, looking back on it, that it was a proper
payment ?
Mr. BrjVdford. Well, I find it hard today to judge an action that
was taken in 1948. Certainly it is clear that the union official dealing
with Neo-Gravure said that he could obtain delivery of these sections
if these payments were made. These were sections to which they
were legitimately entitled under our contract with Neo-Gravure.
\^''e were not ourselves involved in any labor dispute. We were
anxious to deliver a complete Sunday paper to our readers, which is
alwaj'S a newspaper's first interest. We have already gone into the
advertising problem, the fact advertisers were depending on these
sections for fall business.
I can say that in the light of the circumstances that have developed
since then, particularly many of the facts brought out by this com-
mittee, and in earlier investigations of similar situations in New
York, the Times would not today under any circumstances agree to
reimburse any of its suppliers for payments to union officials. We
would put the public interest against corruption in labor-management
relations above private interests in having any such sections delivered.
I would think, looking back to 1948, all we can say is that we hope
we have learned sometliing from our own experience and that of
others.
Tlie Ciiairjman. Have you anything further?
Mr. Kennedy. No.
This other memorandum has been made an exhibit, Mr. Chairman.
In it it makes a number of references. For instance —
Gervase of Neo on the phone this noon reported the total of special expenses
incurred by Neo in connection with the Book Review and Magazine sections for
September 5 and September 12 is $43,143.
Then it states :
Nearly all of this was "tribute," although the total includes some overtime we
authorized and .$1,400 in printing the book review of the 12th ahead of schedule
on Saturday and Sunday, September 4 and .5. I told Gervase that our figures
on the "tribute" were approximately the same, $7,000 to $7,200 the first week.
Then it goes on to say in the second week $31,000 to $32,000.
Senator Mundt. Mr. Bradford, you were in the hearing room this
morning, were you not ?
Mr. Bradford. I was sir.
Senator IMitndt. This may have been brought out earlier in the
afternoon before I was able to attend the committee liearing, but I
made tlie statement this morning which you must have heard me make :
The public has a very great interest in matters of this kind and should
have an interest in necessary labor reform legislation because tliese ex-
penses, incuri-ed under the duress from which you were suffering at
that time I presume are charged off as deductible expenses in the cost
of doing business. I conjectured that an examination of the books or
18254 IMPROPER ACTIVITIES IN THE LABOR FIELD
papers of the company involved would show that these were listed as
regular business expenses and as tax-deductible items.
I would simply like to have you confirm that fact or deny it, what-
ever the facts indicate.
Mr. Bradford. There would be no question whatsoever but that
these expenses which are outlined in this memorandum were listed as
deductible expenses on our income tax return. I think I should point
out in this connection, however, that if these amounts had not been
paid we would have had $160,000 less revenue to report in those same
returns. So that the net result is not quite what you implied.
Senator Mundt. Other than the fact that you naturally, in the
course normal business proceedings, pay a tax on whatever profits
there are, wherever this kind of extortion takes place I think the
public should realize that they are participants in the tribute which
is paid, because this is money which otherwise would have borne its
fair share of taxation.
Mr. Bradford. Quite apart from the tax consideration, sir, we agree
completely that this kind of payment is not the sort of payment that
we would make today.
As I said earlier, we would not make payments of this sort today
in order to obtain delivery of sections of this kind.
Senator Mundt. My statements this morning were not necessarily
critical of the practice of corporations charging this off as a cost of
doing business.
I think, in fact, it probably was a cost of doing business, where the
corporation elects to pay tribute instead of fight for what it considers
to be a fair consideration. I am speaking as one member of the com-
mittee and I am very glad to hear you enunciate what you tell me
is at the present time the policy and philosophy of the management of
the New York Times.
Mr. Bradford. Thank you, sir.
Senator Mundt. If somebody doesn't stand up and fight these fel-
lows, I think the cost of blackmail is like the experience encountered
with inflation. The more you get of it, the faster it moves.
The Chairman. The Chair checked with the staff. We find that
Mr. Gross received two payments of $2,500 each in cash, and also
received each year $4,000 annual payments in cash. That was in
addition to his weekly check and also his check each month — well, it
amounts to $28,000 over 7 years' time, at $4,000 a year.
He paid no income tax on that. He didn't report that. Neither
did he report the $5,000, or the two $2,500 payments.
Not only did the Government lose when these expenses are charged
off by business, presumably reputable businesses when they make such
payments, either being compelled to or when they enter into a col-
lusive agreement to do so, but usually the recipient of them, who actu-
ally profiteers out of it doesn't report it and, therefore, the tax is lost
on that also.
It is a veiy sad commentary, indeed, to find that we have such a
situation in this country, a country that is supposed to be ruled by
law and order and decency and human relations, to find that certainly
one of the greatest publications in the country, along with others,
associated in the same community, you may say, is subjected to a
situation where the publication can absolutely be closed down unless
IMPROPER ACTIVITIES IN THE LABOR FIELD 18255
they pay tribute. I don't think the Federal Government has the con-
stitutional power to close down a publication, even by excess taxation.
I don't think the Government could do it. It would be unconstitu-
tional for it to do it.
Yet we find here a bunch of rats under the guise of a union of
some kind that go out and, today, are vested with an economic power
that they can compel you, all of the subscribers, the advertisers, all
of them, to do without the benefits and advantages that such publi-
cation provides. They can compel them to suffer that loss of those
benefits and advantages as well as the operators of the business, of
doing the business, making a legitimate profit, unless they pay tribute.
I think it is very unfortunate that your paper did pay tribute or
any other one pays tribute to it.
I hope it is true that your publication has learned a lesson from
tliis, and that those who may read or get information about w^hat has
happened in this whole transaction, as being revealed here by the
testimony before this committee now, will profit by it, will take heed
from it, and I trust they will be encouraged and will be given a moral
stiffening of resistance to such would-be exploitations of them and the
imposition of such extortion, because that is exactly what it amounts
to.
I do not see anywhere in this that any laboring man who is work-
ing for wages benefited in any sense, in any degree, anywhere, any-
how, or any time. If anyone benefited from it, obviously it was at
the expense of the laboring people, at the expense of the general pub-
lic, and at the expense of what should be and is legitimate business
enterprise. I hope there is a great lesson learned from this, not only
from those of us who are here listening to it, but from the public at
large, that we can all profit by it.
I also hope it will do something else. I said earlier that I think
Congress has to take a large measure of the blame because it lias vested
these powers, or made it possible for them to arrogate to themselves
the powers of economic force that they are using for this cliaracter ot
extortion.
I think the responsibility rests upon the Congress today to enact
laws that will prohibit it, and then the burden would naturally shift
to the law enforcement agencies to enforce those laws.
Thus, we will protect our society, protect our economy, and protect
legitimate business from this kind of raiding, molestation, and ex-
ploitation.
Thank you very much. I think you are certainly to be commended
for coming here and just laying the cards on the table.
Of all decent citizens of this country I am reminded of what we used
to copy on the typewriter : Now is the time for all good citizens to come
to the aid of their party.
Now is the time for all good citizens to come to the aid of — I don't
like to use the word "crusade" — come to the aid of law enforcement
and order in the United States.
Syndicated crime, racketeering, gangsterism tactics have already
made dangerous, dangerous advances. The time has come when we
have to mobilize those forces that can resist them and those forces that
can repel the advances they have already made.
Is there anything further ?
36751— 59— pt. 51 9
18256 IMPROPER ACTIVITIES IN THE LABOR FIELD
Mr. Bradford. I just want to say thank you, Senator. Since I was
sitting in the stand while you made your very fine statement, I
would like to make it clear for the record that the Times was not in-
volved in the situation with respect to Mr. Gross, I believe it is, on
which you based your remarks, and nothing in which we were in-
volved had anything to do with our relations with our own employees
and our own unions.
The Chairman. I understand. You just had to simply agree to
pick up the tab, so to speak, in order to get your services that you were
entitled to.
Mr. Bradford. Correct, sir.
The Chairman. But, again, it is a sad commentary upon the state
of affairs in this country that such a situation can prevail or does
prevail or has prevailed, and that such acts have occurred.
Senator Mundt ?
Senator Mundt. I think it should be said, too, that as long as people
do pick up the tab to finance extortion like this, it tends to make that
extortion profitable. Once the corporate community decides it is not
going to be blackmailed, and is not going to get involved in paying
the fee that these racketeers prescribe, it will be very helpful in
correcting the situation.
So I hope you stand firmly on the policy which you enunciated,
which puts you on a much firmer position than to say, "Well, we
really didn't pay the money to Mr. Noonan direct. We just paid it
to the other company and they paid it to Mr. Noonan," which isn't
very convincing evidence.
Mr. Bradford. Thank you, sir. I can assure you that we will
stand on it.
Mr. Kennedy. Were there some matters that you wanted to
straighten out, Mr. Bradford ?
You or the Times or anyone connected with the Times has never
paid any money directly or indirectly to the Mail Deliverers Union in
connection with any of the negotiations that they have had with either
your wholesalers or with yourselves ?
Mr. Bradford. That is correct. We negotiate with the Newspaper
and Mail Deliverers Union through the Publishers Association of
New York. We, of course, deal directly with their officials in our
own plant on day-to-day matters.
I wanted to make it clear in the light of some of the remarks that
were made here yesterday that we had never made any payments,
direct or indirect, to the union or any of its officers or officials.
Mr. Kennedy. And as far as any of the wholesalers making any
payments directly or indirectly to any of the union officials, as I
understand it, you have informed them that such payments would not
be reimbursed nor tolerated by the New York Times?
Mr. Bradford, I would like to break my answer to that into two
parts. First, we have not reimbursed any wholesaler for any such
paj^iients. Our payments to the wholesalers are made on the basis
of a fixed scale of weight allowances for the weight of the papers
they deliver, and they also receive their returns from the difference
between the price they pay us for each 100 papers and the price
for which they resell those papers to the dealers. This is a normal
IMPROPER ACTIVITIES IN THE LABOR FIELD 18257
profit of an independent contractor which is usually referred to in
this trade as commissions.
The commissions that the Times pays the wholesalers, city and
suburban, in a year, aggi'e<^ate very close to $3 million on these fixed
scales. We have never been asked to reimburse any wholesaler for
any amounts paid to any union official.
We have been aware of the rumors that such payments are made that
have been extent for many years. I think these rumors were quite
clearly summarized in articles that appeared in the Washington Post
and in The Reporter and in, I believe, The Nation, last December
and this January.
After our strike was settled in December, we reached the conclu-
sion that the time had come to put our relations with this union on a
much sounder basis than they obviously had been in the period
preceding the strike. We concluded that if any payments had been
made and, mind you, all we knew were rumors that had been circu-
lated, we had no knowledge of any such payments, but if such pay-
ments had been made, the time hacl come when they should stop.
I asked our circulation director in his dealings with the wholesalers
in connection with the new contract arrangements with them this
spring to make it absolutely clear that if any such payments had
been made, they were not to be made in the future. We realize these
wholesalers are independent contractors and that we cannot control
what they have done, but we felt that since we both deal with the
same union, if anytliing of this kind existed, the time had come to
clear the air and get rid of it.
Mr. Kennedy. Mr. Chairman, I might say that since we began
this investigation, the New York Times has been most cooperative,
unlike some groups that we have had to work with. When we served
the supena, they agreed to compile the information and documents
and did turn over the documents to the committee, although some
of them, obviously, reflected on the New York Times.
But they made those documents available to the committee and
they have been completely candid and completely cooperative with the
staff of the committee since it began its investigation, their attorney
as well as the officials of the New York Times.
The Chairman. Thank you very much. We are veiy pleased that
you have cooperated. I think it is to your credit.
Is there anything further ?
Mr. Kennedy. We just have two people here, Mr. Chairman, not
directly on this, that we expected to hear, who I would like to release-
It would only take a minute to call them.
The Chairman. Call them forward.
Mr. Kennedy. Mr. Levine and Mr. Ertis.
The Chairman. Be sworn, please.
Do you and each of you — is it one or two ?
Mr. Kennedy. I want both of them. Mr. Ertis?
The Chairman. You and each of you do solemnly swear the evi-
dence you shall give before this Senate select committee shall be the
trutli, the whole truth, and nothing but the truth, so help you God?
Mr. Ertis. I do.
Mr. Levine. I do.
18258 IMPROPER ACTIVITIES IN THE LABOR FIELD
TESTIMONY OE SOLOMON LEVINE, ACCOMPANIED BY COUNSEL,
SIDNEY I. ELOREAN; AND lEVING EETIS, ACCOMPANIED BY
COUNSEL, HAREY B. STEINBERG— Resumed
The Chairman. State j-our name, your place of residence, and your
business or occupation.
Mr. Levine. Mr. Solomon Leviiie, 255 West 23d Street, Ne^Y York
City, N.Y. I represent Manhattan News Co., vice president and di-
rector.
The Chairman. Thank you.
Mr. Ertis. Irving Ertis, 209-03 32d Avenue, Bayside, N.Y. ; presi-
dent. Pacific News Co.
The Chairman. Each of you have counsel ?
Will you identify yourself as counsel ?
Mr, Florean. Sidney I. Florean, counsel for Manhattan News.
Mr. Steinberg. Harry B. Steinberg, counsel for JNIr. Ertis.
Mr. Kennedy. You are president of Pacific News Co., Mr. Ertis; is
that right?
Mr. Ertis. Yes, sir.
Mr. Kennedy. And, as such, you are a member of the Magazine
Wliolesalers Association; is that right? It is the group.
Mr. Steinberg. May I say ]Mr. Ertis is partially deaf?
JNIr. Kennedy. You f^e a member of the Magazine Wholesalers, are
you ?
Mr. Ertis. Yes, sir.
Mr. Kennedy. Mr. Ertis, how long have you been president of the
Pacific News Co. ?
Mr. Ertis. Since 1955.
Mr. Kennedy. And what m.agazine do you handle ?
Mr. Ertis. All of them.
Mr. Kennedy. All magazines ?
Mr. Ertis. All of them from regular franchised publishers.
Mr. Kennedy. Wliere does your company operate — in the New
York City area ?
Mr. Ertis. In Brooklyn and parts of Queens.
Mr. Kennedy. Have you made any payments to any union officials,
directly or indirectly ?
Mr. Ertis. I respectfully decline to answer on the grounds of my
constitutional privilege.
Mr. Kennedy. Mr. Ertis, do you know Mr. Michael Spozate ?
Mr. Ertis. I respectfully decline to answer on the grounds of my
constitutional privilege.
The Chairman. Knowing him wouldn't tend to incriminate you,
would it, just knowing the man ? Is that what you are saying ?
Mr. Ertis. Yes.
The Chairman. All right.
Mr. Kennedy. Mr. Tierney has been sworn. Could I ask him what
the record shows as far as Mr. Sjiozate is concerned ?
The Chairman. Yes.
IMPROPER ACTIVITIES IN THE LABOR FIELD 18259
TESTIMONY OF PAUL J. TIERNEY— Resumed
Mr. Kennedy. Have you anything on his background ?
Mr. TiERNEY. He is vice president of Pacific News Co., and a part
of the stock of the company is owned or is in the name of his wufe,
Rose Spozate. He has an extensive criminal record dating back to
1911, consisting of 10 arrests, including charges of burglary, larceny,
felonious assault, white slave traffic act, and bookmaking. ^ He was
convicted on eight occasions, two for juvenile delinquency, for which
he received suspended sentences ; petty larceny, for which he received
a suspended sentence ; unlawful entry, for which he received a sentence
of 60 days ; and a charge of bookmaking, for which lie was fined.
Mr. Kennedy. Do we find Mr. Ertis loaned money to Mr. Spozate?
Mr. TiERNEY. Yes.
Mr. Kennedy. Would you give us that situation ?
Mr. TiERNEY. An examination of the records of Pacific News Co.
revealed that Mr. Ertis borrowed $13,500 from Pacific News Co. He
deposited this amount in his personal bank account on the same day,
October 28, 1958.
(At this point Senator Church entered the hearing room.)
Mr. TiERNEY. On October 29, 1958, the check cleared Mr. Ertis'
account. An examination of Michael Spozate's account on October
29, 1958, revealed that $13,500, the same amount, was deposited to his
personal account. Thereafter, on November 3, 1958, Spozate wrote
a $9,000 check payable to the Bi-County News Co.
We have been advised by the officials of Bi-County News Co. that
he has an investment in that company, too. That is the company
which is partially owned by Irving Bitz, who testified yesterday.
Mr. Kennedy. Can you explain that transaction to us, Mr. Ertis?
(At this point Senator Mundt left the hearing room.)
Mr. Ertis. I respectfully decline to answer on the grounds my
answer may tend to incriminate me.
Mr. Kennedy. We have been looking for Mr. Spozate for 2 months.
Can you tell us where he has gone ?
Mr. Ertis. I respectfully decline to answer on the grounds my
answer may tend to incriminate me.
Mr. Kennedy. Mr. Levine, you are secretary-treasurer of the Man-
hattan News Co. ?
Mr. Levine. And vice president.
Mr. Kennedy. Manhattan News Co. is also a member of this asso-
ciation ?
Mr. Le\t;ne. We have no association as you are defining association.
Mr. Kennedy. Are you a member of any group ?
Mr. Levine. I am a member of Atlantic Coast
Mr. Kennedy. What is the name of it ?
Mr. Levine. Atlantic Coast Independent Distributors Association.
Mr. IvENNEDY. Is there any other association you are a member of?
Mr. Levine. No ; we have no association.
Mr. Kennedy. You are engaged in the wholesale distribution of
magazines in the Borough of Alanhattan (
Mr. Levine. Yes, sir.
Mr. K^JENNEDY. And you employ some 50 union drivers; is that
right?
18260 IMPROPER ACTIVITIES IN THE LABOR FIELD
Mr. Levine. Approximately.
Mr. Kennedy. And a gross business of about $8.9 million a year ?
Mr. Levine. No, sir.
Mr. Kennedy. How much ?
Mr. Levine. I would say a gross business of approximately between
$-41/^ million and $5 million, sir.
Mr. Kennedy. Have you made any payments directly or indirectly
to any union official ?
Mr. Levine. I respectfully decline to answer that question, sir, on
the grounds that the answer may tend to incriminate m.e,
Mr. Kennedy. The stockliolders of the Manhattan News Co. are
whom ?
Mr. Levine. The stock is held in three parts. Two parts are held
in trust. I am the trustee for two minor children.
Mr. Kennedy. "Who are the two children ?
Mr. Levine. Myron Garfinkle and Gale Garfinkle.
Mr. Kennedy. Are they the daughters of the Henry Garfinlde,
president of the American News Co. ?
Mr. Levine. Daughter and son.
Mr. Kennedy. Who is the third individual ?
Mr. LE\aNE. Mrs. Ann Garfinkle.
Mr. Kennedy. Who is she ?
Mr. Levine. The wife.
Mr. Kennedy. Of Henry Garfinkle ?
Mr. Levine. That is right.
Mr. Kennedy. Henry Garfinkle is the president of the American
News Co. ; is that correct ?
Mr. Levine. That is correct.
Mr. Kennedy. Was he aware of the fact that you were going to
appear before this committee and refuse to answer whether you make
any payments to any union officials ?
Mr. Levine. I decline to answer that question on the grounds the
answer may tend to incriminate me.
Mr. Kennedy. Did you discuss it with Mr. Garfinkle ?
(The witness conferred with his counsel.)
Mr. Levine. I decline to answer that question on the grounds the
answer may tend to incriminate me.
The Chairman. Do you regard yourself as a businessman ?
Mr. Levine. Yes, sir ; I do.
The Chairman. Do you favor this racketeering in business, in labor-
management relations?
Mr.LEviNE. I decline to answer on the ground the answer may tend
to incriminate me.
The Chairman. The only answer that could incriminate you is to
say that you do. Is that the impression that you want to leave?
(The witness conferred with his counsel.)
Mr. Levine. I decline to answer on the ground the answer may tend
to incriminate me.
The Chairman. You don't have to answer it.
Proceed.
Mr. Kennedy. On January 23, 1958, the Manhattan News Co. made
a loan of $7,500 to Michael Spozate of the Pacific News Co. Could
you tell us what that was for ?
IMPROPER ACTIVITIES IN THE LABOR FIELD 18261
Mr. Levixe. I decline to answer on the ground tlie answer may tend
to incriminate me.
Mr. Kennedy. And on January 24, 1958, Spozate deposited the
$7,500 in his personal bank account at the National City Bank of New
York in Brooklyn. Can you give us any information about Mr.
Spozate's activities?
Mr. Levine. I decline to answer on the ground the answer may tend
to incriminate me.
Mr. Kennedy. That is all for these witnesses.
The Chairman. Call the next witness.
Mr. Kennedy. Mr. Warren Kelly.
The Chairman. Come forward, Mr. Kelly.
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. Keli>y. I do.
TESTIMONY OF WARREN KELLY, ACCOMPANIED BY COUNSEL,
THOMAS A. BRENNAN
The Chairman. State your name, your place of residence, and your
business or occupation.
Mr. Kelly. Warren Kelly, 1111 Midland Avenue, Bronxville, N.Y. ;
vice president and advertising director of the New York Mirror.
The Chairman. You have counsel.
Please identify yourself.
Mr. Brennan. I am Thomas A. Brennan, 959 8th Avenue, New
York City, N.Y.
The Chairman. Proceed.
Mr. Kennedy. Mr. Kelly, you held what position in 1948 ?
Mr. Kelly. General manager.
Mr. Kennedy. And what position did you hold in 1946 with the
New York Mirror ?
Mr. Kelly. Director of retail advertising.
Mr. Kennedy. I will ask you to identify this document.
The Chairman. The Chair presents to you a photostatic copy of a
document and I ask you to examine it and state if you identify it.
(The document was handed to the witness.)
Mr. Kelly. I do.
The Chairman. AYliat is it?
Mr. Kelly. A memorandum written by me on September 16, 1948,
to Charles J. Weindorf, the subject of which is the Neo-Gravure bill.
The Chairman. It may be made Exhibit No. 10.
(Memo referred to was marked "Exhibit No. 10'' for reference and
may be found in the files of the select committee. )
Mr. Kennedy. Now, Mr. Kelly, we have had testimony by repre-
sentatives of the Neo-Gravure in connection with the strike that oc-
curred in 1948, where there was difficulty in delivering the supplement
sections of both the New York Times and the New York Mirror.
We have had testimony from the representatives of the New York
Times, and you are being called as a representative of the New York
Mirror to give whatever facts you have in connection with this.
18262 IMPROPER ACTIVITIES IN THE LABOR FIELD
You are aware, or you were aware that in connection with the diffi-
culty that existed in 1948 in the delivery of the supplemental section,
there were certain payments that were made by the New York Mirror ;
is that correct ?
Mr. Kelly. Yes, sir.
Mr. Kennedy. And those payments were made to Neo-Gravure ?
Mr. Kelly. Yes, sir.
Mr. Kennedy. To obtain those deliveries ?
Mr. Kelly. Yes, sir.
Mr. Kennedy. This memorandum would appear to indicate that the
New York Mirror paid some $13,856.38 in connection with those de-
liveries.
Mr. Kelly. That is correct. I don't think the entire amount is
there ; it is specified, however, in the memorandum.
Mr. Kennedy. I believe the whole cost was $13,856.38.
Mr. Kelly. Approximately $10,000 was paid.
Mr. Kennedy. To Mr. Gross and Mr. Noonan '?
Mr. Kelly. I don't know.
Mr. Kennedy. You mentioned $10,000.
Mr. Kelly. That was made to Neo-Gravure.
Mr. Kennedy. And the rest of the $13,000 went to whom ?
Mr. Kelly. It says in the memorandum there, and I don't remember.
Mr. Kennedy. Wliat was the $10,000 that was paid to Neo-Gravure ?
Wliat was that for, Mr. Kelly ?
Mr. Kelly. As far as I know, to expedite the shipment of maga-
zine supplements from Neo-Gravure's plant on 26th Street to the
Mirror plant on 45th Street by their trucks.
Mr. Kennedy. And how were they going; to expedite them ?
Mr. Kei^y. I don't know how they were going to expedite them.
Mr. Kennedy. You paid some $10,000 for the service. What was
going to be done ?
Mr. Kelly. We paid it afterwards.
Mr. Kennedy. You paid it afterwards, but what did they do then ?
What did you understand they did ?
Mr. Kelly. They were going to expedite them.
Mr. Kennedy. What did they do, and what did you find out and
what did you learn that they did to expedite them ?
Mr. Kelly. They told me that they had spent it, so much per load.
Mr. Kennedy. And that is indicated in this memorandum ; is that
right?
Mr. Kelly. Yes, sir.
Mr. Kennedy. Some $150 a load?
Mr. Kelly. $375, and there were varying amounts, and some were
at $275.
The Chairman. Is that something unusual ?
Mr. Kelly. Very.
The Chairman. Did it arouse your curiosity ?
Mr. Kelly. Not at the time.
The Chairman. Is that unusual, $250 a load extra, that didn't
arouse your interest at that time ?
Mr. Kelly. I w^as interested chiefly in having the magazines de-
livered, so that we could deliver them.
The Chairman. You were not interested in Imowing where your
money was going or what it was going for?
IMPROPER ACTIVITIES IN THE LABOR FIELD 18263
Mr. Kelly. We had a contract with Neo-Gravure to print and de-
liver the papers to us.
The Chairman. For so much ?
Mr. Kelly. For so nuicli.
The Chairman. This was in addition to the "so much," was it not?
Mr. Kelly. That is right, and that contract also provided that
there were escalator clauses, that any extra expenses, and so forth, we
would meet the extra expenses.
The Chairman. When they present something for extra expense,
wouldn't you w^ant to know what it was for ?
Mr. Kelly. I understand that it was going to be, although I did not
handle it at the time, I understood that they were going to pay extra
for getting the trucks out through the strike.
The Chairman. Proceed.
Mr. Kennedy. Did you inquire as to who was to receive the money ?
Mr. Kelly. I did not.
Mr. Kennedy. You didn't care where the $10,000 went as long as
you got your magazine sections ?
]VIi\ Kelly. Exactly.
Mr. Kennedy. Do you think that is the proper attitude for a busi-
ness executive?
Mr. Kelly. I think it is the proper attitude for an executive that
wants to sell 2 million papers.
Mr. Kennedy. That is the most important thing ?
Mr. Kelly. And with the advertising revenue that is in the 2 mil-
lion papers, we are in exactly the same position as the TimevS.
The Chairman. Mr. Kelly, surely you don't mean to imply here
that all legitimate business ought to just surrender to this racketeer-
ing exploitation whenever it occurs ? You don't mean to say that, do
you?
Mr. Kelly. I do not.
The Chairman. Well, in testifying here at a great indifference,
and it doesn't matter to you as long as you got your papers out. Is
that what you mean to say ?
Mr. Kelly. It wasn't my position at the time.
The Chairman. You are doing the testifying now, and I am trying
to find out.
Mr. Kelly. I realize that, and it wasn't my position at the time to
arrange with Neo-Gravure to get them. We had a circulation man-
ager who would arrange wdth Neo-Gravure.
The Chairman. I can understand you did not actually make the
arrangements, and I can imderstand that. But I could hardly con-
ceive that you would want to place your stamp of approval on some
arrangement that would pay out this extortion money, and that is
what I regard it.
Mr. Kelly. I don't place my stamp of approval on it.
The Chairman. I think that you would condemn it and not say
that you had no interest in it just so you got your papers. You
didn't mean to say that ?
Mr. Kelly. No; I didn't mean to say that, and I think that I
condemn such practices.
The Chairman. I don't see how a businessman that wants to do a
legitimate business and wants to uphold the standards of ethics in
18264 IMPROPER ACTIVITIES IN THE LABOR FIELD
our economy in business affairs in this country can possibly condone
that sort of practice, or that act. I hope you don't say that you do.
Mr. Kelly. I don't condone it.
Mr. Kennedy. Would you do it again?
Mr. Kelly. No ; I would not.
Mr. Kennedy. You would not make these payments that you made
in 1948 ; you would not do it again ?
Mr. Kelly. Now you are asking me as an individual, that is not in
that position. I have nothing to do with that part of the business
now.
Mr. Kennedy. I am asking you if you were in that position again.
Mr. Kelly. As an individual citizen I would not.
Mr. Kennedy. Let us assume you were back in the same position,
as an executive of the New York Mirror. Would you make those
payments now as you made them then ?
Mr. Kelly. That I would have to give more thought to.
The Chairman. Did you make the payments then, or authorize
them ?
Mr. Kelly. I did not authorize them ; no, sir.
Mr. Kennedy. This is the memorandum. It would appear to show
Mr. Kelly's participation.
The Chairman. You had full knowledge of the transaction, that
the money was being paid at the time.
Mr. Kelly. I authorized the payment later.
The Chairman. You authorized the payment at the time. Well,
the question should be, whether you should mider the same circum-
stances authorize payment again like that.
Mr. Kelly. No ; I would not.
The Chairman. Why ?
Mr. Kelly. Because I have a different view. This was 11 years
ago.
The Chairman. You know it is the wrong thing to do, do you not ?
Your paper editorially would condemn it in others just like that.
Mr. Kelly. Exactly.
The Chairman. Don't you condemn it when you do it ?
Mr. Kelly. Yes, sir.
The Chairman. All right.
Mr. Kennedy. You wouldn't do it again if you were in the same
position ?
Mr. Kelly. I would not.
Mr. Kennedy. That is all.
Here is one other memorandum in connection with the 1946 strike.
The Chairman. I hand you what looks like a pen-written memo-
randum and ask you to examine it, Mr. Kelly, and see if you can iden-
tify it. It has no date on it, I don't believe, but you may identify it.
This other memorandum, made exhibit No. 10, came from the files
of your paper, did it not ?
Mr. Kelly. Yes, sir.
The Chairman. Thank you.
Mr. Ivelly. This does, too. As far as I can tell from this memo-
randum, I only saw it for the first time yesterday or the day before,
and this has to do with the 1946 strike.
IMPROPER ACTrVITIES IN THE LABOR FIELD 18265
The Chairman. I understand it did. It does not have to do with
the 1948 one. You had another one in 1946 ?
Mr. Kelly. That is right, sir, and I was not tlie general manager at
the time.
The Chairman. But can you identify that as a memorandum from
your files?
Mr. IvELLY. It is.
The Chairman. Thank you. It may be made exhibit No. 11.
(Document referred to was marked '"'Exhibit Xo. 11"' for reference
and will be found in the appendix on p. 18327.)
Mr. Kennedy. I Avant to read you some excerpts from the memo-
randum, Mr. Kelly.
The memorandum has a firet paragraph here which I do not think
refers to our situation. But it states here :
Neo-business agents of New York Teamsters, $2,750 first week, and then a ques-
tion mark second week.
Do you know what that referred to?
Mr. Kelly. I have to guess on this one.
Mr. Kennedy. Would you tell us what you think '.
Mr. Kelly. I would imagine that it refers to some payment to the
Teamsters. I thinks it says in there the Times in that first paragraph,
the Times and the Mirror or one and the other.
Mr. Kennedy. It says business agents of the New York Teamsters,
$2,750 the first week, and a question mark the second week. This was
in the file on the 1946 strike ; is that not correct ? This memo was
taken from that.
Mr. Kelly. I believe it w^as, it was in some file.
Mr. Kennedy. And then the next paragraph :
Union representatives for Jersey Tunnel comics, $400.
What did that refer to %
Mr. Kelly. That is wdien the comics, I. think, were delivered from
Wilkes-Barre, Pa., by one union, had to go through the tunnel and
there was a strike at the time, of the New York truckdrivers, and that
might have been a payment, and I say it might have been, because I
don't know, and I am just guessing, but it might have been payment
to the New York union to let the trucks go through,
Mr. Kennedy. Then the next paragraph is "Claims for musclemen,
$6,700."
Mr. Kelly. That I can't say.
Mr. Kennedy. Then it says, "Kenney, $5,000 donation," and then
"$1,700 other."
You had a man by the name of Kenney with you ?
Mr. Kelly. We did have a circulation man l3y the name of Kenney.
Mr. Kennedy. Do you know what claims for musclemen of $6,700
referred to ?
Mr. Kelly. I don't know.
Mr. Kennedy. Did the New York ]\Iirror use musclemen in that
strike in 1946, that you know of ?
]\Ir. Kelly. We did not. We were not on strike at the time. It
was New York truckdrivers, the Mailers and Deliverers Union.
18266 IMPROPER ACTIVITIES IN THE LABOR FIELD
Mr. Kennedy, The last paragraph says,
Camion ; $10 a night plus meals to take pickets away so trucks can come
through.
The total there is $2,000.
Mr. Kelly. I think that had something to do with getting the
trucks through.
The Chairman. Is there anything further ?
Senator Church. I have no questions, Mr. Chairman.
Mr. Kennedy. That is all.
The Chairman. The committee will stand in recess until 10 :^0 to-
morrow morning, and we will meet here in this room.
(^^Hiereupon, at 1 :10 p.m., the select committee recessed, to recon-
vene at 10 :30 a.m., the following day. Members of the select com-
mittee present at the taking of the recess were Senators McClellan
and Church.)
INVESTIGATION OF IMPROPER ACTIVITIES IN THE
LABOR OR MANAGEMENT FIELD
THURSDAY, MAY 7, 1959
U.S. 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 Kesolu-
tion 44, agreed to February 2, 1959, in the caucus room of the Senate
Office Building, Senator John L. McClellan (chairman of the select
committee) presiding.
Present: Senator John L. McClellan, Democrat, Arkansas; Senator
Karl E. Mundt, Eepublican, South Dakota; Senator Sam J. Ervin,
Jr., Democrat, North Carolina ; Senator Homer E. Capehart, Repub-
lican, Indiana; Senator Carl T. Curtis, Republican, Nebraska.
Also present: Kobert F. Kennedy, chief counsel; Jerome S. Adler-
man, assistant chief counsel; P. Kenneth O'Donnell, administrative
assistant; Paul J. Tierney, assistant counsel; George M. Kopecky, as-
sistant counsel ; Walter R. Mayj assistant counsel ; Walter J. Sheridan,
investigator; Robert J. Cofini, investigator; Ruth Y. Watt, chief
clerk.
The Chairman. The committee will come to order.
(Members of the select committee present at time of convening:
Senators McClellan and Capehart.)
The Chairman. Call the next witness.
Mr, Kennedy. Mr. John J. Padulo.
The Chairman. Be sworn, please.
You do solemnly swear the evidence you shall give before this Sen-
ate select committee shall be tlie truth, the whole truth, and nothing
but the truth, so help you God ?
Mr. Padulo. I do.
TESTIMONY OF JOHN J. PADULO
The Chairman. State your name, your place of residence and your
business or occupation.
Mr. Padulo. John Joseph Padulo, 3.51 West Sixth Street, Erie,
Pa. ; business manager of the Erie Times-News.
The Chairman. You waive counsel?
Mr. Padulo. I have no counsel.
Tlie Chairman. Do you waive counsel ?
Mr. Padulo. Yes, sir.
The Chairman. Thank you. Proceed.
182('7
18268 IMPROPER ACTIVITIES IN THE LABOR FIELD
Mr. Kennedy. Mr. Padulo, prior to joining the Erie Times- News,
you were employed by the Hearst organization; is that correct?
Mr. Padulo. Yes, sir.
Mr. Kennedy. And your name came out in tlie testimony yesterday
as one of those who was involved in this $4,000 payment that was made
each year by the Hearst organization, and which was paid up until
1958. You prepared an affidavit for the conunittee, in the presence
of a staff member ?
Mr. Padulo. Yes, sir.
Mr. Kennedy. You were business manager from 1952 to 1955 ?
Mr. Padulo. Yes, sir.
Tlie Chairman. I present to you what purports to be the affidavit
that you signed for the staff and ask you to examine it and state if
you identify it.
(The document was handed to the witness.)
Mr. Padulo. Yes, sir.
The Chairman. Is that correct ?
Mr. Padulo. Yes. sir.
The Chairman. Does it state the truth ?
Mr. Padulo. Yes, sir.
The Chairman. It may be printed in the record at this point. Print
it in full.
(The affidavit referred to is as follows :)
Affidavit
State of Pennsylvania,
County of Erie, ss:
I, .loliii Joseph Padulo, of 3.51 West Sixth Street, Erie, Pa., make this affidavit
freely and voluntarily to Joseph F. Maher, who has identified himself to me as
an investigator of the United States Senate Select Committee on Improper Activ-
ities in the Labor or Management Field, and I know this affidavit may be used
in a public hearing.
I am presently business manager of the Erie Times-News.
Prior to joining the Erie Times-News I was employed by the Hearst organiza-
tion for a period of approximately 28 years.
I was business manager of the American Weekly from May 1952 through
December 19.")5, at which time I was transferred to Los Angeles as business man-
ager of the Los Angeles Examiner.
My duties as business manager of the American Weekly included approval of
all disbursements, approval of invoices, and I negotiated various labor contracts
and did other duties of a business manager that would come up in the normal
course of business.
During the year 1951 a contract was negotiated with Neo-Gravure for the
printing of the American Weekly effective with the issue of May 11, 1952. All
labor negotiations and the drawing up of the printing contract were completed
before I became business manager of the American Weekly.
As business manager of the American Weekly I approved all expenditures
pertaining to the printing of the American Weekly. In May of each year, as I
recall, there was an item of .$4,000 tliat appeared on the invoices submitted by
Neo-Gravure to the American Weekly and labeled "Miscellaneous Expense" or
"Expense." This $4,000 was paid in order to keep labor peace and it was
included in the total amount of the invoice.
I was told by Mr. Chenicek, who was general manager of the Neo-Gravure Wee-
hawken plant, that this $4,000 had to be paid in May of each year to certain
individuals in order to keep labor peace, and the production of the American
Weekly.
I approved the $4,000 payment after a discussion with the New York general
management office and was told to make the payment by the general manager,
J. D. Gortatowsky.
IMPROPER ACTWITIES IN THE LABOR FIELD 18269
As a newspaper man of 30 or more years' experience, it is my opinion that
if tliis payment was not made every year, the American Weelcly would not
have been printed.
The above statement was made to the best of my recollection.
J. J. Padxjlo.
Sworn to and subscribed before me this 4th day of May 1959.
Alice C. Peerboom, Notary Public, Erie, Erie County, Pa.
My commission expires January 7, 1963.
The Chairman. You may make comments about it or read any
excerpts from it.
Mr. Kennedy. I think to expedite matters, he could read it into
the record, INIr. Chairman.
The Chairman. It may be read into the record at this point and then
you may be interrogated about it. You may read it.
Mr. Paditi.o. Do you want me to read it out loud ?
The Chairman. Yes; read it out loud. Just read the pertinent
parts of it.
Mr. Padulo (reading) :
Prior to joining the Erie Times-News I was employed by the Hearst organi-
zation for a period of approximately 28 years.
I was business manager of the American Weekly from May 1952 through
December 1955, at which time I was transferred to Los Angeles as business
manager of the Los Angeles Examiner.
During the year 1951 a contract was negotiated with Neo-Gravure for the
printing of the American Weekly effective with the issue of May 11, 1952. All
labor negotiations and the drawing up of the printing contract were completed
before I became business manager of the American Weekly.
As business manager of the American Weekly I approved all expenditures
pertaining to the printing of the American Weekly. In May of each year, as I
recall, there was an item of $4,000 that appeared on the invoices submitted by
Neo-Gravure to the American Weekly and labeled "Miscellaneous Expense" or
"Expense." This $4,000 was paid in order to keep labor peace and it was included,
in the total amount of the invoice.
I was told by Mr. Chenicek, who was general manager of the Neo-Gravure
Weehawken plant, that this $4,000 had to be paid in May of each year to certain
individuals in order to keep labor peace, and the production of the Ajtnerican
Weekly.
I approved the $4,000 i)ayment after a discussion with the New York general
management office and was told to make the payment by the general manager,
J. D. Gortatowsky.
As a newspaper man of 30 or more years' experience, it is my opinion that
if this payment was not made every year, the American Weekly would not have
been printed.
The Chairman. On what do you base that opinion ? If you didn't
pay this $4,000 each year to — to that fellow Gross, was it ?
Mr. Padulo. I don't know.
The Chairman. You don't know who the money went to ?
Mr. Padulo. No, sir.
The Chairman. But you knew it was not connected with legitimate
operations, it was paying a tribute to someone to keep from being
molested or interfered with in your proper operations?
Mr. Padulo. All I know about the item, sir, is that it was being
paid to Neo-Gravure to insure labor peace and guarantee delivery of
the American Weekly.
The Chairman. That wasn't a part of the original contract with
the Neo-Gravure, was it ?
Mr. Padulo. No, sir.
18270 IMPROPER ACTIVITIES IN THE LABOR FIELD
The Chairman. That is something that was over and beyond the
legal contract that was entered into?
Mr. Padulo. Yes, sir.
The Chairman. Did it occur to you that such a payment might be
improper ?
Mr. Padulo. Yes, sir.
The Chairman. So you realized that at the time you were, in effect,
having to pay tribute to someone ; didn't you ?
Mr. Padulo. Yes, sir.
The Chairman. I mean, you were conscious of that, whether you
went into all the details of it or not ?
Mr. Padulo. I was not, sir. I mean, as far as my end of it, it was
an item being paid to maintain labor peace.
The Chairman. That is what I said. Ordinarily, you don't have
to pay tribute to somebody for the privilege of engaging in legitimate
business; do you?
Mr. Padulo. No, sir.
The Chairman. That is contrary to the conception of our philoso-
phy of government ; is it not ?
Mr. Padulo. Yes, sir.
The Chairman. So you really knew at the time, or you felt at the
time, that it was an improper payment in some respect ?
Mr. Padulo. Yes, sir.
The Chairman. But you felt that you were compelled to do it;
otherwise, the orderly delivery of your papers, in other words, the
Neo-Gravure Printing Co. would not be able to perform its contract,
its agreement with you, for printing your magazine unless this tribute
was paid ?
Mr. Padulo. Correct.
The Chairman. That is the way you felt about it ?
Mr. Padulo. Yes, sir.
The Chairman. And that was the pressure or the compulsion that
caused you to pay ?
Mr. Padulo. Yes, sir.
The Chairman. All right.
Mr. Kennedy. You also discussed this with Mr. Brennan ?
Mr. Padulo. Yes, sir.
Mr. Kennedy. Mr. Brennan is the attorney for the Hearst publica-
tions?
Mr. Padulo. Yes, sir.
Mr. Kennedy. During this period of time you discussed it with
him?
Mr. Padulo. Yes, sir.
Mr. Kennedy. So he was aware of the fact that the payment was
being made ?
Mr. Padulo. He was told that we were making this payment, but
knew nothing about it.
Mr. Kennedy. Well, he knew the reason for making the payment?
Mr. Padulo. He did not, as far as I was concerned.
Mr. Kennedy. What did he know about the payment?
Mr. Padulo. He knew nothing about it.
Mr. Kennedy. Did you discuss at all the fact that you were making
the $4,000 payment?
IMPROPER ACTIVITIES IN THE LABOR FIELD 18271
Mr. Padulo. I did.
Mr. Kennedy. And you discussed why you wore making- the pay-
ment?
Mr. Padulo. I discussed we luxd to make it in order to get delivery
of the xVmerican Weekly and he didn't want to go any further than
that.
Mr. Kennedy. He didn't want to hear any thing moi-e about it 2
Mr. Padulo. No, sir.
Mr. Kennedy. He said, "That is up to you. I don't Avant to hear
any more about it" ?
Mr. Padulo. He didn't say that. He just said he didn't want to
hear anything about it, and didn't want to carry the conversation
beyond that.
The Chairman. As a lawyer, he didn't Avant to be involved in it.
If such practice Avas going to be engaged in, he didn't Avant to giA^e his
professional approval to it ?
Mr. Padulo. Well, it wasn't discussed from that angle. He merely
said, "John, I knoAA' nothing about it, period."
The Chairman. He Avasn't goiuii; to get iuA'oh-ed if he could help
it.
Mr. Padulo. Well, I don't know.
The Chairman. He shied aAAay from it, didn't he ?
Mr. Padulo. He didn't shie aAvay from it. He just said, "John, I
knoAV nothing about it."
Mr. Kennedy. Yesterday you told Mr. Adlerman and myself in
tlie office that "Brennan Avas aAA'are of the payment and the purpose of
the payment.''
Mr. Padulo. I didn't say the purpose of the payment. When you
say the purpose of the payment, he Avas told by me that this hacl to
be made.
The Chairman. You said a moment ago it AA^as to buy labor peace.
Mr. Padulo. That is right.
The Chairman. And you told him that ?
Mr. Padulo. That is right, and he said, "John, I knoAA' nothing
about it." That AA'as his answer.
The Chairman. When you told him that, that made him aAvare of
the general purpose of it, didn't it ?
Mr. Padulo. Yes, sir.
The Chairman. All right.
Mr. Kennedy. That is it, Mr. Chairman.
The Chairman. Is there anything further?
Senator Capehart. I haA^e a couple of questions.
This $4,000, AA'as that paid because this printing company told you
that they had to do it in order to print your Aveekly ?
Mr. Padulo. The ansAver that I AA^ould get from Neo-Gravure Avheii
I talked to them AA^as that this payment had to be made if we ex-
pected to have the American Weekly delivered.
Senator Capehart. Printed or delivered ?
Mr. Padulo. Delivered. I don't knoAv Avhetlier he used the word
"printed" or "delivered."
Senator Capehart. In other words, the $4,000 had to do Avitli the
printing of the magazine, or did it have to do Avith the deliA^ery of
the magazine ?
.•>f;751 — 50— i.t. 51 10
18272 IMPROPER ACTIVITIES IN THE LABOR FIELD
Mr. Padulo. Delivery. As I say, I don't know whether we dis
cussed it from the standpoint of it being printed or delivered, but 1
think it weighed more on the fact that it could not be delivered.
Senator Capehart. And they told you, this printing concern, that
they had to have $4,000 to pay to somebody in order to get your
magazines delivered to where ?
Mr, Padulo. To the New York Journal American plant. This
$4,000, I want to bring this out to clarify it, was always included in
an invoice, the regular invoice, that we would get from Neo-Gravure
weekly. This was included in our normal production charges of the
American Weekly.
Senator Capehart. It was $4,000 a year, was it not ?
Mr. Padulo. $4,000 each year.
Senator Capehart. It was included in the weekly invoices?
Mr. Padulo. That is correct.
Senator Capehart. And it was for making certain that the maga-
zines were delivered from New Jersey, from the New Jersey plant,
to your New York plant ?
Mr. Padulo. The $4,000 was labeled — I don't recall now, eitlier
"Miscellaneous expense" or "Expense."
Senator Capehart. Do you have any proof tliat the printing com-
pany ever paid the $4,000 ?
Mr. Padulo. No, sir.
Senator Capehart. You just don't know. You just gave them
$4,000?
Mr. Padulo. Included in this invoice.
The Chairman. Did you make this payment in cash ?
Mr. Padulo. No, sir. Tliis was made the same as we paid our
regular weekly production charges. It was one check.
The Chairman. You paid in check ?
Mr. Padulo. Yes, sir ; to Neo-Gravure.
The Chairman. On the $4,000, they just called on you once a year
for that?
Mr. Padulo. That was included in the weekly invoice once a year
and paid the same as we paid our other invoices.
The Chairman. Three officials of the company testified yesterday
that in order to make delivery of these magazines, they had this man —
or to keep labor peace ; I think that is the term they used— they kept
this man Gross on their payroll and gave him a check each week for
$143 plus, and then gave him a monthly check for $460 a month, and
then in addition to that gave him a yearly check, or gave him cash
each year of $4,000.
This is the man that now has be«n drawing this money who is head
of the Teamsters Union down in Florida. Do you have any informa-
tion about that ?
Mr. Padulo. Nothing whatsoever until yesterday morning when I
was sitting here.
The Chairman. When you heard it testified about ?
Mr. Padulo. Correct.
The Cilurman. Did you require any itemized statement of this
$4,000?
Mr. Padulo. No, sir.
IMPROPER ACTIVITIES IN THE LABOR FIELD 18273
The Chairman. The fact is, everybody understood that this was to
pay off the labor racketeer, didn't they? You understood it and
everybody ?
Mr. Padulo. I did not understand it that way.
The Chairman. What did you think they were going to do with it?
Mr. Padulo. I had no idea whatsoever.
The Chairman. Wouldn't you want to know about it, if you were
going to pay out $4,000 ?
Mr. Padulo. I certainly would. But I was unable to find out who
it was being paid to or who was getting it.
The Ch.virman. Do you mean you tried to find out where it was
going and couldn't find out ?
Mr. Padulo. Correct.
The Chairman. Would they not tell you ?
Mr. Padulo. They would not.
The Chairman. How did they convince you that you had to pay it?
Mr. Padulo. We had to pay it in order to get the American Weeklies
delivered.
The Chairman. This is a kind of new one. Here is a businessman
paying out $4,000, and all he gets is a bill for it, and he is unable to
find out what is going to be done with it except that it is to buy labor
peace. That is a little unusual way for a businessman to operate,
isn't it?
Mr. Padulo. It is, sir.
Senator Capehart. Did you figure you were getting your money's
worth, or was it a good investment ?
Mr. Padulo. I did not. All I know was that we had to get the
American Weeklies delivered, and this had to be paid.
Mr. Kennedy. You knew it was wrong ?
Mr. Padulo. Yes, sir.
Mr. Kennedy. And it had been going on prior to the time you
became general manager ?
Mr, Padulo. No, sir. It started with the issue of May 11, 1952,
which was the day I became business manager of the American Weekly.
Mr. Kennedy. So you made the first payment ?
Mr. Padulo. I don't believe that I approved the first payment.
Maybe I did. I don't recall. But I do recall it existing from May of
1953 through the time that I left.
Mr. Kennedy. And you knew that if you didn't make the payment,
there would be a strike or you would have labor difficulties ?
Mr. Padulo. Yes, sir.
Mr. Kennedy. So it was in order to avoid labor difficulties for your
newspaper that you made the payment ?
Mr. Padulo. Yes, sir.
The Chairman. I made a comment about this yesterday. I think
it is a sad state of affairs in America when we find a situation where
some racketeers are in a position of power where they can close down
the press of this country if they want to. Government could not do
it constitutionally. I don't think government could even tax the press
so high that it would put them out of business. I think it would be
unconstitutional. I think the courts would protect them.
Yet we have a situation in America where these racketeers, and I
think of them mostly as rats, can move in and wield such tremendous
18274 IMPROPER ACTIVITIES' IN THE LABOR FIELD
power. I am not condoning what j^ou did. I can appreciate that
business people get into such a dilemma sometimes that they may feel
they are compelled to do these things that are wrong in order to caiTy
on business.
Sometimes, maybe, they initiate some of these things in order to get
a sweetheart contract, too. I am not upholding that. But it is a sad
state of affairs in our country that such a condition prevails or has
existed. I hope t iiat some day we will find a remedy for it, a legisla-
tive remedy.
(At this point Senator Mundt entered the hearing room.)
Mr. Padulo. I agi-ee with you.
The Chairman. Thaiik you very much. Is there anything further ?
If not, thank you.
Call the next witness.
Mr. Kennedy. Mr. Fontana.
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. Fontana. I do.
TESTIMONY OF JOSEPH E. FONTANA, ACCOMPANIED BY COUNSEL,
THOMAS A. BRENNAN
The Chairjian. State your name, your place of residence, and your
business or occupation.
Mr. Fontana. Joseph E. Fontana, 1282 80th Street, in Brooklyn.
N. Y. ; business manager of the American Weekly.
The Chairman. You have counsel present.
Mr. Brennan. Yes, sir. Thomas A. Brennan, 959 Eighth Avenue,
New York City.
The Chairman. Proceed, Mr. Kennedy.
Mr. Kennedy. Mr. Fontana, you are presently the business man-
ager of the American Weekly, and you have held that position since
when ?
Mr. Fontana. December 1955.
Mr. Kennedy. And from 1953 to 1955, you were the chief account-
ant for the American Weekly ?
Mr. Fontana. That is correct, sir.
Mr. Kennedy. Mr. Fontana, you authorized the annual pavment of
$4,000 from 1955 to 1958 ?
Mr. Fontana. That is correct.
Mr. Kennedy. That has been discussed here over the period of the
last couple of days ; is that correct ?
Mr. Fontana. That is correct.
Mr. Kennedy. ^Vliat was that $4,000 paid for? What purpose?
Mr. Fontana. In 1952, when the first payment was made, I was
then told by the then business manager that it was a payment to
assure deliveries of the American Weekly to the New York Journal
American. When I assumed the position of business manager, I con
tinned paying the $4,000 based on wliat had happened in the past.
Mr. Kennedy. Did you feel that it was a proper payment?
Mr. Fontana. At the time I felt it was a business expense.
Mr. Kennedy. A proper business expense ?
IMPROPER ACTIVITIES IN THE LABOR FIELD 18275
Mr. FoNTANA. At the time I did ; yes.
Mr. Kennedy. Now looking back on it, do you feel it is a proper
payment ?
Mr. FoNTANA. Now, after having heard the testimony yesterday, I
certainly don't feel that it was a proper payment.
Mr. Kennedy. Up until yesterday, then, from the testimony of
these other witnesses, you didn't see anything irregular about this
payment ?
Mr. FoNTANA. I did not, sir ; no.
Mr. Kennedy. Had you ever made a similar kind of payment since
you had been with the Hearst organization ?
Mr. FoNTANA. No, sir ; I have not.
Mr. Kennedy. Nothing like this had ever happened before ?
Mr. FoNTANA. No, sir.
Mr. Kennedy. This is the only payment of its kind, of this kind ?
Mr. FoNTANA. Well, sir, what do you mean by "of its kind" ?
Mr. Kennedy. Was this an unusual type of operation, an unusual
type of payment ?
Mr. FoNTANA. Well, I don't think it was an unusual type of pay-
ment. It was a payment authorized by management, the American
Weekly management.
Mr. Kennedy. You handled other payments like this ?
Mr. FONTANA, No.
Mr. Kennedy. Then it was an extraordinary kind of payment?
Mr. FoNTANA. Well, you might call it an extraordinary kind of
payment.
Mr. Kennedy. You have never handled any other kind of pay-
ments such as this ?
Mr. FoNTANA. No ; I did not.
Mr. Kennedy. You knew that the payment was for the purpose of
achieving labor peace ?
Mr. FoNTANA. No, I did not know it was for the purpose of achiev-
ing labor peace at the time. I knew that it was a payment to assure
delivery of the American Weekly.
Mr. Kennedy. How was that going to be achieved ?
Mr. FoNTANA. Well, that could have been achieved — we had a con-
tract with Cuneo, and I assumed that this was costs incurred by Cuneo
over and above which were piovided for in the contract.
Mr. Kennedy. Where was the money going ?
Mr. FoNTANA. Pardon?
Mr. Kennedy. Where was the jnoney going ?
Mr. FoNTANA. We paid Cuneo Press each month.
Mr. Kennedy. You paid the $4,000 when you were general manager
in 1955.
Mr. FoNTANA. Yes.
Mr. Kennedy. You had already made a contract for the delivery of
the American Weeklies. What was this extra $4,000 payment made
for? What was the purpose of that $4,000?
Mr. FoNTANA. As I was told in 1952, it was to assure delivery of the
American Weekly.
Mr. Kennedy. Did you understand that in 1955 you had to make the
same kind of payment ?
Mr. FoNTANA. I understood in 1952-53 that it was to continue for
the duration of the Cuneo contract.
18276 IMPROPER ACTIVITIES IN THE LABOR FIELD
Mr. Kennedy. You were told that ?
Mr. FoNTANA. Yes.
Mr. Kennedy. By whom ?
Mr. FoNTANA. By Mr. Padulo.
Mr. Kennedy. Did you ever attempt to find out wliere the $4,000
was going ?
Mr. FoNTANA. I believe in 1956, the first time I became responsible
for the payment, I questioned Mr. Chenicek about it, and I was told
tliat it was a payment to a person or persons employed on their loading
platform.
Mr. Kennedy. That it was a payment to a person or persons. You
inquired about where the $4,000 was going; is that correct?
Mr. FoNTANA. That is right.
Mr. Kennedy. And he told you that he had to make his payment
to these people ?
Mr. FoNTANA. That is right.
Mr. Kennedy. Did you then feel that there was anything improper
or wrong about the payment ?
Mr. FoNTANA. No, I did not feel that it was improper.
Mr. Kennedy. There was nothing about this whole arrangement
that you thought was wrong at that time ?
Mr. FoNTANA. Not at the time ; no, sir.
Mr. Kennedy. And you would continue to pay it, is that correct,
if you had not found out about the testimony of yesterday? You
w^ould have continued to pay it ?
Mr. FoNTANA. No, sir, I wouldn't have continued to pay it, because
now^ that I know Avhat it is really about, I would have not.
Mr. Kennedy. In 1956 you knew it was some payment, some special
payment that was being made, Mr. Fontana.
Mr. Fontana. Yes, sir, and I assumed it was a payment, a normal
business payment, a norm.al expense Cuneo incurred.
Mr. Kennedy. That would have been included in the contract ?
Mr. Fontana. The contract was still operative. It was part of the
contract.
Mr. Kennedy. Did you inquire why this special payment had to be
paid to the person or persons ?
Mr. Fontana. The answer I got was that it was to assure delivery
of the American Weekly.
Mr. Kennedy. That was the reason that the American Weekly
wouldn't be delivered otherwise?
Mr. Fontana. I don't know.
Mr. Kennedy. That would be a logical question that you would
ask. What was holding up the American Weekly otherwise? l^liy
did you have to make this special payment every year ?
Mr. Fontana. I assumed, perhaps incorrectly, I assumed that it
was an additional cost that they had incurred.
Mr. Kennedy. So that he had to make a payment to some people in
order to achieve the delivery of the American Weekly, Mr. Fontana ?
Mr. Fontana. Yes.
Mr. Kennedy. Now, what was it that was going to delay the Ameri-
can Weekl}' or stop the American Weekly from being delivered ?
Mr. Fontana. That question I cannot answer.
IMPROPER ACTIVITIES IN THE LABOR FIELD 18277
Mr, Kennedy. That would be the logical one that you would ask
then — "Why can't the American Weekly be delivered without paying
tlie$4:,000?"
Mr. FoNTAXA. I don't know, sir.
JMr. Kennedy. You must have asked them that question, Mr.
Fontana.
Mr. Fontana. Well, we go back to 1952, and I was told that this
was
Mr. Kennedy. I am not going back then. You inquired about it
in 1956, and so you sought the information on your own in 1956?
Mr. Fontana. Yes.
Mr. Kennedy. And they said that it has to be paid in order to
obtain the delivery of the American Weekly ?
Mr. Fontana. That is right.
Mr. Kennedy. And the next logical question, if you went so far as
to ask them that question, the next question is: "Why couldn't the
American Weekly be delivered without the payment of the $4,000 ?"
Mr. Fontana. I didn't ask that question, sir.
Mr. Kennedy. Then, if you didn't ask that question, certainly you
asked them what services these people were going to perform.
Mr. Fontana. I didn't ask that question either, sir.
Mr. KIennedy. Isn't it a fact that the reason you are giving this
testimony today is because what your newspaper and what you did is
illegal under the law, and that you can be sent to the penitentiary for
doing it, for making these kind of payments, and you have to take this
position, that you did not know what it was for ? Isn't that the reason
you have received that advice?
Mr. Fontana. I haven't received any advice.
Mr. Kennedy. Isn't it connect that the officials of your paper knew
what the $4,000 payment w^as for, and that you knew what the $4,000
payment was for ?
Mr. Fontana. I did not know what the $4,000 payment was for.
Mr. Kennedy. You mean to tell this committee that after you made
that initial inquiry, that all the Neo-Gravure Printing Co. said was,
"We have to give somebody $4,000 to assure delivery," and you didn't
inquire into it any further, and you just paid out $4,000 of your com-
pany's money?
Mr. Fontana. It was a commitment made by my predecessor.
Mr. Kennedy. But you inquired about it and you were interested in
it enough in 1956 according to your own testimony.
Mr. Fontana. And I said, they told me, Mr. Chenicek told me it
was a payment to people on the platform.
ISIr. Kennedy. That could not have been a satisfactory answer.
Mr. Fontana. Well, I perhaps assumed, or I assumed that it was
some additional labor, and I didn't go into it any further.
Mr. Kennedy. But that doesn't make any sense, that you didn't go
into it any further. According to the testimony of the witnesses yes-
terday, they informed you what it was for.
Mr. Fontana. Who informed me?
Mr. Kennedy. Mr. Chenicek testified that on each occasion, as you
came back, you and your predecessors came back and there was discus-
sion about what the $4,000 payment w^as for.
18278 IMPROPER ACTIVITIES IN THE LABOR FIELD
Mr. FoNTAXA. Mr. Chenicek called me in May of 1956 and said to
me, "The usual annual payment is coming up, and do you authorize
payment?"
I said I would call him back, and I did call him back.
Mr. Kennedy. What did you do between the time that you spoke
to him and called him back ? Did you talk to anybody in your organ-
ization ?
Mr. FoNTANA. I informed Mr. Gortatowsky.
Mr. Kennedy. What was his position at that time ?
Mr. FoNTANA. General manager, I believe, of the Hearst News-
papers, and I informed him that the usual annual payment that we
have been making to Cuneo since 1952 was coming due, and I was
going to authorize payment in order to continue the service.
Mr. Kennedy. What did Mr. Gortatowsky say ?
Mr. FoNTANA. He said that if it is what you have been doing since
1952, you continue doing it.
Mr. Kennedy. He told you to go ahead and make the payment?
Mr. FoNTANA. He said, "If that is what you have been doing since
1952, you continue it."
The Chairman. Mr. Fontana, yesterday the representatives of the
New York Times and other publications came in here and frankly
admitted that they knew what the money was for, and they didn't
know who got it necessarily, but they came in here and they realized
they had to do it or felt they had to do it and go along with it in
order to have labor peace.
Now, why can't you say the same thing? It just does not seem
that a businessman occupying that high position would not have had
enough curiosity to find out exactly what had happened, and didn't
you ?
Mr. Fontana. I found out exactly what I have said before, sir.
I wasn't aware
The Chairman. The peculiar thing is that you get sometliing that
you know is improper, which goes beyond the legal contract you have.
You get up to that point and then you lose interest, and you go ahead
and pay it but don't try to find out any more about it. Don't you
think that you knew all about it ?
Mr. Fontana. No, I didn't know all about it.
The Chairman. And you had no curiosity to find out?
Mr. Fontana. I didn't know to whom the money was being paid.
The Chairman. I know. But you knew it was being paid to some-
body to guarantee labor peace ?
Mr. Fontana. Yes, I said that, and I knew it was being paid to a
person or persons.
The Chairman. You might have not known the name of the person,
and I assume there is no reason why this Neo-Gravure firm couldn't
have told you the name, and they knew who was getting it. Did you
ask them wlio was getting the money?
Mr. Fontana. I didn't.
The Chairman. You didn't even ask them ?
Mr. Fontana. No.
The Chairman. Proceed.
Mr. Kennedy. As I understand your answer, then, you know who
it was in order to achieve labor peace ?
IMPROPER ACTIVITIES IN THE LABOR FIELD 18279
Mi\ FoNTANA. Well, I suppose you could say it that way, and I was
saying that it was to achieve
The Chairman. Which way do you say it ?
Mr. FoNTAXA. In order to assure delivery of the American Weekly.
The Chairman. What was it that would keep them from being
delivered, and what was it you were afraid of that would keep them
from being delivered!^
Mr. FoNTANA. There may be difficulty on the loading platform,
and I am assuming this.
The Chairman. You were pretty sure of it when you paid out
$4,000, weren't you?
Mr. FoNTANA. I was sure of it.
Mr. Kennedy. We have some documents here, Mr. Chairman.
Senator Capehart. I have a couple of questions.
Who got the $4,000?
Mr. FoNTANA. It was included in a check to the Cuneo Press.
Senator Capehart. Do you know to whom they paid it?
Mr. FoNTANA. I do not know; no, I do not know to whom they
paid it.
Senator Capehart. I wasn't here yesterday to listen to the testi-
mony, but what would be illegal about you paying the Cmieo Press
$4,000 ^
Mr. FoNTANA. Nothing, sir.
Senator Capehart. I miderstood a moment ago that someone said
here it would be illegal. This man Gross that I have been hearing
about, was he a member of the Teamsters Union when he worked
for this Cuneo Press ?
Mr. FoNTANA. I don't know Mr. Gross and I never heard his name
until last week.
Senator Capehart. You entered into a contractual relationship
with the Cuneo Pi-ess to pay them $4,000 a year ?
Mr. FoNTANA. That is right.
Senator Capehart. And they were to bill it to you on their in-
voices as miscellaneous expense ; is that correct ?
Mr. Fontana. As I recollect the first bill, I think it was billed as
"organizational expenses agreed to," and subsequently as "adminis-
trative expense."
Senator Capehart. That was on one of their regular invoices?
Mr. Fontana. Yes, sir.
Senator Capehart. And you paid it by check ?
Mr. Fontana. We paid it by check, sir.
Senator Capehart. And it., was a contractual relation, or you
agreed to do it ?
Mr. Fontana. W^e agreed to do it, yes, sir.
The Chairman. Are there any further questions?
Senator Capehart. I think that that is all. I was trying to get
wherein it was illegal from their standpoint, if they entered into a
contract.
The Chairman. I think probably it would come under the Hobbs
Act, any threat that would amount to an extortion. If this man had
such power and was holding such threats over them, and they had to
pay it solely to get labor peace, it would seem to me like it would be
extortion.
18280 IMPROPER ACTIVITIES IN THE LABOR FIELD
Senator Capehart. Or it might have been that this man Gross or
whoever got the money, their job was to keep the lines of transporta-
tion open.
Mr. FoxTANA. It could be, sir.
The Chairman, I have no doubt about that. That is what it was
paid for.
Senator Capehart. The question gets back to whether it was il-
legal on the part of these gentlemen to pay the Cuneo Press.
The Chairman. I am in sympathy with them and I don't see why
they just don't come out like the others had, and say they had to pay
it, "and otherwise we are going to be shut down."
I think that is the truth about it, and that is why they paid it. Isn't
thatriffht?
Mr. FoNTANA. Pardon, me, sir?
The Chairman. You thought you would be shut down and you
wouldn't get deliveries if you didn't pay it, and that is why you
paid it. You weren't anxious to throw away $4,000 ?
Mr. FoNTANA. Oh, no, sir.
The Chairman. You thought by paying it, you would get what you
got, labor peace ?
Mr. FoNTANA. Well, I suppose so.
Senator Capehart. And you understood that the money was going
to a gentleman who would be able to keep the lines of transportation
open ?
Mr. FoNTANA. I knew the money was going to the Cuneo Press, sir,
and I don't know whether the Cuneo Press paid anyone.
Mr. Kennedy. They told you that they had to give it to someone?
Mr. FoNTANA. They told me, and I don't know as a fact it was paid.
Mr. Kennedy. That is why the $4,000 payment was made, so they
in turn would give it to somebody else ?
Mr. FoNTANA. I understand.
The Chairman. Is there anything further?
Senator Mundt. Do I understand that you made these payments in
cash or in check ?
Mr. FoNTANA. It was paid by check, included in our monthly and
weekly charges.
Senator Mundt. And entered in your books ?
Mr. FoNTANA. Yes, sir.
Senator Mundt. Mr. Chairman, I am not a lawyer, but I am curious
about these charges of illegality, and I can't see exactly liow Mr.
Fontana broke the law, but I yield to the counsel on that. It seems
to me that if you make a payment to Cuneo Press and do it by check
and put it in the books, I think the taxpayers are getting gypped
because of this racket situation which exists, because that $4,000 which
otherwise would have been reported as profit, was reported as a cost
of doing business expense. On that $4,000 Uncle Sam didn't collect
the taxes, and so the public gets gypped.
But I would not like to see the witness stigmatized as being guilty
of something illegal if in fact it was not illegal. Not being a lawyer
I wonder if you would clear that up.
The Chairman. I just wonder if anyone thinks it is legal to make a
contract that is against public policy. I do not think anyone could
say that sucli an agreement to buy off some racketeers or somebody
IMPROPER ACTIVITIES IN THE LABOR FIELD 18281
that is threatening you with violence or threatening to stop a paper
or threatening a strike, if you don't pay off — that is nothing on God's
earth but a shakedown and an illegal shakedown at that. It is extor-
tion and it couldn't be anything else.
Mr. FoNTANA. I am not versed in the law, sir.
The Chairman. Well, I am not the best, and I don't claim to be.
But I think if I had to pay out 4,000 to get something done that was
already contracted to do legitimately, and that everybody had a right
to do under the contract without interference, I think that v.'ould be
extortion.
Senator CArEiiART. Well, may I ask an.other question ?
Senator Mundt. May I finish? We had testimony yesterday, Mr.
Fontana, that at some stage of the game American Weekly canceled
its contract under the terms of the contract because they wanted a
better deal with Neo-Gravure Co.
Mr. Fontana. That is correct, sir.
Senator Mundt. And at that time was there any discussion about
this $4,000?
Mr. Fontana. Not during the negotiations, sir, on the new contract,
sir.
In the informal discussion with Mr. Chenicek, I just don't remem-
ber how it came about, but I made a statement that since we now have
a new contract, perhaps we can clean up all of these miscellaneous
charges that are coming in.
Senator Mundt. What did he say ?
Mr. Fontana. Well, he said he would look into it, and a day or two
later, or perhaps maybe 4 or 5 days later, he called and he said that that
$4,000 charge would be discontinued with the last payment in May of
1958.
Senator Mundt. It was discontinued at that time ?
Mr. Fontana. That is right, sir.
The Chairman. Is there anything further ?
Mr. Kennedy. Senator, I might answer that question about
Senator Mundt. Mr. Chairman, counsel was going to suggest some-
thing.
Mr. Kennedy. It was on the question of whether these tyi)es of pay-
ments cannot be deducted properly under the Internal Revenue law.
Payments for extortion, payments that are in the form of payoffs,
cannot be properly deducted as a business expense.
Senator Mundt. We had testimony from the New York Times that
they deducted them. We had testimony from the Neo-Gravure Print-
ing Co. that they deducted them. ^
I would like to find out. I am willing to bet you a good South
Dakota pheasant shooting license, and the best pheasant shooting in
the world, that you deducted them in the American Weekly. These
are charged off as deductible expenses, are they not ?
Mr. Fontana. These w^ere considered as business expenses ; yes.
Senator Mundt. I don't know about the law, but I do know that
the impact on this was that Mr. John Q. American Taxpayer got hit
every time. He got hit l:)ecause the New York Times deducted it, he
got hit when the American Weekly deducted it, and because the Neo-
Gravure Printing Co. deducted it.
The Chairman. And the racketeer didn't pay any tax on it, either.
18282 IMPROPER ACTIVITIES IN THE LABOR FIELD
Senator Mundt. That is right. They didn't pay any tax on it,
either ; you are right.
The Chairman. I hand you a photostatic copy of a memorandum
which appears to be dated May 11, 1952.
I ask you to examine it and state if you identify it and, if so, I would
like to call your attention to the third paragraph from the bottom of it.
It appears to be a memorandum from Mr, O. T. Bondy.
Would you please examine it and state if you identify it ?
(The document was handed to the witness. )
The Chairman. Do you identify it ?
Mr. FoNTANA. Yes.
The Chairman. What is it ?
Mr. FoNTANA. A memorandum from Mr. O. T. Bondy, to Mr. John
J. Padulo, with carbon copies to J. E. Font ana and J. C. Sacchia.
The Chairman. Would you read the third paragraph from the
bottom ?
That may be made exhibit No. 12.
(Memo referred to was marked "Exhibit No. 12" for reference and
may be found in the files of the select committee.)
The Chairman. Will you read the third paragraph from the bottom,
please ?
Mr. Fontana (reading) :
It is my understanding that you are familiar with the $4,000 organizational
expense item which was arranged for and agreed to by Mr. McHenry Brown.
This is a once-only item and should not recur.
The Chairman. At that time, when this thing was first done, ap-
parently you just had to pay $4,000 for the one time and that was the
end of it. That is what the memorandum said ?
Mr. Fontana. That is what the memorandum says ; yes, sir.
The Chairman. But thereafter, the pressure was put on you or
for some reason you continued to pay.
Mr. Fontana. I cannot answer that. In my capacity thereafter,
sir, I was chief accountant. We paid it thereafter.
The Chairman. But at that time it was indicated that you would
just pay the $4,000 and that would end it.
Mr. Fontana. That is right, sir.
The Chairman. But then it developed that you continued to pay it
each year ?
Mr. Fontana. Yes, sir.
The Chairman. All right. Thank you,
I submit to you photostatic copies of bills and checks.
Will you examine these and state if you identify them ? They then
will be made an exhibit.
(The documents were handed to the witness.)
Mr. Fontana. This is a check and a photostatic copy of an invoice
dated May 9, 1952, in payment of the printing of the May 11, 1952,
issue.
The Chairman. You identify them as photostatic copies of your
records, do you ?
Mr. Fontana. Yes.
The Chairman. They may be made exhibit No. 13 in bulk.
(Documents referred to were marked "Exhibit No, 13" for refer-
ence and may be found in the files of the select committee.)
IMPROPER ACTIVITIES IN THE LABOR FIELD 18283
The Chairman. Are there any further questions of this witness ?
Mr. Kennedy. In each one of these bills, the $4,000 is mentioned
and how it is to be charged. The terminology is changed.
The Chairman. The first bill I have before me is dated May 9, 1952,
and the last item on it says ''Organizational expense as agreed upon,
$4,000."
Is that the item, the $4,000 item, that we have been discussing ?
Mr. FoNTANA. Yes, sir.
The Chairman. Then I have another one dated May 22, 1953. That
sems to be the following year. It says "Organizational expense,
$4,000."
That is the way it was carried.
(At this point Senator Curtis entered the hearing room.)
The Chairman. I notice the item always comes at the bottom of the
invoice.
Mr. FoNTANA. Yes, sir.
The Chairman. It is the last item on each of these invoices. Here
is another one dated November 16, 1954, and it shows again, "Organi-
zational expense, $4,000." That is the same item ?
JMr. Montana. Yes, sir.
Tlie Chairman. There was some testimony here yesterday that one
year they forgot to pay it and it ran along for a while. Then this man
came to them and told them he expected it to be paid, and several
months later they paid.
That must have been the year that that occurred. It wasn't paid in
May. It wasn't paid until November of that year.
Mr. FoNTANA. That is right.
The Chairman. There was some testimony here that they went
along 1 year for a while and didn't pay it. Maybe they thought they
were going to get by without paying it, but he finally demanded it.
Mr. FoNTANA. It was paid every year.
Mr. Kennedy. June 1955, it is listed "Organizational expense as
approved by Mr. Padulo, $4,000."
Then in May 1956, administrative expenses as approved by Mr.
Fontana.
The Chairman. Why was it changed? One says organizational
expense, and in 1956 it says administration expense.
Do you know why the change ?
Mr. Fontana. No, sir ; I don't.
The Chairman. But it all relates to the same thing ?
Mr. Fontana. That is right.
The Chairiman. All right. Thank you very much.
Call the next witness.
Mr. Kennedy. Mr. Cornelius J. Noonan.
Senator Mundt. I would like to ask Mr. Fontana a question.
Were you here yesterday when the New York Times representative
was testifying?
Mr. Fontana. Yes, sir.
Senator Mundt. At the end of his statement, he made a salutary
comment. He said in retrospect, looking back at it, the New York
Times would never be shaken down like this again, and that they had
adopted a policy that from now on, as a great corporation and a great
newspaper, they would rather fight and take their chances than be
taken in by a bunch of racketeers.
18284 IMPROPER ACTIVITIES IN THE LABOR FIELD
I was wondering whether in retrospect, the American Weekly would
like to say that it also is going to assume the responsibility, now that
we all know more about how labor operates, and if you get stuck in
the back again you are going to stand up and fight like Americans
should, instead of yielding to this kind of thing.
Mr. FoNTANA. Most definitely, sir. I make that statement that a
situation like this will never arise with the American Weekly while I
am in position.
Senator Mundt. I am not too critical of you or the New York Times
or the Neo-Gravure, because you were up against a pretty tough Hob-
son's choice in these circumstances. But I do think that now that it has
been ventilated and we know what the situation is, that unless the
American corporate structure and employers assume their responsi-
bility, as I think the House of Kepresentatives and the Senate should
in passing efi'ective legislation, we are never going to get this out of
our hair.
If you yield to these things, blackmail accumulates. It is like in-
flation. It is an accumulative force. If you start yielding to it, it
can be ruinous.
I commend you on the statement you made on the basis of the in-
formation wliich is now available.
Mr. FoNTANA. Thank you, sir.
The Chairman. All right.
Mr. Noonan ? Be sworn, please.
Do you solemnly swear the evidence you shall give before this
Senate select committee shall be the truth, the whole truth, and noth-
ing but the truth, so help you God ?
Mr. NooNAN. I do.
TESTIMONY OF CORNELIUS J. NOONAN, ACCOMPANIED BY
COUNSEL, THOMAS W. GLEASON
The Chairman. State your name, your place of residence, and your
business or occupation, please.
Mr. NooNAN. My name is Cornelius J. Noonan. I live at 26 Hunt
Boulevard, Jersey City. My occupation is I am president of the
Inland Terminal Workers Local, ILA. That is International Long-
shoremen's Association.
The Chairman. Inland Terminal
Mr. NooNAN. Workers Local 1730.
The Chairman. Inland Terminal Local is affiliated with the ILA?
Mr. NooNAN. Yes, sir.
The Chairman. You have counsel present.
Mr. Gleason. Thomas W. Gleason, 80 Broad Street, New York.
The Chairman. All right, Mr. Kennedy.
Mr. Kennedy. You are a member of the bar of New York, Mr.
Gleason ?
Mr. Gleason. Yes, I am.
Mr. Kennedy. How many members does 1730 have ?
Mr. NooNAN. I respectfully decline to answer because I honestly
believe that any answer I may give may tend to incriminate me.
Mr. Kennedy. Just giving us the background of the union and the
number of members that you have ?
IMPROPER ACTIVITIES IN THE LABOR FIELD 18285
Mr. NooNAN. I still decline to answer because I honestly think
that my answer may tend to incriminate me.
Mr. Kennedy. Will you give us a little bit of your background,
Mr. Noonan; where you were born, w^iat jobs you have had^
Mr. NooNAN. I respectfully decline to answer because I honestly
believe that any answer I may give will tend to incriminate me.
Mr. Kennedy. Will you give us the source of your income at the
present time?
Mr. NoONAN. I respectfully decline to answer because I honestly
believe that my answer may tend to incriminate me.
Mr. Kennedy. I would like to call Mr. Sheridan, Mr. Chairman, to
give some of the background of Mr. Noonan.
The Chairman. Mr. Noonan, you have heard a lot of testimony
about rackets being carried on up there. Do you want to make any
comment about it before we proceed ?
Mr. Noonan. No, sir.
The Chairman. You are satisfied ?
Mr. Noonan. The answer to you is that mj- answer to you is that I
respectfully believe that if I answer that question I may tend to
incriminate myself.
The Chairman. I agree. Proceed.
TESTIMONY OF WALTER J. SHERIDAN— Resumed
Mr. Kennedy. Mr. Sheridan has been sw'orn, Mr. Chairman.
Mr. Sheridan, we have found, based on investigation, that Mr.
Noonan is president of local 1730 of the ILA ; is that right ?
Mr. Sheridan. That is correct.
Mr. Kennedy. And that local was organized in 1948 ?
Mr. Sheridan. Yes, sir.
Mr. Kennedy. It was organized to succeed a previous ILA Ix)cal
21510; is that correct?
Mr. Sheridan. That is right.
Mr. Kennedy. Do w^e know who was active in local 21510 W'liich
1730 succeeded ?
Mr, Sheridan. Local 21510, Mr. Noonan, of course, was an official
of the local. Mr. Edward J. McGrath
Mr. Kennedy. Where is Mr. McGrath now ?
Mr. Sheridan. Mr. McGrath is currently in Florida. He has a
long criminal record. He has been referred to previously in testi-
mony in connection with the w itness w^e had last summer, Mr. Baker.
Mr. Kennedy. So it is Edward McGrath and who else?
Mr. Sheridan. John "Cockeyed" Dunn was another.
Senator Mundt. While we are on Baker, is he going to be able to
testify, or is he still in the hospital ?
Mr. Kennedy. Every time we subpena him or send him a telegram,
he gets into a hospital. Senator. I think he is dow^n in Florida at the
present time. I understand he has lost 130 pounds and he is nervous.
Senator MuNivr. Let's keep him nervous. Let's send him a wire
that we are still interested in him.
(At this point Senator McClellan left the hearing room.)
Mr. Kennedy. The other official of the union was John "Cockeyed"
Dunn, who was also identified as an associate and friend of Mr.
Baker's : is that rifjlit ?
18286 IMPROPER ACTIVITIES IN THE LABOR FIELD
Mr. Sheridan. Yes ; lie was.
Mr. Kennedy. What happened to him '?
Mr. Sheridan. Mr. Dunn was electrocuted for the murder of a
man named Hintz on the waterfront.
Mr. Kennedy. Who else was in that local ?
Mr. Sheridan. Of course, this local goes over into the area of an
organization called Varick Enterprises, which Mr. Noonan was also
associated with.
Mr. Kennedy. Wasn't Squint Sheridan also active in that?
Mr. Sheridan. Yes, he was. Squint Sheridan also went to prison,
and went on to Ms INIaker for the murder of Mr. Hintz.
Mr. Kennedy. Mr. Sheridan and Cockeyed Dunn were both elec-
trocuted ?
Mr. Sheridan. I am not sure whether Sheridan was electrocuted.
I think he died in prison.
Mr. Kennedy. That was a local, Mr. Noonan, that you were origi-
nally connected with ? Is that right ?
Mr. Noonan. I respectfully decline to answer because I honestly
believe my answer may tend to incriminate me.
Senator Curtis. Mr. Sheridan, these characters that you have de-
scribed, ex-convicts and the like, who was responsible for giving them
an official status in union activities ?
Mr. SHERroAN. I don't know. Senator. All I can assume is who-
ever at that time was head of the ILA would have been responsible.
Senator Curtis. They got a charter?
Mr. Sheridan. Yes, sir.
Mr. Kennedy. Joe Ryan, I believe. Senator.
Senator Curtis. He was acquainted with these men ?
Mr. Sheridan. I am sure he was.
Senator Curtis. What was his official title ?
Mr. Sheridan. President of the ILA at that time.
Senator Curtis. "VYliere is he now ?
Mr. Sheridan. I don't know.
Senator Curtis. Is he still president ?
Mr. Sheridan. No, he is not still piesident.
Mr. Kennedy. He was indicted for income tax evasion. I don't
know what the situation is at present.
Senator Curtis. Has the leadership changed?
Mr. Sheridan. Well, Mr. Ryan is no longer in the leadership, but
people who were associated with Mr. Ryan at the time are still in
leadership. Captain Bradley is the current president.
Mr. Kennedy. They have been expelled from the AFL-CIO for
the fact that they are corruptly dominated — the ILA.
Senator Curtis. But there has been no complete change of leader-
ship other than Mr. Ryan's ?
Mr. Sheridan. That is true. Senator.
Senator Curtis. That is all.
(At this point Senator McClellan entered the hearing room.)
Mr. Kennedy. Mr. Noonan was also secretary-treasurer of the
Varick Enterprises from 1937 to 1941 ?
Mr. Sheridan. That is correct.
Mr. Kennedy. Who was the president of Varick Enterprises ?
Mr. Sheridan. A man named Estreicher.
IMPROPER ACTIVITIES IN THE LABOR FIELD 18287
Mr. Kenxedv, Estreicher?
Mr. Sheridan. Yes.
Mr. Kennedy. Was Mr. Baker associated with Varick Enterprises?
Mr. Sheridan. Mr. Baker was very closely associated with Mr.
Noonan in this venture.
Mr. Kennedy. What was Varick Enterprises?
Mr. Sheridan. Varick Entei-prises was first established in New
Jersey as a means of collecting from trucking companies tribute to
keep the Varick Enterprise people quiet about double sets of books
that the trucking companies were carrying to avoid income tax diffi-
culties.
It was then further branched out into New York City where it was
used to collect tribute from the New York City trucking companies.
It was a shakedown, a pure shakedown.
Mr. Kennedy. It was a company organized for shakedown pur-
poses ?
Mr. Sheridan. That is correct.
Mr. Kennedy. And Mr. Baker was very closely associated with it,
and Mr. Noonan was the secretary-treasurer?
Mr. Sheridan. That is correct.
(At this point Senator Mundt left the hearing room.)
Mr. Kennedy. Mr. Chairman, I would like to also call at this time
Mr. Kelly, who has also made an investigation of Mr. Baker's activi-
ties in other areas.
The Chairman. Mr. Noonan, do you want to deny any of these
statements ?
Mr. Noonan. No, sir.
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. Kelly. I do.
TESTIMONY OF JAMES P. KELLY
The Chairman. You are a member of the committee staff?
Mr. Kelly. That is correct. Senator.
Mr. Kennedy. Mr. Kelly, you have examined the files of the New
York Police Department, made an investigation of your own and ex-
amined files of the Waterfront Commission ; is that correct ?
Mr. Kelly. That is correct, sir.
Mr. Kennedy. Have we found that Mr. Noonan has been associ-
ated with some of the top hoodlunls in the New York area?
Mr. Kelly. That is correct, sir.
Mr. Kennedy. Who are they ? A^Hio did they include ?
Mr. Kelly. Well, his list of associates includes, for example ■
Mr. Kennedy. Just give us the names.
Mr. Kelly. Barney Baker.
Mr. Kennedy. We had that.
Mr. Kelly. We have John Earle, who was shot and killed on
June 18 or 19 of last year, a notorious waterfront character and hood-
lum who had been very active in the affairs of local 205, an independ-
ent ILA local. Earle, along with several other waterfront characters,
were organizing — it was a catchall local — they were organizing every-
36751— 59— pt. 51. -11
18288 IMPROPER ACTIVITIES IN THE LABOR FIELD
thing from bartenders on Staten Island to lumbermen in Brooklyn.
He was shot and killed. There is a rumor that he was killed in comiec-
tion with labor activities.
Mr. Kennedy. We have found him associated with Joe Adonis ; is
that correct, Mr. Kelly?
Mr. Kelly. There are telephone calls going from a number that
Mr. Noonan, tlie witness here, used at 230 Riverside Drive, in 1955,
going to Joseph Doto, in Palisades, N. J., a CLiffside number. Joseph
Doto was the true name of Joe Adonis, who has since been deported
to Italy.
Mr. Kennedy. Have we found that he has been in contract with
Jimmy "Blue Eyes" xilo?
Mr. Kelly. There have been calls going to Alo's residence in Holly-
wod, Fla.
Mr. Kennedy. The answer to the question is what ?
Mr. Kelly. Yes.
Mr. Kennedy. And Meyer Lansky ? Have we found him in contact
with Meyer Lansky ?
Mr. Kelly. He is an associate of Lansky. We haven't found any
calls.
Mr. Kennedy. Have we found him to be an associate of Lansky ?
Mr. Kelly. Yes, sir.
Mr. Kennedy. And Longy Zwillman ?
Mr. Kelly. Yes, sir.
Mr. Kennedy. And Albert Anastasia ?
Mr. Kelly. That is correct.
Mr. Kennedy. And Mike Coppola ?
Mr. Kelly. Trigger Mike Coppola ; yes, sir.
Mr. Kennedy. Also an associate of Harry Nussbaum ?
Mr. Kelly. That is correct.
Mr. Kennedy. "Wlio is he ?
Mr. Kelly. Hariy Nausbaum is an operator who recently has been
interested in Cuban gambling casinos.
Mr. Kennedy. And did Mr. Noonan have an interest with him in
a gambling casino in Havana, Cuba ?
Mr. Kelly. According to police reports he did ; yes.
Mr. Kennedy. We also have found him in contact with Sam
Finazzo, of Detroit?
Mr. Kelly. That is correct. Sam Finazzo is connected with the
Motor City Arena in Detroit.
Mr. Kennedy. Also, he has been identified before the committee as
one of the ma j or sources of narcotics ?
Mr. Kelly. Narcotics ; that is correct, sir.
Mr. Kennedy. And have we also established that he attended a
meeting at the Riviera Hotel, in Cliifside Park, N.J., on December 2,.
1954?
Mr. Kelly. Yes.
Mr. Kennedy. That was at the Riviera Hotel, Cliffside Park, N.J. ?
Mr. Kelly. December 2, 1954.
IMr. Kennedy. AVho was present at that meeting ?
Mr. Kelly. Albert Anastasia, Zwillman, and Edward McGrathy
referred to previously.
Mr. Kennedy. Has it been established wliat the pur^wse of that
meeting was for ?
IMPROPER ACTIVITIES IN THE LABOR FIELD 18289
Mr. Kelly. The puiiDose of the meeting was supposed to set up
an agreement whereby Anastasia would take over the Irish element
and Noonan on behalf of Eddie McGrath would control the — the
Italian element by Anastasia and the Irish element by McGrath.
INIr. Kennedy. Not the other way around ?
Mr. Kelly. Not the other way around.
Mr. Kennedy. And the Irish element on the New York waterfront;
is that right ?
Mr. Kelly. The common denominator of both was that they were
hoodlum elements, Anastasia with the Italian group, and Noonan, on
behalf of Eddie McGrath, would represent the Irish group.
Some of these people I mentioned, like John Earle, and people like
Harold Farmer, and George McLaughlin, both of whom were picked
up in Boston, and when picked up had cards indicating they were busi-
ness agents of this Local 205, Independent, ILA.
Mr. Kennedy. Mr. Noonan is also reported to have control of the
rackets on the piers along the North Eiver in New York City, south
of pier 84 ; is that correct 'i
Mr. Kelly. That is correct.
Mr. Kennedy. In other words, he is a major figure; is that correct?
Mr. Kelly. He is a major figure.
Mr. Kennedy. He attended the Teamster convention in September
of 1957?
Mr. Kelly. The one in Miami ?
Mr. Kennedy. Yes.
Mr. Kelly. We have the Gleasons down in Florida.
Mr. Kennedy. Mr. Sheridan, do we find that Mr. Noonan attended
that meeting?
Mr. Sheridan. Yes, he did.
Mr. Kennedy. Can you tell us if this is correct, Mr. Noonan? .
Mr. Noonan. I respectfully refuse to answer because I honestly be-
lieve that my answer would tend to incriminate me.
Mr. Kennedy. In addition to those individuals — Mr. Chairman, I
have some other questions to ask Mr. Kelly, but I would like to call
Detective Frank Nostramo to testify.
The Chairman. You do solemly 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. Nostramo. I do.
TESTIMONY OF.FEANK NOSTEAMO
The Chairman. State your name, your place of residence, and your
business or occupation.
Mr. Nostramo. Detective Frank Nostramo, New York City Police
Department, assigned to the district attorney's office, New York
County.
The Chairman. How long have you been in that position ?
Mr. Nostramo. Seven and a half years.
The Chairman. Proceed.
Mr. Kennedy. Detective, do you have some information regax-ding
the activities of the witness, Mr. iSToonan?
Mr. Nostramo. I do.
18290 IMPROPER ACTIVITIES IN THE LABOR FIELD
Mr. Kennedy. Are you prepared to give that information to the
committee ?
Mr. NosTRAMO. Yes, sir.
Mr. Kennedy. Would you please read your statement?
Mr. NosTRAMO. In 1958, New York's District xVttorney Frank
Hogan's oflice conducted an investigation in corruption and racket
influence in professional boxing. Evidence we gathered showed Con-
nie Noonan, a West Side waterfront racketeer, was in frequent con-
tact with Dominic Mardhii, also known as Billy Brown, the I.B.C.
matchmaker to secure bouts for Carlos Ortiz, a leading lightweight
boxer.
Several witnesses, prominent in the field of boxing, informed us
Noonan acted as undercover manager for Carlos Ortiz. Early this
year Carlos Ortiz was inter^•iewed by Assistant District Attorney
Jack Bonomi. Ortiz stated that Noonan was acting as a boxing
adviser to him.
Noonan is known to our office as a close associate of Frank "Blinky"
Palermo, a Philadelphia numbers racketeer. Frankie Carbo, who is
generally recognized as the underworld's czar of boxing, was indicted
by a New York County grand jury in July of l'.)58 on charges of con-
spiracy and undercover fight activities and has been a fu|Titive since
that time. While Carbo has been in hiding, Noonan's associate, Frank
Palermo, has filled Carbo's shoes as No. 1 underworld representative
in professional boxing.
Mr. Kennedy. Is that correct, Mr. Noonan ?
Mr. Noonan. I respectfully refuse to answer because I honestly
believe my answer would tend to incriminate me.
Mr. Kennedy. That is all of this witness.
The Chairman. Thank you very much.
Proceed.
TESTIMONY OF JAMES P. KELLY— Eesumed
Mr. Kennedy. Mr. Kelly, when we subpenaed the records of the
union, we also obtained the address book of IMr. Noonan ?
Mr. Kelly. That is correct.
Mr. Kennedy. Would you give the committee the names of some
of the individuals who appear in that address book ?
Mr. Kelly. Some of the individuals whose names we found in the
book were Barney Baker
Mr. Kennedy. Mr. Chairman, I might just say that when there
is a question as to how Mr. Noonan is able to achieve the results that
he achieves, it is not only through liis connections with the Long-
shoremen's Union but through his connections with major under-
world figures in the city of New York. ^h\ NooEian is a major figure
in this area. As has been shown here in the testimony, he is in con-
tact with major underworld figures.
Ke also has high contacts with certain union officials. He is able
to achieve the results that he achieves because of his connections and
contacts which, of course, is of considerable interest to us.
The Chairman. "VATiat is his position with the union ?
I believe he testified he was president of local 1730, but he can't
give the nmnber of members without self-incrimination, possible
self-incrimination.
IMPROPER ACTIVITIES IN THE LABOR FIELD 18291
Mr. Kennedy. But liis influence goes far beyond that, with many
otlier unions, and with many other areas in industry than just the
local of the ILA.
The Chairman. Proceed with your taking of testimony.
Senator Curtis. What other unions does Mr. Noonan have influ-
ence with ?
Mr. Kennedy. We have already established, Senator, that he has
influence with a number of the Teamster unions in New York City ;
that he has it with the Platform Workers Union in New York City;
with local 560 of the Teamsters Union in New Jereey ; as well as with
the Newspaper and Mail Handlers Union.
As you will see from the address book, he has contacts with many of
these people and others.
The Chairman. Let me get what the witness is going to testify to.
Are you going to testify now on an address book ?
Mr. Keli^y. That is correct. Senator.
The Chairman. It belonged to this witness Noonan; is that cor-
rect?
Mr. Kelly. That is correct, Senator.
The Chairman. Do you have the original book ?
Mr. Kelly. This is the book in front of me.
The Chairman. You have taken the names from the book that you
are going to supply for the record ?
Mr. Kelly. That is right.
Tlie Chairman. And you have the book before you ?
Mr. Kelly. That is right.
The Chairjian. You have verified this list as taken from the book ?
Mr. Kelly. That is correct.
The Chairman. Proceed.
Mr. Kelly. Barney Baker, 1127 Pine Street, St. Tx>uis, Mo. This
is the Barney Baker that we referred to previously in the testimony.
He was associated as a collector in the Varick Enterprises as far back
as 1937, along with Edward McGrath and John "Cockeyed" Dunn.
Mr. Kennedy. We have identified him.
Mr. Kelly. There was a listing for Carlos, CY-2-5785, which is
listed to Carlos Oritz, 610 Trinity Avenue, the Bronx, N.Y., apart-
ment 1.
The Chairman. Is that the prize fighter ?
Mr. Kelly. That is correct.
There is a listing for DeKoning with two numbers, IV-3-7318,
listed to local 138 of the Operating Engineers; and IV-6-0965, listed
to William DeKoning, Jr., at 335 California Avenue, Uniondale, Long
Island. DeKoning, Sr. and Jr., weie the powers in local 138 of the
Operating Engineers.
The Chairman. We have their record here.
Mr. Kelly. We have had that testimony.
It is interesting to note. Senator, that Albert Akalitis, who con-
trolled the Chelsea piers on the West Side, the ILA in New York,
was banned from the piers by the Waterfront Commission, and that
he was given a membershi]) card in local 138 of the Operating Engi-
neers, which is controlled by the DeKonings. Both of the DeKon-
ings have criminal records, have been arrested and convicted for labor
extortion.
18292 IMPROPER ACTIVITIES IN THE LABOR FIELD
There was a listing for John Earle, at WH-3-1658. This listing is
for Local 1826, ILA independent, which is Buster Bell's old outfit.
There was another listing underneath that for Eose, OR-5-5160.
Rose is Rose Dunne Earle, who was John Earle's widow. She is re-
puted to have answered the phones at this particular local.
Mr. Kennedy. Who is John Earle ?
Mr. Kelly. John Earle is the one I referred to before. He was a
waterfront character, who was killed in June of 1958, shot to death.
Mr. Kennedy. He has a criminal record of 10 arrests and 4 con-
victions ?
]\Ir. Kelly. That is correct.
Mr. Kennedy. He was shot to death and killed in June of 1958 ?
Mr. Kelly. Yes, sir.
Mr. Kennedy. Then also Vincent Rica ?
IMr. Kelly. Vincent Rica is the listing for the Erb Strapping Co.,
WA-5-1957. You will recall from committee testimony the Erb
Strapping Co. was listed by Vito Genovese as a source of income.
Mr. Kennedy. Barney Fello?
Mr. Kelly. Barney Fello is the brother of Willie Fello, an associate
of Irving Bitz in the Bi-County News Co.
Abe Gordon, Rockaway 7-4862, is an official of local 805 of the
Teamsters in New York City and a very close associate of James R.
Hoffa.
Harry Gross, with two Miami numbers, UN-6-4026, and Jefferson
2-4569 in Miami. This is the Harry Gross we have been referring to
in this testimony. He has a criminal record and is also associated
with the Teamsters in Florida.
Joe Hat, the listing, Atlantic Highlands 0062. Joe Hat is an alias
for Joe Chiarella. He is known as Joe Hat. His New York "B"
number is 134862. He has four arrests, mcluding conviction and
sentence to Federal prison for 5 years for counterfeiting. Chiarella
was involved in narcotics and dock racketeering at the Claremont
Terminal in Jersey City. As far back as 1954 I worked on this in-
dividual myself, and certain people that he was supplying narcotics to
were friendly to Gleason, the secretary-treasurer of Mr. Noonan's
local, 1730.
James R. Hoffa, Woodward 1-6065, is an unlisted number at
Hoffa's office, local 299, in Detroit. There is also a listing marked
"Office, Woodward 1-1241."
Neo-Gravure, Union 6-5100. Next to this, there was a large blue
checkmark and tlie notation "57 Mike Rider." Mike Rider" is the
brother-in-law of Harry Gross.
There is a listing Keeshin, and Dover 3-6685. This is a Chicago
number and is a listing for J. L. Keeshin, Motor Express Co. Mr.
Keeshin ATas one of the persons who loaned money to Jimmy Hoffa,
a $5,000 loan.
There is a listing for Local 478 of the Teamsters, and tiie notation
Ted Nalikowski. Tliis local is located at 1153 Broad Street in New-
ark. Nalikowski was seated in front of the local in March of 1957,
seated in his car in front of this local when lie was shot three times.
He recovered and the case is still active. He refuses to name his
assailants. He also has a criminal record, including grand larceny
and highway robbery for which he did 5 years.
IIVIPROPER ACTIVITIES IN THE LABOR FIELD 18293
There are two listinos for Olvoiirke. one for Joliii O'Koiirke at
WA-^0002, and anotlier for John O'Rourke, Jr., Astoria 4-8410.
John O'Ronrke is head of Joint Council 1(5 of the Teamsters in New
York, and John O'Eourke, Jr., listing was for the Coastal Sales
Co., which, incidentally, lias lar^e accounts with many of the people
who have collective l)ar<raining agreements with his father's local.
There was a listir^g for Tony Provenzano, also known as Tony
Pro, Diamond 3-8526. This list is 77 Catalpa Avenue in Hackensack,
which is Tony Pro's address. Pie is an official in local 560 of Hoboken,
New Jersey, a Teamster local. lie has a record of two arrests for
assault and battery, one in May and the other in October 1958, in
Jersey, with no disposition shown. He is also a close associate of
James K. Ho If a. I believe he is currently running for office in the
joint council elections over in Newark.
There is a listing for Runyon Sales, Mr. Green, Bigelow 3-8778.
This has been referred to in committee testimony in the julvebox
hearings as the company with which Jerry Catena, who was present
at the Apalachin conference, had an interest. Catena has a criminal
record showing four arrests and two convictions, including one in
1944 for bribing a Federal juror.
Mr. Kennedy. That is it?
Mr. Kelly. Yes.
Mr. Kennedy. Now, Mr. Noonan, would you tell us what con-
tacts you have had witli any of those people ?
Mr. NooNAN. I respectfully decline to answer because I honestly
believe that the answer may tend to incriminate me.
Mr. Kennedy. Isn't it because of these kind of connections that
you were able to earn the sum of $45,000 in five nights' work in
1948?
iMr. NooNAN. I will give you tlie same answer.
I respectfully decline to answer because I honestly believe my an-
swer may tend to incriminate me.
The Chairman. Are you just simply engaged in that sort of racket-
eering, going around and putting on these pressures and lii jacking and
extortion? Is that your principal business? Is that the way you
make your living?
Mr. NooNAN. I respectfully refuse to answer you, sir, because I
believe my answer may tend to incriminate me.
Senator Curtis. Mr. Noonan, you have been connected with unions
here, and do you contend that you are a friend of tlie laboring man?
Mr. NooNAN. I respectfully refuse to answer you, sir, because I
honestly believe that my answer to your question may incriminate
me.
Senator Curtis. Have you had anything to do with the legitimate
objects of unionism ?
Mr. NooNAN. I will give you the same answ^er, sir.
Senator Curtis. That is all, Mr. Chairman.
The Chairman. Is there anything further, Mr. Kennedy ?
Mr. Kennedy, Can you tell us about the $4,000 that was paid to
Mr. Gross in connection with the Neo-Gravure ?
Mr. NooNAN. I respectfully decline to answer on the grounds or
because I honestly believe my answer my incriminate me.
Mr. Kennedy. And could you tell us anything about the payments
made in the 1946 Teamster strike or the 1948 Teamster strike?
18294 IMPROPER ACTIVITIES IN THE LABOR FIELD
Mr. NooNAN. The same answer to you, sir.
Mr. Kennedy. What is that?
Mr. NooNAN. I respectfully decline to answer you because I hon-
estly believe that my answer may tend to incriminate me.
Mr. Kennedy. Also you and Mr. Gross also received commissions
from the Associated Paper Co., of Philadelphia.
Could you tell us what you do for that?
Mr. Noonan. I respectfully decline to answer because I honestly
believe that my answer may incriminate me.
Mr. Kennedy. Could I ask Mr. Sheridan to put in the totals of the
amount of money that they have received ?
The Chairman. You may do it sitting where you are.
TESTIMONY OF WALTER J. SHERIDAN— Resumed
Mr. Sheridan. Mr. Gross and Mr. Noonan have been on tlie pay-
roll of Associated Paper Co. during the period 1955 to 1959. During
that period, they have received each a total of $17,381.52.
The Chairman. Where is this paper company located ?
Mr. Sheridan. In Philadelphia, Pa.
The Chairman. I thought this Gross was supposed to be a foreman
up there at the Neo-Gravure plant.
Mr, Kennedy. He is a Teamster official in Miami.
The Chairman. And he is getting $17,000 out of this paper com-
pany, and a foreman up at Neo-Gravure drawing a weekly salary,
and a monthly salaiy, and a yearly "tribute." He is a pretty good
operator.
Senator Curtis. I would like to ask Mr. Sheridan a question. Were
taxes withheld on those payments ?
Mr. Sheridan. Yes, they were.
Senator Curtis. Including social security taxes ?
Mr, Sheridan. Well, at this point. Senator, all we know is that
Mr. Noonan and Mr, Gross did claim in their income tax returns this
remmieration from the Associated Paper Co,
Senator Curtis, But when it was paid, there was withholding on
it?
Mr, Sheridan, Yes, there was.
Senator Curtis. Was it caiTied as wages ?
Mr. Sheridan. I don't know that. Senator.
It was carried as wages, and it was canned as commissions, and
these men are carried on the payroll as salesmen and the commission
basis is a third to Mr. Noonan and a third to Mr. Gross, and a third
to the company, and it is split three ways.
Senator Curtis. Now, all of Mr. Noonan's income that you have
uncovered, has all of it been reported for income tax purposes?
Mr. Sheridan. No, none of the cash payments as far as we know-
that were testified to yesterday have been reported as income.
Senator Curtis. Now, to your knowledge has the Internal Revenue
Service ever investigated Mr. Noonan ?
Mr. Sheridan. I don't know, sir.
Senator Curtis. I think that they ought to find out. I am speaking
of the Internal Revenue Service.
The Chairman. I think this record gives them considerable work
to do.
IIVIPROPER ACTIVITIES IN THE LABOR FIELD 18295
Senator Curtis. But have they been busy before this record was
established? Law abiding citizens all over the country are periodi-
cally checked, and that is all right, and I guess it is necessary. But I
think over a period of yeai-s they missed a great opportunity to get
a lot of revenue.
The Chairman, Is there anj^thing further ?
Mr. Kennedy, I might ask Mr, Sheridan. You say the company
received a third and Mr, Noonan received a third and Mr. Gross
received a third. What was the commission on ?
Mr. Sheridan. We have talked to the officials of the Associated
Paper Co. and they say that these commissions were paid to Mr.
Noonan and Mr. Gross because they had attempted for 8 years to
obtain a contract from the Lily Tulip Cup Co. in New York City, and
had been unanble to do so. They say, however, that Mr. Noonan was
able to obtain this contract and it is for this reason that they received
a commission.
Mr. IvENNEDT. Now, does Mr. Noonan's local represent the Lily
Tulip Cup Co. employees, or any of them ?
Mr. Sheridan. Yes; he does. His local represents 20 of the em-
ployees at the Lily Tulip Cup Co.
Mr. Kennedy. Was the commission always split one-third, one-
third, and one-third ?
Mr. Sheridan. No ; in the begimiing the commission was split 45
to Mr. Gross, 45 to Mr. Noonan, and only 10 for the company. But
this was changed 2 months later and now it is split three ways.
Mr. Kennedy. According to the company, they were paid the com-
mission because Mr. Noonan was able to obtain the contract with the
Lily Tulip Co.?
Mr. Sheridan. That is right.
Mr. Kennedy. Mr. Noonan also received some money from the
welfare fund of the ILA ; is that correct ?
Mr. Sheridan. Yes; he does.
Mr. Kennedy. As a trustee ; he is a trustee of the welfare fund ?
Mr. Sheridan. He is a trustee of the welfare fund, and he receives
money as a trustee.
Mr. Kennedy. Btwik in 1952 we identified him as receiving some
money as commissions as a fight manager ; is that right ?
Mr. Sheridan. Yes.
Mr. Kennedy. What about the $200 you received each year from
Neo-Gravure, Mr, Noonan ?
Mr, Noonan. I respectfully ^refuse to answer because I honestly
believe that my answer might incriminate me.
Mr, Kennedy. In addition to that, Mr. Sheridan, have we also
received some information regarding a business deal that he had with
Meyer Lansky ?
Mr, Sheridan, Yes, sir.
Mr, Kennedy. Would you relate that to the committee?
Mr. Sheridan, Mr. Lanslcy and Mr, Alo loaned Mr. Noonan some-
where between $70,000 and $100,000, and this was to be invested in a
frozen shrimp canneiy operation in Canada.
Mr. Kennedy. And the operation failed, did it?
Mr. Sheridan. The operation failed and the last that is known Mr.
Lansky and Mr. Alo w^ere trying to get their money back from Mr.
Noonan.
18296 IMPROPER ACTIVITIES IN THE LABOR FIELD
Mr. Kennedy. Would you tell us about that ?
Mr. NooNAN. I respectfully refuse to answer because I honestly
believe that my answer may tend to incriminate me.
Mr. Kennedy. Could you tell us how you could be working as a
trustee for the Welfare Fund and working for the union, and invest-
ing in a shrimp plant up in Canada, and receiving money from a
paper company in Philadelphia, and handling the trucking for the
New York Times and the New York Mirror, and being a fight man-
ager, and could you tell us what you do in your spare time, Mr.
Noonan ?
Mr. Noonan. I respectfully decline to answer because I honestly
believe that my answer may tend to incriminate me.
Mr. Kennedy. I think that is all.
Then, of course, you have the gambling place down in Havana
Cuba, which I didn't mention.
The Chairman. Is there anything further?
All right. Stand aside.
Mr. Kennedy. Mr. Gross.
The Chairman. Will you be sworn ?
You do solemnly swear that the evidence you shall give before this
Senate select committee shall be the truth, the whole truth, and noth-
ing but the truth, so help you God ?
Mr. Gross. I do.
TESTIMONY OF HAROLD GEOSS, ACCOMPANIED BY COUNSEL,
H. CLIFFORD ALLDER
The Chairman. State your name and your place of residence and
your business or occupation.
Mr. Gross. Harold Gross, 7921 Oregon Avenue, Miami Beach, Fla.
The Chairman. And you have any business or occupation ?
Mr. Gross. I respectfully decline to answer because I honestly be-
lieve my answer may tend to incriminate me.
The Chairman. Let me ask you if you have any legitimate business.
Mr. Gross. I respectfully decline to answer because I honestly be-
lieve my answer may tend to incriminate me.
The Chairman. Do you do anything that you can acknowledge
you do without possible self-incrimination ?
Mr. Gross. I respectfully decline to answer because I honestly be
lieve my answer might tend to incriminate me.
The Chairman. You have counsel present. Mr. Counsel, will you
identify yourself for the record ?
Mr. Allder. H.ClitrordAllder, Washington, D.C.
Mr. Kennedy. Before we begin the investigation of this union, of
which Mr. Gross is president, I thought you might want to know
that the union has already been investigated, and that they have come
back and written a letter that there isn't any kind of racketeering or
gangsterism.
Mr. Gross, we have had some testimony in connection with some of
your activities here before the committee during the past 2 days, and
specifically that you were on the payroll of the Neo-Gravure Co., and
you are still on the payroll and receiving certain amounts of money
weekly and certain amounts of money monthly.
IMPROPER ACTIVITIES IN THE LABOR FIELD 18297
Could you tell us what you do for that money ?
Mr. Gross. I respectfully decline to answer because I honestly be-
lieve that my answer might tend to incriminate me.
Mr. Kennedy. The testimony before the committee is that this
amount of money must be paid to you in order to achieve labor peace;
is that correct ?
Mr. Gross. I respectfully decline to answer because I honestly be-
lieve my answer might tend to incriminate me.
Mr. Kennedy. And then, in addition to that, we have had the testi-
mony that you were able to put some three or four of your relatives on
the payroll.
Mr. Gross. I respectfully decline to answer because I honestly be-
lieve my answer might tend to incriminate me.
Mr. Kennedy. And then, in addition to that, according to the testi-
mony, when the American Weekly w\as having difficulties or potential
difficulties, or faced potential difficulties in connection with having
deliveries made of their magazine, you were able to straighten out
those difficulties by the payment of some $4,000 in cash every year,
with the understanding that you would pass that cash around to the
proper people.
Could you tell us about that '^
Mr. Gross. I respectfully decline to answer because I honestly be-
lieve my answer may tend to incriminate me.
Mr. Kennedy. Who were the proper people, Mr. Gross ?
Mr. Gross. I respectfully decline to answ^er because I honestly be-
lieve my answ^er might tend to incriminate me.
Mr. Kennedy. Could you tell us why you didn't declare any of that
on your income tax return ?
Mr. Gross. I respectfully decline to answer because I honestly be-
lieve my answer may tend to incriminate me.
The Chairman. Who is Mr. Derow, Bernard Derow ?
Mr. Gross. I respectfully decline to anSw^er because I honestly be-
lieve my answer may tend to incriminate me.
The Chairman. 1 have documents here indicating that he is the sec-
retary-treasurer of local union 320, located at 1410 20th Street, Miami
Beach, Fla.
Do you have any information regarding that ?
Mr. Gross. I respectfully decline to answer because I honestly be-
lieve my answer may tend to incriminate me.
Tlie Chairman. Is that tlie headquarters of your union ?
Mr. Gross. I respectfully decline to answer because I honestly be-
lieve my answer may tend to incriminate me.
The Chairman. Did you receive a letter from Mr. George H.
Bender, former Member of the Senate, who has been appointed as a
cleanup commissioner or something for the Teamsters Union ?
Did you receive a letter from him regarding the state of health,
morally and criminally speaking, of your union '^
Mr. Gross. I respectfully decline to answer because I honestly be-
lieve my answer may tend to incriminate me.
The Chairman. And don't you know such a letter came to your per-
sonal attention?
Mr, Gross. I respectfully decline to answer because I honestly be-
lieve my answer may tend to incriminate me.
18298 IMPROPER ACTIVITIES IN THE LABOR FIELD
The Chairman. Don't you know tliat Mr. Derow, your secretary-
treasurer of your local, replied to that letter ?
Mr. Gross. I respectfully decline to answer because I honestly be-
lieve my answer may tend to incriminate me.
The Chairman. And that this correspondence took place in Novem-
ber and December of 1958 ?
Mr. Gross. I respectfully decline to answer because I honestly be-
lieve my answer may tend to incriminate me.
The Chairman. I hand you here photostatic copy of a letter from
Mr. Bender to Mr. Derow, dated December 5, 1958, and w^hat pur-
ports to be a photostatic copy of the reply thereto hj Mr. Derow writ-
ten on November 11, 1958, or rather, Mr. Bender's letter is a reply
to that letter.
I want to make sure that I get these straight. The first letter was
written by Mr. Bender. There is one written November 11 by Mr.
Derow to Mr. Bender, and then Mr. Bender's reply thereto of Decem-
ber 5, 1958.
Will you examine those and state if you can identify them?
(The documents were handed to the witness.)
The Chairman. Are you able to identify those photostatic copies ?
Mr. Allder. Would you ask him first if he has looked at them ?
The Chairman. I take judicial notice of the fact that his eyes are
glued to it right now.
Mr. Allder. Thank you, sir.
The Chairman. Proceed.
Mr. Gross. I respectfully decline to answer because I honestly
believe my answer may tend to incriminate me.
The Chairman. All right. Who got these letters out of the files?
Mr. Sheridan, you have been sworn. I present the letters to you,
and do you identify them and state where you received them ?
Mr. Sheridan. Yes, Senator. I received these from the files of
Local 320 of the Teamsters Union in Miami Beach, Fla.
The Chairman. Those may be made Exhibits 14r-A and 14r-B.
(Letters referred to were marked Exhibits 14-A and 14-B for
reference and will be found in the appendix on pp. 18328-18329.)
The Chairman. I present to you a letter dated October 23, 1958,
addressed to Mr. Joseph W. Morgan, secretary-treasurer of Team-
sters Local No. 320, and signed by Mr. George H. Bender, apparently.
Will you please examine it and it has some written notation on the
bottom of it, apparently signed by Mr. JNIorgan. Will you please ex-
amine it and state if you identify it ?
(The document was handed to the witness.)
The Chairman. Do you identify the letter?
Mr. Gross. I respectfully decline to answer because I honestly be-
lieve my answer may tend to incriminate me.
The Chairman. You have looked at it, have you, in examining it ?
Mr. Gross. Yes.
The Chairman. The thing that is a little bit puzzling is this : Ap-
parently your officers in the union answered back very frankly that
there w^as no racketeering and nothing wrong in your local, to Mr.
Bender, and now you come here and take the fifth amendment and
say you can't talk about it without possible self-incrimination.
IMPROPER ACTIVITIES IN THE LABOR FIELD 18299
Don't you think under sucli circumstances that you are either being
luif air to this committee or you were misleading and your officers were
misleading Mr. Bender when they so reported?
Mr. Gross. I respectfully decline to answer because I honestly
believe my answer may tend to incriminate me.
The Chairman. This letter may be made exhibit No. 14-C.
(Letter referred to was marked "Exhibit 14-C" for reference and
may be found in the liles of the select committee.)
Mr. Kennedy. Could we read those letters ?
The Chairman. The point I am making is this : Apparently when
Mr. Bender writes as the commissioner or committeeman of Mr. Hoffa
to investigate these matters, you respond and your officers respond
promptly and say, "Oh, no; everything is all right with us, and
there is no racketeering and nothing else."
When you get up here before a committee, and j'ou are being asked
about it, a committee duly constituted and appointed by the Senate
of the United States to inquire into these things, then you come before
he committee under oath and say. "Well, I can't talk about it on the
basis of possible self-incrimination."
Whom are we to believe ? Are we to believe these letters, or are
we to believe the position that you take now as being true? You are
swearing you honestly believe that it might incriminate you.
Do you know of any racketeering in this union ?
Mr. Gross. I respectfully decline to answer because I honestly
believe tliat my answer may tend to incriminate me.
The Chairman. Have you, yourself, as a union member and as a
union official in this union, engaged in any racketeering or any other
illegal or improper act in connection with your union affairs?
Mr. Gross. I respectfully decline to answer because I honestly
believe my answer may tend to incriminate me.
The Chairman. Do you know Mr. Morgan, Mr. Joseph W.
Morgan ?
Mr. Gross. I respectfully decline to answer because I honestly be-
lieve my answer may tend to incriminate me.
The Chairman. Is he not an officer or was he not an officer of your
local No. 320?
Mr. Gross. I respectfully decline to answer because I honestly
believe my answer may tend to incriminate me.
.The Chairman. Did Mr. Derow succeed Mr. Joseph W. Morgan
as secretary-treasurer of your local ?
Mr. Gross. I respectfully decline to answer because I honestly
believe my answer may tend to incriminate me.
The Chairman. What is there about telling who the members or
the names of your officers are that could possibly incriminte you?
There is a record of it and there is a record of your relationship.
What is there about that that could possibly incriminate you, to
say who is president or who is treasurer or secretary of a local labor
union ? I think it would be helpful to the committee, and certainly
helpful to the public of this country and Congress, too, to undei'stand
if there is any such thing, what could possibly be incriminating about
being an officer in a labor union to begin with, and what could possibly
be incriminating to know that officer ?
Can you give us any explanation of that ?
18300 IMPROPER ACTIVITIES IN THE LABOR FIELD
Mr. Gross. I respectfully decline to answer because I honestly be-
lieve my answer may tend to incriminate me.
The Chairman. There is something deeply mysterious about it.
Is there anything further ?
These letters clearly indicate the kind of answers — I am going to
let counsel read them into the record — it shows the superfluity, I may
say, of that character of investigation. You can write a letter and
ask, "Have you been a good boy?" and the fellow writes back, "Uh
huh," but when you get them under oath we find them having to take
the fifth amendment. They can't talk without possible self-incrimi-
nation.
I just wonder about the value of this. This has been given pub-
licity, this cleanup investigation that is being conducted by the Hoffa-
appointed committee. It is quite illuminating to find when they write
in to him they say they have been good boys and there is nothing
wrong with them, and when you get them before a committee under
oath, they say they can't talk about it because of possible incrimina-
tion.
Senator Curtis. Do you know Mr. Hoffa ?
Mr. Gross. I respectfully decline to answer because I honestly be-
lieve my answer may tend to incriminate me.
Senator Curtis. Do you know Dave Beck, Sr. ?
Mr. Gross. I respectfully decline to answer because I honestly be-
lieve my answer may tend to incriminate me.
Senator Curtis. Do you know Mr. Noonan, who was just on the
stand before you ?
Mr. Gross. I respectfully decline to answer because I honestly be-
lieve my answer may tend to incriminate me.
Senator Curtis. Have you ever attended a Teamster Union con-
vention ?
Mr. Gross. I respectfully decline to answer because I honestly be-
lieve my answer may tend to incriminate me.
Senator Curtis. That is all, Mr. Chairman.
Mr. IvENNEDY. Mr. Chairman, this first letter, which is exhibit No.
14-C, was the letter that Mr. Bender sent out on October 23, 1958, to
determine whether there was any racketeering or gangsterism in any
of the Teamster Unions. He based the letter on the hearings of the
committee which, of course, up to the present time, I don't believe he
has obtained, but he sent that letter out to the various locals, and he
received back this letter.
The Chairman. To this local of which this witness is president ?
Mr. IvENNEDY. This witness is president, and this is the witness
who has received this extortion money over a period of some 8 or 10
years.
The Chairman. That is according to the proof that we have.
Mr. Kennedy. Some $45,000 in cash in 1948 and he has been con-
victed of a number of crimes, and he has been involved in shady deals
for 20 years, and now since our investigation he becomes head of this
local down there.
So Mr. George Bender writes them a letter and he says: "What
gangsterism or racketeering do you have in your local?" and under
letter of November 11, 1958, a letter comes back from Bernard Derow,
secretary-treasurer of local 320, who, Mr. Chairman, I might add,
IMPROPER ACTIVITIES IN THE LABOR FIELD 18301
has refused to answer any questions of the staff members of our com-
mittee when we asked him about it
The Chairman. We liaven't had him as a witness yet ?
Mr. Kennedy. No, but he wrote back to Mr. George Bender and he
said:
Dear Sir: There are no cases of racketeering or gangster alliances in this
local union. We will give you full cooperation on any investigation of tMs
local union.
The Chairman. Would you be willing to give that same cooperation
to the committee?
Mr. Gross. I respectfully decline to answer because I honestly be-
lieve my answer might tend to incriminate me.
Tlie Chairman. You then don't think that letter was written in
good faith, do you ?
Mr. Gross. I respectfully decline to answer because I honestly be-
lieve my answer may tend to incriminate me.
Mr. Kennedy. Then a letter on December 5, 1958, goes to Mr. Derow,
secretary-treasurer of this local, of which this witness is president,
and he says :
Dear Mr. Derow : Your letter of recent date responding to mine of October 24
nad been received —
and this is the interesting part :
The fine report you give of your organization is most gratifying to the commis-
sion. The officials and members of your local are to be commended upon it.
Thank you sincerely for your fine spirit of cooperation. With kindest regards
and best wishes, I am, cordially yours.
George H. Bender.
The Chairman. Could you get back in the mood now for a little
fine spirit of cooperation and help us ?
Mr. Gross. I respectfully decline to answer because I honestly
believe my answer may tend to incriminate me.
Senator Curtis. I would like to ask some questions.
You have been in the union business a long time. Apparently
somebody connected with this local union sold our former colleague,
Bender, a bill of goods.
Mr. Kennedy. For $28,000.
Senator Curtis, Do you know of any of the top labor leaders in
the country that have come in and recommended any legislation that
would make it impossible for racketeers and exconvicts and gangsters
and thugs to get into unions or to make it unprofitable for them if they
get in there ? Do you ?
Mr. Gross. I respectfully decline to answer because I honestly
believe that my answer may tend to incriminate me.
Senator Curtis. Now, Mr. Bender made the mistake of going to
the top officers and asking them if they were good or bad. But there
are a lot of other people in the United States making that same mis-
take. It is time for the top union leaders in the country who contend
that they are honest, and I do not doubt their personal lives at all, to
back up some of the legislation that will really curb some of these
abuses and make it unprofitable and undesirable for any racketeer
to ever want to get into the union business.
That is all, Mr. Chairman.
The Chairman. Is there anything further ?
18302 IMPROPER ACTIVITIES IN THE LABOR FIELD
Do you know Mr. George Bender ?
Mr. Gross. I respectfully decline to answer because I honestly
believe that my answer may tend to incriminate me.
The Chairman. Is there anything you can tell us or are you willing
to help us in any way in the world ?
Mr. Gross. I respectfully decline to answer because I honestly be-
lieve my answer may tend to incriminate me.
The Chairman. The committee will stand in recess until 2 o'clock,
and you may be back at that time.
(Members of the select committee present at time of recess: Sen-
ators McClellan and Curtis. )
(Whereupon, at 12:30 p.m. the select committee recessed, to recon-
vene at 2 p.m. the same day.)
AFTERNOON SESSION
The select committee reconvened at 2 p.m., Senator John L. Mc-
Clellan (chairman of the select committee) presiding.
The Chairman. The committee will come to order.
(Members of the select committee present at time of reconvening:
Senators McClellan and Ervin.)
The Chairman. Proceed, Mr. Counsel.
TESTIMONY OP HAEOLD G-EOSS, ACCOMPANIED BY COUNSEL,
H. CLIFFOED ALLBEE— Eesumed
Mr. Kennedy. Mr. Gross, is it correct, as has been testified, that you
and Mr. Noonan received some $45,000 in cash in 1958 from the Neo-
Grai^ure Co. to achieve the delivery of the supplements of the New
York Times and New York Mirror ?
Mr. Gross. I respectfully decline to answer because I honestly be-
lieve my answer may tend to incriminate me.
Mr. Kennedy. And whether you put four members of your family
on the payroll of the Neo-Gravure Co. ? Did you do that?
Mr. Gross. I respectfully decline to answer because I honestly be-
lieve my answer might tend to incriminate me.
Mr. Kennedy. And that you received $4,000 each year from the
Neo-Gravure Co., from 1952 to 1958, with the purpose being to achieve
labor peace for the xVmerican Weekly ?
Mr. Gross. I respectfully decline to answer because I honestly be-
lieve my answer might tend to incriminate me.
Mr. Kennedy. Could you tell the committee why you did not report
that as income ?
Mr. Gross. I respectfully decline to answer because I honestly be-
lieve my answer may tend to incriminate me.
Mr. Kennedy, In 1954 and 1955, you received a total of $5,000 in
cash for the purpose of obtaining or for having obtained a less
stringent contract in connection with the employees in a union contract
for Neo-Gravure. Would you tell us about that?
Mr. Gross. I respectfully decline to answer because I honestly be-
lieve my answer might tend to incriminate me.
Mr. Kennedy. That was a contract with Connie Noonan's local of
the ILA. Could you tell us how you were able to obtain a contract
IMPROPER ACTIVITIES IN THE LABOR FIELD 18303
wliich had less stringent provisions than the Teamster contract in the
city of New York, which ordinarily was followed?
Mr. Gross. I respectfully decline to answer because I honestly be-
lieve my answer may tend to incriminate me.
Mr. Kennedy. Did any of that money go to Mr. Connie NoonaJi ?
Mr. Gross. I respectfully decline to answer because I honestly be-
lieve my answer may tend to incriminate me.
Mr. Kennedy. You discontinued tliat practice in 1058, but you
remained on the payroll of the Neo-Gravure Co., and at the same
time you were made head of local 320 in Miami Beach, Fla.
Could you tell us how you became head of local 320 in jVIiami
Beach, Fla., of the Teamsters ?
Mr. Gross. I respectfully decline to answer because I honestly be-
lieve my answer may tend to incriminate me.
Mr. Kennedy. Mr. Gross, Mr, HolTa had appeared before this
committee in the middle of 1957 and explained how he was going
to take steps to clean up the union, that he was going to talce steps
to rid this union of racketeers and gangsters.
Could you explain to the committee, in view of that statement by
Mr. Hoffa and in view of Mr. Hoffa's later appearance in 1958, how
it was that you, with a criminal record, were made president of this
local in Miami Bearch, Fla. ?
Mr. Gross. I respectfully decline to answer because I honestly
believe my answer may tend to incriminate me.
Mr. Kennedy. And that while you were president of the local in
Miami Beach, Fla., you were on the paja-oll of the Neo-Gravure
Co., and you are on the payroll at the present time? Is that correct?
Mr. Gross. I respectfully decline to answer because I honestly
believe my answer may tend to incriminate me.
Mr. Kennedy. You have received a total from the Neo-Gravure
Co. of $131,459.35, all of it for obtaining labor peace for that com-
pany. Can you explain to the committee how you were able to achieve
that?
Mr. Gross. I respectfully decline to answer because I honestlj"
believe my answer may tend to incriminate me.
Mr. Kennedy. Was it because the local union that you came out
of, the local union that has been identified as a local union of the
Teamsters up in New York, which has been identified as the Team-
ster local that was controlled by Murder, Inc., and where a number
of the officials of the union were sent to jail for extortion or were
murdered in gangland style — can you tell us about that?
Mr. Gross. I respectfully decline to answer because I honestly
believe my answer may tend to incriminate me.
Mr. Kennedy. Isn't it correct that in your activities — Mr. Chair-
man, it is of some importance the way he has operated local 320. Mr.
Sheridan will have some information to place in the record on that.
Isn't it correct that your local in Miami Beach, Fla., local 320, is
nothing but a shakedown operation, that you achieve no benefit for
any of your membership ?
Mr. Gross. I respectfully decline to answer because I honestly
believe my answer may tend to incriminate me.
36751— 59— pt. 51 12
18304 IMPROPER ACTIVITIES IN THE LABOR FIELD
Mr. Kennedy. Isn't it correct that in your operations you have
been aided and assisted, or at least accompanying you on your opera-
tions, has been Mr. Johnny DiogTiardi's brother Frank Dioguardi ?
Mr. Gross. I respectfully decline to answer because I honestly be-
lieve my answer may tend to incriminate me.
Mr. Kennedy. And isn't it correct also that Mr. James Plumeri,
his uncle, known as Jimmy Doyle, who is one of the major gangsters
in New York, has also accompanied you on some of your so-called
organizing drives in Miami ?
Mr. Gross. I respectfully decline to answer because I honestly be-
lieve my answer may tend to incriminate me.
Mr. Kennedy. And isn't it correct that Mr, Barney Baker has also
been down in Miami, Fla., assisting you in your organizing drives?
Mr. Gross. I respectfully decline to answer because I honestly be-
lieve my answer may tend to incriminate me.
TESTIMONY OF WALTER J. SHERIDAN— Resumed
Mr. Kennedy. Have we been able to establish the fact that Barney
Baker, Franli; Dioguardi, and James Plumeri have been accompanying
Mr. Gross in his organizing drives in the city of Miami ?
Mr. Sheridan. Yes, we have.
Mr. Kennedy. That has been ascertained through your investiga-
tion down there ?
Mr, Sheridan. Yes, sir,
Mr, Kennedy. Can you tell the committee what we have found on
what kind of people Mr. Gross has attempted to organize?
Mr, Sheridan. Parking lot attendants, service station attendants,
and taxicab drivers. In the organization of all of these, the ones that
I contacted, there were no benefits accruing to the employees as a result
of his organization.
In the case of the service station attendants, the service station
managers were asked by Mr. Gross and Mr. Derow and other members
of local 320 if they would like to invest in local 320 as a business
venture. Barney Baker — ■ —
Tlie Chairman. Did you find out how they make an investment in
a labor organization ? Did any of the witnesses you mentioned make a
suggestion as to how they might invest in a labor local and get a
dividend in return ?
Mr, Sheridan, Well, it wasn't fully explained. These people did
not invest their money, but one man was asked if he would like to in-
vest $7,000 in local 320.
The Chairman. How much?
Mr, Sheridan, $7,000.
The Chairman, If he would like to ?
Mr, Sheridan, If he would like to.
The Chairman, What was the investment? Is that to keep some
more peace somewhere ? To keep from getting destroyed ?
Mr. Sheridan. Well, this was
The Chairman. Stink-bombed, or what ?
Mr, Sheridan, This was moi'e in the nature of a business investment
with the hope of some return, I believe.
The Chairman, How ?
Mr, Sheridan, That wasn't explained.
n'IPROPER ACTIVITIES IN THE LABOR FIELD 18305
The Chairman. How could you know anyone would have hope with-
out some explanation of what the project was ?
Mr. Sheridan. It wasn't explained to him, Senator, because he
turned it down immediately.
Mr. Kennedy. Isn't it correct, Mr. Sheridan, that this local union
is financed by Mr. Hoff a directly out of the International ?
Mr. Sheridan. Yes. They are currently receiving, and have been
since December 1958, $?>,000 a month from the international union.
Mr. Kennedy. And isn't it correct that Mr. Gross' salary is paid
out of that money that is sent down by Mr. Hoffa ?
Iklr. Sheridan. Yes. Mr. Gross receives $150 a week in salary.
Mr. Kennedy. How many members are there in the local at the
present time?
Mr. Sheridan. Thirty-two.
Mr. Kennedy. How much salary does Mr. Gross receive ?
Mr. Sheridan. $150 a week.
The Chairman. That is being paid out of the international ?
Mr. Sheridan. Well, the subsidy is from the international for $3,000.
The Chairman. But 32 members would hardly support that.
Mr. Sheridan. The better part of the $150 would have to come out
of the $3,000.
The Chairman. How long has this local had a charter? Do you
know?
Mr. Sheridan. The original charter was in July 1957, and the local
went defunct in March 1958, and Mr. Gross took it over in October
1958.
The Chairman. When did you make this check with respect to the
membership ?
Mr. Sheridan. About 2 weeks ago. Senator.
The Chairman. It had only 32 members. Is that according to the
international records ?
Mr. Sheridan. No. That is according to the local's records.
The Chairman. You got their records, the local's records ?
Mr. Sheridan. Yes ; we did.
The Chairman. And they showed 32 members ?
Mr. Sheridan. Yes, sir.
The Chairman. Aud this man is di-p.vi'Tg that salary dow^i there of
$150 a week, and he has been drawing about $17,000 a year, plus, from
this Neo-Gravure Co. ?
Mr. Sheridan. Yes, sir.
The Chairman. All right.
Mr. Kennedy. Do the otlier officers draw a salary also ?
Mr. Sheridan. Yes ; they d5.
Mr. Kennedy. Wlio is that ?
]Mr. Sheridan. Bernard Derow draws a salary in the same amount.
Leo Levin was an officer of the local. He resigned recently. He was
also drawing a salary in the same amount.
The Chairman. In other words, there was about $300 a week being
paid out for two officers, and the third one gets $150 ?
Mr. Sheridan. Yes, sir. Pie has resigned now.
The Chairman. They had been getting $450 a week. That is what
they were paying out for tiiese three officers ?
Mr. Sheridan. Yes, sir.
18306 IMPROPER ACTIVITIES IN THE LABOR FIELD
The Chairman. And there are only 32 jnembers in the local. All
right.
Mr. KJENNEDY. Isn't it correct that in addition to that, in order to
service these 32 employees, that Mr. Gross rents a car and charges it to
the union ?
Mr. Sheridan. Yes, sir. He rents a red Thunderbird from the
Huskamp Ford Agency in Miami.
Mr. Kennedy. Wliat kind of an automobile ?
Mr. Sheridan. A red Ford Thunderbird.
Mr. Kennedy. How much does the union pay for that ?
The Chairman. While you are looking at that, I was thinking that
that local pays out at $450 a week; $150 salary for each of three
officers, about $1,800 a month. Assuming that the 32 members pay $5 a
month dues, that would be $160 a month.
There is a pretty big deficit to make up there, around $1,400 or
$1,500 a month to be made up as a subsidy from some source. Is
that much coming in from the international to support this?
Mr. Sheridan. $3,000 a month comes from the international.
The Chairman. $3,000 a month goes into it ?
Mr. Sheridan. Yes, sir.
Mr. Kennedy. But Mr. Gross is very busy trying to sign up new
members, Mr. Chairman, in his red Thunderbird.
The Chairman. All right.
Mr. Kennedy. How much does that cost the union ?
Mr. Sheridan. This is a letter dated February 12, 1959, from Hus-
kamp International, Inc., to the local. On January 21, 1959, the
balance owed for the rental of the Thunderbird was $3,028.48.
Mr. Kennedy. The balance owed on the rental, or are they buying
it by installments ?
That is what it says, Mr. Chairman. They are paying, evidently,
$164.63 every month, and as of January they owed that amount.
They expect to have it paid off by July.
Senator Ervin. In other words, the International Teamsters, whose
president appeared before this committee and said he was going to
clean up tlie Teamsters, is financing this local, of which this witness
is president, in Miami, Fla., out of international funds to the
extent of $3,000 a month j
Mr. Sheridan. Yes, sir.
Senator Ervin. And the international is giving that to a local
whose president is a man who has been convicted of petty larceny,
that is, stealing
Mr. Kennedy. Extortion.
Senator Ervin. And who has served a penitentiary sentence for
extortion, which is nothing in the world but taking by intimidation
money or property which belongs to others.
And that all happened in the good years of 1958 and 1959?
Mr. Sheridan. Yes, sir.
The Chairman. It should be noted that he became president of this
union and took over this defunct local after Mr. Hoffa's appearance
before this committee, at which time he gave some assurance he
would sort of clean it up.
All right.
Mr. Kennedy. Do we find any other charges, Mr. Sheridan ?
IMPROPER ACTIVITIES IN THE LABOR FIELD 18307
Mr. Sheridan. Yes. In addition to the rental of the Thunder-
bird, there are bills from the Susco Rent-A-Car agency for another
f^r rental in the amount of $75.75.
Mr. Kennedy. What kind of an automobile is that'^
Wliat kind of an automobile was that? Could you help us on
that?
Mr. Gross. I respectfully decline to answer because I honestly
believe my answer may tend to incriminate me.
The Chairman. I don't know the name of any automobile in this
country that w^ould incriminate anybody. There may be, but I don't
know of any.
Is there anything further?
Mr. Sheridan. Also another one from the Curry Automobile
Rental, Inc., one for $135.84, and another for $120.20, and another
one
The Chairman. iVre these all current bills ?
Mr. SiieriDxVN. Yes. This is November 1958.
Mr. Kennedy. This is all since he took over the union.
Mr. SHERmAN. The previous one was January 1959.
The Chairman. I would be interested to know if the membership
in this particular local has increased any as a residt of these expendi-
tures in his elforts to organize. Do you have a comparison of the 32
members now with the number at the time the organization went
■defunct or at the time he took over the presidency ?
Mr. Sheridan. No, we don't have an accurate record of that, Mr.
Chairman, l>ecause the way they keep the records is that they have
a membership i-oster where you can establish that there are 32 mem-
bers now, but there are no records to indicate what the membership
was when the other local w-ent defunct.
The Chairman. There have not been any overwhelming gains
imy way ?
Mr. Sheridan. No, sir. There has been an increase, if anything.
There is also a bill from the Pershing Automobile Rentals cover-
ing the period December 29, 1958, to January 29, 1959, in the amount
of $183.82.
In addition to that, we have gasoline slips signed by Norman Gross,
who is the son of Harold Gross, w^ho is also on the payroll of Neo-
Gravure. Norman Gross was signing gasoline slips and charging
them to local 320 in March of 1959.'
The Chairman. There is nothing here tliat we have been able to
find that would at all indicate or even give a mild suggestion that
this is a successful labor operation. Would you maintain that it is
a successfully organized and operated labor union local in the field
of service as such for tlie true purposes of unionism ?
Mr. Gross. I respectfully decline to answer because I honestly
believe my answer may tend to incriminate me.
The Chairman. Then that gives rise to this thought: Obviously,
then, this is some kind of an operation outside of legitimate unionism
and a very expensive operation.
I will ask you, then, is it connected in any way with racketeering?
Mr. Gross. I respectfully decline to answer because I honestly
believe my answer may tend to incriminate me.
The Chairman. Proceed.
18308 II^IPROPER ACXrV'ITIES IX THE LABOR FIELD
'Mr. Kennedy. Mr. Sheridan, have we definitely established about
Mr. Barney Baker's activities in connection with this local?
Mr. Sheridan. Yes. sir.
Mr. Kennedy. AVould you tell us what the record shows about that?
Mr. Sheridan. ]Mr. Baker was to have testified before this commit-
tee on August 27, 1958, and that morning he had a heart attack
Mr. Kennedy. It is alleged.
Mr. Sheridan. An alleged heart attack, and went to the hospital.
On October 1, 1958, Mr. Gross took over local 320.
Several days later, while staying at the Seagull Hotel, he contacted
Barney Baker in Chicago, 111., and in Iowa, and several days there-
after i3arney Baker checked into the Seagidl Hotel, at the same time
Mr. Gross was staying there.
Within 2 weeks thereafter, within a week thereafter, Mr. Gross and
Mr. Baker were out attempting to organize for local 320.
^Ir. Kennedy. "Would you tell us about that, Mr. Gross ?
Mr. Gross. I respectfully decline to answer because I honestly
believe my answer may tend to incriminate me.
Mr. Ivennedy. It is also of some interest, Mr. Chairman, again
showing the tie between the ILA, Mr. Xoonan, and the Teamsters
Union, about Mr. Baker's bill while he was in Miami.
Mr. Sheridan. Mr. Baker, while staying at the Seagull Hotel, at the
same time Mr. Gross was there, when Mr. Baker left the hotel the
balance of the bill, which at that time was $55.62, was transfererd t-o
the account of Thomas Gleason, in care of the ILA. So while Mr.
Baker was assisting ^Ir. Gross in organizing for the Teamsters, his
hotel bill was paid for by the ILA.
Mr. Kennedy. We have that bill here, Mr. Chainnan.
The Chairman. The bill may be made exhibit Xo. 15.
(Document referred to was marked ''Exhibit No. 15'' for reference
and ma}^ be found in tlie files of the select committee.)
The Chairman. Is there anything further?
Mr. Kennedy. Yes.
Can you explain Mr, Hoffa subsidizing this local for $3,000 a month?
Mr. Gross. I respectfully decline to ansAver because I honestly
believe my answer may tend to incriminate me.
jNIr. Kennedy. Isn't it because of your own criminal record and your
underworld connections that you were placed in charge of the local
and that Mr. Hoffa now subsidizes this local for this amount of
money ?
Mr. Gross. I respectfully decline to answer because I honestly
believe my answer may tend to incriminate me.
Tlie Chairman. Did 3'ou have anv other qualities to recommend you
toMr.Hoff'a?
]Mr. Gross. I respectfully decline to answer because I honestly
believe my answer may tend to incriminate me.
Mr. Kennedy. You also, in addition to all these other activities, are
on the payroll of the Keamy Smelting & Refining Corp. of Kearny,
X. J., from which j-ou receive an annual salaiy. Can you explain that
to us ?
]Mr. Gross. I respectfully decline to answer because I honestly
believe my answer may tend to inci'iminate me.
Mr. Kennedy. Tha't is the K-e-a-r-n-y Smelting & Eefinhig Corp.
The Chairman. Do you keep labor peace for them ?
IMPROPER ACTIVITIES IN THE LABOR FIELD 18309
Mr. Gross. I respectfully decline to answer because I honestly
believe my answer may tend to incriminate me.
Mr. Kexxkdy. Could you tell us from records that Ave have, Mr.
Sheridan, what money he received from the Kearny Co ?
Mr. Sheridan. In"^195r) he received $3,054,73 ; 'in 1950, he received
$2,814,27 ; in 1957, $1,474,7().
Mr. Kennedy, In addition to that, you were on the payroll or re-
ceived commissions from the Associated Paper Co. of Philadelphia
as a salesman. You received, over the period of the last 3 years or
so, some $17,000. Would you explain that to us i
Mr. Gross. I respectfully decline to answer because I honestly be-
lieve my answei- may tend to incriminate me.
The Chairman.' How do you provide this protection for labor
peace ? What are your methods ?
Mr. Gross. I respectfully decline to answer because I honestly be-
lieve my answer may tend to incriminate me.
Mr. Kennedy. You receive money from Kearny, the Kearny Smelt-
ing and Refining Corp.; Associated Paper Co.; the Neo-Gravure Co.
in New Jersey; Local 320 in Miami; The Associated Paper Co. is
in Philadelphia.
You receive money for getting the deliveries of New York Times
and the New York Mirror, some $45,000 for that. You received ^4,000
each year for obtaining American Weekly— for having that delivered
without having any labor difficulties.
Could you tell us any of your other activities ?
Mr. Gross. I respectfully decline to answer because I honestly be-
lieve my answer may tend to incriminate me.
Mr. Kennedy. Mr. Gross, what it amounts to, and according to this
record, you are not more than a professional fixer, who has very close
associates and ties with the underworld. Is that correct ?
Mr. Gross. I respectfully decline to answer because I honestly be-
lieve my answer may tend to incriminate me.
Mr. Kennedy. This is what has been established by the record:
That you have been hired as a fixer, you have been successful as a fixer;
you went to jail as an extortionist ; and it also has been established that
you have these close ties and associates in the underworld in several
cities in the United States. You started out as an associate of Murder,
Inc.
Can you tell us anything about that ?
Mr. Gross. I respectfully decline to answer because I honestly be-
lieve my answer may tend to incriminate me.
Mr. Kennedy. With this background and record, the local was reac-
tivated in Miami, Fla., of the Teamsters Union, and you were made the
head of it by Mr. James Hoffa.
Can you give us any explanation of that?
Mr. Gross, I respectfully decline to answer because I honestly be-
lieve my answer may tend to incriminate me.
The Chairman. Mr. Sheridan, let me ask you this question : Have
you checked to ascertain whether these funds that we know he re-
ceived, have been reported on his income tax ?
Mr. Sheridan. Yes, Senator.
We have established from our sources that he has not reported the
cash amomits of money that he has received on his income tax.
18310 IMPROPER ACTIVITIES IN THE LABOR FIELD
The Chairman. I am sure they will take notice of this, but the
transcript of these hearings, of this testimony, will certainly be pro-
vided the Justice Department and also the Internal Revenue Service
with, the idea of recouping a little taxes that may have escaped the
Federal Treasury so far, which belong in there.
Is there anything further?
Mr. Kennedy. That is all.
Can we keep him under subpena ?
The Chairman. You will remain under your present subpena, sub-
ject to being recalled and further interrogated hj the committee at
such time as the committee may desire further testimony from you. I
will give reasonable notice of the time and place of such hearings so
that you wdll have an opportunity to be present.
Do you accept such recognizance ?
Mr. Gross. I do.
The Chairman. On your acceptance, you may be excused for the
present.
Call the next witness.
Mr. Kennedy. Mr. John Walsh, Mr. Chairm,an.
The Chairman. Mr. Walsh.
You do solemnly swear that the evidence you shall give before this
Senate select committee shall be the truth, the whole truth, and noth-
ing but the truth, so help you God ?
Mr. Walsh. I do.
TESTIMONY OF JOHN P. WALSH
The Chairman. State your name, your place of residence, and your
business or occupation.
Mr. Walsh. John P. Walsh, 6 Kensington Road, Garden City, Long
Island, N.Y. ; wholesale beauty supplies. Wholesaler of beauty
supplies.
The Chairman. You waive counsel, do you ?
Mr. Walsh. Yes, I do.
The Chairman. All right.
Mr. Kennedy. Mr. Chairman, this is on another entirely different
phase of the Mail Handlers and Deliverers Union investigation, and it
was a phase that we had expected to finish the first day, but we could
not get a quorum and we were unable to do it. We have two witnesses
to be relatively short. I wanted to complete the record in connection
with some activities.
You were formerly with your father, operating the Walsh Trans-
portation Corp ; is that right ?
Mr. Walsh. That is right.
Mr. Kennedy. And the Union News Special Delivery Co.?
Mr. Walsh. That is correct.
Mr. Kennedy. And you operated under contract with the Union
News Co. ; is that right ?
Mr. Walsh. Correct.
Mr. IvENNEDY. That was a subsidiary of the American News?
Mr. Walsh. Correct.
Mr. Kennedy. You delivered vending supplies to tlie newsstands?
Mr. Walsh. That is right.
IMPROPER ACTIVITIES IN THE LABOR FIELD 1S311
Mr. Kenxedv. Then ALr. Henry Garfinkle obtained control of the
American News and the Union News Co., and he set up a relative of
his, William Levine, in the L. & M. Trucking Co. in Queens; is that
right?
Mr. Walsh. That is true.
Mr. Kennedy. And also in Brooklyn ?
Mr. Walsh. Right.
Mr. Kennedy. Tliey took over all of the trucking business fiom
you?
Mr. Walsh. That is right.
Mr. Kennedy. So you went out of the trucking business ?
Mr. Walsh. I went out of the trucking business.
Mr. Kennedy. "VYlien was this ?
Mr. Walsh. This was 1953, 1 believe.
Mr. Kennedy. Thereafter you operated an independent trucking
business and rental ?
Mr. Walsh. Truck rental and general trucking ; yes.
Mr. Kennedy. In June of 1958 you met Mr. William Fello; is that
right?
Mr. Walsh. That is right.
Mr. Kennedy. Y\^\o Avas Mr. Fello ?
Mr. Walsh. Mr. Fello was the operator and, as far as 1 knew at
that time, the president of the Bi-County News Corp.
Mr. Kennedy. We had some testimony from him, :ind he is alstj
The Chairman. Pie testified, I believe.
Mr. Kennedy. That is right — but refused to answer any questions.
Wliat did he suggest to you ?
Mr. Walsh. I solicited the truck rental for the delivery of their
magazines, and during the course of our conversations, he suggested
that there was a possibility I could become a member of Bi-County
News.
That was in an investment capacity, and also in an employment
capacity.
Mr. Kennedy. Did you agree to do that ?
Mr. Walsh. I did. '^
Mr. Kennedy. Did you know anything about William Fello at the
time?
Mr. Walsh. Very, very little.
Mr. Kennedy. Did you know what his general reputation was ?
Mr. Walsh. Not generally, uo.
Mr. Kennedy. Well, not specifically. But what was his general
reputation ?
Mr. Walsh. His general reputation ? I know he had been em-
ployed by one Inter-Boro News Co., a former distributor of maga-
zines, and that he had been employed in the capacity of foreman.
Mr. Kennedy. Did you understand as his general reputation that
he had close associates with the underworld in New- York ?
Mr. Walsh. Not at that time I did not.
Mr. Kennedy. You learned that subsequently ?
Mr. Walsh. Subsequently I did.
Mr. Kennedy. So did you agree to invest in this company ?
Mr. Walsh. Prior to my finding out about this, I had, yes.
Mr. Kennedy. So how much money did you invest?
18312 IMPROPER ACTIVITIES IN THE LABOR FIELD
Mr. Walsh. $20,000.
Mr. Kennedy. Where did you get the $20,000 ?
Mr. Walsh. Mortgaged my home.
Mr. Kennedy. How much did Fello invest in the company?
Mr. Walsh. At that time the stories varied from $35,000 to $40,000.
Mr. Kennedy. Where did he obtain his money ?
Mr. Walsh. That I do not know for certain. He did mention that
he had people who woukl supply him with his cash.
Mr. Kennedy. Who, from the course of the conversation, did you
understand these people were ?
Mr. Walsh. Well, actually I had no direct knowledge of who the
people were. He just continually refered to them as "my people."
Mr. Kennedy. Did you feel that it was his mother and father, or
did you think
Mr. Walsh. No, not particularly.
Mr. Kennedy. When he said, "my people," whom did you under-
stand "my people" were ?
Mr. Walsh. Well, in the parlance, I would take it that they were
people of questionable resources. Possibly underworld characters
and what have you.
Mr. Kennedy. Did you understand that they were underworld
figures ?
Mr. Walsh. No, I did not. There was mention of one truckman,
offhand I can't think of the name, who was, as far as I know, a
legitimate truckman, and he apparently had some resources to put in
also. He might have gotten it from that source.
Mr. Kennedy. Did you understand there might have been some
legitimate sources for Mr. Fello's money, but when he referred to
"my people" as being the people behind him, did you understand
these people were people of questionable backgrounds or people who
had underworld comiections, as a general proposition?
Mr. Walsh. As a general propostion, I did, yes.
Mr. Kennedy. Did you see Mr. Fello in the company, for instance,
of Tony Ducks Corallo or somebody who was identified as Tony
Ducks Corallo?
Mr. Walsh. A subsequent identification was made to that effect,
yes.
Mr. Kennedy. The individual in whose company you had seen him
was Tony Ducks ?
Mr. Walsh. That is right.
Mr. Kennedy. Did Mr. Fello give you an important position in the
company ?
Mr. Walsh. Well, no. I spent a very short time inside the office,
and possibly with my business background I didn't agree with the
tactics that were being employed, and I was then relegated to more
or less a route man.
Mr. Kennedy. Was Bi-County able to obtain some good accounts,
however ?
Mr. Walsh. In the magazine field ?
Mr. Kennedy. Yes.
Mr. Walsh. At the time I was there, nothing particularly good, no.
Mr. Kennedy. Well, were they able to obtain, for instance, T.V.
Guide?
IMPROPER ACTIVITIES IN" THE LABOR FIELD 18313
Mr. Walsh. No, they were not. We liad T.V. Junior.
Mr. Kennedy. T.V. Junior?
Mr. Walsh. Yes.
Mr. Kennedy. Wliile you were with them then, they didn't obtain
T.V. Guide?
Mr. Walsh. No, they didn't.
Mr. Kennedy. Did they show any progress or make any progress?
Mr. Walsh. On the surface there was no progress ; no.
Mr. IvENNEDY. Did you understand that the publishers had indi-
cated that they were going to stay with the Rockaway News Co., which
was then in financial difficulty ?
Mr. Walsh. Well, at that time there were varying statements made.
Some stated that they would stay with them, and there were state-
ments that they would not. Some said the publishers would remain
with Rockaway News, and there were others who stated that they
thought we could come over to Bi-County News.
Mr. Kennedy.. Did you understand at that time that Irving Bitz
and Gordon, of Bronx County, were forming a new company, the
Island News Distributing Co., to take over Long Island?
. Mr. Walsh. That developed, yes.
Mr. E^ENNEDY. So they would be a competitor of yours; is that
right?
Mr. Walsh. That is right.
Mr. Kennedy. Bi-County at that time had a union contract; is
that right?
Mr. Walsh. Well, there was a question there as to whether we had
the contract.
Mr. Kennedy. You were about to obtain it ?
Mr. Walsh. We were about to obtain a miion contract.
Mr. Kennedy. Did you have discussions with Fello that Bitz and
Gordon couldn't operate out on Long Island unless they had a union
contract ?
Mr. Walsh. That was my opinion at that time.
Mr. Kennedy. Wliat did Fello tell you ?
Mr. Walsh. He told me they could operate any place they saw fit.
Mr. Kennedy. For what reason ? How were they going to be able
to operate?
Mr. Walsh. That they had a wholesalers contract which enabled
them to operate in any area within the metropolitan area.
Mr. Kennedy. Did Fello then shortly afterwards indicate that he
wanted to buy you out ?
Mr. Walsh. Well, in not quite that fashion.
Mr. Kennedy. Wliat did he Say ?
Mr. Walsh. He suggested that I take my money and leave because
we had received a union contract but it appeared that the other or-
ganization, Bitz and Gordon, had the contracts with the publishers.
We were in no position to argue, he put it.
Mr. Kennedy. Why did he want you to get out ?
Mr. Walsh. Subsequent information or conjecture?
Mr. Kennp:dy. Well, subsequently what did you learn?
Mr. Walsh. Well, I subsequently learned that he had made a deal
with Bitz and Gordon to stay on and they would, instead of forming
a new company and applying for a new union contract, they would.
18314 IRIPROPER ACTIVITIES IN THE LABOR FIELD
use the union contract awarded Bi-County News; and they would
then operate with Bitz' contracts with the publishers.
Mr. Kenxjidy. So the two companies would combine?
Mr. Walsh. That is right. I presumed that.
Mr. Kennedy. And in order to do that, to get Bitz, Gordon, and
Fello together, you had to be gotten rid of ; is that right ?
Mr. Walsh. That is correct, yes.
The Chairman. Wliy would you have to be gotten rid of?
Mr. Walsh. Well, conjecture again. I believe that my percentage
of the coi-poration was too much.
The Chairman. In other words, they saw they were going to make
money and they needed you out of the way ?
Mr. Walsh. That is right.
The Chairman. Is that what it amounted to ?
Mr. Walsh. That is exactly v/hat it amounted to.
The Chairman. So as they merged, you got squeezed?
Mr. Walsh. Yes, sir.
Mr. Kennedy. You were the legitimate operation ?
Mr. Walsh. I felt that I was ; yes, sir.
Mr. Kennedy. On November 2, 1958, were you asked by Fello to
meet him at Fello's Bar & Grill in Jackson Heights?
Mr. Walsh. Yes, sir ; I was.
Mr. Kennedy. At that time did you meet with Barney Fello ?
Mr. Walsh. Yes, that is right.
Mr. Kennedy. And Barney Fello is William Fello's brother?
Mr. Walsh. Correct.
Mr. Kennedy. He was the one, Mr. Chairman, who was identified
in Connie Noonan's address book this morning.
Wliat was explained to you at that time ?
Mr. Walspi. At that time it was explained to me that — Barney Fello
explained to me that he could make a deal that they would get my
money back for me. Otherwise, if I refused to accept my money,
it would be lost to me because the other company would then go into
operation, subsequently get a union contract and I would be without
the return of my investment.
Mr. Kennedy. Did they explain to you about Bitz and Gordon's
reputation?
Mr. Walsh. Yes. They said they played rough.
Mr. Kennedy. And that you would be in difficulty unless you got
out of the company ?
Mr. Walsh. Well, it was intimated, yes.
The Chairman. Did you get any profit on yoMr money when you
got out ?
Mr. Walsh. No, sir.
Mr. Kennedy. Had the
The Chairman. They were very generous to let you have your
original capital back.
Mr. Walsh. They thought it was a very generous offer.
The Chairman. They thought it was very generous ?
Mr. Walsh. Yes.
Mr. Kennedy. Did you know of Bitz' criminal record ?
Mr. Walsh. Yes, I had heard. Of course, the minute I had heard
the name — I didn't know of the name or of the personality prior to
IMPROPER ACTIVITIES IN THE LABOR FIELD 18315
my going into the business, nor of his ability to get things done.
If I had known, I don't think I would have ever entered into it.
Mr. Kennedy. You knew of liis associates — of Bitz's associates
subsequently ?
Mr. Walsh. Subsequently, yes.
Mr. Kennedt. And was it explained at this meeting in November
1958 that if you didn't agree to get out that Bitz and Gordon could
play very rough ?
Mr. Walsh. It was as much as said that way, yes, sir.
Mr. Kennedy. What did they tell you'^ Anything about what
would happen to your family ?
Mr. Walsh. Well, in the conversation, I am not sure which one of
the people at the table mentioned it, they said that they could probably
tell you what time your children get on and olf the bus, and so on.
There were no direct threats on me.
Mr. Kennedy. And about your wife ?
Mr. Walsh. Yes, sir. They said they could say where she shopped,
and so on.
The Chairman. They could what ?
Mr. Walsh. Say where she did her shopping, and so on. They
could tell me where she did her shopping.
Mr. IvENNEDY. That this was a very rough group, a vei-y tough
group, and that they can play rough and know where your children
go to school, what time they get on the bus, what time they get off
the bus and when your wife goes shopping ; is that correct ?
Mr. Walsh. That is correct ; yes.
Mr. Kennedy. They said that to you, and the implication to you
was clear then?
Mr. Walsh, It wanS quite clear.
Mr. Kennedy. That it was a threat against your family miless you
got out?
Mr. Walsh. That is right.
Mr. Kennedy. Did you then decide you were going to get out ?
Mr. Walsh. I made an overture toward taking over whatever
debts William Fello had and offering them notes with the idea that I
and several others of the company would continue the operation and
take our chances on a strictly legitimate basis. But I was advised
that this could not be done, that they were bigger than the rest of us,
and that we would not exist very long.
Mr. Kennedy. So did you get out?
Mr. Walsh. Yes; I did.
Mr. Kennedy. AVhat happened. Where did you get your $20,000 ?
Mr. Walsil The following day, it was the Monday preceding elec-
tion day, I reported to an office in Long Island City, and I signed a
general release and was handed a package containing $20,000.
Mr. Kennedy. Wlien you say a package, what kind of a package?
Mr. Walsh. A brown paper bag.
Mr. Kennedy. And in the bag was $20,000?
Mr. Walsh. $20,000 ; yes, sir.
Mr. Kennedy. Where did they give you the brown paper bag with
The $20,000?
Mr. Walsh. In the office of the attorney.
Mr. Kennedy. What was the attorney's name?
18316 IMPROPER ACTIVITIES IN THE LABOR FIELD
Mr. Walsh. Leo Barry, of Barry, Barry & Barry.
Mr. Kennedy, Did you agree to take the currency ?
Mr. Walsh. I hesitated to take it. I didn't want to walk out of
an office like that with $20,000 in cash, and besides, I wouldn't have
the opportunity to count it.
Mr. Kennedy. What kind of bills were they ?
Mr. Walsh. I think the highest denomination was a $20 bill.
Mr. Kennedy. It must have been a lot of money, then, a lot of bills?
Mr. Walsh. It was a large package ; yes, sir.
Mr. Kennedy. How big was the package ?
Mr. Walsh. I would say it stood about 10 inches tall.
Mr. I^nnedy. Almost a shopping bag full of money ?
Mr. Walsh. Well, loosely ; yes. It stood so high. About 10 inches
tall.
The Chairman. What did you say the largest bill was?
Mr. Walsh. A$20bin.
Mr. Kennedy. Did you decide then that you would pick it up and
walked out with it ?
Mr. Walsh. I decided I had better do that or I wouldn't get it
at all.
Mr. Kennedy. Did they explain that to you ?
Mr. Walsh. No, but I assumed as much.
Mr. Kennedy. You took the bag and where did you go ?
Mr. Walsh. I got in the car and drove directly to the bank in my
hometown.
Mr. Kennedy. And you deposited the money there?
Mr. Walsh. Well, as soon as I got within the bank I made a call
to my wife to assure her that I had made the trip safely. Then I
went to one of the executives and tendered the money to him. I
called it an unusual deposit and I would like to leave it subject to
count.
He wouldn't accept it in that fashion. He said, "You can wait
while I count it." He was quite amazed when he saw the package.
Mr. Kennedy. There was $20,000 in it?
Mr. Walsh. To the penny.
Mr. Kennedy. What?
Mr. Walsh. To the penny.
Mr. Kennedy. To the penny ?
Mr. Walsh. Yes, sir.
Mr. Kennedy. What about the furniture and everything in your
office?
Mr. Walsh. When I returned from the bank to my home, from
my home I went to the premises of Bi-County News. I wanted to
tie up the furniture and so on that I had brought with me when I
joined the organization.
While standing around, of course, the place suddenly had become
a beehive of activity in contrast to what it had been prior to when
I had my piece of it. One of the employees came over and suggested
that I leave, that my presence wasn't appreciated there.
Mr. Kennedy. What did tliey about taking out your desks and
personal articles?
Mr. Walsh. Well, when I was asked to leave by this employee
who had been a former employee of Bi-County, I told him I would
IMPROPER ACTIVITIES IN THE LABOR FIELD 18317
like to make arrangements to have my furniture removed, and he,
of course, went over and spoke to those people.
He came back with the answer that I had better leave or my fur-
niture and myself would be deposited out on the road.
Mr. Kennedy. Was Bitz there at the time?
Mr. Walsh. He was.
Mr. Kennedy. That was after talking to Bitz?
Mr. Walsh. I had never had a conversation with Bitz, nor have I.
Mr. Kennedy. That was after this driver went and talked to Bitz?
Mr. Walsh. That is correct.
Mr. Kennedy. And he came back and warned you that you better
get out or else you would be thrown out ?
Mr. Walsh. That is right.
Mr. Kennedy. That has been the end of it ?
Mr. Walsh. That was the end of it.
Mr. Kennedy. This Bi-County company combined, and Bitz and
Gordon Fello operate it at the present time, these individuals we have
been discussing, all of whom have appeared before the committee
and have refused to answer questions on the ground of self-incrimina-
tion.
They control approximately 75 percent of all the magazine distribu-
tion franchises in Nassau and Suffolk Counties, which are on Long
Island. So they have virtually a monopoly in this area. This is the
organization that he has been discussing and the organization which
the underworld connections have control of.
Senator Ervin. Does the evidence show why such a condition can
exist in a country that claims to be civilized ?
Mr. Kennedy. I think just the evidence we have had over some
214 years at these hearings.
Senator Ervin. Can you give any explanation why officers of com-
munities allow things like this to go on ?
Mr. Walsh. Officers of the unions ?
Senator Ervin. No, I mean the law enforcement officers.
Mr. Walsh. Well, I don't see where they have ever been called in
to settle any grievances. I wouldn't let it go as far as to have to call
a law enforcement officer to get my furniture out. I simply billed
them for what I had.
Senator Ervin. Do you know any kind of legislation that ought to
be passed that could reach this type of racket ?
Mr. Walsh. Definitely to exclude anyone who had had a previous
record ; definitely.
Senator Ervin. In other words, it is virtually impossible for a
man to stay in business in a legitimate way.
Mr. Walsh. Again the adage, "It is not what you know, it is who
you know."
Mr. Kennedy. That is all, Mr. Chairman.
I will call Mr. Herbert Cohen.
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. Cohen. I do.
18318 IMPROPER ACTIVITIES IN THE LABOR FIELD
TESTIMONY OF HERBEST C. COHEN, ACCOMPANIED BY COUNSEL,
ROBERT D. STERN
The Chairman. State your name, your place of residence and your
business or occupation.
Mr. Cohen. Herbert C. Cohen; residence, 620 Fort Washington
Avenue, New York, N.Y. I am president and general manager of
Periodical Distributors of Greater New York, Inc.
The Chairman. You have counsel.
Mr. Counsel, identify yourself for the record, please.
Mr. Stern. My name is Robert D. Stern. I am associated with the
law firm of Fink, Weinberger, Levin & Gottschalk, New York City.
The Chairman. Proceed, Mr. Kennedy.
Mr. Kennedy. Mr. Cohen, you are president of Periodical Distribu-
tors of Greater New York. ^Yhat do you distribute ?
Mr. Cohen. Magazines.
Mr. Kennedy. In Manhattan, Queens, Nassau, and Suffolk County?
Mr. Cohen. That is right.
Mr. Kennedy. You are in competition with Manhattan News in
Manhattan, Pacific News in Queens, and Bi-County News on Long-
Island ; is that right ?
Mr. Cohen. No. Essentially correct, with the exception that we do
not touch upon tlie territory to any extent of Pacific News Co., that
Pacific News Co. does.
Mr. Kennedy. "V^niat is your gi'oss business ?
Mr. Cohen. In 1958, approximately $780,000 per year.
Mr. Kennedy. '^Vliat kind of newspapers do you handle ?
Mr. Cohen. Essentially magazines.
Mr. Kennedy. The wholesale magazine group is in a loosely knit
organization ; is that correct ?
Mr. Cohen. As far as I know.
Mr. Kennedy. The wholesale magazine group, the wholesalers ?
Mr. Cohen. I do not know that it is an association. It is just my
idea that it is a loosely Imit group of wholesalers.
Mr. Kennedy. But they did get together to negotiate a contract, did
they not ?
Mr. Cohen. So I understand.
Mr. Kennedy. The Manhattan News, Bronx County News, Bi-
County News, Pacific News, Selgin News ?
Mr. Cohen. Essentially ; yes.
Mr. Kennedy. This group joins together to negotiate a contract
with the union ?
Mr. Cohen. Yes.
Mr. Kennedy. Have you made efforts to join the group ?
Mr. Cohen. I have.
Mr. Kennedy. Have you been prevented from joining the group ?
Mr. Cohen. Well, I have not joined it.
Mr. Kennedy. They will not take you into the group ; is that cor-
rect?
Mr. Cohen. According to their attorney, we are not welcome.
Mr. Kennedy. Is it correct that this gi'oup has a better contract with
the union than you do ?
Mr. Cohen. Yes, they do.
IMPROPER ACTIVITIES IN THE LABOR FIELD 18319
The Chairman. Accordino^ to whom you are not welcome ?
Mr. Cohen. Mr. Koi'kus is the attorney for this group. I was in
touch with him and asked him if he didn't think it woidd be advan-
tageous for both of us for periodical distributors to lend their weight
to their group inasmuch as we hire union men the same as they do,
tliat we should join with them in negotiating with the Newspaper &
Mail Deliverers Union.
Tie thought this over for a couple of days and called me back and told
me that he was too busy to handle our affairs; he could not take us
on as a client.
The Chairman. Is that the relationship ; that you would be a client
of his?
Mr. Cohen. This is the way he explained it to me.
Tlie Chairman. Did you know what you wanted to do, whether you
wanted to become his client or whether you wanted to join an asso-
ciation?
Mr. Cohen. I wanted to join this association, if it was an association.
At least I wanted to bargain collectively with this group.
The Chairman. I understand now your problem is that since you
are not in that group, you have a more disadvantagous contract than
they have. They have a more advantageous contract wnth the union
than you do ; is that right ?
Mr. Cohen. That is correct.
The Chairman. So that your idea was if you could get in with
that o-roup you would get the same terms, and so forth, that they
had?
Mr. Cohen. That is exactly what I wanted, to be able to compete
with this other group, by paying the same wages and have the same
working conditions for my men.
Mr. Kennedy. In what w^ay is the contract different ?
Mr. Cohen. Well, part of the contract that we have with this
union calls for a Newspaper & Mail Deliverers Union to be the bar-
gaining agent for our return department. Our return department
is all magazine return department, consists mostly of menial work
and certainly not calling for the scale of pay that a driver, or news-
paper deliverer, or magazine driver should receive.
If we have to pay this very high scale of pay, we certainly are at a
disadvantage.
Mr. Kennedy. They don't have to pay that ?
Mr. Cohen. That is correct.
Mr. Kennedy. You are the only one that has to make those pay-
ments?
Mr. Cohen. As far as I know we are the only magazine distri-
butor in New York City that has this in the contract.
Mr. Kennedy. There are others outside of New York City which
operate under different circumstances that have this kind of an ar-
rangement, but you are the only one in the New York City area that
must make these extra payments ?
Mr. Cohen. Generally speaking, the distributors outside of New
York City that do business with an MDU, are also newspaper dis-
tributors so their circumstances are quite different than mine, which
is strictly a magazine distributor.
36751— 59— pt. 51 13
18320 IMPROPER ACTIVITIES IN THE LABOR FIELD
Mr. Kennedy. You are the only solely magazine distributor that
must make these extra payments ?
Mr. Cohen. As far as I know.
Mr. Kennedy. When you say as far as you know, you would know,
wouldn't you ?
Mr. Cohen. I really don't know, because they probably have con-
tracts with 50 or 60 news companies, but as far as New York City is
concerned I do know.
Mr. Kennedy. Wliat is that ?
Mr. Cohen. I do know as far as New York City is concerned.
Mr. Kennedy. Well, in New York City, then, you are the only one?
Mr. Cohen. Yes.
Mr. Kennedy. And you know of no other even outside of New
York City that has to make this extra payment ?
Mr. Cohen. That is correct.
Mr. Kennedy. Now, you also had some difficulty in connection with
La Guardia Field in the selling of magazines there ?
Mr. Cohen. Well, we have been banned from selling to the Union
News stands in La Guardia Field. They refused to do business with
my company.
Mr. Kennedy. What was the reason for that ?
Mr. Cohen. I don't know.
Mr. Kennedy. That is the Union News stand, which was operated
by Mr. Garf inkle ?
Mr. Cohen. I believe he is president. I know he is president of the
American News Co., which controls Union News.
Mr. Kennedy, And they operate the La Guardia newsstands; is
that right?
Mr. Cohen. That is correct.
Mr. Kennedy. And he made a rule that they would not accept
magazines from you ?
Mr. Cohen. That is right.
Mr. Kennedy. Does his family control the Manhattan News, which
is a competitor of yours ?
Mr. Cohen. Well, I heard testimony in this room to that effect, and
I didn't know definitely. It has always been my understanding that
that is so.
Mr. Kennedy. And we had some testimony to that effect, Mr.
Chairman, and the representative of that company appeared before
the committee and took the fifth amendment.
Wliile you were banned, were you responsible for distributing such
magazines as Time, Eeader's Digest, U.S. News & World Eeport, Me-
Call's, and other magazines to La Guardia ?
Mr. Cohen. This is within the geographical territory, contractual
territory that I have signed a contract for, or I had signed a contract.
Mr. Kennedy. Did that mean for a period of time that La Guardia
Field did not have any of those magazines ?
Mr. Cohen. I think it was an 11-week period.
Mr. Kennedy. They didn't get any ?
Mr. Cohen, That is correct.
Mr. Kennedy. Because he was trying to insist that they use another
company, is that correct, Mr. Garfinkle ?
IMPROPER ACTIVITIES IN THE LABOR FIELD 18321
Mr. Cohen. Well, the word that came out was that they thought it
was economically inadvisable to do business with more than one news
company. This was the reason given to us.
Mr. Kennedy. Did you understand that Mr, Bitz stated or it was
related to you that Mr. Bitz indicated that he could straighten the
matter out at La Guardia ?
Mr. Cohen. I know nothing about this.
Mr. Kennedy. You never hear of Mr. Bitz' intervention at all ?
Mr. Cohen. No, I did not.
Mr. Kennedy. Did you Imow of Mr. Spozate of Pacific News ?
Mr. Cohen. I know him.
Mr. Kennedy. Did he intervene there in this matter at all ?
Mr. Cohen. Well, I believe, or I assumed he did, because his com-
pany eventually wound up distributing the magazines in La Guardia.
Mr. Kennedy. Did you know how that came about ?
Mr. Cohen. No, I do not.
Mr. Kennedy. He is the one, Mr. Chairman, who has disappeared
for 2 months, and we have not been able to find him, and his partner
appeared before the committee and refused to tell us where he was
and refused also on the ground of self-incrimination to say whether
he had been making payments to any union official.
So ultimately, it was worked out so that this company received the
franchise ; is that right ?
Mr. Cohen. More or less, yes, and my contract was abrogated.
Mr. Kennedy. You were forced out ?
Mr. Cohen. That is correct.
Mr. Kennedy. So you no longer distribute out there ?
Mr. Cohen. I never did distribute there, and I never had the op-
portunity to.
Mr. IvENNEDY. Isn't it correct that you are not permitted to dis-
tribute to some 19 union newsstands on Long Island 'i
Mr. Cohen. Yes, that is correct.
Mr. Kennedy. And these are supplied by Bi-County ?
Mr. Cohen. For the magazines that Bi-County distributes, and the
magazines that I hold the franchise for are not being distributed on
these newsstands are not being sold on these newsstands.
Mr. Kennedy. Are Time and Life distributed out there in these
other magazines ?
Mr. Cohen. Not to the Union News stands.
Mr. Kennedy. So because of the pressure that had been placed by
Mr. Garfinkle, who has ownership of this company and this relation-
ship with these other individuals, there were a number of newsstands in
New York, out on Long Island, quite a large number that did not get
magazines such as Time, Life, U.S. News & World Keport, and
Reader's Digest. For a period of 11 weeks in La Guardia Field because
of this pressure these newsstands there did not receive these magazines;
is that correct ?
Mr. Cohen. That is correct.
Mr. Kennedy. As I say, Mr. Chairman, it is Mr. Garfinkle's own
company, representatives have appeared before the committee and
take the fifth amendment, and that is the control that this group has
in the New York City area.
18322 IMPROPER ACTIVITIES IN THE LABOR FIELD
The Chairman. Are there any questions, Senator Ervin ?
Senator Ervin. I have no questions.
The Chairman. Is there anything else ?
All right. Thank you very much.
The committee will be in recess for 5 minutes.
(A brief recess was taken. )
The Chairman. I understand the last witness concludes the testi-
mony that we expected to hear at this time with respect to this news-
paper problem that we have been investigating.
The Chair hasn't time, or the staff either, to prepare a closing state-
ment for that phase of the investigation.
I have asked the staff to prepare a brief statement that I may use
tomorrow summarizing what the testimony that we have heard in that
area of our inquiry is. I will probably have it ready for release in
the morning when we resume hearings.
(Wliereupon, at 3 :30 p.m., the select committee recessed, to reconvene
at 10 : 30 a.m., Friday, May 8, 1959.)
INVESTIGATION OF IMPROPER ACTIVITIES IN THE
LABOR OR MANAGEMENT FIELD
FRIDAY, MAY 8, 1959
U.S. Senate,
Select Committee on Improper Activities
IN the Labor or Management Field,
Washington^ D.O.
The select committee met at 10 :30 a.m., pursuant to Senate Resolu-
tion 44, agreed to February 2, 1959, in the caucus room of the Senate
Office Building, Senator Jolin L. McClellan (chairman of the select
committee) presiding.
Present: Senator John L. McClellan, Democrat, Arkansas; Senator
Homer E. Capehart, Republican, Indiana.
Also present : Robert F. Kennedy, chief counsel ; Jerome S. Adler-
man, assistant chief counsel; P. Kenneth O'Donnell, administrative
assistant; Paul J. Tierney, assistant counsel; George M. Kopecky,
assistant counsel ; Walter R. May, assistant counsel ; Walter J. Sheri-
dan, investigator ; Robert J. Cofuii, investigator ; Ruth Y. Watt, chief
clerk.
The Chairman. The committee will come to order.
(Members of the select committee at the convening of the session
were Senators McClellan and Capehart. )
The Chairman. Call the next witness.
Mr. I^nnedy. Mr. Chairman, I want to get straight for the record
as far as the Neo-Gravure Co. is concerned, that they have some 9 or
10 unions up there, and we did not have any information on any of
them adversely, any adverse information on any of them, other than
the ILA local, and the testimony that we had in connection with that.
I want to make sure that the record is clear as far as that is con-
cerned.
The Chairman. I just received a wire. I do not know how impor-
tant it is, but certainly it is not the purpose of the committee at any
time to reflect upon someone ^ho is innocent or who is in no way
connected. Sometimes where there are all these ramifications with
reference to unions, different unions, all related in a particular work
or plant or operation, the wrong impression gets abroad as to some
of them that may be wholly innocent.
I received a wire this morning from some attorneys in New York.
It says :
Our client, Local No. 2, New York Newspaper Printing Pressmen's Union,
were members as employees of Neo-Gravure, in New York City, concerning
recent committee revelations appreciate positive statement by your committee
and Neo-Gravure that Local 2 or its oflBcers never involved in practices disclosed.
18323
18324 IMPROPER ACTIVITIES IN THE LABOR FIELD
Mr. Counsel, do we have anything that would reflect upon local 2
or any of its officers ?
Mr. Kennedy. We do not, Mr. Chairman. We do not have any-
thing of a critical nature, adverse testimony or advense information,
in the files reflecting on local No. 2.
The Chairman. All right.
That statement has now been made and, therefore, no reflection
should be entertained as against that union and its officers.
Mr. Kennedy. Also, Mr. Chairman, in that connection could I
thank publicly the district attorney's office, Mr. Frank Hogan, for
being of great assistance in that investigation, and also the Water-
front Commission, which was of great help.
The Chairman. I know Mr. Hogan has cooperated with this com-
mittee from its inception. At all times he has cooperated. I believe
that is true with respect to the Waterfront Commission.
We will give them credit as we go along, those who work with us
and cooperate with us. We may not get along to all of them. We
will try to remember them and do appreciate, whether we mention
their names or not, those who cooperate with the committee and par-
ticularly the law enforcement officers who follow up on these things
that we may bring out here at these hearings, and who, therefore,
pursue them and try to see that justice overtakes those who have been
guilty of violating the law.
The hearing completed this week into the newspaper and magazine
industry in New York has revealed the alarming degree to which
racketeers have entrenched themselves in the economic structure of
the Nation's largest city.
Probably no hearing held by this coimnittee has been as significant
in pointing out the present racketeer threat to our free economic
system. It is an appalling thing when racketeers can successfully
exact tribute from newspapers like the New York Times, the New
York Journal American and the New York Mirror and a major pub-
lishing firm like the Neo-Gravure Printing Co.
In a country where freedom of the press is a cornerstone of our
basic liberties, we find racketeers able to do what no government
authority would conceive of doing. We find racketeers able to shut
off the supply of news to the public and we find these nationally
known publications compelled to make pajnnents to assure the deliv-
ery of their newspapers.
The revelations in this hearing clearly indicate that the time has
come for Congress to seriously consider the enactment of special anti-
trust legislation in the transportation field. I have instructed the
staff to prepare legislative recommendations in this field which would
then be referred to the Judiciary Committee for further consideration.
It is obvious to the whole country that the labor unions themselves
cannot handle the critical problem of racketeering. In this hearing,
17 of 19 officials of the New York Newspaper & Mail Deliverers'
Union took refuge behind the fifth amendment. This union is in-
dependent of the AFL-CIO, which, therefore, has no control over
them. The same can be true of the principals involved in the sliake-
down of the New York newspapers, Harold Gross and Connie
Noonan, who respectively are officials of the International Brother-
hood of Teamsters and the International Longshoremen's Associa-
IMPROPER ACTIVITIES IN THE LABOR FIELD 18325
tion, both of which are operating outside the AFL-CIO. The present
alliance of top officials of the Teamsters Union with the underworld
has gained the proportions where the amassing of any further power
by that union with equally corrupt unions like the ILA or leftwing-
led unions like the International Longshoremen's and Warehouse-
men's Union on the west coast would be calamitous for the Nation.
During this case we also had the unfortunate spectacle of repre-
sentatives of 12 wholesaling companies of the newspaper and maga-
zine industry in New York pleading the fifth amendment, concerning
bribery and extortion. It would appear to the committee that the
newspapers and magazines in the New York area should take some
steps to eliminate having to do business with persons of this ilk. It
would also appear that the Congress or State bodies should provide
some regress where gangsters operating under the guise of union
officers can, through the simple expedient of halting deliveries, put a
small firm out of business or extort tribute from a larger company.
The committee is particularly gratified by the attitude of the New
York Times and the Neo-Gravure Printing Co. in their testimony
before the committee. The i-epresentatives of these two companies
have indicated that they understand the gravity of the problem and,
by forthrightly telling the circumstances under which they were
shaken down, have displayed a sense of public duty and responsibility
which is, unfortunately, not always as evident in other segments of
the business community.
(Whereupon, at 10 :85 a.m., the committee recessed, subject to the
call of the Chair.)
APPENDIX
Exhibit 1
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Exhibit 11
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Exhibit 14B
BOSTON PUBLIC LIBRARY
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