FACT SUMMARY SHEET
50 MILLION DOLLAR LAWSUIT AGAINST
IBEW LOCAL NO. 3 AND SIX ELECTRICAL CONTRACTORS

On June 27, 2000, two telecommunications contractors, U.S. Information Systems, Inc. (USIS) and Odyssey Group, Inc., brought an antitrust lawsuit in New York federal court against IBEW Local 3 and six electrical contractors that employ Local 3 workers. Those contractors are: A&R Electric Co., Adco Electric, Inc., Five Star Electric Corp., Forest Electrical Corp., Nead Information Systems, Inc., and IPC Communications, Inc.

USIS and Odyssey state in their complaint that the antitrust violations result in trebled damages of $50 million, as provided for by federal law. Plaintiffs also seek an order prohibiting the defendants, and anyone cooperating with them, from engaging in illegal antitrust activity under penalty of civil and criminal contempt of court.

The basis of the lawsuit is an illegal, on-going conspiracy among Local 3 and the electrical contractors to take over the telecommunications wiring market in the New York metropolitan area. The complaint outlines how the defendants, who control the electrical construction industry, have utilized their position in the electrical market to initially limit, and ultimately exclude, the plaintiffs from engaging in telecommunications work.

For several years, the defendants have threatened to use, and have, in fact, used disruptions and delays in construction projects unless Local 3 electrical contractors were given the telecommunications portions of the projects. They have made false statements about the plaintiffs and their businesses and have engaged in job site intimidation, harassment, and vandalism.

These defendants, their agents and others have used various types of actions, as tools to extend the present electrical monopoly to telecommunications work. The complaint describes situations where the defendants' illegal actions kept the plaintiffs off bidding lists, kept them from getting the bid award, got the plaintiffs' telecommunications contracts reassigned to electrical contractors, and interfered with the plaintiffs' work, equipment, and personnel. In doing so, the complaint shows how the defendants made threats that there would be labor unrest and threatened to withhold required overtime so as to prevent the plaintiffs' CWA employee's involvement on the job site. It describes how misstatements were made regarding the likelihood of vandalism on projects in which the plaintiffs' CWA employees took part. In another area, the complaint notes how the defendants and their agents manipulated situations so as to bar the plaintiffs from particular buildings, labeling them as "Local 3 only buildings".

The plaintiffs show in their court papers that they are, routinely, the best qualified and lowest cost bidders on telecommunications projects in New York. The papers argue that telecommunications customers, and thereby the public at large, are harmed every time the defendants' antitrust actions result in telecommunications work being awarded to the defendants instead of the lowest qualified bidder, which are either the Plaintiffs or other CWA telecommunications contractors. The damages sought by the plaintiffs, as stated in the complaint, are at least $50 million but the extra cost to the public is in the hundreds of millions.

Even though the plaintiffs employ Communications Workers of America ("CWA, AFL-CIO") members while the defendants use IBEW Local 3 workers, this is not a labor case. It is an antitrust case because it deals with the conspiracy by IBEW Local 3 and electrical contractors to monopolize and restrain trade. It should be noted that the National Labor Relations Board has already found certain of the types of conduct committed by the defendants to be unlawful.

The plaintiffs are continuing their investigation of these matters and, as they add to the evidence that they are gathering, they will add more parties to the lawsuit should the evidence so warrant. They are fully committed to bringing these issues to resolution, not only because the defendants' conduct is illegal but, more importantly, because it is harming the telecommunications industry and is costing the public hundreds of millions of dollars.

For additional information about the lawsuit, for a copy of the complaint or if you are being, or have been, pressured into selecting other than the lowest qualified bidder for reasons similar to those described above, please contact us by clicking here.

The plaintiffs are represented by the New York office of King & Spalding, a national law firm.

 

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