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Union Reimbursement of Officers' Expenditures Challenged

Noble v. Sombrotto, 525 F.3d 1230 (C.A.D.C., May 16, 2008)

David W. Noble, Jr. was an employee and longtime member of the National Association of Letter Carriers (the “Union”) who became aware of Union expenditures that he deemed in violation of the Labor-Management Reporting and Disclosure Act (“LMRDA“), 29 U.S.C. §401, et seq. After unsuccessfully complaining to the Union, Noble filed suit alleging that officers of the Union violated LMRDA by directing Union funds for their own benefit. The suit sought an accounting, repayment of funds, and release of financial documents.

The District Court (D.D.C.) dismissed Noble’s complaint with prejudice, and Noble appealed.

Under LMRDA, union officials are fiduciaries of union funds and must use those funds exclusively for the organization and its members. Noble’s first issue was that union officials were given $500 month expense allowances without having to submit any documentation justifying how the funds were spent. The Court of Appeals held that Noble presented sufficient circumstantial evidence that Union officials were using this money for personal items, including that officials overwhelmingly failed to submit expense documentation despite an obvious tax incentive to do so.

Noble next challenged the Union’s policy of reimbursing FICA taxes withheld from Union paychecks of its officers. The Court of Appeals held that the Union’s Executive Council’s decision to make this reimbursement was a reasonable interpretation of its powers under the Union constitution provisions regarding employment benefits to attract and retain personnel.

Noble also challenged Union payment of per diem allowances to the officers for attending the Union's national convention, as reimbursement for expenses that may not be incurred. Here also, the Union constitution provided for per diem allowances for attending the convention, and a committee determined the allowance each year. The Court found no clear impropriety in this practice.

Noble’s final argument was that, even if the challenged expenses were authorized by the Union constitution, Second Circuit precedent prohibited union officers from personally benefiting from the payments if it was “manifestly unreasonable“ for them to do so. The Court of Appeals held that Noble failed to show that the FICA and convention per diem allowances were outside the realm of reasonableness, so the District Court would be affirmed on those categories. The District Court was directed to make further inquiry into the $500 in-town expense allowances to determine whether there was personal benefit to the officers and, if so, whether it reached the degree of “manifestly unreasonable.”

Finally, the Court of Appeals reversed and remanded the District Court’s determination that Noble’s complaint that the Union had failed to supply him with records he had requested was moot.


 

 

Judge(s): Sentelle, Kavanaugh, Williams
Jurisdiction: U.S. Court of Appeals, D.C. Circuit
Related Categories: Employment
 
Appellant Lawyer(s) Appellant Law Firm(s)
Bernadette C. Sargeant Law Office of Bernadette Sargeant

 
Appellee Lawyer(s) Appellee Law Firm(s)
Bruce H. Simon Cohen Weiss and Simon LLP

 

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appellees violated lmrda 501(a) by authorizing an "expense morgan, 914 a.2d 647, 663 (del. ch. 2007). on the matter are striking. at the 1976 convention, in the unfulfilled but meritless. we give even greater personally signed the 1975 executive council resolution filed by senior circuit judge williams. gibbons, 455 u.s. 457, 468-69 (1982). power to adopt non-uniform bankruptcy laws. see u.s. not unreasonable and is nowhere near the kind of egregious on two occasions, the union convention, which under the the per diem payments, meanwhile, doesn't involve convention delegates were "misled" about the nature of vi. president sombrotto's failure to report activities. they represented at most a small percentage increase 10 15 is not for the resident national officers $6,000 70001 (d.c. cir. 1990)). by contrast, a holding that the additional findings. if the district court had found on this officers' payment practices and confirming that they properly art. 9, 11(e)(3), to cover the expenses nalc officers residing have never done so. before the district court, the officers do you want me to read the individual payments? expenses, the officers did not need to submit itemized receipts. nalc's constitution would alert delegates that executive by the second circuit, see morrissey, 650 f.2d at 1274-75 conventions to cover lost wages, hotel rooms, meals, and reimbursements have no bearing on the issue. "for the benefit of the labor organization." 501(b) was at least reasonable which no doubt is why the union nalc officers to receive them. see j.a. 657 (1964 (a form of post-enactment legislative history) only as an judge kavanaugh's separate opinion provides no better minimal. that likely explains why an overwhelming on the basis of certain estimated expenses: lost wages, hotel union members specifically rejected the merits of noble's expenses and the $500 per month allowance amount was conclusion that no violations had ever occurred. ordinary delegate to imagine far more strenuous eligibility addresses were not read aloud. payments from its members, it was not "reasonable to say that the executive council resolutions authorizing the in-town least ten years. see 42 u.s.c. 414. thus, when letter carriers on what benefits may be offered; it does not expand the agree, but the information i have says that they will be contrary finding of fact would have been clearly erroneous in the union's constitution presented by officers to justify their 12, 6 (emphasis added), and nalc officers are also (1966 convention). the convention then voted up-or-down readings is limited by the factual context. as sombrotto services. the constitutional text offers no basis for for the district of columbia between conventions on all matters related to the welfare of the stated only that they "have historically interpreted" their of the lower court's decision depends upon a determination of receive reimbursement according to the constitution. . . . incorrect impression that the accusations were inaccurate. officers' interpretation of the union constitution, the federal retaining competent personnel by "lessen[ing] the financial absence of any offsetting burden. down and approved the proposal to raise sombrotto's salary. whether adequate disclosure of these facts was made during approve the payments, had enough information as to who was i concur in the per curiam opinion's reversal of the district i would affirm the judgment of the district court on the union not specifically prohibited by the membership." nalc authority must still be read consistently with the salary caps, made in bad faith." monzillo v. biller, 735 f.2d 1456, 1464 language of the union constitution is ordinarily reasonable. officers to obtain reimbursement of itemized expenses, that second circuit did imply a requirement of direct proof for such $94.59 for meals and incidentals.) the officers noble named in benefits for the officers would amount to a prohibited salary const. art. 9, 1(g). this committee must "compute and allowance without requiring that expenses be documented; reporting and disclosure act ("lmrda"). 10 constitution provides for the union to be administered by an town and out of town." to claim their allowance for a month's whether their actions also violated other duties under 501. if not), or if it were unsupported by sufficient evidence in the after a bench trial, the district court dismissed all of documentation necessary to verify nalc's annual financial properly raises this issue on appeal, we could affirm only if establish just cause to obtain the documents, which is a 4 have governed future instances when all members of the reporting requirement is an independent duty of the committee, payments. i will address the three in that order. compensation before the union convention approved the "union") is a labor union that represents approximately 300,000 without informed consent, for "authorization secured `without court, noble identified nine categories of documents listed in a have provided everything noble sought. thus there is no contributions act ("fica") taxes; and (3) unnecessary "per constitution's clear text. whether or not the reimbursements 128, pt. 3, at 7. the decision of each convention whether or too with respect to reimbursement of fica taxes. the vincent r. sombrotto, president, national money at will by: affirm the district court's 501 judgment, and end this 14- remand will moot the issue either way. were not supported by receipts is thus considerable and third, contrary to noble's submission, the union directors' potentially conflicting self-interests are at issue. be unreasonable in light of the relevant text; the extrinsic failed to rule on the relevant factual issues--and because this fica reimbursements, and per diem payments were fully approving the unitemized reimbursements--answered by a question of fact, not interpretation. the district court found that article 9, 11(e)(4) provided direction of a majority vote as well as any other process. have (1) limited per diem payments to full-time officers during reasonableness and fairness of the transaction . . . at least as the mileage and per diem committee, having checked in session, may direct." id. art. 13, 2. this allows his proposed "manifestly unreasonable" standard, which as he and documentation requirements. the district court disagreed, noble accordingly argued before the district court that the services that he or she performs for the union." see "benefits" and "salary" that included fica reimbursements personally received $34,000 in reimbursements from executive council were charged simultaneously. during the compelled to pay into two different retirement systems--one of and expend" the union's money and property "in accordance 8 to the fica reimbursements, per diem payments, and president individual names and amounts was consistent with a power to set "salaries, wages, expenses, allowances, and other encouraged the officers to apply for $500 monthly even when constitution did not unambiguously bar reimbursement of executive council's reliance on past practice and a plain "general exculpatory resolution . . . purporting to relieve found that nalc was reimbursing officers and staff for their tax terms--which they implicitly concede by paying their own convention adopted a resolution affirmatively approving the unrelated to union business." noble, slip op. at 17. because the district court's opinion does not reveal cir. 2002) (quoting clarke v. united states, 915 f.2d 699, federal or state court to recover damages on behalf of the labor additionally, article 11 makes it the duty of a three-member 4. if true, this might be relevant to the size of nalc's according to the union's independent auditor, sombrotto general fiduciary duties the statute imposes, see maj. op. pt. constitution, sombrotto called for a five-member investigating 1347, 1351-54 (7th cir. 1972), no final determination of this program was unauthorized, but that in collecting nor does he join part iii of the per curiam opinion. rather, he given misleading responses, leaving union members under the that the committee "shall compute and report to the national provides a private cause of action by which members may and staff for each employee's share of fica taxes, which is doesn't require the general membership to guess about union expenses. if so, it would be unnecessary for us to decide that it had "examined each voucher carefully and found it to individual suits may be brought only after "the labor total per diem allowance per eligible delegate for each day. officer reimbursed for a business dinner "has been relieved of the does that answer you, microphone 1? indicate that the officers will, in fact, be included among those them to receive per diems "as the national association, while don't believe me, check with the irs. adjusted at every biennial convention. see mem. supp. mot. minimum entitlement does not unambiguously prohibit the constitution's last restraint on the officers' helping themselves all of which had been fulfilled, id. at 29 & nn.103-04, 30 & the per curiam opinion reads the provision for reasons, among them the fica reimbursements (discussed (2) authorizing union reimbursement for the officers' employee nalc's officers $500 a month on their say-so alone, cannot union constitution. courts have limited authority under our precedents to upset september 14, 1993 request which he claims never to have for each officer. the majority argues that fica reimbursements "meals and incidentals" portion of the committee's per diem for an unauthorized raise would have been equally attractive. part) for most officers' hotel rooms, transferring the union's moore's federal practice--civil 206.03[6]. on whether or not to pay the per diems. slip op. at 19. but at compel the union to allow them to inspect records necessary for officers were here, if the second circuit has indeed adopted a rooms, and meals and incidentals. noble argued in the district special compensation supplement"?) could be justified on "on all matters . . . not specifically prohibited by the this is incorrect, for the constitution unambiguously requires delegates voted only on whether the expense allowance august 16, 1993, by hand-delivering his accusations to union council had no authority to relax the constitution's itemization 5 kavanaugh, circuit judge, concurring in part and seq. he later joined the union itself as an additional defendant. documentswhoserelevancewascontestedbetweenthem,which 9, 11(e)(4), even a purpose of attracting quality personnel provide sufficient evidence of abuses within the category to justify duties." the resolution did, however, require officers to goes, "will neither presently affect the parties' rights nor have a noble, slip op. at 19. the district court found that this practice 20 union." id. art. 6, 1 (emphasis added). this clause is 15, at 4 (nov. 19, 2001); see also sombrotto decl. 11/19/01, factual finding ourselves, however, for "where the correctness noble argues that even if the in-town expense allowances, as to the in-town expense allowances, the district court will $500 allowance. but let us assume arguendo that there is guaranteeing reimbursement for the officers' itemized forfeited his claim to any further documents by failing to request 1307 (omission in original). defries's "nullity" phrase comes "per diem" allowances to executive council members during council resolution authorizing the challenged allowance the executive council with authority to make this lose time and pay for their hotel rooms."). but the district officials. noble, slip op. at 2021. noble appeals the district below, noble challenges this reimbursement as a violation of nor does the officers' theory of "double taxation" alter matter is germane to the board's constitutional authority to not to grant a raise (and, if so, of how much) is made in the morrissey v. curran ("morrissey ii"), 650 f.2d 1267, 1284 (2d cir. official acts during his/her term of office," the executive that "heightened scrutiny" was not suitable merely because a 4/2/04 31, at 13; see also trial tr. 4/13/04 at 181:6-18 f.2d 848, 850 (d.c. cir. 1960) ("courts will accept the constitution was reasonable, and we exercise clearly erroneous receiving per diems at any particular convention. the fica tax reimbursement as a benefit under article 9, under our precedents, would justify a decision by article iii provided to "those delegates who will be reported as eligible access to all of the pertinent nalc records. further, he no garrett, 720 f.2d 705, 710 (d.c. cir. 1983)); see also 19 here, the union constitution explicitly incorporates policy recital of a tedious list of names: record. the defendants claim that ray supports a laxer standard. it convention. the district court found that: authorized, the officers violated their fiduciary duties under 1977, and 1980, pursuant to its authority under nalc const. allowance for "purely personal reasons, unrelated to union dissenting in part: i join parts i, ii, vi, vii, and viii of the f.2d 1267, 1274 (2d cir. 1981). in accordance with the national constitution, . . . we of this suit attended every convention ex officio and received per reimbursed for "all official expenditures made by him, both in personal expenses" supported by the fact that the officers lacked below) and the fact that "all resident national officers receive associates, which would otherwise have been properly secure an accounting or other appropriate relief" but only names. rather, in subsequent years, the committee engaged 13, 2. the per diems were reasonable in amount, moreover, has passed on neither the merits of noble's claim nor the constitution." loretangeli, 853 f.2d at 19495. because the authorizing per diem payments to executive council members such grounds. an interpretation that "reads out of the the council took this action because all union staff and officers, president in 1992; no promiscuous rounding here!) only the by receipts as part of the officers' taxable income. noble, slip expenses legitimately incurred in conduct of the affairs of the as i've mentioned above, nalc's constitution sets forth const. art. 9, 11(e) (1992) (the relevant sections of the disclosed the hotel subsidies until after noble complained. claim on this issue. we affirm the district court's dismissal of revealed as a result of noble's internal complaints. among others, but there were more per diems paid (in every language reading of other provisions in nalc's constitution as were read aloud to the convention delegates. thus, we cannot committee concealed information on challenged severance 6 noble, slip op. at 2122. we agree with the district court's specifically charged each officer with retaining receipts for all 1284, and hood v. journeymen barbers int'l union, 454 f.2d employees, rather than a new imposition in 1980, the officers (2d cir. 1981). there, the second circuit rejected for court failed to address noble's argument. because he practice-civil 206.03[6]. moreover, because the district court finding of clear error as to the historical fact of how the findings of fact & conclusions of law 6-7, doc. no. 241, (forbidden) salary increase; business arguments for the the majority places great weight on the payments' sombrotto to david w. noble, jr. (aug. 31, 1993), defs' 2 the officers' hands, solely on those same officers' bland help. by looking to business reasons for upholding the 7.65% a specific dollar amount for each officer as "the sum . . . per shareholder ratification by a majority of the disinterested judicial restraint in these cases. when a union member sues union convention has approved the officers' interpretation of the is what a finding of mootness requires. nor is it clear which the district court relied on a clearly erroneous factual finding: to the national convention the name, residence, and amount due appeal from the united states district court for the same . . . later in the week." j.a. 660 (1986 were provided," noble v. sombrotto, 260 f. supp. 2d 132, 146 further. he would hold that, in all but the most exceptional 13 would refer the district court to our decision in united states v. should sleep more easily tonight. at least in this circuit, their unreasonable and made in bad faith." id. at 1464. this is the with the valid authorization of the union after adequate persuasion apply to such questions, but the district court on remand (suggesting that courts apply "judicial scrutiny of the under circumstances closely analogous to those before us, the related expenses than officers responsible for the payments 2 thought that what was right for a lowly staffer would also be because we cannot identify the factual basis for the district noble's motion and on september 20, 2006, issued its final nothing to resolve the interpretive issue. perhaps the extra relevant period was appointed by sombrotto. cf. nalc considers the unitemized allowances within the officers' 501(a) by personally enriching themselves with union funds. nalc's constitution, which fixes the salaries that each 501(a) by (1) authorizing a monthly "in-town" expense finishers union local 25, 972 f.2d 738 (7th cir. 1992). be justified on any reasonable reading of nalc's constitution. other expenses incurred during that period. the committee also ("fixed compensation paid regularly . . . for services"), and j.a. 657. vote after informed disclosure, would indeed "undermine[] a nalc constitution would have revealed the necessary facts. expenditures. he also sought the release of certain financial allowances. neither article 6, 1 nor article 11, 2(b) expected to incur "transportation, entertainment, and other more-than-speculative chance of affecting them in the future." salaries that are specified in the nalc constitution and thus reimbursement an employment benefit, reasoning that the move category of "benefits" to include payments that are really personal use of union funds by its officers will hardly ever be the in-town expense allowance program, which handed courts should closely scrutinize self-serving courses of conduct salary increases. the only constitutional issue is whether the review for manifest unreasonableness. the outcome of the nalc constitution was ambiguous on this point, id. at 16, we distinction between salary and benefits." kavanaugh op. at 3. amount to be paid, slip op. at 19, with the committee reporting exact counterpart in the corporate-shareholder analogy. they ballot. they are, moreover, likely in some degree to share the proposed findings of fact 18. first, via the board of expanded each week's paycheck by a fixed amount, regularly that "[d]uring the course of this case, plaintiff has been given 1988). conversely, an interpretation that accords with the plain of noble's 201 claim appear frivolous. in any event, the district did not vary with run-of-the-mill variations in individual of 501(a). payments to the officers are invalid if made hotel discount to the officers' benefit. thus, the members so article 11 on its face appears to cover the demands for the during convention meetings neither unreasonable nor in bad j.a. 165-66. nonetheless, in finding the executive council's repeated noble argues that the officers' participation in the expense officers otherwise would face with respect to their retirement evidence only strengthens this conclusion. the dispute over personal influence by union officers, especially when they for appellant. twice overwhelmingly approved their interpretation. as to op. at 9. but on that reading, the executive council could because the degree of separation necessary to avoid 501's expenses. biennial national conventions. noble sought recovery of all interpretation that would warrant a judicial override of the membership," id. art. 9, 11(e), but this does not mean "agency" problems--the tendency of agents to a degree to to attract and retain competent personnel," nalc const. art. excessive. thus the payments, if authorized, did not violate decision to pay the fica taxes was entirely reasonable, council resolutions at issue in this case were official acts the union had disbursed far more funds for purportedly union- insufficient evidence a district court's finding "that all of the the district court found that the mutual benefit association and dismissal of this claim. light of sombrotto's concession. thus, the officers themselves judge kavanaugh's opinion goes further, and argues that always vote itself whatever reimbursements it thought generally reasonable in the ordinary course of union officers' special defense is appropriate at this time. the district court (d.d.c. sept. 20, 2006). the court held that the various finally, for the reasons already explained, the payments per diem rate is based on consideration of lost time and hotel not improper for the district court to use monzillo's more 780-81 (d.c. cir. 1984), nor have the parties exhausted the them properly in the course of discovery on his 501(a) claims. purposes. see 26 u.s.c. 3121(a), (a)(6)(a). premise behind lmrda's mandatory reporting and fiduciary not limited to annuity, welfare, vacations, holidays, severance indistinguishable from salary, there is no way to differentiate council passed resolutions authorizing these payments in 1975, fica reimbursements were a (permitted) benefit or a not, then the officers received no personal benefit that we could allowance" for nalc's resident officers. the executive id. this was also false: while some officers did submit a finding as reasonable the executive council's interpretation of position within nalc." noble, slip op. at 1718. here, as in-town expense allowances and as to the 201(c) claim and the deferential standard of clear error. cf. 19 moore's federal expenses are not to be reimbursed. placing union money in (1) that the union's officers were among those receiving per the context of a proposal to raise his own salary. delegate while we agree with the district court's finding that the diem payments, even though they continued to earn their received 88% of the nearly 4,500 votes cast. ii. reimbursement of fica payroll taxes factual finding nor drew from it any legal conclusions, and district court--that nalc's own employees, of whom he was accuses of having violated 501 by accepting them. we whether to the irs or anyone else (although in the absence of because the district court neither explained the scope of its of approximately 4,500 voting union members, the national he claimed that the officers misinterpreted and violated the interpretation, for example, an increase in health insurance 3 to see why union members might have been left in the allows officers to receive the payments by making an forfeiture issue, we decline to reach these alternative grounds. $5132 in receipts. see joint appendix ("j.a.") 685. defeat satisfied that constitutional provision's intent of attracting and reports. by the committee on an individual basis, with each allowance and robert w. vincenzi received their expense allowances and "undermines a finding that the [officers'] interpretation was payments or uninformed that the officers would receive full per national convention, and gives the council authority to "act substituted a procedure by which the mileage and per diem the district court held a bench trial on noble's claims on vote through public "teller" proceedings requiring them to received from the union, including records from a union bank bruce h. simon argued the cause for appellees. with him from the nalc." id. art. 14, 6. to manage union funds "in accordance with [the union's] itemized receipts for expense reimbursement (the $500 weekly allowances paid to the officers were used for their delegates would flatly conflict with article 13, 2. the 1980 we reverse the district court's judgment as to the expense violation of these statutory duties. given that sombrotto follows: disbursements . . . other than provided for." nalc const. art. reporting and disclosure act ("lmrda"), 29 u.s.c. 401 et 13 challenged by union members on some of these practices had salaries to be "the amount paid annually to each officer for the whether the convention delegates, in approving per diem the officers' interpretation of the constitutional language is maj. op. at 12-13; but although the executive council actually used the money as the program required. the latter is november 1988 to july 1993, for which he provided only separate opinion concurring in part and dissenting in part factual basis for the district court's mootness finding, we vacate deferential standard of review in evaluating the reasonableness buttressing this conclusion by observing that noble had the policy goal named in the clause is if anything a limitation guards against officers' subverting the limit via sinecures, shall be paid to each officer as the national association, while members. see id. at 1307 (holding that when union executive necessary. at one time, per diem payments were calculated every expenditure within a challenged category, but he must judgment of what is in their best interests. and on which we express no opinion.) stand and be counted individually rather than through secret the expense allowances in full, i join the per curiam opinion's moreover, if the term "benefits" includes payments to be resolved on remand. on february 17, 1994, noble filed suit against sombrotto statement of material facts as to which there is no dispute on the brief were brian a. powers, nicholas r. femia, peter interpretive thumb on the scale, not a conclusive extra weight. conventions to "authorize and/or ratify the payment of salaries, district court may consider the union's consistent past practices, and eleven other nalc officers alleging that they had breached "account" for the actual use of the expense allowance, 14 i. background (n.d. ind. 1984). we agree with the district court that the pages of financial and other documents to plaintiff," sombrotto must reverse the court's dismissal of noble's claim on this issue leave these questions, as well as the factual determination of income). sombrotto did not correct this misrepresentation, assurances that it will be used for union business, completely and benefits. opinion and order entering judgment in favor of the union diem amount determined by the mileage and per diem district court properly deferred to that interpretation. where, as 501 may impose broader limitations on self-dealing without expenses because any difference between their documented pay was useful "to attract and retain" officers; yet the officers' members which were approved by this summarized procedure, 1984), requires that we defer to "an interpretation of a union medicare contributions. the council made this expenditure nonetheless, convention resolutions, if adopted in a fair union officers under 501 and alleges that they violated the annual reports, pl.'s am. proposed findings of fact 30, 42, and payment of under-the-table salaries, but that hardly means the may find it useful to consider the views of other circuits. e.g., for the district of columbia circuit their duties, the officers could find sanctuary by putting "direct[ion]" by the convention, but not directions occurring matter, despite noble's request, see pl.'s am. proposed hotel rooms were paid for by the union. see pl.'s am. disclosure act provides that union officers "occupy positions president), 15 "national business agents," and 3 "trustees." the officers gained convention approval of their per diem percentage of the rank-and-file voting union members had no would have had every opportunity to make their case to the the hotels hosting the conventions. noble alleges that the the majority's central error lies in its readiness to accept noble's claims. noble v. sombrotto, no. 94-302, slip op. allowances for their personal benefit rather than on legitimate constitutional amendment. the executive council may act in session, may direct" and article 11, 6 directs that "[t]he constitutional amendment, the officers necessarily lacked the cummins co., 142 f.2d 82 (d.c. cir. 1944), some mention of of documents relevant to verifying the union's annual financial would defer under monzillo. cf. english v. cunningham, 282 report to the national convention the name, residence, and at every biennial convention after 1964, a small group of (emphasis added), language that encompasses non-suit at the might well have been material to their decision. unambiguous language" of the union's constitution is ordinarily union votes somehow constituted unlawful "exculpatory "inspected documents on october 7, 1993." noble, slip op. at 9. available to their members all information the organizations are maj. op. at 16. but the constitution nowhere says that the confesses to such. here, noble presented about as much under 501(a), which concerns only the use of union funds, and necessary to verify an annual financial report. therefore, this union leaders to evade that ban. cf. morrissey v. curran disclose the inclusion of officers. no names were given; not diem" expenses; in so doing, it misconceives both the record confers discretion only over questions left unresolved by other resolve on remand whether the officers used any portion of the noble presented showing that nalc presidents twice association of letter carriers, et al., vouchers for the committee's review. see j.a. 661 (1992 officers' salaries, the constitution never explicitly forbids issues of material fact regarding which documents were we do not find the executive council members' acceptance of as appears, rather than approving a change in the system of the vouchers, recommend the payment of 47 delegates for the national association, while in session, may direct." art. thanks to the court's decision, pilfering union chieftains opinion.* increasing the annual payments made for the officers' daily expense allowances to a small group of attendees at the quite the reverse. although the constitution authorizes the can't turn a salary increase into a non-salary benefit. lacking delegates were misled as to the nature of the payments and that diem" payments made during the union's biennial national presided over the statement of a similar misrepresentation in to a subsequent union convention accept an interpretation of 4 noble's strained interpretation would treat many "benefits" as they did not disclose to the membership until after noble not reimbursed for out-of-pocket expenses. was worthless. the fourth and fifth circuits have agreed, review over the district court's factual findings. and that the council had decided to reimburse their members for comprised of an employee's mandatory social security and same rate as that paid to other delegates. this resolution to be sure, noble offers a plausible interpretation of the determine their salaries. judges to override the union conventions' twice-considered retain competent personnel," it gives no license to increase language and the purpose of the labor management salaries and thus had no "lost time" (unlike rank-and-file mail estimate, on the grounds that their salaries continued and their officers' bad faith. maj. op. at 11. the convention records officers might have interpreted "bills" to be unrelated to receipt of per diem payments during conventions met the same constitutional violations; rather, they reflected the union's each member eligible for mileage and per diem." the district apparently uncontradicted and was never addressed by the corporate entities affiliated with nalc (the mutual benefit arguments of defendants dunn and vincenzi. i respectfully the officers contend that they used the excess per diem evidence" of this practice. noble, slip op. at 17.1 additionally, while the constitution permits officers to receive [rademacher:] there is no stipulation in that evidence as one could hope a 501 plaintiff could gather--that 11 did not actually incur. noble further alleges that convention 12 while the district court had previously identified "genuine conventions. by way of relief, he sought an accounting from imposed by 501(a)." morrissey, 650 f.2d at 1274. the council officers were receiving those sums, even if no names their personal benefit in three ways: (1) an unmonitored mcnulty's "correct[ion]," the debate did not return to the doubtful that anyone at the convention (beyond the 255 (d.c. cir. 1998). because the district court characterized argued october 26, 2007 decided may 16, 2008 behalf of the organization," 501(a), as well as the more themselves) had been informed of the relevant facts. noble urges this court to adopt the second circuit's approach, the delegates again asked to dispense with the reading of the u.s. postal service, were required to pay a fixed percentage in the total compensation of the officers, which was not itself union constitution, we have held that the reviewing court individual payments." slip op. at 6. the convention did not effect to subsequent interpretive resolutions would enable sustenance," 753 f.2d at 390, no special scrutiny was in order. but constitutional amendment, in-town, out-[of-]town or court can dispose of the 201 claim on remand. evidence merely confirms the text's evident sense. wages, expenses, allowances, and other disbursements which it first, contrary to noble's idiosyncratic views, the union but it is in practice the only barrier to almost unlimited self- itself a representation that "the sum requested was expended on committee. combining that information with a basic reading of informed shareholder vote in favor of that particular then contribute into, nor were covered by, social security. by competent personnel," a given benefit's wisdom as a policy of the nalc executive council's interpretation of their united states court of appeals appellant possible tests that could be employed--or even those proposed exception to their otherwise-applicable salary caps, permitting copies of nalc records relevant to his charges," and that noble appearance. lighten their own tax burden at the union's expense--a move provide them any benefits. known as the labor-management reporting and disclosure act surplusage, the facially permissive language of article 6 must and payment amounts having been read aloud to convention (del. ch. 1999) (internal citation omitted); see also sample v. the period relevant to this suit, we should remand for inappropriate for a distinct group of recipients. thus, while whenever they believe the extra money will help the conventions revealing that union officials who had been washington, d.c. see trial tr. 4/13/04 at 129:4-9, :25, them, or the contents of the vouchers, or the extent to which reverse it for clear error, and noble is entitled to have this association and the health benefit plan, respectively). the had continued ever since. id. employee portion of the officers' federal insurance 16 officers argue that dunn and vincenzi cannot be held liable of the executive council, not the president. therefore, of trust" and that it is the officers' duty "to manage, invest, majority vote of its biennial national convention. nalc's the nalc constitution's method of administering executive council member receives. expenses are incurred. the district court did not address the ground regardless of our resolution as to the other defendants. submitting receipts for legitimate union-related expenses he or a total sum of $33,044.88. no convention delegate ever requested the names of those program was constitutional, not whether the officers had metropolitan area," and it allowed them to draw "up to $500.00 its holding as resting on mootness alone, we read the opinion as (chorus of noes.) will be deemed reasonable whenever the interpretation passes regular, immediate, and unrestricted cash payment for each of the officers' fica payroll taxes. in december 1980, the executive council to offer "benefits" in order "to attract and union's money was used. maj. op. at 9-11. such misuse may be properly categorized as something other than salary, benefits as a result of their participation in the civil service majority vote would be perverse, especially in light of closed- union's overwhelming approval of the officers' interpretation. in 1959, congress passed the landrum-griffin act, also op. at 5. of the union constitution; we have said that union approval expenses, we have no basis to assume--as the district court of taking $500 monthly expense allowances without providing payments far in excess of their actual expenses during nalc's filed by circuit judge kavanaugh. document's minutely detailed salary caps. these for the benefit of the organization and its members. it also undisclosed material information and then ask for it; rather, williams, senior circuit judge, concurring in part and w. noble, jr., then a union employee as well as a longtime phrased as an exception to an otherwise-applicable limit on under a complete misapprehension of the facts; nor does it article 13, 2 that "[p]er diem shall be paid to each officer as payments made to delegates other than executive council the benefited officers are obliged to disclose material facts to he alleged a variety of document requests made to nalc, not (d.c. cir. 1984). but monzillo treats a delegates' resolution an allegation in morrissey v. curran, 650 f.2d 1267, 128384 reasoning and affirm its dismissal of this claim. 5 unambiguously requires a contrary interpretation. thus, it was necessary element of a 201(c) claim; and (2) that noble the delegates decided to dispense with the reading of the stating that noble has been given everything he asked for and noble's second challenge is to the union's reimbursement disclosure of the facts that reasonable delegates would have webster's third new international dictionary 2003 (1981) and his 201(c) claim. compensation, and it directly implies that unitemized conclusion that the union officials' interpretation of the at the meeting, the investigating committee reported that constitution did not unambiguously prohibit the executive [a]lthough art. 9, 1(k) requires that the president "shall faith. illegitimate 7.65% raise. the reimbursements also fall within rather, we vacate the dismissal of noble's 201(c) claim and defendants to prove the propriety of each expenditure."). sombrotto's non-disclosure but reverse the judgment as to the of individual defendants sombrotto et al., doc. no. 128, pt. 2, receipts nalc evidently reported reimbursements as taxable requirement that allegations of personal use are susceptible of the union's authorized officials." (emphasis added)). but they special convention, 95 percent of approximately 2,000 voting congress "[t]o establish . . . uniform laws on the subject of internal expenses, posing a different issue for review, but they share of social security taxes because those members were as to the second question, as noted above, the officers never sombrotto-appointed committee and the lucky recipients noble alleged that the officers had directed union funds to 19 pharmachemie b.v. v. barr labs., inc., 276 f.3d 627, 631 (d.c. supp. 704, 728 (d.d.c. 1995), with morrissey, 650 f.2d at authority to authorize the expenses. she incurred each month. additionally, the 1980 executive utilized by resident officers for purely personal reasons, as to the first question, the process itself plainly did not appellees any . . . person of liability for breach of [fiduciary] duties" to ("lmrda") to protect against misuse of union funds by corrupt were paid a daily convention allowance based only on the had held another job that paid into social security, might never dictionary 48 (corrected ed. 1933) ("[f]ixed payment made truth of lippe's charges; the convention voted her amendment although i would reverse the district court's judgment on breach their duties. allegations, see kavanaugh op. at 3, but the subsequent judge, and williams, senior circuit judge. claims--never addressed by the district court--that the that as to them we should affirm the judgment on this alternative paid to executive council members during the pertinent period following exchange--to dispense on that occasion with the requiring an "unusual or egregious set of facts" to overcome expense allowance and fica reimbursements to the the constitution but on whether the delegates, in deciding to prohibited matters must be mentioned by name. in fixing the simultaneously required to pay into the civil service retirement precondition to suit into a virtually insurmountable barrier. behalf of [nalc] in the course of performance of official correctness of an interpretation fairly placed on union rules by even while working away from their letter carrier positions with record that disclosure was inadequate, we certainly could not id. though morrissey is unclear on whether those union their nalc paychecks. noble also found records from past the union was already bearing the same costs. the majority not only attempts to supply the necessary noble filed internal charges against the nalc officers on during convention week, meaning that they otherwise were with "examin[ing] all bills submitted for payment," requiring per curiam opinion, as well as those portions of part iii payments in this way to be clearly contrary to nalc's we cannot say that the executive council's "interpretation a detailed accounting. at that point the burden will be upon the defendants ask us to reject the second circuit's standard, fact which only a [fact-finder] could make but which has not are clearly erroneous. burden on individuals who chose to hold appointed or elected nalc's interpretation of its constitution that it does not unambiguously prohibiting payments of per diem to executive this evidence would have been welcome here. on remand, we but the source the court cites for the proposition that the shop or union-shop rules that curtail employee exit. in this of facts. fact, it stated that "[p]er diem shall be paid to each officer as those found "eligible," or whether any officers were among thought material. resident officers and staff in-town expense allowance the constitution provides that "[i]n addition to their salaries, predatory officials. to this end, 501(a) declares any expenditure, they must prove "that the funds . . . were obtained id. art. 11, 2(b). on this basis, noble argues that the executive 2 allowance program violated their duty under 29 u.s.c. 501(a) herman, and victoria l. bor. keith r. bolek entered an clear distinction between salary and benefits. under noble's council from authorizing reimbursement of un-itemized in- const. art. 9, 11(e)(4). none takes the form of a fixed, i also join the per curiam opinion with respect to the convention the name, residence, and amount due each prejudice. noble subsequently filed a motion to alter or amend acceptance of per diems during the national conventions; in claim should be remanded for further development of the be read as an implicit restriction, just as the power of delegates to the annual convention. such delegates have no clearly covers the fica reimbursements, which directly "wisdom as a policy matter," maj. op. at 13, but this does executive council, rejected noble's attempts to participate in the majority rejects noble's claims concerning the "per accord brink v. dalesio, 667 f.2d 420, 424 (4th cir. 1981). that "[a]ll bills shall be itemized." nalc const. art. 11, of their income into csrs. csrs-covered employees did not those whose consent they seek. portion of their fica taxes; and (3) collecting per diem five years. nalc reported all reimbursements not documented constitution an important protective provision" is "patently president sombrotto asked these nameless delegates to submit compensated for actual expenses." id. at 119. the second misleadingly denied the allowance's existence when challenged only were officers merely potential recipients of per diems made in bad faith." id. at 1458.1 committee on mileage and per diem shall compute and report all elected officers [i.e., executive council members] shall be that proof of personal use may only be made by direct evidence. financial incentive to keep receipts for all union-related requirements: that even majorities of union members may which authorized the council to "establish such benefits as may able to put on direct proof of such use unless an officer circumstantial evidence suggesting that much of this money without having read their names aloud to the convention was 17 a sum of $6,000 per annum unaccountable expense money." attract and retain competent personnel." art. 9, 11(e)(4). claim is moot and is dismissed." noble, slip op. at 20-21. 8 court's mootness determination, we cannot affirm it, even under right for an officer. provided for." art. 9, 11(e)(3). noble seems to equate any article 9 of that constitution determines the precise salary that see conley v. parton, 116 l.r.r.m. (bna) 3071, 307576 nalc officers were accepting per diem during meetings of the reports. the district court dismissed this claim as moot, stating noble's argument "largely eras[es] the constitution's clear in question also were not otherwise "manifestly reversible for clear error). we cannot simply supply the each month as an allowance for official in-town expenses." presentedamplecircumstantialevidencethatofficerswereusing officers' viewpoints, interests, and perspectives. thus the likelihood that delegates were misled is heightened if the critical point in this case, therefore, is the following: proceedings. that interpretation, at least absent an unusual or egregious set authorize salaries and benefits for elected officers, and (3) would inference of an under-the-table "salary increase," at least if result in windfalls and uncertain tax complications, but they judge kavanaugh does not address these additional constitution first mentions per diems in providing for a proposed findings of fact 18-19; noble br. 13; noble aff. case with facts strikingly similar to those here. the butler course of a debate over an increase in dues, delegate john (quoting morrissey, 650 f.2d at 1275); see also noble reply br. retirement system. problem with the officers' in-town expense reimbursements president vincent sombrotto. sombrotto immediately unreasonable as to evidence a breach of the fiduciary obligation thedistrictcourtmayhavebeenunderthemisapprehension committee provided the convention a summary report of the executivecouncil'sinterpretationoftheconstitutionpermitting 21 while we take no view on the propriety of per diem evidence in its factual findings, see schilling v. schwitzer- investigation, which confirmed that noble's complaints were reasonable and entitled to deference. particularly given that union officers went "off expenses" payment, notwithstanding its authorization, is so manifestly week worked. if such payments are "benefits," then the nothing in ray suggests a willingness to countenance undisclosed 11(e)(4) was neither unreasonable nor made in bad faith, the 14 1981) ("a plaintiff in a 501 suit need not prove the impropriety of payments, however, noble has failed to show that the payments moreover, because it avoided the "double taxation" that some 19 that the [officers'] interpretation was unreasonable and made in lack the skill or incentives to protect themselves from record (i.e., if a finding in noble's favor would have been the payments that the officers cannot increase from the ones limited number of receipts, they were never required to carriers); and (2) that the union had already paid (in full or overwhelmingly voted against noble's claims and approved article 9, 11(e) and (e)(3) as authorizing the expenditures, and court found that in 1964 a majority of convention delegates letter carriers, 9 f.3d 138, 146 (d.c. cir. 1993). and 1992 versions of nalc's constitution explicitly state at salaries for that purpose. the distinction may be formalistic, members from their fellows, ending the legal inquiry after a personally violated 501(a) by failing to report his official officers could vote themselves one; there is no ambiguity or the nationalassociationoflettercarriers("nalc"orthe to [nalc] for any profit received . . . [in] transactions . . . on the in-town expense allowances and fica reimbursements to board to establish benefits as "required to attract and retain constitution. reading article 11, 6 as clearly and were unaware of these costs' peculiarities--peculiarities that from nalc. slip. op. at 13-14. noble does not appeal this appropriate, making a guarantee for reimbursement of from united states v. butler, 954 f.2d 114 (2d cir.1992), a under our precedent in united states v. defries, 129 town expenses; in fact, it permitted the executive council to expenses for the benefit of the [union] in the washington, d.c. u.s.c. 501(b). noble's theory were inadequate as a matter of law (which it is eleven other union officers, accusing them of violating their though he had personal knowledge of the situation (and had of the provision for reimbursement of itemized expenses vii. noble alleges not only that the expense allowance provisions of 501 would be completely emasculated if, delegates); id. at 337 (2002 convention) (38 delegates). and forbade them from receiving per diem if their names and right to access but "nonetheless[] made available to plaintiff authorizing their acceptance of per diem payments via this in my judgment, this case turns on the nature of the interpretations of the union's constitution that gut that returned from his long-term leave from the u.s. postal service each officer will receive, down to the last dollar. nalc rigorous as that undertaken when the fiduciary is a corporate dark, a brief supplement to the majority's account is along with fixing the salaries of the executive council, employee of the national association of letter carriers legitim[ize] their former derelictions of duty."). and since the members to verify the accuracy of a union's report. actions to the biennial convention in accordance with nalc finding, but to do so it rests on an inaccurate reading of the of 501 for the purposes of this claim. william m. dunn, jr., defries, 129 f.3d 1293 (d.c. cir. 1997), which suggests that find the kind of unambiguous constitutional language that, authorization of the "in-town" expense allowance reasonable, transaction is to maintain the business judgment rule's n.105; see also pl.'s exs. 28, 31. in a supplemental filing to this the legitimacy of that receipt turns not on an interpretation of our decision in monzillo v. biller, 735 f.2d 1456 (d.c. cir. unnamed delegates received a "per diem" payment calculated finally, two of the appellees purport to be outside the scope david w. noble, jr., diems may be paid to any delegate. the constitution then a case is moot if the judgment, regardless of which way it 15 within the former and excluded them from the latter, we officers should have been even more tightly monitored. but allegations. a few years later, by a vote of nearly 90 percent member eligible for mileage and per diem," nalc const. art. iii. "per diem" expenses during national conventions the reimbursements are reasonable in amount, as they were read aloud to the convention by name and amount. in the the convention was told that the recipients' vouchers had that he and other recipients "were already being fully quoting legislative history of the lmrda to the effect that conflicted with the stark and unambiguous language of the interpretations allow the officers to help themselves to union diem payments despite the fact that they lost no wages by 16 for the aforementioned reasons, we affirm the judgment as the $500 "in-town" expense allowance for nalc officers, court that the presidentially appointed committee on mileage ten years later, at the 1986 convention, sombrotto respect to amount, a possibility he does not develop in any detail authorized by the executive council that redounded to its in his separate opinion, judge kavanaugh would go even require such reporting of resolutions is reasonable. dissenting in part: i would reject all of noble's 501 claims, and per diem asked each post-1964 convention to approve constitution rendered by officials of a labor organization . . . (the fica reimbursement issue). thus, in a classic self-dealing transaction the effect of a fully- and the nature of his challenge. because the district court rely on it to pay themselves the dual salaries prohibited by also, another piece of misinformation by the sister, there "unreasonable or made in bad faith." monzillo v. biller, 735 12 day, based on $166.93 for lost time, $158.48 for hotels, and 2(b). the word "bills" includes requests for reimbursement, the nalc const. art. 13, 2 provides that "[p]er diem went to officers' personal use. somewhat convoluted constitutional language on these three same kind of rule that applies to analogous shareholder convention); see also noble, slip op. at 6, 18; j.a. 661 (1992 complained--they usurped the convention's authority to noble determined that unionofficialshadlongstandingpractices national convention may alter this salary, and only by incidentals--and recommended the total as the figure to be privilege," namely gene mcnulty, a national business agent council from providing additional payment for expenses or they can. any regular payment to the officers (an "extra- 501 on noble's own theory. (noble suggests obscurely that margin of 25 to 1. 7 payments to the officers had been properly authorized under the unreasonable," loretangeli v. critelli, 853 f.2d 186, 195 (3d -- dispensing with the constitution's requirement of regarding the "in-town" expense allowance. the evidence * avoided a substantial additional tax liability by keeping and f.2d 1456, 1458 (d.c. cir. 1984). of particular importance payment while having incurred no "lost time" and while 130:1-2. yet article 11 makes no distinction as to where the increase. but the union constitution says no such thing. so viii. claim for release of documents under 201(c) noble's circumstantial evidence of misuse against any evidence year for which there is evidence in the record) than there were expenses without restricting what else they may receive. maj. convention delegates probably understood that the per diems rejected each of noble's charges of wrongdoing by an average 3 convention); id. at 336 (2002 convention). in the meantime, personal cost, which he otherwise would have incurred, of daily "double dip[ping]," as butler put it. 954 f.2d at 117. be correct." j.a. 337 (2002 convention); see also id. at 658 the per curiam opinion's reading is further weakened by -- interpreting "benefits" to encompass salary increases note in its findings of fact that noble had made document a fair range of reasonableness." noble br. 30 (emphasis added) the union convention has approved the officers' interpretation meeting of the nalc convention. the investigating committee, noble's remaining 501(a) claim concerns the payment of funds, a court in a 501(b) suit may determine whether the not say that. moreover, un-itemized expense reimbursements which the per diems were based were categorically union constitution is the union's "supreme body," longer contends that he is being denied access to any documents director who has an interest in the challenged transaction"). but propositions unrelated to mootness: (1) that noble failed to reimbursements. article 11 charges the fiscal committee compensation). 1 11 denied documents that were relevant to verifying the union's per curiam: david w. noble, jr., is a member and former james h. rademacher, then president of the union--who had ii. standard of review defendants made copies available--letter from vincent r. conventions had been misled. pl.'s am. proposed findings of the national association, while in session, may direct." the constituted of nalc members who were not members of the issues) on the union convention's votes against noble's separate test for 501 claims. cf. morrissey v. curran, 650 [rademacher:] well, your information is incorrect. the based in fact, the investigating committee presented its findings 1083 (d.c. cir. 1998); u.s. postal serv. v. nat'l ass'n of both longstanding and justified by a ban on reimbursement for concedes that, even under the streamlined procedure followed witnesses, and denied his request to receive a copy of its report duringthesubsequentregularnationalconventionin1994, took full-time positions with the nalc, they found themselves nalc is governed by a constitution which may be amended by officers failed to adequately disclose the nature of their double distinguishing a 7.65% "fica reimbursement" from an monthly in-town expense allowances), and required to file with the secretary of labor. that section also of the constitution; we uphold their interpretation unless it is union constitution because such approval "undermines a finding "authorize . . . the payment of . . . expenses, allowances, and ex. 7--makes clear that even the defendants did not claim to and voted to approve them. requirements to apply to internal expenses incurred away from [that officer's] duties." id. art. 9, 1-10. this definition they took union funds as "reimbursements" for expenses they officers' acceptance of these per diems violated 501 because such that "where a union officer personally benefits from union announcement then disclosed to the convention the total payment of officers' half of fica taxes, and payment of per documents under 201(c) of the lmrda, 29 u.s.c. 431(c). i would like to correct the sister. . . . judicial role in 501 disputes. our precedents and the the nalc health benefit plan were "separate and distinct" cases, the courts have essentially no role whenever delegates attending and frequently stayed in free or reduced-rate rooms at (emphasis added). under 501(b) of the lmrda, postal statutory text and structure establish a basic principle of unaccountable. they have to account for that. if you convention to alter the method of paying per diems, nor were number of delegates found eligible for per diems and the total not have violated 501(a). id. at 15-19. it also dismissed fica reimbursements not from nalc itself, but from other personally keep their receipts for a "reasonable period" of up to up to five years. the fact that the vast majority of allowances cir. 1997) (alterations in original) (quoting united states v. vii. noble's "manifest unreasonableness" argument potential recovery, but it has nothing to do with whether the be required to attract and retain competent personnel, including organization. lmrda's 201(c) requires unions to make say that the district court erred by finding both the summarized providing that no officer "shall receive more than one salary pl.'s ex. 47, at 4, the district court clearly erred by finding "no noble is correct to assert--as he did in a statement that was while it is unclear in his brief, noble may have attempted longstanding practice dating to the 1950s. similarly, it reported to the purpose and functioning of this union, other than nalc const. art. 6, 1 expressly entitles all elected union procedure and the officers' acceptance of per diem payments generally accepted definitions of salary, see 9 oxford english a laugh test, free from any need to be consistent with the also can save both the employer and employee from constraint. payment to be made," noting that "[a]ll bills shall be itemized." convention) (47 delegates); id. at 658 (1966 convention) (54 on behalf of the union. further, noble brought a claim under an interpretation that conflicts with the "stark and exercised their authority. because the union approved its vote to "substitute[]" a summary report, cf. maj. op. at 14, bad faith." id. at 1464. we review de novo the district court's shareholders acts as a safe harbor in situations where are elected agents of the members, and are more subject to costs that the union itself had already met. the defendants reply that nalc "produced thousands of these payments without informing the delegates of two facts: or allowances are hardly so uncommon as to raise an v. per diem expenses during national conventions council members during the convention without their names the $500 monthly "in-town" expense allowance was a been material to the convention's decision to approve the per personal income taxes--and, as they themselves allege, are april 13 and 14, 2004. on september 30, 2005, the court issued "members," see id. art. 6, 4. but it is also irrelevant, for the const. art. i, 8, cl. 4; ry. labor executives' ass'n v. union member noble filed suit against postal union officers; id. art. 11, 6 (emphasis added), which indicates that per to salary increases appears dead. we have not yet given precise content to 501's fiduciary court's mootness finding as to noble's 201 claim. but the merits i. the $500 monthly in-town expense allowances one prior to his internal complaint and subsequent discharge, officers were under an obligation to retain receipts as the nalc under its power to establish "such benefits as may be required what (if any) records noble has requested but not yet received, lmrda's 501(a) makes union officers fiduciaries of union the officers and the recovery by the union of all unlawful section 501(a) of the labor-management reporting and the officers' vote to have the union reimburse their 2 burdensome administrative paperwork, which is why they can certainly cannot say that nalc's constitution unambiguously forbids unions from adopting provisions or resolutions convention weeks, (2) limited the executive council's power to convenience we use the 1992 numbering throughout unless noble's first challenge is to the dismissal of his claim that district court need not specifically reference all contrary noble did contend before the district court that he had been votes of the full union membership, but rather votes of expressly empowering the executive committee to set its own 9 resolution (dec. 8, 1980). sombrotto, as president, was we note as well that the district court's memorandum documents noble was able to review on october 7, 1993. in advance of the special convention. after conducting its in what noble alleged to be a "verbal shell game." pl.'s am. the majority argues that the committee's failure to read 18 represents a violation of 501's independent duty to "account enjoying union-provided hotel rooms could obviously have court upheld the embezzlement conviction under 501(c) of a subverts the clause's obvious goal of preserving accountability. some bylaws are designed to protect a minority of union 9 commented from the chair on other measures). after no time did the committee disclose either the identities of executive council, whose power is secondary only to that of the opinion for the court filed per curiam. allowed $500 and it does not say if they list it on an supplemental resp. 4, but they do not claim that noble has longstanding obligation of all of the union's full-time can be offered no further relief--not that his requests are disclosure of . . . material information' is a nullity." id. at particular appeal, the resolutions cannot have so powerful an a convention resolution, as judge kavanaugh would do, (d.d.c. 2003), the record does not reveal any basis for its later which, unless they remained in nalc's employ for ten years or comfortably within that definition. owes "considerable deference" to the officers' interpretation un-itemized expense reimbursement or allowance with a record. the majority asserts that a "basic reading" of the the executive council--and no one else. thus, article 13, 2 the executive council has explicit authority to act between their fiduciary duties to the union in violation of 29 u.s.c. individualized accounting, it simply voted--as shown in the the constitution is debatable at best. noble certainly cannot sister circuit on this point. a union member complaining of national convention even if theyincurrednopersonalexpenses; not a condition precedent to the officers' receipt of per diems. committee to investigate noble's charges and report to a special diem to officers during national convention meetings at the presented no evidence "that the in-town expense allowance was the convention's blessing a less effective absolution than a alluding to the constitutional provision for officers' itemized council's authority to set wages and benefits and limit their were sound policy, the constitution specified a precise salary of action to sue officers in breach of their fiduciary duties in requests in a letter to sombrotto, that the union had contested his duties. lmrda's 501(b) gives union members a private right 1992 nalc constitution lists as "officers" all 28 members of been examined "carefully," but this would have led an (testimony of william h. young). members may have naively rightly concluded, the union votes did not excuse prior scant their principals' interests in favor of their own--render made no findings on the matter--that there was adequate "reimbursements" the officers falsely represented that they described the new payment as a "fringe benefit," j.a. 598, not content with that, the court short-circuits fact-finding on fail. the constitution describes "benefits" as "including but in washington, d.c. incurred in the performance of their official so ordered. fica increase, the majority erases the distinction and the summ. j. filed by individual defs. sombrotto et al., doc. no. duties, cf. mallick v. int'l bhd. of elec. workers, 749 f.2d 771, that union officers would receive a full per diem those who have paid a minimum amount into the system for at derivative actions where it is a "settled proposition that court's dismissal of his three claims under lmrda 501(a) union official who had secured approval for "fixed expense kavanaugh op. at 2, will commonly turn this procedural when union officers conceal vital information from union proof only by direct evidence, then we must part ways with our convention); id. at 336 (2002 convention). a subsequent chair stands here in front of 5,000 delegates and says holding that when union officers benefit directly from an make sense when the amounts in question are relatively wherever it happens to be. if they itemized expenses they 17 application is itself uncertain, compare yager v. carey, 910 f. convention beforehand. when nalc's officers voted to 3 union's efforts to constrain its officers' self-help. union constitution in granting themselves various payments be "void as against public policy"; giving near-conclusive them; that was up to each convention to decide. the the per diem--lost time, hotel costs, and meals and j.a. 734. in response, sombrotto recognized a speaker "on committee on mileage and per diem, which during the resolution that approved and confirmed the constitutionality of trustees, it announced estimates of the various components of incurred in conduct of the affairs of the union." id. art. 6, 1. suspended noble from his job without pay, after which noble "in-town" expense allowance; (2) union reimbursement of the i do not agree, moreover, with noble's contention that the your information is incorrect. i would find the officers' interpretations with respect to appears to direct per diem payments to the very group noble ex. a ("pl.'s am. proposed findings of fact"), but any and a member of the executive council. mcnulty stated as union "retain competent personnel," namely themselves solution. he does not address the meaning of this provision, staying at a cousin's apartment, but whether the factors on compliance with the constitution means that the officers did not presents it, imposes liability on union officers when they (no. 94cv00302) payments for legitimate expenses such as entertaining union law, social security retirement benefits are only payable to annum, payable weekly," for "the faithful performance of cir. 1988); so a reading that decapitates the salary caps should periodically to a person as compensation for regular work"); to renew an argument he made below that president sombrotto under the tax code are part of the officers' wages for fica minneapolis bank records. instead, the defendants argue two article 14, nor to avoid article 6's limits on reimbursement of pay, tuition or scholarship, and insurance benefits." nalc rates implies . . . that the payment will be made to people who past conduct. as i develop below, this contradicts both the ("morrissey i"), 423 f.2d 393, 399 (2d cir. 1970) ("[t]he with its constitution and bylaws." 29 u.s.c. 501(a). a allowance program and vacate its dismissal of noble's 501(a) purporting to absolve union officials for breaches of these here, we afford even greater deference to union officials when the allowance for personal use. the officers had a direct authorize it. we see no reason to disturb the district court's could account for. on remand, the district court must reach the theinvestigationbyattending investigatory meetings and calling it exceeded their actual expenses, see sombrotto tr. 9/15/93, could hardly be more complete. fiduciary duties under 501(a) of the labor-management a resolution of the merits. see in re papandreou, 139 f.3d 247, expenses incurred and to keep them for a "reasonable period" of kimberlin v. quinlan, 199 f.3d 496, 500 (d.c. cir. 1999). but we further find no merit to noble's argument that theseverancepayments were `authorized'"despiteunionbylaws nalc membership rejected proposed amendments that would to the special convention on october 13, 1993. reported as taxable income. thus, each officer could easily have submit at each convention a written report of all his/her question determined by the original fact-finder in the first vincent r. sombrotto, then president of the union, as well as through 1992, the convention was informed of the total per interpretation of the union constitution at all, but rather factual circuit held that approval given under these circumstances thus, nalc officials' interpretation oftheir constitution as active and retired letter carriers of the u.s. postal service. 1996 convention, proposed amendments to limit the executive council to "establish such benefits as may be required to 501 issue. i join all but parts iii and ix of the per curiam never did so, and a fortiori they never did so reasonably. * * * expenses. the exchange proceeded as follows: constitutional provisions. the officers obviously could not instance. cf. summers v. dep't of justice, 140 f.3d 1077, unlawful expenditures from the officers named in his complaint union member such as noble may sue a union officer for presumptions." solomon v. armstrong, 747 a.2d 1098, 1115 of this union, other than provided for." id. 11(e)(3). incidentals. (in 2002, for example, the allowance was $420 per finding that noble's requests had been fulfilled. the court did assuming that some ambiguity remains, then, the extrinsic any supporting documentation justifying such payments; that payments for attending trustee meetings" without revealing deference to the union officials' interpretation when, as here, a finding, which makes it conclusive on remand. see, e.g., per diem payments. finally, because we cannot identify the conceded in his testimony at trial, he considered article 11's per diems, it nowhere indicates that officers must receive because a key factual finding underlying its conclusion that the separate opinion concurring in part and dissenting in part expense account. it says they will be given $500. amount due each member eligible for mileage and per diem," before: sentelle, chief judge, kavanaugh, circuit issues, and he may have a good policy argument why union personal share of fica taxes similarly contravened the had spent the requested amount on union business, a plain were outside the kinds and amounts of payments that are complained that sombrotto should have reported his approval of 5 karen lippe proposed limiting the increase for a variety of ("nalc" or the "union"). in 1994 he brought suit against bankruptcies" is read to limit, rather than supplement, any itemized expenses entirely unnecessary. rather than mere and, if found to be correct, to approve them and authorize organization or its . . . officers refuse or fail to sue," 501(b) its dismissal of his 201(c) claim. 1-10, and article 6 provides that "[i]n addition to their salaries, deems necessary and appropriate to the purpose and functioning voted to dispense with the reading of the individual payees and opinion made no mention of noble's evidence of bad faith alleged violations of 501(a) in order "to recover damages or the record does not reveal any informed decision of the agree with what the chair has said[,] that the constitution court cannot make the necessary findings on its own--the finally, noble brings a claim under 201(c) for the release [the officers] shall be entitled to reimbursement of all itemized authority to increase their own salaries other than by ambiguity in the term. in that case, the range of reasonable contains it and if they do itemize this thing, then i would iii. in-town expense allowance no. 06-7170 that noble produced "[n]o evidence" that officers had used the interpretation was reasonable was clearly erroneous. though receipts showing the expenses were made for union business. instead, the resolution deemed any request for reimbursement as plaintiff lacks legal entitlement to his requested relief is plainly duties. the 1980 resolution noted that these officials were concerning the district court's fact-finding and the separate diem payments. the total per diem was a set figure and noble f.3d 1293 (d.c. cir. 1997), these allegations state a violation fate. the 1996 national convention, however, passed a power to evade this limitation by using a different label. fact 19 ("stating to the convention that . . . the recommended const. art. 9, 1-10. (e.g., $62,699.00 for the executive vice v. reimbursement of itemized expenses as merely setting a floor, 18 diems. this is not merely a question of whether individual second, contrary to noble's argument, the union receiving $500 per month for "in-town expenses." j.a. 165. requested by plaintiff as well as what responsive documents unreasonable," even assuming that formulation qualifies as a a memorandum opinion and order dismissing noble's case with the district court's judgment, but the district court denied members' personal benefit. conducting his own investigation, through a constitutional amendment or by-law retroactively to shadow of the governing tax law. since fica taxes were a 9, 11(e)(3); cf. kavanaugh op. at 3. this clause, however, judge kavanaugh rests his concurrence (as to all three resolutions." see 29 u.s.c. 501(a). as the district court officers' hotel rooms had been paid for, a fact that was only we have not yet determined what burdens of production and noble's 201(c) claim as moot. id. at 20-21. interpretive votes are surely irrelevant here. the convention constitution have been renumbered over time; for the sake of receiving per diems prior to noble's suit. but defries union member, became aware of various union expenditures on the issue at national conventions is troubling. while the ix. conclusion other disbursements which it deems necessary and appropriate 1964 convention, as the district court found, "a majority of necessary disclosures were made. the officers also argue that if the officers provided reasonable definitions of severance pay, tuition or scholarship, and insurance benefits." been made, the appellate court cannot take the place of the union officers, including 10 "resident officers" (including the that officers' receipt of per diem during convention weeks was payment provided incidental benefits to an officer; thus, though an year litigation odyssey. nor did the district court so find, see slip op. at 6, 19. so far textual "gap" on the point. rather, nalc's constitution meetings of the biennial national convention. nalc provides the officers' challenged payment practices. art. 1, 4. at a we need not decide these questions here. noble relies solely on iv. reimbursement of fica payroll taxes approve their receipt of excessive benefits, significantly above union's constitutionandinternalprocedures,andtherefore could but not limited to annuity, welfare, vacations, holidays, every time a court . . . found that the officers had breached [fact-finder]." united states v. hill, 131 f.3d 1056, 1061 (d.c. officers' fica taxes; in fact, it authorized the executive business." noble, slip op. at 17. to the contrary, noble section 501 precludes our allowing it any greater impact. vacate the dismissal of each. the case is remanded for further considered article 11 to apply to internal expenses. the pl.'s ex. 21, 9, at 3-4. the fica reimbursements fit their share of social security and medicare taxes withheld from prohibited salary increase, but the constitution simply does under the authority of nalc const. art. 9, 11(e)(4) (1980), receiving the payments and, for the officers, the systematic effect as to overcome the comparatively plain language of the vote of the whole membership. prohibited salary increases, largely erasing the constitution's [bourlon:] no, sir, i'm sorry, it doesn't answer it. i can fiscal committee to "examine all bills submitted for payment bernadette c. sargeant argued the cause and filed the briefs dissent from the resolution of noble's other claims under 29 1 concerns into the board's grant of authority by directing the constitution and bylaws." executive council members receive account in minneapolis. issue of how the union's money was actually used, weighing noble's 501(a) claims on the fica reimbursements and the lmrda 201(c), alleging that he had been denied financial interpretation of union rules to permit their self-enrichment requirements than were actually applied. it thus seems finding that the [officers'] interpretation was unreasonable and system ("csrs"). delegates to the special convention roundly bourlon rose to ask whether it was true that the officers were in this case, the officers' interpretation of the constitution the officers present to the contrary. following the 1992 national convention, appellant david here. to be sure, un-itemized expense accounts sometimes disclosure." ray v. young, 753 f.2d 386, 389 (5th cir. 1985);2 involved). as to the fica reimbursements and the per diem unless the court finds the interpretation was unreasonable or constitution did not unambiguously prohibit officers' to work as a letter carrier. in accordance with the nalc the analysis. their salaries are constitutionally fixed in pre- payments, had any notice that the per diems covered officers' received the particular documents he has identified, such as the "reasonable" reading of the constitution. see maj. op. at 15. each of the three issues noble raises, his contrary reading of 4 beyond the council's power to control, nalc const. art. 9, union officials. see, e.g., tile, marble, etc. v. ceramic tile 7 noble contends that the factual findings underlying this ruling judge kavanaugh's theory would also contradict the noted otherwise.). the executive council is made up of 28 unreasonable. loretangeli v. critelli, 853 f.2d 186, 194-95 (3d cir. unreasonable or in bad faith. in determining reasonableness, a did so, but only for very different sorts of payments. its point was funds and commands that they keep and use those funds solely indication whether nalc made available to noble the many should resolve this issue on remand. executive council decided to reimburse all full-time officers entitled to reimbursement of all itemized expenses legitimately recipients could save money by eating cheaper meals or claims. kavanaugh op. at 1-2. of course, these were not reimbursable through the usual route. cf. kavanaugh op. at const. art. 9, 1(k). in the district court, noble specifically 6 16 & n.4 (contesting the reasonableness of the amounts summarized approvalprocedureisoweddeferenceunlessshown payments without adequate disclosure.


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