SEIU Announces 30% Budget Cuts in 2017 with AFSCME Merger on the Way

According to multiple press outlets, SEIU President Mary Kay Henry issued an internal memo on December 14 announcing plans for a 30% cut to SEIU International’s budget in 2017. Tasty’s sources say the plan calls for cuts of 10% in January 2017 and another 20% in July 2017.

News of the memo was first publicly reported by Josh Eidelson at Bloomberg Businessweek (Eidelson, “Fear of Trump Triggers Deep Spending Cuts by Nation's Second-Largest Union,” Bloomberg Businessweek, December 27, 2016).

In the memo, Henry says the cuts are necessary due to the Republican Party’s imminent control of all three branches of the federal government. Here’s an excerpt from her December 14 memo, according to Bloomberg:

Because the far right will control all three branches of the federal government, we will face serious threats to the ability of working people to join together in unions. These threats require us to make tough decisions that allow us to resist these attacks and to fight forward despite dramatically reduced resources.

Tasty believes the story behind the cuts is more complex than what SEIU describes in its memo.

Why?

There’s another reason for the cuts that so far hasn’t been mentioned – namely, SEIU’s planned merger with AFSCME.

More than 18 months ago, SEIU and AFSCME began merger talks spurred by concerns about Friedrichs v. California Teachers Association, the U.S. Supreme Court case that could weaken public-sector unions by challenging their right to collect fair share fees from nonmembers to cover the costs of representation, such as negotiating contracts. In February 2016, the sudden death of Justice Antonin Scalia left the court deadlocked on the Friedrichs case and apparently slowed the two unions’ merger plans.

In May 2016, SEIU approved a resolution leaving open the possibility of a full-blown merger while immediately calling for joint planning, organizing, bargaining, and political work between the two unions. In July 2016, AFSCME approved a nearly identical resolution.

With the election of Trump in November, both unions are likely speeding up their merger plans -- which undoubtedly will require the elimination of duplicate functions, departments, etc at the two unions. Tasty guesses this helps explain SEIU’s announcement of rapid budget cuts.

It also helps explain why other unions with large public-sector memberships haven’t also announced deep budget cuts.

SEIU's Mary Kay Henry

So why doesn’t Henry’s budget-cut memo mention the AFSCME merger? It’s easier to win the staff’s support for layoffs based on Trump.

If Tasty’s theory is correct, we’ll likely see evidence of expedited merger activity in the months ahead… and perhaps budget cuts at AFSCME as well.

As far as eliminating waste, SEIU should start by axing some of its highly paid officials inhabiting the top floors of the Purple Palace. For example, over a number of years, SEIU has almost doubled the number of its full-time “Executive Vice Presidents” (from four to seven EVPs). 

The latest increase came in May of 2016 when SEIU boosted the number of EVPs from six to seven-- at the same time that it passed the AFSCME merger resolution to prepare for SEIU's declining membership. Makes total sense, right?

Each EVP earns more than $200,000 a year, according to financial records. If you eliminate four of them, that’s more than $1 million in savings a year when you factor in benefits, etc.

Stay tuned.

California Governor: I refuse to meet with SEIU-UHW's Dave Regan

California Gov. Jerry Brown

What do California’s top political and union leaders think about SEIU-UHW President Dave Regan?

Not much.

That’s one of the intriguing findings in a 42-page decision issued last month by the arbitrator who investigated the dispute between SEIU-UHW and the California Hospital Association.

According to the arbitrator’s report, California Gov. Jerry Brown -- who is scheduled to speak at next week’s Democratic National Convention -- refused to be in the same room with Regan. Ditto for the California Teachers Association and the SEIU California State Council.

Why do they dislike Regan so much?

It turns out that Regan betrayed them by attempting to raid billions of dollars set aside for California’s chronically underfunded schools.

Here’s what happened.

In 2012, the governor joined the teachers union and many other civic organizations in successfully passing a ballot initiative that established a “Millionaire’s Tax” to improve funding for California’s schools. The tax, also called “Proposition 30,” will expire in 2018.

Last year, the California Teachers Association began openly preparing to file a new ballot initiative to extend California’s “Millionaire’s Tax” and its funding for schools.

Dave Regan

As the teachers began their efforts, Regan eyed an opportunity. 

Under the terms of his secret partnership with the California Hospital Association, Regan was under the gun to deliver billions of dollars of new government funding to hospital CEOs in order to buy their consent to unionize 30,000 of the hospitals’ non-union employees.

Regan, rather than supporting the schools, introduced a separate ballot initiative to snatch $2.5 billion a year from the schools and put it into the pockets of the hospital CEOs with whom he’d secretly been conspiring.

In June of 2015, Regan asked the California Hospital Association (CHA) to join him in filing the competing ballot initiative. Here’s what happened next, according to the arbitrator’s report:

"CHA representatives expressed surprise and raised a number of concerns about the Union's proposal, including the likelihood that the California Teachers Association (CTA), the so-called "ABC Coalition" and the Governor would be angry and unhappy if the LMC [SEIU-UHW and the CHA] were to file a competing statewide tax increase initiative. In particular, CHA expressed concern that competing Proposition 30 initiatives would undermine each other, decreasing the opportunity of either passing." (pp. 11-12)

SEIU-UHW nonetheless filed its competing ballot initiative.

Next, Regan tried to engage Gov. Brown and the teachers union in negotiations over a compromise ballot initiative that would steer billion to his hospital CEO pals. 

Regan asked CHA CEO Duane Dauner to reach out to the Governor’s office. He also called on Peter Ragone and former California Senate President Darrell Steinberg to reach out to the California Teachers Association (CTA) and the SEIU California State Council, which was working with the CTA.

How did they respond to Regan’s plea?

Here’s what the arbitrator wrote in his decision:

"Despite efforts by CHA to have UHW and the LMC included in the discussions, both the Governor's office and the other stakeholders, including CTA and the SEIU State Council, continued to insist that they would not meet with UHW or the LMC, but only with CHA separately." (p. 13)

Ouch. (The term “LMC” refers to the “Labor-Management Committee” that SEIU-UHW and the CHA set up to carry out their secret partnership deal. Duane Dauner and Dave Regan were the co-chairs of the LMC.)

Gov. Brown campaigning for Prop 30

Several months later, Regan begged the Governor, the CTA, and other “stakeholders” to allow SEIU-UHW to join them in a single ballot initiative. But they again refused. The arbitrator says it was “clear that the other stakeholders would not modify their position of opposition to UHW’s involvement.” (p. 13)

In November, the CHA announced its support for the teachers’ ballot initiative. According to the arbitrator, the CHA’s Duane Dauner phoned Regan on November 3, 2015 and “explained to representatives of UHW that the new coalition was not willing to work with UHW and that they, therefore, could not be part of the coalition.” (p. 19)

The arbitrator’s decision makes multiple other references to statewide leaders’ apparently extreme dislike for Regan:

“...it was the stakeholders that insisted UHW was not welcome.” (p. 22)

“UHW was generally aware that.. the Governor's office, CTA and other stakeholders were unwilling to meet with UHW or to allow UHW to join their coalition.” (pp. 23-24)

Elsewhere, the arbitrator refers to “UHW's apparently strained relationship with the governor and the SEIU State Council.”

We all know what happened next. When Regan failed to deliver the billions of dollars he’d promised to his CEO pals, his secret partnership deal with the Hospital Association exploded in flames.

Dave Regan and the gang that can't shoot straight

In an angry response to his former CEO pals, Regan filed a new ballot initiative designed to cap their salaries at $450,000 a year. 

Unfortunately, Regan forgot to read the gag clause that he’d signed as part of his secret partnership deal, which legally blocked SEIU-UHW from taking any action "adverse" to the interests of the hospital industry.

Last month, after Regan had already wasted $5 million of SEIU-UHW members’ dues money to collect signatures for his doomed executive-compensation ballot initiative, a Superior Court judge ordered Regan to withdraw the initiative or face tens of millions of dollars of penalties.

Altogether, it was quite a remarkable series of failures and f*ck-ups by Regan and his chief political strategist, Dave Kieffer.

As one observer remarked: “It looks like Dave Regan is chief gunner for the gang that can’t shoot straight.”

Merger between SEIU and AFSCME?

SEIU's Mary Kay Henry and AFSCME's Lee Saunders

Here’s another item from the recently concluded SEIU Convention in Detroit:  the resolution calling for SEIU and AFSCME to work collaboratively and to explore a full-blown merger. A full copy of the resolution is below.

The proposal reportedly has been under discussion for a year by a committee formed by the two unions.

According to Tasty’s sources, the two unions’ merger discussions are driven by concerns about Friedrichs v. California Teachers Association, the U.S. Supreme Court case that could weaken public-sector unions by challenging their right to collect fair share fees from nonmembers to cover the costs of representation, such as negotiating contracts.

Together, SEIU and AFSCME represent approximately 3 million public-sector workers.

In December of 2015, the two unions held a first-ever meeting between their lawyers “to share ideas and best practices to deal with issues confronting all public employees, such as Friedrichs v. California Teachers Association…” 

The three-day event began with a panel discussion by SEIU President Mary Kay Henry, Steve Fantauzzo (Chief of Staff to AFSCME President Lee Saunders), and each union’s general counsel.

In February, the sudden death of Justice Antonin Scalia left the court deadlocked on the Friedrichs case, with Senate Republicans subsequently refusing to consider Obama’s nominee to fill the vacant seat.

Scalia’s death appears to have slowed the two unions’ plan for a full merger. The resolution approved at SEIU’s convention holds open the possibility of a full-blown merger while immediately calling for the establishment of “unity partnerships” between the two unions at the local, state, and national levels in order to carry out joint planning, organizing, bargaining, and political work.

These “unity partnerships” sound a lot like the “unity councils” established by former SEIU President Andy Stern, which were intended to coordinate activities between SEIU locals. 

However, Stern’s manipulation of the “unity councils” -- including the Purple Palace’s blunt rigging of their votes -- was one of the actions that pushed California healthcare workers to rebel against SEIU’s top officials in 2008.

The following are excerpts from the resolution recently passed at SEIU’s convention, entitled “AFSCME and SEIU: Unstoppable Unions that Never Quit.” 

In a stunning display of their newfound coordination, the resolution’s title manages to include both SEIU’s and AFSCME’s 2016 convention themes: “Unstoppable” and “Never Quit.” Tasty can only imagine the multiple planning meetings needed to devise convention themes that could be wrapped together into a single resolution title!

AFSCME will presumably consider a similar resolution at its upcoming International Convention in Las Vegas on July 18-22. Here are the excerpts:

Our vision requires the creation of “unity partnerships” at the national, state and local levels. Unity partnerships may include some or all of the following activities: joint goal setting and planning; joint bargaining and representational activities where we have a common employer and coordinated bargaining where we represent workers in the same industry and labor market; joint setting of priorities and strategies where we deal with the same legislative and/or administrative bodies; joint political activity where we share an interest in electoral outcomes; and joint communication, legal, mobilization and research strategies and activities to support our work…

Based on the durability and effectiveness of the partnerships that are developed at the national, state and local levels, we will explore ways to deepen and expand our collaborative efforts, including consideration of an institutional merger that would formally unite the strengths of both our unions to create a new entity…

Our unions will convene a joint committee to foster the collaboration that we envision and to review and modify our process as needed. The International Executive Boards of SEIU and AFSCME shall be empowered to modify or end the collaboration between our unions described in this resolution. Any proposed structural changes must be recommended by both international Executive Boards and shall be submitted to a vote in accordance with each union’s constitution and bylaws.

While the last sentence references “a vote,” it doesn’t indicate who would be allowed to participate in the votes.

  SEIU Resolution on Cooperation and Possible Merger with AFSCME: May 2016

Leaked Document Offers Glimpse into California Hospital Association’s Arbitration Hearing against SEIU-UHW’s Dave Regan

A source has offered an interesting glimpse into last week’s three-day, closed-door arbitration hearing against SEIU-UHW. The hearing was triggered by a California Hospital Association lawsuit alleging SEIU-UHW violated a secret partnership deal.

For six months, Dave Regan has refused to appear before an arbitrator.

Recently, however, a Sacramento Superior Court judge and an appeals court both ordered Regan to stand before an arbitrator to face charges he violated the terms of his secret partnership deal with the California Hospital Association (CHA), including the deal’s far-reaching gag clause.

So… what happened at last week’s arbitration hearing?

A source has provided a 30-page document with the questions that SEIU-UHW’s attorneys posed during their cross-examination of CHA CEO Duane Dauner, who also testified at the hearing.  

The document, entitled “Dauner Cross-Examination Outline,” offers insights into the clandestine maneuvers by Regan’s rivals at SEIU, along with the shifting loyalties of his former best buddy, CEO Duane Dauner.

Under the partnership deal -- memorialized in a written contract called the “Code of Conduct” -- SEIU-UHW and the CHA set up a labor-management committee (LMC) that they named “Caring for Californians” (CFC). The LMC, which was jointly controlled by the two partnering organizations, planned to introduce a statewide ballot initiative to raise billions of Medicaid revenues to deposit into the coffers of California hospitals.

Then, in the summer of 2015, Dauner reportedly began clandestine discussions with Regan’s rivals and decided to dump Regan and instead form a partnership with SEIU California State Council, the California Teachers Association, and the California Medical Association.

CHA's Duane Dauner

The CHA joined these organizations -- known as the “ABC Coalition” -- to file an alternative ballot initiative that submarined Regan’s scheme to corral $6 billion in taxpayer funding for hospitals. 

(For discussion of the organizations’ motives in undermining Regan’s initiative, see this post.)

Regan’s simmering anger at Dauner and Regan's Purple Palace rivals is abundantly evident in the questions that SEIU-UHW attorneys fired at Dauner as he sat on the witness stand last week.

SEIU-UHW’s attorneys repeatedly sought to uncover details about Dauner’s contacts and conversations with Laphonza Butler (President of the SEIU California State Council and a close ally of SEIU President Mary Kay Henry), John Youngdahl (Executive Director of the SEIU California State Council), the California Teachers Association, and others. Here are excerpts from the document below:

Who are the members of the ABC Coalition?

Who is your contact person for each organization?

Who is your primary contact at the ABC Coalition?

Who is John Youngdahl? (SEIU State Council Executive Director)?

When did you first meet with John Youngdahl regarding the ABC Coalition?

How many times did you meet in person regarding the ABC Coalition?

Where did you meet?

Who else was present?

What was discussed?

Isn’t it true that the subject of the discussions was how to construct an alternative

SEIU's Mary Kay Henry and Laphonza Butler

initiative?

Isn’t it true that as part of the agreement outlined above the California Hospital Association made a $25 million commitment to the ABC Coalition?

And when David Regan asked you for a copy of the Agreement – you refused to give it to him, didn’t you?

And on December 3, you told David Regan that you would be supporting the ABC Coalition initiative – didn’t you?

How many e-mails did you exchange regarding the ABC Coalition?

Who else was on the e-mail chain?

What was discussed?

How many times did you speak on the phone regarding the ABC Coalition?

Contacts with Laphonza Butler, President of SEIU United Long-Term Workers

Contacts with Dustin Corcoran, CEO of California Medical Association

Contacts with California Teachers Association

When did your contacts with ABC Coalition or members begin?

Who initiated the contact?

For what purpose?

Frequency – regular, scheduled discussions versus occasional, as needed

What form where the communications: written or oral?

Duration of contacts – ended or ongoing

…SEIU-UHW’s questioning of Dauner continued:

When did you know ABC Coalition would put a competing initiative on the ballot?

SEIU's John Youngdahl

ABC Coalition asked you to stall or prevent CFC’s initiative, didn’t they?

What promises did you give to ABC Coalition?

What was your deal with ABC?

Did deal involve other CHA members of CFC’s Board?

Who?

What are the specifics of discussion with John Youngdahl?

What with the specifics of discussions with Laphonza Butler?

The 30-page document also confirms the money-for-members transaction that Regan inked with hospital CEOs, including the exchange of 30,000 non-union members for billions in new Medicaid revenues.

And it confirms that Regan and other SEIU-UHW officials (including Arianna Jimenez) attended secret meetings with hospital execs at luxury hotels in California, including the Fairmont Grand Del Mar in San Diego... where the cheapest room costs $545 a night. (pp. 6-7)

Here’s the document:

  SEIU-UHW's Cross-Examination of Duane Dauner, California Hospital Association 05-06-16 by tastysternburger

SEIU-UHW’s Dave Regan is Interrogated by California Hospital Association in Court-Ordered Arbitration Hearing

Dave Regan and Duane Dauner

SEIU-UHW’s Dave Regan is in the midst of a three-day arbitration hearing in Emeryville, Calif., where attorneys from the California Hospital Association (CHA) are questioning him over SEIU-UHW’s alleged violations of their secret partnership deal and a gag clause.

The hearing, which is taking place at the Courtyard Marriott Hotel in Emeryville, began May 5 and is scheduled to conclude tomorrow afternoon, May 7. Both Regan and CHA CEO Duane Dauner are testifying at the hearing, which is close to the public.

According to Tasty's sources, the testimony is offering jaw-dropping details about SEIU-UHW’s intimate relationship with hospital CEOs. For example…

• Regan met secretly with hospital CEOs at fancy hotels across California including a July 10, 2015 meeting at the Fairmont Grand Del Mar in San Diego, Calif., where the cheapest room costs $545 a night … and the Villa Brisa Suite will set you back $5,000 a night. 

• During the summer of 2015, Dauner began discussions with Regan’s opponents, which ultimately led him to dump Regan so he could ink an alternative deal. Testimony described Dauner’s contacts with Jon Youngdahl (Executive Director of the SEIU California State Council), Laphonza Butler (President of SEIU California State Council), Dustin Corcoran (CEO of the California Medical Association), and leaders of the California Teachers Association. Butler is a close ally of SEIU President Mary Kay Henry.

• During the summer and fall of 2015, Dauner had multiple phone conversations with California Gov. Jerry Brown about plans for ballot initiatives to pour billions more dollars into hospital industry coffers.

The arbitration hearing, now under way in Emeryville, was ordered by a Superior Court judge. After

Regan met with hospital CEOs at the Fairmont Grand del Mar

the CHA first requested arbitration to deal with SEIU-UHW’s multiple alleged violations of their secret partnership deal, Regan simply refused to show up.

The CHA then sued SEIU-UHW in Sacramento Superior Court. 

In March, a judge ordered Regan to submit to binding arbitration. 

And just three weeks ago, SEIU-UHW lost a last-ditch appeal to escape the arbitration hearings, thereby landing him in the Emeryville hotel to be questioned by CHA attorneys.

Stay tuned! 

Ballot Initiative Backlash: SEIU-UHW's Dave Regan Tried to Snatch Billions from California's Schoolchildren

In a fit of anger, Dave Regan recently sued the California Hospital Association and penned an angry attack against SEIU officials (entitled "The Shame of SEIU") after his erstwhile pals joined hands to introduce a statewide ballot initiative that competes head-to-head with Regan's own initiative.

Regan's initiative is designed to deposit billions of dollars a year into the hospital industry's pocket, a massive payoff he must deliver before industry bosses will allow SEIU-UHW to put tens of thousands of non-non-union hospital workers into cheap, pre-negotiated labor contracts that ban them from striking.

Why did SEIU officials team up with the CHA to undermine Regan's initiative?

It turns out that Regan's ballot initiative was horribly designed. According to one knowledgeable source, "It would have blown a multi-billion-dollar hole in the state budget" by re-directing billions of state tax revenues -- currently used to fund public schools -- into hospital bosses' pockets.

By cutting school funding, Regan also would have destabilized funding for other government services as budget-makers shift budget dollars to make up for lost revenues.

That's why the California Teachers Association teamed up with the SEIU California State Council, headed by Laphonza Butler, to introduce a competing ballot initiative ("School Funding and Budget Stability Act") to preserve funding for public schools.

SEIU represents approximately 95,000 California state employees through its Local 1000. Other locals, such as SEIU Local 99, SEIU Local 521 and SEIU Local 1021, represent tens of thousands of teacher assistants, cafeteria workers, and other public education workers. California's students have suffered devastating budget cuts during the Great Recession that forced massive teacher layoffs and skyrocketing classroom sizes.

So, umm,... who was the genius at SEIU-UHW who wrote a ballot initiative to strip money from schoolchildren and from SEIU's own public-sector members?

Dave Kieffer: ballot initiative genius

Sources say it was Dave Kieffer. 

Kieffer, who was involved in trying to cover up the Tyrone Freeman corruption scandal, was pushed out of his job at the SEIU California State Council in 2013 and now serves as "Director of Governmental Relations" at SEIU-UHW.

He was the architect of an earlier money-for-members scheme by which SEIU officials tried to trade billions in taxpayer-funded Medicaid dollars for tens of thousands of workers at nursing homes.

Way to go, Dave.

All of this helps explain why analysts are penning articles like this one, entitled "Shrinking Political World of UHW President Dave Regan," which begins:

We've been chronicling the ever-shrinking political world of union President Dave Regan, see here, here and here, for a while now, and recent news highlights his dwindling power.

Kablam! SEIU-UHW Dave Regan’s "Partnership" with the California Hospital Association Crashes and Burns

Plaintiff Regan and Defendant Dauner

In case there was any doubt about the implosion of Dave Regan's partnership with the California Hospital Association (CHA), check out the latest news...

On November 24, SEIU-UHW sued the CHA’s CEO Duane Dauner in Sacramento County (Calif.) Superior Court for ditching Regan in favor of his new pals Mary Kay Henry, Laphonza Butler, Jon Youngdahl, the SEIU California State Council, the California Teachers Association, and the California Medical Association.

The full lawsuit is available below. Also, here’s a link to a Dec. 1 article in "Courthouse News."

Regan’s lawsuit -- which reads like a jilted lover’s divorce case -- revolves around Mary Kay Henry’s recent success in outmaneuvering Regan by inking her own secret deal with the CHA.

Under Henry’s deal, the CHA agreed to team up with the SEIU California State Council, the California Teachers Association and the California Medical Association to introduce a statewide ballot initiative that competes head-to-head with Regan’s initiative. Regan's ballot initiative was supposed to be the "centerpiece" of SEIU-UHW’s ongoing partnership and organizing deal with the CHA.

Not anymore. The CHA has pulled its support from Regan's initiative, which is now "certain to fail," according to the lawsuit.

 

Mary Kay Henry and Laphonza Butler

Basically, the CHA has declared an end to its "partnership" with SEIU-UHW, thereby jettisoning Wall Street Dave like a pair of old shoes. That means an end to Regan's plans to unionize 60,000 hospital workers under a sweetheart deal that gags healthcare workers, bans them from striking, and forces them into contracts with substandard wages and benefits… which Regan famously called an "audacious new proposal to save the labor movement."

This ain't good news for Regan.

He’s poured $15-20 million of SEIU-UHW members' dues into his failed partnership with the CHA. And he’s staked SEIU-UHW's entire future -- including its membership growth and labor relations strategies -- on a partnership that's been relegated to the trash bin.

No wonder Dave is coming unhinged.

Last month, he penned an angry letter ("The Shame of SEIU") in response to SEIU's secret deal with the CHA, in which he wrote he's "repulsed and disgusted" by SEIU officials who are selfishly pursuing "control, internal power and organizational dominance."

He also sent a ranting letter to CHA's members in which he personally attacked his former bedmate, CHA CEO Duane Dauner.

In Dave’s latest act of vengeance, he filed a 23-page lawsuit against Dauner and three other CHA officials… including Greg Adams, a top Kaiser Permanente executive who also serves as the chair of the CHA's Board of Directors. Mark Laret, the CEO of UCSF Medical Center, is another defendant.

Regan's attack on Kaiser's Greg Adams is intriguing and may signal the unraveling of SEIU-UHW’s partnership with Kaiser. According to Regan's suit, Greg Adams "accepted and enabled" the CHA's decision to throw SEIU-UHW under the bus. In addition, Adams "agreed to shut down" the CHA's labor-management cooperation committee with SEIU-UHW, according to the suit, effectively putting the kibosh on Regan's partnership with the CHA.

Defendant Greg Adams, Kaiser Permanente

Here are some excerpts from Regan's suit, which predictably contains plenty of ranting and raving. For example, the lawsuit calls Dauner "corrupt" in its opening line.

The suit also makes interesting claims about secret meetings and clandestine maneuvers carried out by Purple Palace officials in their plot against Regan, as well as the impact of SEIU’s recent decision to strip 80,000 members from SEIU-UHW and transfer them to "SEIU Local 2015."

The following excerpts refer to the two groups that have introduced competing ballot initiatives: the "ABC Coalition" (i.e., the CHA, SEIU California State Council, the California Teachers Association, and the California Medical Association) and the "CFC" (SEIU-UHW).

At or around the same time CFC was developing its idea of a ballot initiative to fix and fully fund the Medi-Cal program, a separate coalition that includes the California Teachers Association ("CTA"), the California Medical Association ("CMA"), and the SEIU State Council ("State Council) (collectively known as the "ABC Coalition"), began to develop a competing ballot initiative…

Defendant Dauner intentionally opposed the filing of CFC's initiative prior to the filing of the ABC Coalition's initiative for a nefarious purpose -- that is, in order to put CFC's initiative at a disadvantage, while providing both a strategic and procedural advantage to the ABC Coalition. Defendant Dauner, however, kept to himself the fact that he had been secretly working with the ABC Coalition to undermine CFC's initiative…

In or around March 2015, Defendant Dauner had been secretly meeting with members of the ABC Coalition, although the ABC Coalition had not yet been formally organized…

During this same period, Defendant Dauner also met with representatives of the SEIU State Council in order to keep them informed of the business of CFC, including but not limited to CFC's confidential "Strategic Plan." The SEIU State Council is led by Jon Youngdahl ("Youngdahl"), who is the Executive Director of the State Council, and Laphonza Butler ("Butler"), who is the President of the State Council.

In addition, Butler is the President of the SEIU, United Long-Term Care Workers ("ULTCW") as well as the provisional President of SEIU, Local 2015. Local 2015 represents approximately 285,000 home-care and nursing home workers m California… Local 2015 is the result of a merger of home care and nursing home members from three SEIU-affiliated Unions: SEIU Local 521, ULTCW, and UHW. As a result of the merger, UHW lost half its membership to Local 2015.

Prior to the merger, representatives of the SEIU State Council informed Defendant Dauner that Regan would soon lose half of UHW's membership and that Defendant Dauner needed to deal with Butler and the State Council – not Regan and UHW – if he wanted to accomplish any legislative and policy goals that were important to CHA's members.

Beginning in or around March 2015, Defendant Dauner decided to work covertly with CMA, the SEIU State Council, and CTA, while duplicitously pretending to carry out his duties as a Director and Officer in the interest of CFC.

Defendant Dauner chose to work with the ABC Coalition for several reasons. First, he feared CTA's political reach in Sacramento. Second, he no longer wanted to be involved in a "strategic partnership" with UHW because the partnership was threatening his power within CHA, and members of CHA were calling for an end to the partnership for ideological reasons. Third, he believed that he could take advantage of an internal SEIU disagreement between Butler and Regan regarding the transfer of UHW members into Local 2015…

On November 2, 2015, Defendant Dauner requested a conference call with Regan and multiple other persons, including other Directors of CFC to discuss CFC's initiative and his agreement with the ABC Coalition.

On the call, Defendant Dauner revealed that he had been secretly meeting and negotiating with the ABC Coalition regarding its competing initiative…

Defendant Dauner explained that he had engaged in these covert actions because the CHA Board of Directors had instructed him to do so and that a "substantial number of hospitals," affiliated with CHA did not want CHA to participate in CFC or to continue its partnership with UHW. The reason that a substantial number of hospitals wanted to end the strategic partnership between CHA and UHW is because these hospitals are philosophically opposed to the unionization of the hospital industry and seek to remain non-union so that they may continue, without interference, to provide their employees substandard working conditions, pay, and benefits. Because the ABC Coalition does not consist of any labor organization that seeks to organize hospital workers in California, working with the ABC Coalition is preferred over working with UHW.

During the call, Defendant Dauner revealed that his discussions with the ABC Coalition had led to a written agreement, executed by and between CTA, CMA, and the SEIU State Council and Defendant Dauner and CHA.

According to Dauner, the agreement with the ABC Coalition provides that Defendants and CHA will jointly sponsor, and contribute financially to the ABC Coalition's The School Funding and Stability Act of 2016 that is in direct competition with CFC's initiative, Invest in California's Children Act.

Defendant Dauner further agreed to "to veto any expenditure" to support CFC's initiative, and [Kaiser’s Greg] Adams, [UCSF’s Mark] Laret and Holmes agreed to support Dauner in this cessation of CFC's activities. Thus, the CHA Directors agreed to terminate all of CFC's operations by using Defendant Dauner's veto power.

Put otherwise, Defendant Dauner agreed to use his position of power to quash CFC's initiative and to support the ABC Coalition's competing initiative, and the other CHA Directors accepted and enabled this decision. As a result, lacking any financial support, CFC's initiative is certain to fail and the ABC Coalition's initiative will have no effective opposition…

Adams, Laret and Holmes approved this sale after the fact and have since agreed to shut down CFC as part of the deal with the ABC Coalition…

On November 18, 2015, Defendants spoke with Regan regarding the ABC Coalition's initiative. Defendants pleaded with Regan to dissolve CFC. Regan, however, refused to agree to dissolution. In accordance with his agreement with the ABC Coalition, Defendant Dauner stated that he would exercise his veto power, as Co-Chair, on any and all decisions that came before CFC regarding expenditures related to CFC's initiative, which CFC had unanimously voted to file and fund.

The lawsuit alleges that Dauner, Kaiser's Greg Adams, and CHA officials have committed fraud, concealment, breach of fiduciary duty, "conversion," "trespass to chattel," and other "fraudulent or dishonest acts or gross abuse of authority or discretion." It seeks to force the CHA to pay financial damages to SEIU-UHW and also seeks the removal of the CHA's Dauner from his position as a co-chair of the joint labor-management committee set up by the CHA and SEIU-UHW. Regan is the other co-chair.

More details are available in the full lawsuit below.

Stay tuned for more analysis and commentary!

  SEIU-UHW's Lawsuit against Duane Dauner, Greg Adams and the California Hospital Ass'n, Nov. 24, 2...

SEIU-UHW's Dave Regan Launches New Attacks against SEIU Leaders: "The Shame of SEIU"

A source has leaked two letters penned by SEIU-UHW's Dave Regan that describe his deepening war with SEIU leaders. (The letters are viewable below.) 

In June, Regan leaked an earlier attack memo to the press that targeted SEIU President Mary Kay Henry ("Who’s Gonna Bell the Cat?").

In his latest letters, Regan says he is "repulsed and disgusted" by SEIU’s leaders who are selfishly pursuing "control, internal power and organizational dominance."

And that's just the beginning of Regan's rant.

In an "Open Letter to Leaders in SEIU" entitled "What Has Become of Us? The Shame of SEIU," Regan accuses SEIU’s leaders of being "consumed with power and domination in the service of nothing but appetite."

In case Regan's phrasing seems a bit whacky ("in the service of nothing but appetite"), Dave's letter also includes a quote from William Shakespeare.

So, uh… what prompted Dave's latest poison pen attack against SEIU President Mary Kay Henry and SEIU officials?

 

SEIU-UHW's Dave Regan

It appears that Purple Palace officials have stepped up their war against Regan following their earlier successful effort to slash SEIU-UHW’s membership by 60,000 members.

In recent weeks, SEIU officials outmaneuvered Regan by inking their own secret deal with the California Hospital Association (CHA), thereby driving another nail into the coffin of Regan's secret pact with the CHA… which, by the way, has been languishing on its deathbed for months.

How did the SEIU officials do it?

According to the terms of Regan's CHA deal, Dave is required to secure billions of dollars of new government revenues for California hospital companies in order to win the right to unionize 100,000 hospital workers. In recent weeks, however, Purple Palace officials teamed up with the California Teachers Association, California Governor Jerry Brown, and the CHA to sponsor an initiative that undercuts Regan's scheme for delivering billions of dollars to the hospital bosses.

This "chess move" has Regan spitting mad.

SEIU's Henry and Butler

In his two letters, Dave personally attacks Gov. Jerry Brown, the California Teachers Association, the Hospital Association, Laphonza Butler (President of the SEIU California State Council), Jon Youngdahl (Executive Director of the SEIU California State Council), and other SEIU leaders.

Oh, and Regan also attacks his former bunkmate, Duane Dauner (the CEO of the California Hospital Association), for inking a backroom deal with his SEIU rivals. 

Regan is so angry that he sent a letter to the CHA's membership trashing Dauner for being weak and ineffective, for selling out his members' interests, committing "monumental failures," and (more generally) for "the failure of Duane Dauner." 

Nice.

Talk about burning bridges. Regan's hate mail appears to signal that his "visionary," 21st century deal with the CHA is as dead as a doornail.

In SEIU's second attack on Regan, SEIU recently announced it’s sponsoring a statewide ballot initiative in California that competes directly with one that SEIU-UHW has been pursuing for months. Essentially, the SEIU California State Council and various SEIU local unions across the state are waging a head-to-head ballot fight against SEIU-UHW, which the Los Angeles Times describes this way in a recent article:

The fractious internal politics of one of California’s most powerful unions spilled into the movement to raise the statewide minimum wage Tuesday, as one wing of the Service Employees International Union announced a proposed ballot initiative that would compete with a measure backed by another branch of the labor group.

In his recently leaked letters, Regan attacks SEIU officials for conducting secret talks with the CHA:

SEIU's Jon Youngdahl

"These meetings with the Association representing all of UHW's hospital employers were never disclosed by either Butler or Youngdahl to UHW and clearly were intended to undermine and destabilize the hospital organizing work UHW was told to 'focus' on."

He goes on to attack SEIU's national leadership for being "insecure and weak" and also accuses them of "sabotage," "threats," "retaliation," and "impunity."

Here's more from Dave:

What are the implications for SEIU as a whole when the elected leader of the State Council takes it upon herself to secretly communicate with another local's employers and the employer Association for the sole purpose of sabotaging both the organizing and political work of that local?

What are the implications for the health and future of SEIU when UHW is forced to pay $2.5 million per year -- or be threatened with all manner of retaliation -- to a State Council that has license from the national leadership of SEIU to sabotage with impunity the legitimate work of UHW?

What does it mean when the national leadership of our union, and the state leadership of our Council, is so insecure and weak that they could even contemplate, let alone act upon, the sort of destructive behavior have recently been subjected to?

CHA's Duane Dauner

Cry me a river, right? 

It's always quite entertaining to see Backroom Dave -- whose snake-like qualities have never been mistaken for moral righteousness -- try to portray himself as the innocent victim of unscrupulous evildoers. 

Yo Dave, what goes around comes around. Ain't karma a b*tch.

Stay tuned for the next act of Dave’s Shakespearean drama.

Meanwhile, here are Regan's two letters.

  Dave Regan's Open Letter to SEIU: "The Shame of SEIU" (Nov. 2015)

  SEIU-UHW Dave Regan's letter to Members of the California Hospital Association on Duane Dauner (Novemb...