Wackenhut: SEIU is rigging security services contracts

Company files suit against SEIU alleging damages of $5 million


PALM BEACH GARDENS, Fla., April 11 -- The Wackenhut Corporation today filed a civil action against the Service Employees International Union Local 1 responding to the union's entry into and maintenance of an illegal agreement with the Building Owners and Managers Association of Chicago (BOMA/Chicago).

The lawsuit, which is based on the agreement in effect from April 26, 2004 through April 29, 2007, seeks damages in excess of $5 million.

"SEIU's illegal agreement not only violated the labor laws, but also injured customers of security services in Chicago by eliminating competition for security services in Downtown Chicago office buildings. As a result, customers were denied a choice and paid artificially more for security guard services," said Daniel Murphy, Corporate Counsel of The Wackenhut Corporation.

According to the suit, Wackenhut suffered damages as a result of SEIU's illegal agreement with BOMA/Chicago by being denied the opportunity to bid on contracts and lost bids as a result of a "hot cargo" agreement. The agreement required all security companies that wanted to do business with BOMA/Chicago members to be affiliated with SEIU Local 1, to agree to minimum wages and benefits mandated by the SEIU, and to contribute to SEIU Local 1's pension fund.

Additionally, beyond private security contractors, the illegal agreement caused harm to customers, who paid more for security services or paid the same price for inferior security services than they would have absent SEIU Local 1's illegal agreement.

In a major labor ruling on December 21, 2007, a National Labor Relations Board Administrative Law Judge held that "hot cargo" agreements violated Section 8(e) of the National Labor Relations Act.

Filed in the U.S. District Court for the Northern District of Illinois, the lawsuit alleges violations of Sections 1 and 2 of the Sherman Act, 15 U.S.C. Sections 1, 2, and Sections 8(e), 8(b)(4) and 303 of the National Labor Relations Act, as amended, 29 U.S.C. Sections 158(e), 158(b)(4), 187, and seeks treble compensatory damages and costs from defendant SEIU Local 1.