Oberstar holds committee hearing as favor to campaign donor

CHAIRMAN'S PEROGATIVE - House Transportation Chair Jim Oberstar assembed a committee meeting after being asked to do so by a controversial campaign donor.

House Transportation Chairman James Oberstar, D-MN, scheduled a committee hearing at the request of a controversial campaign donor a week after the man formally contacted Oberstar, and just days after he contributed to the Minnesota Democrat’s re-election committee, an investigation by the Majority Accountability Project (www.majorityap.com) has found.

Majorityap.com research also found that Oberstar, who formed a new political fundraising committee at the time of the hearing (his first such committee in more than 30 years in Congress), received $12,000 in campaign donations from lobbyists and firms whose representatives testified at that same hearing.

JUNGBAUER ASKS FOR, GETS HEARING
William Jungbauer, a personal-injury lawyer specializing in claims by railroad workers, was a lead witness in a hearing Oberstar convened October 25, 2007, entitled “The Impact of Railroad Injury, Accident, and Discipline Policies on the Safety of America's Railroads.”

In an earlier letter to Oberstar, Jungbauer complained that rail companies are actively discouraging employees from filing personal injury claims. “Railroad workers who file personal injury reports are being harassed by their employers on a nationwide basis,” Jungbauer charged on July 24, 2007.

Similarly, Oberstar said the hearing would “examine allegations…suggesting that railroad safety management programs sometimes either subtly or overtly intimidate employees from reporting on-the-job injuries.”

Jungbauer followed up his letter with a $1,000 contribution to Oberstar on July 31, 2007, the latest in a series of $16,100 in donations Jungbauer and his associates gave Oberstar in 2006 and 2007.

On August 1, 2007, committee staff scheduled the hearing and, according to Capitol Hill sources, indicated it was being done as a favor to Jungbauer. A client of Jungbauer’s also testified.

Prior to the hearing, Jungbauer’s website asked union members to send him “questions you would like myself or Members of Congress to ask of rail executives on the issue of harassment and intimidation of injured rail employees.”

Jungbauer, also from Minnesota, is no stranger to controversy.

KICK-BACK SCHEME
A four-year federal investigation found that private injury lawyers had been paying as much as $30,000 each in kickbacks to officials with the United Transportation Union (UTU), in order to be put on a list of "designated legal counsels" who handled personal-injury lawsuits for rail workers.

The probe netted guilty pleas from then-UTU International President Byron Boyd, his predecessor, Charles Little, and two other union officials for labor racketeering conspiracy. UTU is the nation’s largest railroad worker union.

According to a 2004 article appearing in the Cleveland Plain Dealer, “thirty-seven lawyers were granted court-ordered immunity to testify about UTU deals. They gave information on 159 incidents of money changing hands.”

“The lawyers, identified by numbers in the indictments, made up most of the designated counsels working for the UTU between 1995 and 2003,” the paper reported.

“Although any lawyer can represent an injured union member,” the Houston Chronicle noted, “those on the designated counsel list had the union’s imprimatur and easier access.”

Because a 1908 federal law - the Federal Employers Liability Act (FELA) - allows unlimited damages to be paid to injured railroad workers, “so many lawyers wanted to represent those workers they were willing to bribe union officials,” the paper reported.

In the wake of the scandal, new leadership at the UTU imposed safeguards in designating preferred counsels, including the institution of an ethics board led by Josh Javits, son of former New York Senator Jacob Javits and former Chairman of the National Mediation Board.

The UTU also sent affidavits to the union’s designated legal counsels serving during Boyd’s term, requiring them to attest that they had no involvement in the kickback scheme. Jungbauer’s firm refused to respond to that request.

Quizzed at the October hearing by U.S. Representative Henry Brown about his connection to the case, Jungbauer would say only that he had no personal involvement, even though his firm had been a UTU designated legal counsel during the federal probe.

“I have never been designated by the UTU…as a legal counsel,” Jungbauer responded, although acknowledging “a partner in my firm was a designated legal counsel (DLC) of the UTU.”

Jungbauer was asked several times about his possible involvement but demurred, noting only the connection to his partner.

Despite the fact that neither Jungbauer nor any member of his firm has been publicly implicated in the scandal, his relationship with the UTU remains strained, according to sources. His ability to garner a hearing by Oberstar might aid in rebuilding those relations, they speculated.

CASHING IN
Others speculated to majorityap.com that Oberstar sees a major political opportunity in revamping the century-old law that governs damges paid for railworker injuries. Changing FELA to a workers’ compensation system that limits workers’ financial claims would be a financial relief to rail companies, while continuing to allow unlimited damages is critical to rail worker unions and trial lawyers.

And Oberstar is already getting cash from both sides of the debate.

On July 31, 2007 – the day before the hearing was planned – Obserstar formed a leadership PAC, the Mesabi Fund. Named after Minnesota’s heavily mined Mesabi Iron Range, the PAC is Obserstar’s first in more than three decades in Congress.

A comparison of FEC records and the Transportation Committee’s witness list found that, in addition to Jungbauer, five groups providing testimony contributed to Oberstar’s PAC.

Labor groups who donated, and whose representatives testified at Oberstar’s October 25 hearing, included the United Transportation Union ($5000) and the Brotherhood of Locomotive Engineers ($2500). Companies who both donated and contributed were BNSF Rail ($1000), Norfolk Southern, whose lobbyist donated $1,000, and the Association of American Railroads, $2500.