FBI takes another run at 'Johnny Doc.' What is it after?

John J. Dougherty, leader of the Philadelphia electricians union, has shaken off FBI scrutiny before.

But a decade after federal authorities last tried to build a case against him, Dougherty and his 4,700-member union appear to be in the crosshairs of an even more aggressive legal assault.

For the last month, FBI raids on union offices and homes and businesses of key allies have signaled the existence of a multipronged investigation into the influence the union has wielded at job sites and polling booths for decades.

Through search warrants and subpoenas, investigators are undertaking an expansive examination of the levers by which Local 98 of the International Brotherhood of Electrical Workers exerts its clout - from prolific giving to political campaigns and the network it has built across all levels of government to allegations of work-site intimidation and misspent funds meant to foster union jobs.

Former federal prosecutors say the investigation appears to have the hallmarks of a classic racketeering conspiracy case - a charge the U.S. Attorney's Office here used recently to convict Rep. Chaka Fattah (D., Pa.) and members of another city union, Ironworkers Local 401.

"I don't think they'll hesitate to use RICO if they think it fits," said William DeStefano, a Center City white-collar defense lawyer. "They have the organization - the electricians union - they just have to find the [criminal] acts."

Publicly, Dougherty, known widely as "Johnny Doc," has expressed only confidence. In a letter to the membership, he vowed to fight a "comprehensive attack upon multiple aspects of Local 98."

Privately, though, there are signs of concern. Since the Aug. 5 FBI raids, which included the City Hall offices of Councilman Bobby Henon, Local 98 has circled its wagons.

A team of lawyers representing figures at the heart of the probe has begun strategizing. Meanwhile, suspicions of possible wiretaps and FBI cooperators within their ranks dominate talk among the membership, union members say.

The union is also grappling with a state inquiry that appears to be covering much of the same ground.

Sources close to both investigations say there has been little to no coordination between the two - so little that when the FBI arrived at the Philadelphia office of the attorney general last month to serve a warrant for the computer of Joseph Ralston, a veteran narcotics agent and childhood friend of Henon, state investigators were caught off guard.

So what has changed since federal authorities last sought to land Dougherty in a courtroom?

In 2006, investigators targeted Dougherty and a South Philadelphia electrical contractor - Donald "Gus" Dougherty Jr., no relation to the union chief but a childhood friend - alleging they had hidden financial transactions involving work on John Dougherty's East Moyamensing Avenue home.

Ultimately, only Gus Dougherty was charged. He pleaded guilty to 99 counts including theft, tax evasion, and making false statements to federal authorities and was sentenced to two years in prison.

Since then, John Dougherty's influence has only grown. Last year, Local 98 helped propel Mayor Kenney into office and Dougherty's brother, Kevin, onto the Supreme Court, while Dougherty himself became head of the Philadelphia Building and Construction Trades Council, which represents nearly 40 regional unions.

Now, investigating a man with a larger footprint, federal authorities appear to have more ambitious goals. The number of sites targeted by search warrants and subpoenas in the last month suggests an investigation with years of work behind it, said L. George Parry, a defense lawyer and former federal prosecutor.

"To put together the kind of probable cause needed for search warrants on more than a dozen separate locations indicates to me that they have been working on this investigation for a very long time, and they're quite sure of the information that they've got," he said.

Here is what is known so far about the areas that have drawn investigators' attention:

Market-recovery funds

Six years after Gus Dougherty's release from prison, his South Philadelphia company, Dougherty Electric, remains a top recipient of payments from a union fund that has drawn fresh attention from federal investigators, sources familiar with the probe said.

Local 98's market-recovery fund, like similar funds in the other building trades, is meant to allow union contractors to discount their bids when competing against nonunion competitors with lower labor costs. The goal is to keep the business with union contractors who hire union workers.

Last year, Local 98 paid nearly $900,000 from the fund to companies, including Dougherty Electric. The money goes directly to the contractor, typically to offset all or part of its required contributions to Local 98's benefit funds.

In pleading guilty in 2008, Gus Dougherty admitted to shorting such payments and spending $527,625 in market-recovery money he was paid for personal use.

Yet, Dougherty Electric continued to receive market-recovery money - $470,000 since 2011 - despite an ongoing disagreement over whether Dougherty still owes the union restitution for his crimes.

In 2011, Gus Dougherty and the union told the federal court that they had agreed that Dougherty would pay $200,000 in restitution for his crimes, less than a third of what was originally owed. A judge still has not approved the deal. Federal prosecutors have questioned whether the "purposed settlement" reflects a true "arms-length" agreement and have asked the court to reject it.

The year the agreement was struck, Dougherty Electric received $170,000 in market-recovery payments.

State authorities and FBI agents have also taken an interest in recent altercations involving electricians union members. Sources familiar with the probe said investigators have recently pulled case files and police reports for at least five confrontations in South Philadelphia, including two near a work site at Third and Reed Streets.

In May 2014, Dougherty reported being hit in the head by a brick thrown by a nonunion crew of electrical workers at the site. The crew said Dougherty hurt himself when he stumbled as several Local 98 members advanced menacingly toward them.

Police reports indicate that both sides threw objects. No charges were filed.

Another fight broke out at the site in January - this time caught on video surveillance footage.

Nonunion electrician Joshua Keesee said Dougherty, backed by three Local 98 members, lost his temper during a confrontation and pummeled him with his fist. A spokesman for Dougherty maintains that the union leader "was not the aggressor" and that Keesee had taunted Dougherty and threatened his family.

Federal investigators have also interviewed nonunion contractors who have lodged complaints of intimidation by Local 98, including the monthslong picketing of a multimillion-dollar apartment rehab in Philadelphia's Loft District.

The rehabbers said protesters blocked work crews and stationed an inflatable rat at the home of one of the developers.

The tactics worked. The developers said they would use only union labor for their next project.

For his part, Dougherty has defended his union's right to lawfully protest nonunion work sites.

Political activities

Since Dougherty assumed Local 98's top post in 1993, he has made the union a formidable force in Pennsylvania politics, undercutting the sway developers have traditionally had in that realm.

Union money and manpower has helped elect mayors, City Council members, county commissioners, members of Congress, state legislators, governors, and at least 60 judges, including the union leader's brother, Kevin Dougherty, and five other state Supreme Court justices.

Local 98's political action committees and affiliated independent expenditure groups have distributed more than $30 million in campaign funds at the state and local levels since 2000.

But the union's backing of Kenney for Philadelphia mayor has drawn scrutiny.

Last month, Kenney's campaign committee received a federal grand jury subpoena for financial records. The mayor has said he does not believe that he or other members of his administration or campaign are targets in the federal probe.

Beyond the union's campaign giving, federal authorities appear to have taken a broader interest in the network of political allies built through Local 98's largesse.

Among the sites raided Aug. 5 were offices of City Councilman Henon, a former Local 98 political director who still holds a $72,000-a-year post with the union, and the South Philadelphia home of Marita Crawford, who followed Henon as political director.

Agents have also searched the Pennsport home of James Moylan, John Dougherty's chiropractor, who was appointed by Kenney earlier this year to lead the city's Zoning Board of Adjustment.

Sources familiar with the investigation say agents are also examining Local 98's influence in the city's courts.

'Force for change'

Despite the intense federal attention, Dougherty has shown no signs of being rattled.

Last week, he kept a busy schedule, meeting with state lawmakers to discuss unemployment compensation benefits for union workers and advocating for the restoration of the state's tax-credit program for film and TV production, said Local 98 spokesman Frank Keel. And when city officials gathered Thursday to announce that next year's NFL draft would be held in Philadelphia, former Eagles quarterback Ron Jaworski singled out Dougherty as having helped bring the event to the city.

"There's a lot of speculation over whether these investigations are impeding Local 98's daily operations or deterring John Dougherty from continuing to move the union and the city forward," Keel said in a statement. "That's hardly the case. . . . IBEW Local 98 and John Dougherty are continuing to be forces for positive change in Philadelphia."

Source: Philly.com