Judge Richard Berman
As its executive secretary treasurer, Bilello held the highest office in defendant labor union. Pursuant to the union's March 1994 consent decree with the government, Walsh was appointed as review officer on June 2, 2010, and vested with authority to review—and remove from office ("veto")—persons currently holding office or employment within the union. Bilello appealed Walsh's veto grounded on Bilello's violation of five "specifications" or charges including, but not limited to, signing a rate increase document—contrary to union bylaws—by which Bilello attempted to divert more than $900,000 to a union welfare fund. Bilello was also charged with failing to cooperate in an investigation by Walsh by providing Walsh with certain false statements. The court denied Bilello's appeal, deeming his veto by Walsh neither arbitrary nor capricious and supported by substantial evidence. As the union's highest official Bilello was required to follow the bylaws. His failure to do so was a breach of fiduciary duty. Further noting the union's history of pervasive mismanagement and corruption, the court observed that there was a continuing need for zero tolerance of official misfeasance and malfeasance at defendant labor union.
