Dave Regan and SEIU-United Healthcare Workers West, the California labor union supporting a proposed billionaire tax, are facing allegations of using mob-style “shakedown” tactics to pressure small health care providers, according to a newly filed lawsuit.
The 67-page complaint, filed Sept. 18 in the U.S. District Court for the Eastern District of California, accuses Regan and the union of engaging in “unlawful and extortionist practices.” It claims the organization spent millions of dollars in union dues on contentious ballot initiatives to force community health centers and other providers into making concessions.
Proposition 44 is cited in the lawsuit as a central example of the union’s alleged strategy.
Backed by SEIU-UHW after a similar legislative proposal failed last year, Prop. 44 would require clinics to direct 90% of their revenue toward patient care. Providers that fell short could face state penalties under the measure.
According to a news release about the lawsuit, the union allegedly offered to withdraw Prop. 44 in return for an agreement governing union elections at clinics. The proposed deal reportedly included a demand that the clinics provide SEIU-UHW with 25,000 additional union members.
The plaintiffs, including several small health clinics, say the alleged conduct violates the federal Racketeer Influenced and Corrupt Organizations Act, or RICO. They describe the union’s actions as part of a “sustained racketeering scheme.”
The complaint claims SEIU-UHW has repeatedly used expensive and polarizing ballot campaigns as leverage to seek money, property, access, confidential information and influence over business operations and labor policies—interests the plaintiffs argue are protected as “property” under federal and California law.
“It’s inexcusable that Dave Regan and UHW have orchestrated a multi-year campaign of threats and bullying that would inflict crippling damage on health centers like ours and the patients we treat,” Brandon Thornock, CEO of plaintiff Shasta Community Health Center, said in a statement.
Jo Cambell, CEO of Hill Country Community Clinic, described the union’s conduct as a “repulsive act of politics.”
“In rural Northern California, community health centers are the only source of care for hundreds of miles. Prop 44 would have devastating effects for patients across our region,” Cambell said.
The other plaintiffs are the California Primary Care Association, Mountain Valleys Health Centers, Centro de Salud de la Comunidad de San Ysidro, Inc., and McCloud Healthcare Clinic, Inc.
The lawsuit also alleges that SEIU-UHW has directed $216 million in union-dues money toward dozens of ballot initiatives.
SEIU-UHW rejected the accusations, calling them “categorically false.”
“This is the second time the [California Primary Care Association] has attempted to use legal filings to bully SEIU-UHW members into backing down from holding clinics and their CEOs accountable to the patients and communities they are supposed to serve,” a union spokesperson said.
The spokesperson pointed to an earlier CPCA lawsuit seeking to keep Prop. 44 off the ballot, saying that case was dismissed. The union said the judge criticized the effort to stop SEIU-UHW members from using the ballot initiative process, quoting the judge as asking: “Isn’t that what democracy allows them to do? You want to take that power away from the people — that is what you are asking me to do?”
SEIU-UHW has defended Prop. 44 as a reform measure that would “increase transparency, reduce wasteful executive spending, and ensure clinic healthcare dollars go where they belong: caring for Californians in need.”
The lawsuit is not the first public accusation involving Regan’s conduct.
Courtni Pugh, a former SEIU executive who now works as a political consultant leading the campaign against the billionaire tax, accused Regan of assaulting her in 2009.
The allegation surfaced during one of two law-firm investigations into Regan’s behavior. The reviews followed complaints filed this year alleging intimidation and bullying by the labor leader. One report substantiated claims that Regan threatened and intimidated women on the SEIU state council in an effort to pressure them into supporting the billionaire tax.
Representatives for Regan denied the allegations, arguing that they were driven by political disputes.
“At the center is a trumped-up claim from 17 years ago that comes less than two months before the billionaire tax goes to the voters — a claim from someone whose firm is being paid handsomely to work against the billionaire tax,” SEIU-UHW officials previously said, referring to the allegation from Pugh.
This is a developing story and will be updated.
