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The Honolulu Advertiser
Posted on: Thursday, December 11, 2008

UPW sued by convicted ex-director

By Jim Dooley
Advertiser Staff Writer

From federal prison, former United Public Workers director Gary Rodrigues is suing the union, claiming he is not responsible for repayment of an $850,000 debt.

The dispute centers on investments made in 1998 and 1999 by a union trust fund while it was administered by Rodrigues.

The trust fund sued Rodrigues in 2003, alleging that the investments, in a company called Best Rescue Systems Inc., were imprudent.

Best Rescue Systems was purportedly developing equipment and technology to rescue people trapped by emergencies in high-rise buildings.

The company later filed for bankruptcy, and the financial adviser who recommended the investment to Rodrigues, Albert Hewitt, was convicted of federal criminal charges related to the Best Rescue investments.

Rodrigues was convicted in 2002 of unrelated money laundering, mail fraud and embezzlement charges.

In 2003, U.S. District Judge David Ezra sentenced Rodrigues to 60 months in prison and ordered him to pay fines and restitution totaling $450,000. After exhausting a series of appeals, Rodrigues began serving his prison sentence in January.

In a nonjury civil trial in February and March, Ezra ruled that Rodrigues is liable for repayment of $850,000 of $1.1 million invested in Best Rescue Systems.

On Tuesday, Eric Seitz, attorney for Rodrigues, filed a new suit in state court, alleging that the United Public Workers should be responsible for the debt.

The investments were made by the union's Mutual Aid Trust, which Rodrigues administered for the union, the suit said.

Rodrigues was acting on behalf of the union when he made the investment decisions and the union should be held liable for the $850,000 judgment as well as for more than $90,000 in related legal fees and expenses, the suit alleged.

Reach Jim Dooley at jdooley@honoluluadvertiser.com.