## Facts

- A federal civil RICO consent decree established internal oversight and disciplinary mechanisms for the International Brotherhood of Teamsters and its locals.
- Officers of IBT Local 493 faced disciplinary charges for misconduct, including misuse of union funds and breaches of fiduciary duties.
- The officers entered an agreement requiring them to present its terms accurately to the local membership; they failed to do so and misrepresented the terms at a membership reading.
- The Government initiated civil contempt proceedings for violation of the agreement.
- On May 2, 1991, during the contempt proceedings, the officers’ attorney stated in open court that he was authorized to settle; a settlement was placed on the record requiring, among other terms, the officers’ resignations and a stay of local elections.
- After the settlement was recorded, the officers sought to resign on different terms; the Government stated it would enforce the recorded settlement if the officers rejected the proposed conditions.
- A later draft settlement prepared with new counsel was not executed by the officers.
- The district court enforced the May 2, 1991 settlement in October 1992.
- The officers and their former attorney appealed, contesting counsel’s authority, the lack of an evidentiary hearing, and alleging judicial bias.

## Issues

1. Whether the district court erred by enforcing the May 2, 1991 settlement on the ground that the officers’ attorney lacked actual or apparent authority to bind them.
2. Whether due process required an evidentiary hearing on the authority dispute, and whether the enforcement decision was tainted by judicial bias.

## Decision

- The Second Circuit affirmed the order enforcing the May 2, 1991 settlement.
- The court held the attorney had actual authority, and in any event apparent authority, to enter the settlement on the officers’ behalf.
- The court held due process was satisfied without an evidentiary hearing because the existing record resolved the material facts concerning authority.
- The court rejected the judicial-bias claim for lack of record support beyond disagreement with the district court’s rulings and case management.

## Legal Principles

- A party is bound by a settlement entered by counsel when counsel acts with actual authority or apparent authority, as shown by the principal’s manifestations that reasonably lead the opposing party to believe the agent is authorized.
- Counsel’s on-the-record representation of settlement authority, combined with client conduct consistent with acceptance or ratification, supports enforcement of the settlement.
- A district court need not hold an evidentiary hearing on a settlement-authority challenge unless the record shows a genuine, material factual dispute that cannot be resolved on submissions and transcripts.
- Due process in settlement enforcement and civil contempt proceedings requires notice and an opportunity to be heard; it does not require live testimony in every dispute.
- Claims of judicial bias require evidence of improper predisposition or prejudice; adverse rulings or firm case management, without more, are insufficient.

## Conclusion

The Second Circuit upheld enforcement of an on-the-record contempt settlement requiring Local 493 officers’ resignations, concluding that counsel had authority to settle and that the district court could decide the authority and due process objections on the established record without an evidentiary hearing.


United States v. International Brotherhood of Teamsters, 986 F.2d 15 (2d Cir. 1993)