Contractor Charged in Connection with Brooklyn Building Collapse

Dec. 16, 2004
Kang Yeon Lee, a contractor and owner of Big Apple Development and Construction, has been arrested and charged with causing the death of a worker by failing to comply with OSHA regulations requiring contractors to provide fall protection equipment for their employees.

Lee and a Big Apple site supervisor, Dai Ki Kim, were also charged with making false statements to the U.S. Postal Service in connection with certifying the amounts that Lee's employees were paid for work performed at a federally funded Postal construction project at John F. Kennedy Airport. Finally, Lee was charged with making false statements and concealing information required to be disclosed in connection with an employee benefit plan governed by Title I of the Employee Retirement Income Security Act of 1974 (ERISA).

The defendants appeared before U.S. Magistrate Judge Cheryl L. Pollak at the U. S. Courthouse in Brooklyn, New York on Dec. 14 to hear the charges against them.

"This prosecution demonstrates our commitment to holding criminally responsible to the maximum extent allowed by law those who willfully violate OSHA safety regulations and make false statements to evade paying laborers wages and benefits to which they are entitled," stated Roslynn R. Mauskopf, the United States attorney for the Eastern District of New York. "I am hopeful that these charges will deter future violations of this sort, as well as provide some measure of justice to the family of Angel Segovia, the victim of the tragic Fort Hamilton Parkway building collapse."

According to the complaint, the government's investigation began on May 20 following the collapse of a balcony that was part of a multi-unit residential building under construction in Brooklyn. Big Apple was the general contractor for the project. Four Big Apple workers were pouring a 5-foot by 16-foot concrete balcony on the third floor of the structure when the balcony collapsed. Three of the workers fell approximately 35 feet to the courtyard below, while the fourth worker leapt to safety inside the building. One of the workers, Angel Segovia, died from injuries sustained in the fall.

Big Apple had not provided any of the four workers with fall prevention equipment. As stated in the complaint, Lee and Big Apple had received prior OSHA citations in 2001 for failing to provide fall protection equipment for Big Apple's workers. The government's investigation also revealed that in August 2000, Big Apple, then operating as Big Apple Construction and Restoration, was hired by the general contractor at a Postal Service-financed construction project at John F. Kennedy Airport to do demolition and foundation work. As a contractor on a federally funded construction project, Big Apple was required to pay its workers the locally-prevailing wage rate determined by the Davis Bacon Act and to submit certified payroll records showing that the workers had been paid in accordance with the law.

The complaint charges that Lee and his site supervisor, Kim, falsely certified on payroll records that Big Apple's workers were paid at the required wage rate, when, in fact, the workers were paid significantly less.

Finally, the government's investigation disclosed that from July 1, 1999, through July 31, 2003, Big Apple, then operating as Big Apple Construction Management, was a party to a collective bargaining agreement with the Mason Tenders District Council of Greater New York and Long Island (MTDC), a labor organization whose membership includes mason tenders, concrete workers and laborers. The MTDC Trust

Funds provide pension, welfare, annuity and training benefits to employees and their beneficiaries pursuant to its pension plan. The plan, which is governed by ERISA, is funded by monthly contributions from employers who are signatories to collective bargaining agreements with the MTDC.

The complaint charges that Lee failed to make required contributions of at least $1.1 million to the plan and thereby caused the Annual Report of Employee Benefit Plan that the Trust Funds are required to file with the Departments of Labor and Treasury to inaccurately state the total receivables to the Trust Funds.

"This company showed a pattern of blatant disregard for the rights and safety of workers for fair pay and benefits and most importantly for safety," stated Gordon S. Heddell, inspector general, United States Department of Labor.

"Let these charges warn other potentially unscrupulous contractors and builders that worker safety and compliance with safety regulations is of paramount importance," added Rose Gill Hearn, commissioner, New York City Department of Investigation. "It is my hope that families of other construction workers will not face the same loss that the family of Angel Segovia experiences."

If convicted, Lee faces a maximum sentence of 6 months' imprisonment for the death of Angel Segovia, and 5 years' imprisonment under 18 U.S.C. Section 1027 for the violation of ERISA. Lee and Kim each face a maximum sentence of 5 years' imprisonment under section 1001(a)(3) for false statements to the Postal Service concerning the wages paid to Lee's employees. Lee and Kim also face a maximum fine of $250,000 on each count of conviction. In addition, in a related proceeding, LEE has been issued 12 OSHA citations carrying penalties of up to $157,940 in connection with the Fort Hamilton Parkway building collapse.

About the Author

Sandy Smith

Sandy Smith is the former content director of EHS Today, and is currently the EHSQ content & community lead at Intelex Technologies Inc. She has written about occupational safety and health and environmental issues since 1990.

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