Philadelphia, PAThe Philadelphia Housing Authority (PHA) and its executive director are in a pile of trouble, says attorney Michael Pileggi. Pileggi, who once worked for the PHA, is representing plaintiffs in a class action suit alleging that as many as 300 non-union employees were forced to pay into a slush fund that was used for the personal enrichment of their boss, Carl Greene.
"He ran this place with an iron fist," says Pileggi. "Everyone was scared to death of him."
The suit claims that Greene, who is currently on medical leave from the PHA, initiated an automatic deduction of $2.50 per week from employee's paychecks for the last four to five years. The money, employees were told, went to a corporation set up by Greene and others called the Pennsylvania Institute of Affordable Housing Professionals (PIAHP).
"In many instances the employees were coerced," says Pileggi. "There was a paper they were supposed to sign to agree to these deductions. Several of them refused to sign and the deductions were taken out anyway!"
Employees were led to believe that the PIAHP would stave off impending layoffs. "Well," Pileggi says, "400 people were let go. And after that it was discovered that the money was that the money was going to parties and the personal enrichment of the PHA's executive director, Carl Greene.
"The theory of the lawsuit is that they were getting federal dollars to pay employees, in turn doing automatic deductions, and raising money under the pretext of doing lobbying activities and then using the money for their own personal enrichment."
Pileggi says the actions of the PHA contravened the Fifth Amendment, which, among other things, protects against abuse of government authority. The PHA also contravened the Fourteenth Amendment, which prohibits state and local governments from depriving persons of life, liberty, or property.
Rather sweeping claims—but Pileggi says this is no ordinary class action suit. The amount collected from PHA employees amounts to a total of about $100,000. "This is more of an attack on federal dollars. It is an overall attack on how Greene had the ability to use federal dollars for his own personal gain."
Michael Pileggi has been in private practice since 2002. He regularly represents clients in civil rights and constitutional law matters, including police misconduct cases, employment law related cases involving First Amendment and whistleblower actions. Between 1991 and 2002 Pileggi was in house counsel for the Philadelphia Housing Authority and settled whistleblower case on behalf of himself after he was fired for allegedly planning to speak to HUD auditors about millions of dollars being spent on outside legal representation.