Chemung Valley Acoustical

National Labor Relations Board - Administrative Judge Opinions

Aug 4, 2004

03-CA-024227 (N.L.R.B. Aug. 4, 2004)

JD–73–04

UNITED STATES OF AMERICA
BEFORE THE NATIONAL LABOR RELATIONS BOARD
DIVISION OF JUDGES

DAVID STAVISKI d/b/a CHEMUNG
VALLEY ACOUSTICAL

And

CLAUDE J. BAILEY, JR., An Individual Case 3-CA-24227

And

JOHN T. ERVAY, An Individual Case 3-CA-24231

Lillian Kleingardner, Esq.,
Of Buffalo, New York
For the General Counsel

Joseph J. Steflik, Esq.,
Binghamton, New York
For the Respondent

SUPPLEMENTAL DECISION

Equal Access to Justice Act

WALLACE H. NATIONS, Administrative Law Judge: On November 21, 2003, I issued
my decision in the captioned cases dismissing them in their entirety. On January 9, 2004, the
National Labor Relations Board (Board) issued its Order adopting my decision and the cases
were dismissed. On February 5, 2004, David Staviski d/b/a Chemung Valley Acoustical
(Respondent or Applicant) filed an Application for an Award of Fees and Expenses (Application)
under the Equal Access to Justice Act (EAJA). On February 12, the Board issued an Order
referring the matter to me for disposition. On March 8, Counsel for General Counsel, (General
Counsel) filed a Motion seeking to dismiss the Application in its entirety. On March 30,
Respondent submitted a Motion to Amend and in Opposition to General Counsels Motion to
dismiss. On April 6, General Counsel filed a Motion to Strike Respondent’s Motion to Amend the
Application.

General Counsel opposes the Application on both jurisdictional and substantive grounds.
Specifically, the General Counsel asserts that the Application is defective as it does not
establish that Respondent has met the jurisdictional requirements set forth in the Board’s Rules
and Regulations, as Respondent has failed to provide documentation of its net worth at any
relevant time period, and failed to list with specificity the requisite information regarding its
workforce. The General Counsel also urges that Respondent’s Application be dismissed on
substantive grounds, asserting that the General Counsel’s position at the hearing was

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substantially justified.

A. Did Respondent fail to provide documentation that establishes that it is an eligible
employer under EAJA?

The Application is subject to dismissal on the jurisdictional grounds that Respondent
failed to establish that it meets the eligibility standards at any relevant time for an award under
EAJA as determined by 5 U.S.C. Sec. 504. The sole owner of an unincorporated business
claiming an EAJA award has the burden of proving that its net worth did not exceed $7 million
and that it employed 500 or fewer employees at the time the action was filed.1

Respondent’s application fails to establish that Respondent meets the jurisdictional
requirements of EAJA on two counts. First, the application contains no exhibits that demonstrate
Respondent’s net worth. Section 102.147(f) of the Board’s Rules and Regulations states that an
applicant, except for a qualified tax-exempt organization or cooperative association, must
provide with its application a detailed exhibit showing the net worth of the applicant at the time
the adversary proceeding was initiated. This provision further states that the exhibits must
provide full disclosure of the applicant’s assets and liabilities. The only documentation submitted
by Respondent in support of the Application is selected portions of Respondent’s tax returns for
years 1999 through 2002, and an income statement for the years 1000 through 2001. These
documents do not constitute a detailed exhibit showing Respondent’s net worth, as they do not
provide the requisite detail regarding Respondent’s assets and liabilities.

Further Respondent has provided no documentation that establishes that it was an
eligible employer at any material time. Section 102.143(d) of the Board’s Rule and Regulations
states that in an unfair labor practice proceeding, eligibility of an applicant shall be determined
as of the date the complaint issued. In the instant case, the Consolidated Complaint issued on
June 26, 2003. Respondent provided no documentation as to its net worth for any period of time
during the year 2003. As Respondent provided no documentation that shows its net worth on or
about June 30, 2003, the relevant date, it has not satisfied its burden of establishing that it is an
eligible employer under EAJA. Because of this failure to satisfy a jurisdiction requirement as well
as other reasons, I will dismiss the application. See Industrial Security Services, 289 NLRB 459
(1988),

The Application is further defective as the Respondent did not comply with Section
102.147 of the Board’s Rules and Regulations that state that an applicant shall state the
number, category, and work location of employees of the applicant. Respondent provided no
such statement in its Application. Rather Respondent merely asserted by its attorney that it
employed less than 500 employees. For this further failure to meet its jurisdictional burden, I will
recommend dismissal of the Application.

Subsequent to the March 8, 2004 filing by General Counsel of the Motion to Dismiss the
Application, Respondent filed what it terms its Motion to Amend and in Opposition to Motion to
Dismiss. This filing by Respondent was dated March 30, 2004. Section 102.150 of the Board’s
Rule and Regulations sets forth the time limits for the filing of an answer and/or motion to
dismiss, and any reply thereto in response to an EAJA application. Specifically, Section 102.150
provides that an applicant has 21 days within service of a motion to dismiss to file a response

1 In its application, Respondent identified itself as a New York corporation. Based on
evidence adduced at hearing I found it to be a sole proprietorship. This finding comports with
the tax returns submitted with the application.

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thereto. Section 102.112 defines the date of service as the date the document is deposited in
the United States mail. Section 102.112 defines the date of filing as the date when the matter is
required to be received by the Board. Section 102.111(b) states that the Board will consider as
timely filed any document postmarked no later than the day before the due date.

General Counsel served on all parties a motion to dismiss the instant Application on
March 8, 2004. Accordingly, the Applicant herein was required to file its response thereto on or
before Monday, March 29, 2004. In order to timely file its response pursuant to Section
102.111(b) of the Board’s Rules and Regulations, the Applicant would have had to deposit its
papers in the United States Mail on or before March 27, 2004.2 However, the Motion and the
accompanying Verification and Certification of Service are all dated March 30, 2004. Utilizing
the definitions of service and filing set forth in the Board’s Rules and Regulations, the Applicant
served the Motion on March 30, 2004, two days after the deadline for filing its response had
expired. Thus, the Applicant’s Motion was untimely filed, and the Applicant failed to ask for an
extension of time to file the Motion. I will strike the Motion as untimely.

With its Motion to Amend, Respondent filed a one page document purporting to be a
statement of net worth as of June 30, 2003. The Board’s Rules and Regulations contain no
provisions that allow for an applicant to amend an application for an award of attorney’s fees
and expenses. Rather, Section 102.148 of the Board’s Rules and Regulations specifically
provides that an application for an award pursuant to EAJA must be filed with the Board within
30 days of the issuance of the decision giving rise to the determination. Section 102.147 of the
Board’s Rules and Regulations clearly delineates what must be included in any application filed
with the Board. Section 102.147(f) states that each applicant must provide, with its application, a
detailed exhibit showing the net worth of the applicant when the adversary proceeding was
initiated. The Applicant’s Motion is a belated attempt to cure its defective Application well after
the deadline for filing such application has passed. Respondent had the obligation to submit the
information contained in its last Motion at the time the application was filed. For this further
reason I will deny the Motion.

B. Was the General Counsel substantially justified in her litigation positions in these
cases?

EAJA provides for the award of attorney’s fees and expenses to eligible parties who
prevail in litigation before administrative agencies, unless the Government can establish that its
litigation position was either “substantially justified” or that special circumstances exist which
would make such an award unjust. Although the EAJA statute is silent as to the meaning of
“substantially justified,” the Supreme Court in Pierce v. Underwood,3 rejected a standard of
something more than simple reasonableness:

“The statutory phrase “substantially justified” means justified in substance or in the main
– that is, justified to a degree that could satisfy a reasonable person. This interpretation of the
phrase . . . is equivalent to the ‘reasonable basis in law and fact’ formulation adopted by the vast
majority of Courts of Appeal.”

The Board has utilized a case by case approach in analyzing EAJA cases. It has
interpreted the reasonableness standard in such a way as to not interfere with the vigorous

2 March 28, 2004 was a Sunday.
3 487 U.S. 552 (1988).

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enforcement of the labor laws. Where there have been close questions of law and fact, no
awards have been made. In cases where conflicting inferences can be drawn from the
evidence, the General Counsel is entitled to resolve the conflict in favor of the violations alleged.
The General Counsel’s failure to prevail raises no presumption that she was not substantially
justified in asserting her position. Where credibility issues crucial to the outcome of the case
cannot be resolved administratively on the basis of documentary or other objective evidence,
the General Counsel is substantially justified in taking the case to trial before and administrative
law judge. Bouley, Inc., 308 NLRB 653, 654 (1992); Advance Development Corp., 277 NLRB
1086, 1087 (1985).

The Consolidated Complaint in these cases alleged that Respondent terminated Claude
Bailey and John Ervay because they engaged in union and protected, concerted activity. In my
Decision, I found that Bailey and Ervay had not been discharged. Rather, based on the
evidence I credited, I found that Respondent believed that they had voluntarily resigned their
positions to go to work for the Union. I also found that if Respondent had terminated Bailey, it
did so because of derogatory remarks made by him that were subsequently relayed to
Respondent by other individuals.

As I noted in my decision, this case turned almost entirely on credibility. If one believed
Respondent’s witnesses, Respondent prevailed and if one believed the General Counsel’s
witnesses, General Counsel prevailed. Thus, based on the evidence adduced at trial General
Counsel was substantially justified in trying this consolidated case. The Region was also
substantially justified in bring the case to trial. As noted in General Counsel’s brief and the
attachments to the brief, upon completion of the investigation of the underlying charges,
General Counsel possessed, inter alia, an affidavit from Claude Bailey that established that
Bailey and Ervay spoke to Mick Pavlick, an organizer for Carpenters Local 281 (Union); that
Robert Tompkins, Respondent’s foreman, knew that Bailey and Ervay had spoken to Pavlick;
and that Bailey and Ervay had joined the Union the following day. Bailey’s affidavit further stated
that two days after joining the Union, Bailey received a telephone call from his mother, Deb
Bailey, advising him that Robert Tompkins told her that they were both (Bailey and Ervay) out of
a job. In his affidavit Bailey testified that he telephoned David Staviski, Respondent’s owner, to
verify if this was true. According to Bailey, Staviski told him during this conversation, “I heard
you’re talking some stuff regarding the Union.” According to Bailey, Staviski swore at him
during this conversation, wished him luck, and hung up.

General Counsel also possessed evidence that corroborated Bailey’s affidavit.
Specifically, General Counsel had an affidavit from Deb Bailey that verified that Tompkins told
her that Bailey was fired because they (Bailey and Ervay) were seen talking about Staviski and
“bad mouthing” both Staviski and Tompkins. Deb Bailey further stated in her affidavit that she
called Bailey and told him that he was fired, and that Bailey called her back and told her that
Staviski had verified that Bailey was fired because he had been talking about the Union.
General Counsel also had affidavits from Pavlick and Ervay that verified that Bailey and Ervay
had joined the Union, and that Bailey had relayed to Ervay that they were fired because of their
interest in the Union. This was the evidence available to General Counsel at the time complaint
issued in these cases.

Thus, based on the investigation, the General Counsel had evidence that Bailey and
Ervay were engaged in union activity when they talked to Pavlick about joining the Union, and
when they joined the Union. The investigation also demonstrated that Bailey and Ervay were
engaged in protected, concerted activity when they complained to Matthew Lehmann and
Edward Vargo (friends and competitors of Staviski) about their supervisor’s (Tompkins) drinking
and about having to pick up their paychecks in a bar. The investigation also established that

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Respondent was aware that Bailey and Ervay had engaged in union and protected, concerted
activity. Knowledge was established by Bailey’s testimony that Staviski told him that he had
heard that he had been talking about the Union, and by Deb Bailey’s testimony that Tompkins
told her that Bailey was fired because he had been talking about him and Staviski.

Finally, General Counsel had evidence that Bailey’s and Ervay’s terminations were
motivated by anti-union animus, based on Bailey’s testimony in his affidavit that Staviski had
said he hear Bailey had been talking about the Union, swore at him, wished him luck and hung
up. The General Counsel also had evidence, based on the testimony of Deb Bailey, that the
discharges were motivated by Bailey’s and Ervay’s protected, concerted activity.

In deciding to issue complaint, the General Counsel also considered the timing of the
discharges, which came just two or three days after Bailey and Ervay joined the Union, and a
day or two after Bailey and Ervay complained about Staviski and Tompkins. Thus, General
Counsel had both direct and indirect evidence that Respondent harbored animus toward Bailey
and Ervay because they engaged in Union and protected, concerted activity.

Clearly, the General Counsel was substantially justified in litigating the instant cases. I
stated in my decision that if I credited General Counsel’s witnesses, then Bailey was terminated
and the principles of Wright Line, a Division of Wright Line, Inc., 251 NLRB 1083 (1980) would
apply. I further stated that if Bailey were terminated, then “the timing of such action clearly
supports a finding of discriminatory motivation, coming three days after the first Union activity by
Bailey or within hours of Staviski learning of such activity.” Had I credited General Counsel’s
witnesses, the General Counsel would have presented a prima facie case that Bailey was
terminated and that union animus contributed to Respondent’s decision to terminate him.

Respondent argues that General Counsel’s position was not substantially justified
because she declined to interview or take affidavits from Lehmann and Vargo, the only non-
party witnesses. I cannot agree with this position. In my Decision, I found that Staviski believed
that Bailey and Ervay had resigned their employment to work for the Union without informing
him of their resignations, based on evidence relayed to Staviski by Lehmann and Vargo. But the
only witness who could competently testify as to what Staviski believed was Staviski himself.
The testimony of Vargo and Lehmann by itself does not establish that Ervay and Bailey
resigned rather than being fired.4 The testimony of Staviski and Tompkins was crucial to that
determination. I again find that General Counsel was substantially justified in taking this case to
trial.

The General Counsel also notes that Respondent never asserted prior to trial that its
defense was that Bailey and Ervay voluntarily resigned and were not fired. Neither Staviski nor
Tompkins provided affidavits or position statements during the investigation despite requests to
do so from General Counsel. Its answer to the Consolidated Complaint did not contain an
affirmative defense alleging that Ervay and Bailey voluntarily resigned. Absent the testimony of
Staviski and Tompkins, there is no way the General Counsel could assess the quality of her
evidence and a trial was necessary.

The Board routinely scrutinizes a respondent’s cooperation, or lack thereof, during the
investigation in order to determine whether the General Counsel was justified in issuing and
litigating the complaint. See C. I. Whitten Transfer Co., 312 NLRB 28, 29 (1993)(where the

4 General Counsel also notes that Lehmann’s testimony at trial varied from statements he
had made to General Counsel prior to trial, calling into question his credibility.

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administrative law judge denied the respondent’s application under EAJA because it did not
provide witnesses during the investigation or make its records available to the investigator.
“Respondent cannot now rely on its own lack of cooperation to support its application for
attorney’s fees pursuant to Equal Access to Justice Act.”)5 I cannot find that Respondent’s lack
of cooperation during the investigation in any way supports its Application.

In conclusion, I find that Applicant’s Motion to Amend was untimely under the Board’s
Rules and Regulations and is stricken and/or denied. I further find that Applicant has failed to
meet the jurisdictional requirements for EAJA and General Counsel’s position was substantially
justified throughout the instant unfair labor practice proceeding. Accordingly, I grant General
Counsel’s Motion To Dismiss the instant application for an EAJA award. On these findings of
fact and conclusions of law and on the entire record, I issue the following recommended6

ORDER

The General Counsel’s Motion to Dismiss the Application for an award of attorney’s fees
and expenses under EAJA of David Staviski d/b/a Chemung Valley Acoustical is granted and
the Application is dismissed in its entirety.

Dated, Washington, D.C.

_____________________
Wallace H. Nations
Administrative Law Judge

5 See also Glesby Wholesale, Inc., 340 NLRB No. 128 (November 28, 2003); Leeward Auto
Wreckers, Inc., 283 NLRB 574 (1987).
6 If no exceptions are filed as provided by Sec. 102.46 of the Board’s Rules and
Regulations, the findings, conclusions, and recommended Order shall, as provided in Sec.
102.48 of the Rules, be adopted by the Board and all objections to them shall be deemed
waived for all purposes.