Sonicraft, Inc.

National Labor Relations Board - Board Decisions

Sep 26, 1986

281 N.L.R.B. 569 (N.L.R.B. 1986)

SONICRAFT, INC.
Sonicraft, Inc. and Warehouse, Mail Order, Office,
Technical and Professional Employees Union,
Local 743, International Brotherhood of Team-
sters, Chauffeurs, Warehousemen, and Helpers
of America . Case 13-CA-22448(E)
26 September 1986
SECOND SUPPLEMENTAL DECISION
AND ORDER
BY CHAIRMAN DOTSON AND MEMBERS
JOHANSEN AND BABSON
On 26 February 1986 Administrative Law Judge
Claude R. Wolfe issued the attached second sup-
plemental decision . The Applicant filed exceptions
and a supporting brief, and the General Counsel
filed cross-exceptions and a supporting brief and an
answering brief.
The National Labor Relations Board has delegat-
ed its authority in this proceeding to a three-
member panel.
The Board has considered the second supplemen-
tal decision and the record in light of the excep-
tions and briefs and has decided to affirm the
judge's rulings,' findings, 2 and conclusions and to
adopt the recommended Order.
ORDER
The National Labor Relations Board adopts the
recommended Order of the administrative law
judge and orders that the application of the Appli-
cant, Sonicraft, Inc., Chicago, Illinois, for an award
under the Equal Access to Justice Act is dismissed.
' In view of the disposition of the case, we find it unnecessary to pass
on questions raised in the Applicant's exceptions and the General Coun-
sel's cross-exceptions regarding whether a fee award in excess of $75 per
hour is appropriate and whether , given the procedural history of this
case, such an award should cover fees and costs incurred in the handling
of representation , as well as unfair labor practice, proceedings.
a In its exceptions, the Applicant contends that a witness statement
which was not part of the record before the Board when it issued the
Union's Certification of Representative , but which has since been fur-
nished to the Respondent as an attachment to the General Counsel's
motion to dismiss the instant application, contains material allegations of
fact which, read in conjunction with an affidavit furnished by the Re-
spondent's attorney in support of Objection 4, would have raised an issue
of credibility critical to resolution of that objection and resolvable only
by a hearing. We note that, even if the witness statement at issue had
been before the Board at that stage of the representation proceeding-
contrary to the Board 's Rules and Regulations , see generally Frontier
Hotel, 265 NLRB 343 (1982), enfd . 734 F.2d 21 (9th Cir. 1984), cited with
approval in LC Cassidy A Son v. NLRB, 745 F.2d 1059 (7th Cit. 1984)-
the witness statement would have raised no substantial and material issue
of fact establishing a prima facie case of objectionable election interfer-
ence under then-prevailing Board precedent, i.e., Westinghouse Appliance
Co., 182 NLRB 481 fn. 1 (1970).
SECOND SUPPLEMENTAL DECISION
569
(Equal Access to Justice Act)
CLAUDE R. WOLFE, Administrative Law Judge. On 8
July 1983 the Board issued a Decision and Order ' in this
proceeding finding the Respondent, Sonicraft , Inc. had
violated Section 8(aX5) and (1) of the Act by refusing to
bargain with Warehouse , Mail Order, Office, Technical
and Professional Employees Union , Local 743, Interna-
tional Brotherhood of Teamsters , Chauffeurs, Ware-
housemen and Helpers of America (the Union) in an ap-
propriate unit after a Decision and Certification of Rep-
resentative issued by the Board on 16 July 1982,2 in
which the Board adopted the Regional Director's find-
ings and recommendations issued 2 March 1982, over-
ruled Respondent's objections to conduct affecting the
results of the election held on 11 December 1981, in
Case 13-RC-15881 , and issued a Certification of Repre-
sentative to the Union covering a unit of Respondent's
production, maintenance , and warehouse employees. On
23 July 1983 , Respondent filed a petition for review of
the Board's Order with the United States Court of Ap-
peals for the Seventh Circuit . On 1 September 1983 the
Board filed a cross-application for enforcement . Thereaf-
ter, on 20 November 1983 the Board filed a motion for
leave to withdraw its application for enforcement. By
Order dated 4 January 1984 , the court granted the
Board 's motion.
On 18 January 1984 the Charging Party filed a motion
for immediate remand and expedited consideration,
moving the Board to issue an order remanding this case
for hearing on the Employer's election objections raised
in Case 13-RC-15881 . The Board, on 30 January 1984,
remanded this proceeding for hearing before an adminis-
trative law judge on the issues raised by Employer's Ob-
jections 4, 5, and 6 filed in Case 13 -RC-15881 . The hear-
ing so ordered was conducted by me at Chicago , Illinois,
on 11 , 25, and 26 June and 16 and 17 July 1984. After
hearing I issued a supplemental decision on 16 November
1984 in which recommended Objections 5 and 6 be over-
ruled ; Objection 4 be sustained ; the 11 December 1982
election be set aside ; and the complaint in Case 13-CA-
22448 be dismissed because the Union had not estab-
lished its majority status in the appropriate unit involved.
On 24 September 1985 the Board issued a Supplemental
Decision and Orders adopting my findings and recom-
mendations with respect to Employer 's Objection 4; va-
cated the election ; and dismissed the complaint in Case
13-CA-22448.
On 24 October 1985 Sonicraft , Inc. (Applicant) filed a
petition for attorneys' fees and costs under the Equal
Access to Justice Act (EAJA),4 asserting that the issu-
ance of the complaint in Case 13 -CA-22448 was not sub-
stantially justified . Applicant explains the basis of this
contention as follows, and proffers additional argument
in support thereof-
1 266 NLRB No. 189 (July 8, 1983).
8 Not reported in Board volumes.
Sonicmft Inc., 276 NLRB 407 (1985).
* 5 U.S.C. § 504 (1982), as amended by Pub. L. 99-80 , 99 Stat. 183
(1985).
281 NLRB No. 90
570 DECISIONS OF NATIONAL LABOR RELATIONS BOARD
The underlying bases for the Petitioner 's claim
for fees are threefold . First, the issuance of the
Complaint was unwarranted and could have been
avoided had the Board or its Regional Director
held the appropriate hearing , as requested by Soni-
craft, regarding objections to the representation
election. Second, the action of the Board in grant-
ing the General Counsel 's motion for summary
judgment without permitting a hearing on the factu-
al issues that have ultimately resolved the objections
to the representation election was a denial of funda-
mental due process that protracted this case unnec-
essarily . Third , the improper action of the Board's
agent at the election , which was the root of the
critical objection to the election , caused the unfair
election and all of the Company's subsequent legal
action to protect its interest.
The General Counsel filed a motion to dismiss the ap-
plication contending the Regional Director and the
Board were substantially justified in overruling Employ-
er's Objection 4 because they acted on the basis of then-
existing precedent and because certain evidence devel-
oped at the hearing before me was not known to the Re-
gional Director or Board at the time Objection 4 was
overruled . The General Counsel also contends that fees
and costs are not recoverable in representation proceed-
ings and fees and costs for the essentially representation
proceeding before me, in which neither the General
Counsel nor the Board were adversaries , are therefore
not recoverable under EAJA.
On 7 February 1986 Sonicraft filed a response in oppo-
sition to the motion to dismiss . In its response Sonicraft
essentially recapitulated and enlarged on its original
three-point argument.
Section 504(a)(1) of EAJA contains the following pro-
vision:
Whether or not the position of the agency was
substantially justified shall be determined on the
basis of the administrative record, as a whole,
which is made in the adversary adjudication for
which fees and other expenses are sought.
Section 504(bXl)(E) explains that "position of the
agency" means, in addition to the position taken in the
adversary adjudication , the agency 's action or failure to
act on which the adversary adjudication is based.
When the Respondent refused to bargain with the
Union after the Board issued the Certification of Repre-
sentative, the General Counsel had no alternative but to
issue a complaint alleging a violation of Section 8(a)(5)
and (1) of the Act and was clearly substantially justified
in prosecuting that complaint . This does not, however,
end the matter because , even though the Certification of
Representative was the product of a representation pro-
ceeding which is not an adversary proceeding and there-
fore is not covered by EAJA,5 the action of the Board
K & I Transfer & Storage, 277 NLRB 1063 (1985)
in issuing the certification provided the basis for the
General Counsel 's prosecution of the refusal-to-bargain
complaint. Accordingly, the issue before me is whether
the issuance of the certification, without a hearing on the
merits of Sonicraft's objections to conduct affecting the
results of the representation election, was substantially
justified.
Sonicraft's objection which the Board, acting upon my
recommendation , sustained in Sonicraft, Inc., 276 NLRB
407 (1985), and therefore caused the election to be set
aside , reads as follows:
4. The Petitioner, its agents and representatives,
improperly induced employees to support the Peti-
tioner by violating the Stipulation for Certification
Upon Consent Election by utilizing more than the
agreed upon number of observers without the con-
sent or knowledge of the Employer, and with the
acquiescence of the Board agent conducting the
election.
The Stipulation for Certification Upon Consent Elec-
tion in Case 13-RC- 15881 contains the following provi-
sion:
4. OBSERVERS.-Each party hereto will be al-
lowed to station an equal number of authorized ob-
servers, selected from among the nonsupervisory
employees of the Employer, at the polling places
during the election to assist in its conduct, to chal-
lenge the eligibility of voters, and to verify the
tally.
I recommended Objection 4 be sustained for the fol-
lowing reasons as related in my supplemental decision of
16 November 1984:
The rule followed by the both the Board and the
Court seems to be that a mere imbalance in observ-
ers is a breach of the Stipulation which must be ex-
amined in context with the circumstances in each
case to determine if the breach was prejudicial or
material enough to require the setting aside of the
election. In the instant case the use of three observ-
ers by the Union at 95th Street had to have been
with the acquiescence or specific permission of the
Board agent who was present during the election. If
this were not so the Board agent would not have
permitted it. The three to one ratio of observers
was a violation of a material term of the agreement.
The Employer . . . was given no notice there
would be such an imbalance nor was it given an op-
portunity to furnish more observers. Moreover, the
Union was permitted to use Barlow as a releaser at
9th Street without any prior notice to or agreement
with the Employer. Nine of the ten eligible voters
at 95th Street voted. The Union won the election
by a 45 to 35 margin. A shift of five votes from the
Union to an against vote would have produced a
tie, which means the Union would have lost. I am
persuaded that the use of Barlow as the sole releas-
er at 95th Street and the two to one imbalance in
SONICRAFF, INC. 571
observers at the polls, all without notice to or per-
mission of the Employer, might well have created
an impression among the electorate that the Board
was partial to the Union, and that the Union was re-
sponsible for running the election. The existence of
such an impression is inimical to fundamental fair-
ness in election proceedings and is sufficient, par-
ticularly in a case such as this where the outcome is
determined by so few votes, to warrant setting an
election.
The use of Barlow as a union releaser at 95th Street
was an important factor in my decision. The General
Counsel asserts, and no evidence to the contrary has
been presented, that no allegation or evidence regarding
Barlow's service as a releaser at 95th Street was present-
ed to the Regional Director during the investigation of
the objections, or was made known to the Regional Di-
rector or the Board prior to Barlow's testimony at the
hearing before me. The affidavits provided the Regional
Director by Barlow and other witnesses during the in-
vestigation were presented to me, and I find no reference
in them to Barlow's service as a releaser at 95th Street.6
On these facts and the uncontroverted representations of
the General Counsel, I conclude and find that Barlow's
releaser service at 95th Street was never reported to the
Board or Regional Director prior to the hearing before
me.
My decision relied on Best Products Co., 269 NLRB
578 (1984), and Frontier Hotel v. NLRB, 625 F.2d 293
(9th Cir. 1980), to the extent I perceived that the Board
in Best agreed with the court's approach in Frontier
Hotel. In 1982 when the Regional Director recommend-
ed, on the basis of existing precedent, and the Board
agreed that this objection should be overruled, and until
the issuance of Best in March 1984 after the Board had
already remanded this proceeding for a hearing on the
objections before an administrative law judge, existing
Board precedent gave substantial support to a conclusion
that a mere imbalance in observers, notwithstanding an
oral understanding between the parties to the contrary,
was insufficient to warrant setting aside a representation
election, Westinghouse Appliance Sales Co., 182 NLRB
481 (1970), and that noncompliance with the terms of a
Stipulation for Certification Upon Consent Election must
be found to be prejudicial or sufficiently material to war-
rant setting an election aside . Grant's Home Furnishings,
229 NLRB 1305, 1206 (1977). It is well settled that
Board precedent must be followed in matters before the
Board, unless and until modified by the Supreme Court,
even if there are United States court of appeals decisions
to the contrary. Iowa Beef Packers, 144 NLRB 615, 616
(1963). Frontier Hotel, in which the Ninth Circuit' found
that an imbalance in the number of observers with the
acquiescence of the Board agent was sufficient ground
for setting aside an election, was therefore not binding
on the Regional Director in 1982. Moreover, I have
found no Board decision prior to Best in which the
Board gave any indication it would adopt the position of
the court in Frontier Hotel as a precedent.
Sonicraft has consistently maintained, during and since
the investigation of its objections in 1981 and 1982, that
its Objection 4 should be sustained on the basis of Fron-
tier Hotel, supra, because a material term of the election
stipulation had been violated with the acquiescence of
the Board agent conducting the election. Evidence to
this effect was presented to the Regional Director, and I
have found that the stipulation was indeed violated and
the Board agent did acquiesce in the violation. This is
the most that the Regional Director and the Board could
have concluded on the record before them. They did not
have the evidence of Barlow 's service as a releaser at
95th Street. This evidence weighed heavily in my deci-
sion to sustain the objection, as did Frontier Hotel which
was not established Board precedent at the time the ob-
jections were ruled on by the Regional Director and the
Board. With respect to the Barlow evidence, the Region-
al Director was not required to conduct further investi-
gation in the absence of specific evidence proffered by
Sonicraft, who had the burden of proving its objections.8
Sonicraft proffered no such evidence. Without the evi-
dence of Barlow's conduct, all that remains is the viola-
tion of the election stipulation with the Board agent's ac-
quiescence. Construing the evidence presented to the Re-
gional Director in the light most favorable to Sonicraft's
objection, his reliance on Westinghouse, supra, in recom-
mending Objection 4 be overruled was more than rea-
sonable . Westinghouse provided a precedent for the posi-
tion taken, and neither the Regional Director nor the
Board is required to be prescient and issue decisions on
the basis of future precedent.
Summing up, in the absence of the Barlow evidence
and the Best/Frontier Hotel precedent, existing precedent
and the evidence before the Regional Director and
Board supported their decision to overrule Objection 4.
Moreover, the evidence before the Regional Director
raised no substantial and material issues of fact requiring
a hearing. This is so because, even when viewed in the
light most favorable to Sonicraft, that evidence could
well be considered unobjectionable under Westinghouse.
Finally, Sonicraft's allegation that the Board refuses to
follow Seventh Circuit law is neither germane to the
issue of substantial justification or a matter properly
before me.
It might well be that another Regional Director or an-
other Board would have viewed the facts and the law
pertaining to Objection 4 differently than they were
viewed by the Regional Director and the Board in 1982,
but it cannot fairly be said the overruling of Objection 4
in 1982 was frivolous, bereft of reason, or without sub-
stantial justification. The position of the Regional Direc-
tor, adopted by the Board, was based on the facts and
law before him, was more than merely reasonable, and
met the statutory requirement of substantial justification.
a The affidavit relates that he served as an observer, but does not men-
tion that he actually was engaged in the process of releasing employees 8 European Parts Exchange, 264 NLRB 224 (1982); Riveredge Hospital,
to vote . 274 NLRB 900 (1985); L C Cassidy A Son Y. NLRB, 745 F.2d 1059 (7th
7 The instant case arises in the Seventh Circuit. Cir. 1984).
572 DECISIONS OF NATIONAL LABOR RELATIONS BOARD
Accordingly, I find Sonicraft, Inc. is not entitled to an ORDER
award under the Equal Access to Justice Act, and issue It is ordered that the General Counsel's motion to dis-
the following recommended miss is granted and the application of Sonicraft, Inc. for
an award under the Equal Access to Justice Act is
denied.