AutoNation, Inc. v. Nat'l Labor Relations Bd.

• Citation: 801 F.3d 767
• Decision Date: 04 September 2015
• Docket Number: Nos. 14–2991,14–3361.,s. 14–2991
• Parties: AUTONATION, INC., and Village Motors, LLC, Petitioners/Cross–Respondents, v. NATIONAL LABOR RELATIONS BOARD, Respondent/Cross–Petitioner.
• Court: United States Courts of Appeals. United States Court of Appeals (7th Circuit)

801 F.3d 767

AUTONATION, INC., and Village Motors, LLC, Petitioners/Cross–Respondents

v.NATIONAL LABOR RELATIONS BOARD, Respondent/Cross–Petitioner.

Nos. 14–2991

14–3361.

United States Court of Appeals, Seventh Circuit.

Argued May 21, 2015.

Decided Sept. 4, 2015.

Joel W. Rice, Attorney, Fisher & Phillips LLP, Chicago, IL, Reyburn Williams Lominack, III, Attorney, Fisher & Phillips LLP, Columbia, SC, for Petitioners/Cross–Respondents.

Douglas Callahan, Attorney, Jessica Willis Muth, National Labor Relations Board, Linda Dreeben, Attorney, Robert J. Englehart, Supervisory Attorney, National Labor Relations Board Office of the General Counsel, Washington, DC, for Respondent/Cross–Petitioner.

Before WOOD, Chief Judge, and ROVNER and WILLIAMS, Circuit Judges.

Opinion

WOOD, Chief Judge.

Union activity was afoot at Libertyville Toyota late in the summer of 2011. When rumors to this effect reached it, Libertyville's owner, a company called AutoNation, held a series of meetings with the affected staff. An employee surreptitiously recorded the last of these meetings, a lengthy affair conducted largely by two AutoNation executives. Around the same time, Libertyville suspended one of its employees, an automotive painter named Jose Huerta. The dealership's manager had received an anonymous voicemail accusing Huerta of promoting the union cause and of receiving a charge of driving under the influence. Once suspended, Huerta did not return to Libertyville. It ultimately fired him, but the parties disagree on when that happened and for what reasons. Both sides concur, however, that Huerta received a computer-generated letter from a third party vendor to AutoNation indicating that Huerta's employment would not be continued.

A local chapter of the International Association of Machinists and Aerospace Workers (the Union) filed charges against AutoNation and Village Motors, LLC (which did business as Libertyville Toyota—we refer to them in the singular as AutoNation) with the National Labor Relations Board in 2011. An administrative law judge (ALJ) concluded that certain comments by the AutoNation executives at the recorded meeting violated the National Labor Relations Act (the Act) in multiple ways. He did not, however, uphold the accusation that AutoNation had unlawfully suspended and discharged Huerta because of his union activity. A three-member panel of the Board, with one member dissenting on two points, affirmed the judge's conclusions about the meeting but reversed as to Huerta's discharge. AutoNation has filed a petition for review of the Board's rulings, and the Board has cross-applied for enforcement. Although we do not endorse all of the Board's language in its opinion, we conclude that substantial evidence supports its findings and that its decision is entitled to enforcement.

I

Libertyville Toyota is a 140–employee car dealership in the Village of Libertyville, Illinois. Its service department has 80 employees engaged in tasks such as fixing vehicles, painting them, and performing shipping and receiving. In August 2011, dealership management learned of discussions among technicians about unionizing. Not long afterward, Libertyville's general manager, Taso Theodorou, held a few brief meetings with workers in the service department to discuss the topic of unionization. On August 23, two members of AutoNation's corporate team joined Theodorou for another such meeting. We know what was said at this last meeting because a dealership employee secretly recorded it; the tape was subsequently transcribed; and the ALJ relied on it.

Theodorou opened the August 23 meeting and then turned it over to AutoNation vice president and associate general counsel Brian Davis. Davis was joined by Jonathan Andrews, one of the company's regional human resources directors. The transcript of the discussion among these men and the dealership's workers runs 111 pages; we focus here on those excerpts that concerned the Board and that are pertinent to the petitions before us.

On the same day as the meeting among Davis, Andrews, Theodorou, and the Libertyville employees, Theodorou received a voicemail at the dealership. The caller stated that she was “calling on behalf of the spouse of one of your employees,” but she refused to identify herself because her husband was “afraid that if they find out that we're the ones who said anything, that they will retaliate.” The caller accused two employees, Jose Huerta and Hermenegildo Tellez, of “trying to stir up this whole union and create issues.” Tellez and Huerta were having arguments with other employees, she said, and worse, they had “questionable” moral standards. In particular, she noted that Huerta “doesn't even have a license” and “had a DUI.” The caller finished by opining that the situation with Huerta and Tellez was “definitely something that needs to be addressed.”

After receiving the voicemail, Theodorou contacted Andrews to acquire a motor vehicle report on Huerta. When it arrived, the report showed that Huerta had a suspended driver's license. This was a problem, because Huerta was classified as a driving employee at Libertyville. He had signed copies of a dealership policy that required employees both to possess a valid license and to inform superiors of changes to their driving privileges. Davis admitted that Theodorou consulted him on how to proceed with Huerta. The ALJ found that Davis “advised Theodorou how to proceed, with a view toward protecting both Huerta and the Company.” Theodorou told Huerta's immediate supervisor, service department director David Borre, to suspend Huerta. On August 26, 2011, Borre called Huerta in for a meeting during which Huerta admitted that he had received the DUI charge and that his driver's license was suspended. Borre told Huerta he was suspended until September 14 and asked him “to try to get his driver's license situation corrected.” (Huerta's court hearing on his DUI charge was scheduled for September 13.)

One day after meeting with Borre, Huerta received a letter signed “2280–Libertyville Toyota.” The letter informed Huerta “that information contained in a consumer report, if accurate, would prevent 2280–Libertyville Toyota from extending an employment offer, continuing your current employment or granting a promotion to you at this time” (emphasis added). The letter, dated August 25, 2011, invited Huerta to “contact Sterling within 5 business days” if he thought the attached background screening report was inaccurate. Although the letter itself gave no indication of who “Sterling” was, the attached report indicated that it had been prepared by a company called Sterling Infosystems. AutoNation contracted with Sterling to furnish motor vehicle reports on its employees, and Sterling automatically sent a letter when it found an adverse notation in an employee's driving record. On September 3, Huerta received another letter (dated September 1), also signed by “2280–Libertyville Toyota” but prepared by Sterling. This letter told Huerta “that an offer of employment, a continuation of current employment or the granting of a promotion will not be made at this time ” (emphasis added). Not long after receiving this letter, Huerta applied for unemployment benefits with the State of Illinois. The Illinois Department of Employment Security promptly informed AutoNation about Huerta's filing, and Theodorou responded that Huerta had been suspended and not terminated. (There is no indication that he ever passed this news along to Huerta.) Huerta did not return to work, and Theodorou sacked him on September 21 for “job abandonment.”

At the end of August 2011, the Union filed an unfair labor charge against AutoNation with the Board alleging that Libertyville had suspended Huerta because of his union activity. Three months later, the Union amended this charge to add a claim about Huerta's firing and to raise several new unfair labor claims against AutoNation. In December 2011, the Board's general counsel filed a complaint against Village Motors (later adding AutoNation) raising claims about AutoNation employees' statements at the August 23, 2011, meeting and about Huerta's suspension and firing. An ALJ agreed that comments by Davis and Andrews violated the Act in multiple ways: (1) threatening that unionizing would be futile; (2) threatening demotion of unionizing employees; (3) threatening blacklisting of union supporters; and (4) impliedly promising salary increases if dealership employees did not vote in the union. The judge decided, however, that AutoNation had not committed an unfair labor practice in either firing or suspending Huerta.

After both the Board's general counsel and AutoNation filed exceptions to the judge's ruling, a three-member panel of the Board issued its decision. The Board affirmed the ALJ's findings that the AutoNation employees' comments at the August 23 meeting were unfair labor practices and that Huerta's suspension was not; it reversed the judge's finding on Huerta's discharge. One member of the panel dissented because he did not agree that AutoNation had made an implied promise of wage increases or that it had violated the Act by discharging Huerta.

AutoNation filed a petition for review of the Board's decision in September 2014. One month later, the Board filed a cross-application for enforcement of the panel's order. We have jurisdiction under 29 U.S.C. § 160(f).

II

We begin with the heart of the case: the Board's finding that AutoNation and Village Motors violated Section 8(a)(1) of the Act, 29 U.S.C. § 158(a)(1), in four ways. The Act makes it an unfair labor practice for an employer “to interfere with, restrain, or coerce employees in the exercise of” their guaranteed rights to organize and bargain collectively. We apply a deferential standard of review to the Board's findings, looking only to see whether they are supported by substantial evidence. See 29 U.S.C. § 160(e). This means “such relevant evidence that a reasonable mind might accept as...