805 F.3d 1155 (9th Cir. 2015), 12-55828, National Labor Relations Bd. v. Fresh & Easy Neighborhood Mkt., Inc.

Docket Nº:12-55828
Citation:805 F.3d 1155
Opinion Judge:Marsha S. Berzon, Circuit Judge:
Party Name:NATIONAL LABOR RELATIONS BOARD, On Relation of the United Food and Commercial Workers International Union, Petitioner-Appellee, UNITED FOOD AND COMMERCIAL WORKERS INTERNATIONAL UNION, Intervenor-Plaintiff--Appellee, v. FRESH AND EASY NEIGHBORHOOD MARKET, INC., Respondent-Appellant
Attorney:Stuart Newman (argued), Seyfarth Shaw LLP, Atlanta, Georgia; Joshua L. Ditelberg, Seyfarth Shaw LLP, Chicago, Illinois, for Respondent-Appellant. David A. Rosenfeld (argued) and Sean D. Graham, Weinberg, Roger & Rosenfeld, Alameda, California, for Petitioner-Appellee.
Judge Panel:Before: Harry Pregerson, Michael R. Murphy[*], and Marsha S. Berzon, Circuit Judges.
Case Date:November 13, 2015
Court:United States Courts of Appeals, Court of Appeals for the Ninth Circuit
SUMMARY

The Union seeks enforcement of a subpoena duces tecum it served on Fresh & Easy before a hearing before the Board. The Board issued the subpoena at the Union’s request in connection with charges that Fresh & Easy engaged in unfair labor practices by stifling union activity. Fresh & Easy contends that it missed the filing deadline because the Union did not serve Fresh & Easy’s counsel of record... (see full summary)

 
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Page 1155

805 F.3d 1155 (9th Cir. 2015)

NATIONAL LABOR RELATIONS BOARD, On Relation of the United Food and Commercial Workers International Union, Petitioner-Appellee, UNITED FOOD AND COMMERCIAL WORKERS INTERNATIONAL UNION, Intervenor-Plaintiff--Appellee,

v.

FRESH AND EASY NEIGHBORHOOD MARKET, INC., Respondent-Appellant

No. 12-55828

United States Court of Appeals, Ninth Circuit

November 13, 2015

Argued and Submitted February 6, 2014, Pasadena, California

Appeal from the United States District Court for the Central District of California. D.C. No. 2:11-cv-10070-CBM-FMO. Consuelo B. Marshall, Senior District Judge, Presiding.

SUMMARY[**]

Subpoena

The panel affirmed the district court's order enforcing a subpoena duces tecum that the United Food and Commercial Workers Union served on Fresh and Easy Neighborhood Market, Inc. in advance of a hearing before the National Labor Relations Board.

The panel disagreed with the district court's holding that the subpoena was properly served, but affirmed the order to comply with the subpoena on different grounds. The panel affirmed the decision to enforce the subpoena because exhaustion was required and Fresh & Easy suffered no prejudice that would excuse it from that requirement. Specifically, the panel held that the Union failed to meet its procedural obligations when it neglected to serve the subpoena on Fresh and Easy's counsel of record. The panel further held that although service of the subpoena was defective, the defect was insufficient to excuse Fresh and Easy from the obligation to file a petition to revoke the subpoena in accordance with agency procedure. The panel further held that its finding that Fresh and Easy was not prejudiced precluded consideration of the merits-based challenges to the subpoena's validity, as the Board did not consider those claims.

Stuart Newman (argued), Seyfarth Shaw LLP, Atlanta, Georgia; Joshua L. Ditelberg, Seyfarth Shaw LLP, Chicago, Illinois, for Respondent-Appellant.

David A. Rosenfeld (argued) and Sean D. Graham, Weinberg, Roger & Rosenfeld, Alameda, California, for Petitioner-Appellee.

Before: Harry Pregerson, Michael R. Murphy[*], and Marsha S. Berzon, Circuit Judges.

OPINION

MARSHA S. BERZON, Circuit Judge.

Petitioner-Appellee United Food and Commercial Workers Union (the " Union" ) asks this court to enforce a subpoena duces tecum it served on Respondent-Appellant Fresh & Easy Neighborhood Market, Inc. (" Fresh & Easy" ) in advance of a hearing before the National Labor Relations Board (the " NLRB" or " Board" ). The Board issued the subpoena at the Union's request in connection with charges that Fresh & Easy engaged in unfair labor practices by stifling union activity.

Fresh & Easy did not contest the validity of the subpoena by requesting within five days of service that the Board revoke the subpoena, as required by the National Labor Relations Act (the " NLRA" or the " Act" ) and its corresponding Board regulations. See 29 U.S.C. § 161; 29 C.F.R. § 102.31(b). Fresh & Easy contends that it missed the filing deadline because the Union did not serve Fresh & Easy's counsel of record with a copy of the subpoena; only the party was served.

The district court held the subpoena properly served and ordered Fresh & Easy to comply with the Union's requests. Fresh & Easy timely appealed. We disagree with the district court's conclusion but affirm the order to comply with the subpoena on different grounds.

I.

As of January 2012, Fresh & Easy operated a chain of approximately 170 grocery stores, with locations in California, Nevada, and Arizona. Beginning in December 2010, Fresh & Easy posted signs near the entrances of at least four of its California stores reading, " Sorry but we don't allow solicitation, loitering or the posting of flyers."

In January 2011, the Union filed an unfair labor practices charge with the Board. The charge alleged that the maintenance of the signs constituted a violation of the NLRA, see 29 U.S.C. § 158(a)(1), by interfering with, restraining, or coercing employees in the exercise of their rights protected under the Act.1 Pursuant to that charge, the General Counsel of the N.L.R.B. filed a complaint against Fresh & Easy before the Board. Fresh & Easy answered the complaint, denying that it had violated the Act. A hearing before an Administrative Law Judge (" ALJ" ) was held on July 19, 2011.

In preparation for the hearing, the Union sought and the Board provided a blank subpoena duces tecum. On July 8, the Union served the completed subpoena duces tecum on " Hugh Cousins and/or the Custodian of Records of Fresh & Easy Neighborhood Market" by courier at Fresh & Easy's principal place of business. As pertinent here, the subpoena sought " [a]ll documents which concern, mention, or relate to any union organizing or union activities" and " [a]ll documents maintained on any company hotline or similar message system which concern [sic] mention, relate or refer to union activity." 2 Any petition to revoke the subpoena was due in writing within five days of service. 29 C.F.R. § 102.31(b).

The Union never served the subpoena on Fresh & Easy's counsel of record. But prior to the hearing, Fresh & Easy sent a copy of the subpoena to its counsel by email. It is not clear from the record exactly when counsel received the client email, but Fresh & Easy never suggested, and has not established, that it was after the deadline to file a petition to revoke. Fresh & Easy's counsel simply overlooked the email " until the evening of July 18, 2011, the night before the hearing at which production of the subpoenaed documents would have been required."

At the hearing, Fresh & Easy did not produce documents responsive to the subpoena. Instead, it argued that the subpoena was invalid because it had not been served on Fresh & Easy's counsel and because it sought evidence outside the scope of the General Counsel's complaint. The ALJ declined to entertain Fresh & Easy's arguments in absence of a petition to revoke, and left the record open following the hearing to permit the Union to decide whether to seek enforcement of the subpoena. Thereafter, the Union requested that the NLRB, through its General Counsel, initiate enforcement proceedings. See 29 C.F.R. § 102.31(d).

Fresh & Easy subsequently filed a motion to close the record before the ALJ, arguing that because the General Counsel had already rested its case, supplementation of the record was unnecessary. The ALJ denied Fresh & Easy's motion, holding that...

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