Lineback v. Printpack, Inc.

• Citation: 979 F.Supp. 831
• Decision Date: 19 September 1997
• Docket Number: No. IP 97-1102-C H/G.,IP 97-1102-C H/G.
• Parties: Rik LINEBACK, Acting Regional Director of the Twenty-Fifth Region of the National Labor Relations Board, for and on behalf of the National Labor Relations Board, Petitioner, v. PRINTPACK, INC., Respondent. PRINTPACK, INC., Counter-Petitioner, v. Rik LINEBACK, Individually and as Acting Regional Director of the Twenty-Fifth Region of the National Labor Relations Board; National Labor Relations Board; William B. Gould, IV, Sarah M. Fox and John E. Higgins, Jr., Individually and as Members of the NLRB; and Frederick Feinstein, Individually and as General Counsel of the NLRB, Counter-Respondents.
• Court: U.S. District Court — Southern District of Indiana

979 F.Supp. 831

Rik LINEBACK, Acting Regional Director of the Twenty-Fifth Region of the National Labor Relations Board, for and on behalf of the National Labor Relations Board, Petitioner, v. PRINTPACK, INC., Respondent.

PRINTPACK, INC., Counter-Petitioner, v. Rik LINEBACK, Individually and as Acting Regional Director of the Twenty-Fifth Region of the National Labor Relations Board; National Labor Relations Board; William B. Gould, IV, Sarah M. Fox and John E. Higgins, Jr., Individually and as Members of the NLRB; and Frederick Feinstein, Individually and as General Counsel of the NLRB, Counter-Respondents.

No. IP 97-1102-C H/G.

United States District Court, S.D. Indiana, Indianapolis Division.

September 19, 1997.

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Walter Steele, N.L.R.B., Indianapolis, IN, for Petitioner and Counter-Respondents.

Robert H. Buckler, R. Steve Ensor, Glenn G. Patton, Alston & Bird, L.L.P., Atlanta, GA, Paul H. Sinclair, Ice Miller Donadio & Ryan, Indianapolis, IN, for Respondent and Counter-Petitioner.

MEMORANDUM OPINION

HAMILTON, District Judge.

Section 10(j) of the National Labor Relations Act ("NLRA") authorizes the National Labor Relations Board ("the Board") to petition a district court for injunctive relief pending final resolution of an unfair labor practice charge. 29 U.S.C. § 160(j). In this case the Board's Regional Director seeks such relief on several unfair labor practice charges pending against defendant Printpack, Inc. The charges arose from Printpack's disputes with the union representing the employees of its flexible packaging factory in Greensburg, Indiana. An administrative law judge ("ALJ") has conducted a hearing for the Board on the underlying unfair labor practices charges, but final resolution of those charges appears it could easily be months or perhaps several years away.

Among many issues here, one appears to be one of first impression: whether a § 10(j) order may require a respondent to seek a stay in another federal lawsuit that the respondent has filed under § 303 of the Labor Management Relations Act ("LMRA"), 29 U.S.C. § 187. The case also raises important issues about the ability of unions and their members to criticize employers when seeking support from third parties in labor disputes. At the heart of this case is a letter that the president of the local union sent to a number of Printpack's customers. The letter began by saying: "I want to alert you to a potentially alarming situation at our plant that could have an impact on the quality of the packaging materials we manufacture for [your Company]." The letter then complained about Printpack's approach to collective bargaining with its employees and said, in the most hotly disputed sentence: "We hope that if the plant's new management provokes a strike, that you will consider withdrawing your patronage, both because we could no longer guarantee the quality of our product and because it would be the right thing to do." Printpack responded to the letter by firing the local president, suing the union and the president, and essentially barring the union president from the factory premises. The Board and the union contend that the local president's letter was a classic exercise of a union's federally protected right to publicize a labor dispute and to seek support for the union's position. They contend that Printpack's response violated § 8(a)(1) of the NLRA. 29 U.S.C. § 158(a)(1). Printpack argues that the letter to its customers was an unlawful and unprotected effort to disparage its products and to coerce those customers into supporting the union in the labor dispute, and thus violated § 8(b)(4)(ii)(B) of the NLRA, 29 U.S.C. § 158(b)(4)(ii)(B). Printpack therefore concludes that its response, including firing the author of the letter and suing the author and the union, was a proper exercise of an employer's rights under federal labor law.

The court has before it the record of the hearing before the Board's ALJ, additional evidence relevant to the parties' requests for injunctive relief, and extensive briefing. This opinion sets forth the court's findings of fact and conclusions of law pursuant to Fed. R.Civ.P. 65. As explained in detail below, the court concludes that the Director has shown a sufficient likelihood that the union's letter to customers was protected activity and that Printpack's response violated federal labor law. The Director has also shown that relief under § 10(j) is, in the terms of the statute, "just and proper." That relief will include reinstatement of the local president and the right to enter the factory premises to represent other employees. In addition, that relief can and will include an injunction ordering Printpack to stay prosecution of its § 303 lawsuit against the union and the president pending final resolution of the unfair labor practice charge directed against that lawsuit. Finally. Printpack has raised in its counterclaims an important question as to whether the Board's internal procedures for deciding whether to seek relief under § 10(j) comply with constitutional due process protections and protections against ex parte communications in administrative proceedings under the federal Administrative Procedure Act. However, controlling case law shows that this court lacks subject matter jurisdiction over all of Printpack's counterclaims.

Findings of Fact

On August 22, 1996, Printpack acquired nine flexible packaging facilities, including the facility in Greensburg, Indiana, from the James River Corporation as part of an asset purchase agreement. After Printpack acquired the Greensburg facility, the business of the facility continued virtually unchanged. James River had a long-standing collective bargaining relationship with Local 761-S of the Graphic Communications Union. The last collective bargaining agreement was effective from October 1, 1995, through October 1, 1996. After closing the asset purchase, Printpack recognized Local 761-S as the exclusive bargaining representative for the Greensburg facility and continued to operate under the James River labor agreement. Local 761-S and Printpack began negotiations for a new contract on October 10, 1996. There were three bargaining sessions before December 20, 1996. At that time, Printpack gave the union written notice that the existing contract would terminate at midnight on January 27, 1997. There were six more bargaining sessions through January 28, 1997. However, Printpack and Local 761-S did not reach agreement on a new contract.

At all relevant times, Chris Hancock has been the president of Local 761-S. On January 28, 1997, Hancock sent identical letters to approximately 40 Printpack customers informing them of the inability to reach agreement on a new contract and requesting their support in the event of a strike. That letter is the central document in this case. It stated in full:

Dear Sir:

On behalf of the 450 employees of Printpack, Inc. in Greensburg, Indiana, who are members of Local 761-S, I want to alert you to a potentially alarming situation at our plant that could have an impact on the quality of the packaging materials we manufacture for [your Company].

As you probably know, Printpack, Inc. purchased the operation last August from James River Corporation. We have always prided ourselves on working in a manner that was both productive for our customer and profitable for our management. Now, the new owners are threatening to reduce our ability to do that. We have been offered a contract that would diminish benefits and hamper working conditions for many if not all employees. When we attempted to address these issues in good faith collective bargaining, Printpack refused to budge and eventually issued an ultimatum: Either we agree to accept less than we have proven our work is worth or the Company will institute even more draconian measures next Monday. February 3.

We could understand this attitude if the plant was in financial trouble. But the quality work we produce for loyal customers such as you continues to make a profitable operation. What we are facing, I am afraid, is a new owner bent on increasing margin at the expense of employee and product. We are trying still again this week to convince Printpack, Inc. to bargain in good faith. You have our word that we seek only fair treatment. We hope that if the plant's new management provokes a strike, that you will consider withdrawing your patronage, both because we could no longer guarantee the quality of our product and because it would be the right thing to do. We will try to keep you posted on future developments.

Sincerely,

Chris Hancock, President Local 761-S

On behalf of the Officers and Members

In Greensburg, Indiana

General Counsel Ex. 9.¹ Hancock arranged to have the letter faxed from the local Greensburg office of Edward D. Jones & Company, a nationwide stock broker, and the faxes showed that they had originated from Edward D. Jones & Company.

Printpack quickly obtained a copy of the letter from customers. On January 30, 1997, Phil Murphree, General Manager of the Film Products Division of Printpack, sent the following response to Hancock's letter to Printpack employees at the Greensburg facility:

Dear Fellow Employee:

Attached is a copy of a letter that was sent to customers of Printpack this week by your union leadership. The letter is both unlawful and irresponsible. The threat by Mr. Hancock that our employees will sabotage the quality of products and his request that our customers "consider withdrawing patronage" not only hurts the Company, but jeopardizes the jobs of everyone employed in Greensburg. Printpack will not tolerate this kind of irresponsible action and will respond to the full extent the law allows.

You also need to know that Mr. Hancock's claim that Printpack has not bargained in good faith and has issued the union "an ultimatum" is untrue. In fact, the entire proposal that has been...