Mid-South Bottling Co. v. N.L.R.B.

• Decision Date: 30 June 1989
• Docket Number: MID-SOUTH,No. 88-4243,88-4243
• Citation: 876 F.2d 458
• Parties: 131 L.R.R.M. (BNA) 2833, 112 Lab.Cas. P 11,324 BOTTLING COMPANY, Petitioner, Cross-Respondent, v. NATIONAL LABOR RELATIONS BOARD, Respondent, Cross-Petitioner.
• Court: U.S. Court of Appeals — Fifth Circuit

Page 458

876 F.2d 458

131 L.R.R.M. (BNA) 2833, 112 Lab.Cas. P 11,324

MID-SOUTH BOTTLING COMPANY, Petitioner, Cross-Respondent, v.NATIONAL LABOR RELATIONS BOARD, Respondent, Cross-Petitioner.

No. 88-4243.

United States Court of Appeals Fifth Circuit.

June 30, 1989.

Kenneth E. Milam, R. Pepper Crutcher, Jr., Jackson, Miss., for petitioner, cross-respondent.

Aileen Armstrong, DeputyAssoc. General Counsel, NLRB, Fred L. Cornnell, Washington, D.C., for respondent, cross-petitioner.

Thomas Chad Farris, Deborah A. Jeon, Little Rock, Ark., for intervenor.

Petition for Review and Cross-Application for Enforcement of an Order of the National Labor Relations Board.

Before REAVLEY, WILLIAMS and JONES, Circuit Judges.

JERRE S. WILLIAMS, Circuit Judge:

Mid-South Bottling Company appeals the National Labor Relations Board's remedial order directing Mid-South to reopen and resume operations of one of its facilities.While Mid-South does not dispute the findings by the Board or the Administrative Law Judge (ALJ) that it committed unfair labor practices including the closure of its facility, Mid-South does dispute the remedy.It argues that the Board abused its discretion.Mid-South urges that a less severe remedy is appropriate because reopening would be unduly burdensome.Mid-South further claims that the facility would have been closed anyway due to its unprofitability and the partial collapsed roof of the warehouse, the main building of the facility.After a careful review of the record, we find Mid-South's assertions unsupported by the record and enforce the remedial order of the Board.

I.Facts and Prior Proceedings

Mid-South was formed as a holding company in 1982 by the leveraged buy-out of several Pepsi bottling and distribution enterprises in Arkansas, Louisiana, Mississippi, and Tennessee that bottled, distributed, and sold soft drinks.In early 1986, Mid-South, operating through three divisions, controlled 20 subsidiaries.The subsidiaries operated more than 20 distribution facilities, including the Forrest City facility, the facility that is the subject of this appeal.

On January 1, 1986, Mid-South transferred the Forrest City soft drink distribution facility to a subsidiary in the Arkansas Division from a subsidiary in the Mississippi-Tennessee Division.The Forrest City facility had been in use for about 60 years, and the main building, which was the warehouse, was in poor condition and had been so for some time.

On January 17, 1986, Mid-South was informed that a sufficient number of its employees at the Forrest City facility had signed authorization cards to warrant representation by the International Union of Electronic, Electrical, Technical, Salaried, and Machine Workers, AFL-CIO ("Union").An election campaign then ensued and the Union won.During the campaign Mid-South officials attempted to defeat the Union by, among other things, threatening to close the facility if the Union won the election.

The Company then filed objections to the election.The Union responded by bringing charges of unfair labor practices against the Company.After negotiations initiated by Mid-South, the Union agreed to drop the unfair labor allegations in exchange for the Company's withdrawal of objections to the election and the promise to recognize and negotiate in good faith with the Union.The Union was certified finally on April 28, 1986, as the exclusive bargaining representative of the employees.

On May 5, only a few days after having been certified, the Union was informed by telegram that the facility was going to be shut down, and at the close of business on May 9, it was.On June 24, 1986, the Union filed new charges of unfair labor practices against Mid-South, including the improper closure of the facility.

After hearings the Administrative Law Judge found numerous unfair labor practice violations by Mid-South.Specifically, the ALJ found Mid-South violated Section 8(a)(1) of the National Labor Relations Act by threatening to close the facility if the Union was elected, threatening individuals with the loss of their jobs and benefits and with other reprisals, and interrogating workers regarding their union activity.29 U.S.C. Sec. 158(a)(1).He also found violations of Sections 8(a)(1) and (3) by the Company's issuance of warnings, its enforcement of work rules more strictly, and its withholding or changing the employees' benefits because of their support for the Union.29 U.S.C. Sec. 158(a)(1) and (3).He further found violation of Sections 8(a)(1) and (3), in that the Company had closed the Forrest City facility because of the employees' selection of Union representation.Id.Finally, he found Section 8(a)(5) was violated by the Company when it refused to bargain with the Union over its decision to close the facility and transfer its operations and when it refused to furnish the Union with the relevant information needed for collective bargaining.29 U.S.C. Sec. 158(a)(5).

On appeal to the NLRB, the ALJ's decision was upheld unanimously with only some modifications on the factual findings.Mid-South BottlingCo., 287 N.L.R.B. No. 146, 1987-88 NLRB Dec.(CCH)p 19262(1988).The Board affirmed the ALJ's order requiring the Company to cease and desist from the unfair labor practices and from in any manner interfering with, restraining, or coercing employees in the exercise of their rights protected by the Act.The affirmance also required the Company to reestablish and resume operations of the Forrest City facility.The Company was further required to offer full and immediate reinstatement to the discriminatees.Reinstatement was ordered to include deleting any reference to termination in the employees' files and making them whole, with interest, for any loss of earnings and other benefits they suffered as a result of the discrimination against them.Finally, the order required the Company to recognize and bargain with the Union upon request and to treat the initial certification year as beginning on the date of compliance with the order, to mail appropriate notice to each employee, and to post the notices after the reestablishment of the Forrest City facility.

Before this Court, Mid-South does not contest any of the unfair labor practice findings of the Board.¹The Company only contests the part of the remedial order that requires it to resume operating the Forrest City facility.

II.Scope of Review

Section 10(c) of the Act vests the NLRB with broad authority to "devise remedies to effectuate the policies of the Act."NLRB v. Seven-Up Bottling Co., 344 U.S. 344, 346, 73 S.Ct. 287, 289, 97 L.Ed. 377(1953).In fashioning its remedies, "the Board draws on a fund of knowledge and expertise all its own, and its choice of remedy must therefore be given special respect by reviewing courts."NLRB v. Gissel Packing Co., 395 U.S. 575, 612 n. 32, 89 S.Ct.1918, 1939, 23 L.Ed.2d 547(1969).Our review then "is quite limited."NLRB v. Lighthouse for the Blind, 696 F.2d 399, 404(5th Cir.1983).An employer seeking to set aside an order of the Board faces the "rigorous task" of showing that the order is " 'a patent attempt to achieve ends other than those which can fairly be said to effectuate the policies of the Act.' "Statler Industries, Inc. v. NLRB, 644 F.2d 902, 909-10(1st Cir.1981)(quotingVirginia Electric & Power Co. v. NLRB, 319 U.S. 533, 540, 63 S.Ct. 1214, 1218, 87 L.Ed. 1568(1943)).

III.NLRB's Long-Standing Policy: Restore the Status QuoAnte the Unfair Labor Practices as Nearly asPossible

The answer as to whether the Board should order the resumption of operations as a remedy for unfair labor practices is closely tied to the facts of each case.No per se rule can be stated.The restoration of the status quo ante the unfair labor practices is, however, prima facie the appropriate remedy where an employer closes a part of its operation for discriminatory purposes.Fibreboard Paper Products Corp. v. NLRB, 379 U.S. 203, 215-17, 85 S.Ct. 398, 405-06, 13 L.Ed.2d 233(1964);Woodline Motor Freight, Inc. v. NLRB, 843 F.2d 285, 291(8th Cir.1988);Statler Industries, 644 F.2d at 909-10;Town & CountryMfg. Co., 136 N.L.R.B. No. 1022, 1962 NLRB Dec.(CCH)p 11100(1962), enforced, 316 F.2d 846, 847(5th Cir.1963).The restoration order is designed to "restore the parties to the situation that existed prior to the commission of the unfair labor practices."Manley Transfer Co. v. NLRB, 390 F.2d 777, 782(8th Cir.1968).Because Mid-South concedes on appeal the finding by the Board that the closure of the plant was for discriminatory purposes, reopening the facility was prima facie the correct remedy.

Mid-South could have avoided the imposition of the restoration order by showing that restoration of the status quo ante either imposed "an undue or unfair burden on it,"Fibreboard Paper Products, 379 U.S. at 216, 85 S.Ct. at 406, or threatened its viability as a company.The threshold to establishing its burden is high.SeeWoodline Motor Freight, 843 F.2d at 290-91(holding that the restoration order was not unduly burdensome where it "would not require capital investment disproportionate to [the employer's] resources or impose substantial, continuing losses");NLRB v. Jackson Farmers, Inc., 457 F.2d 516, 518(10th Cir.1972)(resumption of operations "although it is severe" is "not a prohibited remedy");Rebel CoalCo., 259 N.L.R.B. No. 258, 1981 NLRB Dec.(CCH)p 18662(1981)(restoration order appropriate where no basis to conclude remedy would be "unduly burdensome or endanger [employer's] continued viability");Purolator Armored, Inc., 268 N.L.R.B.No. 1268, 1983-84 NLRB Dec. (CCH)p 16128(1984)(restoration order "unduly burdensome" where credited evidence showed employer in a "financially unprofitable operation" suffering from "long and extensive" and "extreme" financial losses);Great Chinese American Sewing Co., 227 N.L.R.B.No. 1670, 1976-77 NLRB Dec. (CCH)p 17860(1977), enforced, 578 F.2d...