N.L.R.B. v. O'Neill
| Decision Date | 05 June 1992 |
| Docket Number | Nos. 90-70643,I,90-70645,No. 126,126,s. 90-70643 |
| Citation | 965 F.2d 1522 |
| Parties | 140 L.R.R.M. (BNA) 2557, 61 USLW 2047, 122 Lab.Cas. P 10,217 NATIONAL LABOR RELATIONS BOARD, Petitioner, and United Food & Commercial Workers Union, Localntervenor, v. Edwin R. O'NEILL, an individual; O'Neill, Ltd., et al., Respondents. |
| Court | U.S. Court of Appeals — Ninth Circuit |
Paul Hitterman and Howard E. Perlstein, N.L.R.B., Washington, D.C., for petitioner.
Robert M. Cassel, Sullivan, Roche & Johnson, San Francisco, Ca., for respondents.
David A. Rosenfeld Van Bourg, Weinberg, Roger & Rosenfeld, San Francisco, Ca., for intervenor.
On Application for Enforcement of an Order of the National Labor Relations Board.
Before: FLETCHER, D.W. NELSON, and FERNANDEZ, Circuit Judges.
OVERVIEW
The National Labor Relations Board ("NLRB") petitions for enforcement of two of its orders. In case no. 90-70643, the NLRB petitions for enforcement of an order designed to compensate the Butchers' and Teamsters' Unions for unfair labor practices that occurred when Edwin O'Neill closed his meat plant in 1977 and then abruptly reopened it under the auspices of four new corporations just three weeks later. Case no. 90-70645 concerns unfair labor practices that resulted from the plant's permanent closing in 1981. O'Neill contends that the NLRB erred in holding that the unfair labor practices charges at issue in case no. 90-70643 were not time-barred, in finding that the new corporations were alter egos of the corporations formerly in existence at the plant, and in holding him individually liable for the unfair labor practices. We affirm the orders of the NLRB in both cases.
The facts of this case are long and complicated. The issues in this dispute all relate to the closing and subsequent reopening of a meat processing plant in Fresno, California, in 1977. O'Neill Meat Co. was formed in 1949 and Edwin O'Neill personally assumed control in the late 1960s. O'Neill owned 91% of the stock in O'Neill Meat Co.
In the mid 1970s, O'Neill Meat Co. began to experience severe losses. Accordingly, O'Neill decided to undertake an unpublicized reorganization of his company. O'Neill Meat Co. was renamed "Food Equipment Leasing Co." (hereinafter "FELC"). A wholly owned subsidiary of FELC entitled O'Neill Meat Company (hereinafter "OMC") was formed to operate the plant. OMC took responsibility for the production employees and union contracts formerly held by O'Neill Meat Co. Finally, a previously dormant corporation called O'Neill Ltd. was reactivated to assume the management functions of the plant. 1 Under the new organization, OMC leased the plant and its equipment from FELC and operated the plant; O'Neill Ltd. performed administrative and bookkeeping functions for OMC. All former FELC employees were also transferred to the payrolls of either OMC or O'Neill Ltd. O'Neill Ltd. became a holding company for FELC, holding 91% of its stock. The net result of this combined enterprise was an organization responsible for feeding and slaughtering cattle, and supplying beef to various stores in California.
At the same time that O'Neill was reorganizing his business, he began to rethink his relationship with the Butchers and Teamsters Unions. O'Neill had previously had a long and peaceful relationship with both unions. In 1975, however, O'Neill retained the services of a labor consultant. In February 1976, O'Neill allegedly threatened some plant supervisors with the loss Despite the reorganization, O'Neill's company continued to lose money in 1977. Accordingly, on October 26, 1977, O'Neill informed his employees that he intended to close the plant. O'Neill blamed his decision on both longstanding drought conditions and the cheaper labor that was available to meat processors in the Midwest. 2 By November 23, all employees had been laid off from the plant. O'Neill met with the unions on both November 8 and December 8 to discuss the effects of the plant closing.
of their jobs if they did not resign their union memberships. In the fall of 1976, before the reorganization, O'Neill and the unions negotiated new collective bargaining agreements which called for yearly wage increases despite the company's growing financial problems. O'Neill also proposed a four-day workweek, but the unions refused to agree to the proposal
At the December 8 meeting O'Neill and his representatives asserted to the unions that the plant closure should be considered permanent and that O'Neill had no intention of returning to the meat packing business. 3 When the union's attorney inquired if there was a possibility of leasing the facility, O'Neill's attorney responded that he was trying to arrange a lease, but in reality a lease between OMC and an entity called Fresno Beef Packers ("FBP") had already been executed on December 1. O'Neill's attorney also stated that the closing decision might be reconsidered if the Butchers were willing to make some concessions. However, on December 12, the plant did in fact reopen under the auspices of four new corporations. 4
Each corporation handled a portion of OMC's former business. The FBP company was responsible for leasing the plant from FELC and slaughtering the cattle. The Don Turner Corporation (DTC) provided the labor used for slaughtering operations. The Sierra Pacific Meat Company (SPM) procured the cattle and brokered the finished product. The JET company transported the finished product using trucks leased from FELC. O'Neill Ltd. provided accounting and bookkeeping services, and yet another Edwin O'Neill-owned company, O'Neill Cattle Feeding Co. (OCF), supplied the cattle.
For the purposes of this discussion, several facts associated with the formation of the four new companies are significant. First, all were incorporated in late November and early December. Second, the owners of each company had previous relationships with both O'Neill and the meat plant. Third, all the companies had very small capitalizations, ranging from $1000 to $5000. Fourth, none of the companies secured a line of credit from a bank prior to the commencement of operations. Finally, the same lawyer handled the incorporation of three of the companies.
O'Neill and his representatives held another meeting with the Butchers on January 19, 1978. The Butchers inquired about the reopening of the plant and O'Neill's interest in the various companies. The facts are sketchy about what information was given to the union at this meeting, but it appears that O'Neill did not volunteer the information that he was involved with any of the companies. At that time, the Butchers also told O'Neill that they were filing a grievance against OMC over the plant's closing.
On April 12, 1978, the Butchers filed unfair labor practice charges (ULPC) On March 3, 1982, an administrative law judge issued his initial decision, finding that O'Neill and his companies had committed unfair labor practices by terminating and refusing to reinstate union members, by repudiating the union agreements in effect at OMC, and by refusing to bargain in good faith. On August 1, 1985, the NLRB remanded the case to the ALJ to determine whether the complaint should be dismissed as barred by a six-month statute of limitations because of the NLRB's 1985 decision in Ducane Heating Corp., 273 NLRB 1389 (1985), enforced, 785 F.2d 304 (4th Cir.1986). The ALJ found that the statute of limitations had been tolled because of O'Neill's fraudulent concealment of the operative facts underlying his violations. On May 31, 1988, the NLRB adopted the ALJ's findings that the complaint was not time-barred and that O'Neill was the alter ego of all other respondents in the case and thus was individually liable for their unfair labor practices. This appeal for enforcement of the NLRB's orders followed. 7
against OMC. 5 Following an investigation, the NLRB dismissed the charges because of a lack of evidence that O'Neill owned or controlled the new companies. The Butchers filed an appeal of the dismissal; the Teamsters did not. On October 5, 1978, the Regional Director of the NLRB received a letter from the Butchers stating that they had new information relevant to the previously dismissed charges. 6 On November 21, the Regional Director notified the parties that the Butchers' charges had been reinstated. On January 30, 1979, the Regional Director issued a complaint on the Butchers' charges, and on April 27, he issued an amended complaint that consolidated the Teamsters' and Butchers' charges
STANDARD OF REVIEW
Decisions of the NLRB will be upheld on appeal if the NLRB's findings of fact are supported by substantial evidence and if it has correctly applied the law. NLRB v. Howard Elec. Co., 873 F.2d 1287, 1290 (9th Cir.1989). "The substantial evidence test is essentially a case-by-case analysis requiring review of the whole record." Turcios v. INS, 821 F.2d 1396, 1398 (9th Cir.1987). Substantial evidence means Richardson v. Perales, 402 U.S. 389, 401, 91 S.Ct. 1420, 1427, 28 L.Ed.2d 842 (1971) (citing Consolidated Edison Co. v. NLRB, 305 U.S. 197, 229, 59 S.Ct. 206, 217, 83 L.Ed. 126 (1938)).
DISCUSSION
Section 10(b) of the National Labor Relations Act ("NLRA") provides that "no complaint shall issue based upon any unfair labor practice occurring more than six months prior to the filing of the charge with the Board." 29 U.S.C. § 160(b). 8 In Ducane Heating Corp., 273 NLRB 1389, the NLRB held that a dismissed charge may not be reinstated outside of the original six month statute of limitations period, unless the employer has fraudulently concealed material facts underlying the alleged violations. "Where there is fraudulent concealment, the...
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