N.L.R.B. v. Chicago Marine Containers, Inc., 83-1909
| Decision Date | 04 October 1984 |
| Docket Number | No. 83-1909,83-1909 |
| Citation | 745 F.2d 493 |
| Parties | 117 L.R.R.M. (BNA) 2638, 101 Lab.Cas. P 11,213 NATIONAL LABOR RELATIONS BOARD, Petitioner, v. CHICAGO MARINE CONTAINERS, INC., Respondent. |
| Court | U.S. Court of Appeals — Seventh Circuit |
L. Pat Wynns, N.L.R.B., Elliott Moore, N.L.R.B., Washington, D.C., for petitioner.
Dana S. Connell, Matkov, Griffin, Parsons, Salzman & Madoff, Chicago, Ill., for respondent.
Before WOOD and ESCHBACH, Circuit Judges, and KELLAM, Senior District Judge. *
The National Labor Relations Board (the "Board") seeks enforcement of its order finding Chicago Marine Containers, Inc. ("the company") in violation of subsections (a)(1) and (a)(5) of section 8 of the Labor Management Relations Act, 29 U.S.C. Sec. 158(a)(1), (5) (1982), because of the company's refusal to bargain with the United Electrical, Radio and Machine Workers of America ("the union"), the union certified as the exclusive bargaining representative of the company's employees. The company admittedly has refused to bargain with the union, which won election with over ninety percent of the votes, to test the propriety of the Board's certification of the union. We conclude that the company's challenges to the representation election are wholly without merit. The Board's order will be enforced.
On July 1, 1981, a majority of the company's employees voted to be represented by the Electrical Workers in place of the Sheet Metal Workers, their former representative. 1 Five days later, the company filed timely objections to the election, seeking to set aside the result because the union allegedly had (1) engaged in pre-election "misrepresentations of fact and other false and misleading statements concerning crucial issues"; (2) threatened and coerced employees into supporting the union; (3) engaged in conduct that "impugned the integrity" of the Board's processes; all of which (4) interfered with the holding of a free and fair election.
These objections were investigated by the Board's regional director without a hearing. On August 19, 1981, the regional director issued a Supplemental Decision on Objections that overruled the company's objections and certified the union as the employees' bargaining representative. The company sought review of the regional director's decision with the Board, contending that the regional director erred in overruling the company's objections, in failing to assess the union's cumulative conduct, and in denying the company a hearing on the objections. On September 24, 1981, the Board summarily denied the company's request for review and a hearing on the ground that no substantial issues were raised warranting further proceedings.
The company thereafter refused to bargain with the union. The union filed unfair labor practices charges, and a complaint issued. In its answer, the company defended itself by claiming that the union was not validly certified as the bargaining representative because of improprieties in the election. The Board entered summary judgment against the company. The Board disposed of the issues raised by the company in the unfair labor practices proceeding by holding that the issues had been or could have been litigated in the representation proceeding, that the company had failed to offer at a hearing any newly discovered or previously unavailable evidence, and had not alleged the existence of any special circumstances requiring the Board to reexamine its decision in the representation proceeding. Accordingly, the Board concluded that the company's refusal to bargain violated subsections (a)(1) and (a)(5) of section 8 of the Labor Management Relations Act and directed the company to cease and desist from refusing to bargain with the union. This appeal followed.
On appeal, the company challenges the Board's refusal to grant it an evidentiary hearing and renews its four objections to the validity of the representation election because of alleged unlawful pre-election conduct by the union.
A party challenging a representation election is entitled to an evidentiary hearing only when it raises substantial and material factual issues and proffers evidence that establishes a prima facie case for setting aside the election. NLRB v. Howard Johnson Motor Lodge, 705 F.2d 932, 934 (7th Cir.1983); Advertisers Manufacturing Co. v. NLRB, 677 F.2d 544, 546 (7th Cir.1982); cf. Board Rules and Regulations, 29 C.F.R. Sec. 102.69(d) (1984).
The Board is entitled to rely on the Regional Director's report in the absence of specific exceptions supported by offers of proof of facts contrary to the Regional Director's findings. NLRB v. Belcor, Inc., 652 F.2d 856, 859 (9th Cir.1981). If, however, there are substantial and material factual disputes between the election report and the exceptions, a hearing is required. Id.
NLRB v. Advanced Systems, Inc., 681 F.2d 570, 572 (9th Cir.1982).
We believe, as we make clear in our discussion of the company's specific objections, that the company has failed to provide evidence establishing a prima facie case of election impropriety. In addition, the company, through all of its challenges, has not taken issue with any factual findings by the regional director; it has merely disagreed with the regional director's conclusions. See Magic Pan, Inc. v. NLRB, 627 F.2d 105, 109 (7th Cir.1980); Louis-Allis Co. v. NLRB, 463 F.2d 512, 520 (7th Cir.1972). As we find below, the facts as alleged do not warrant setting aside the election, and therefore the Board's refusal to grant an evidentiary hearing is supported by substantial evidence. 2
The company renews its first and third objections regarding alleged misrepresentations made by the union in its pre-election campaign literature. The company's first objection is that the union made material misrepresentations about the Sheet Metal Workers, the company, and their relationship. The company points to language in the union literature stating that the company was "pushing [the employees] around," that the Sheet Metal Workers "did nothing to help," and that the existing bargaining agreement was "a cozy little marriage license." The company's third objection is that the union impugned the integrity of Board proceedings by misrepresenting their purpose and effect through statements in the campaign literature characterizing the Sheet Metal Worker's pre-election unfair labor practices charges against the company, which had the effect of temporarily "blocking" the election, as "phony" and motivated by a desire to "stall the election."
The parties disagree as to what standard we should apply in determining whether the union's pre-election statements justify setting aside the election. The Board has vacillated between two standards. The first of these standards, enunciated originally in Hollywood Ceramics Co., Inc., 140 N.L.R.B. 221 (1962), requires that a representation election be set aside if there is
(1) a misrepresentation of a material fact involving a substantial departure from the truth, (2) made by a party with special knowledge of the truth, (3) communicated so shortly before the election that the other party has insufficient time to correct it, and (4) involving facts about which the employees are not in a position to know the truth. The misrepresentation need not be deliberate so long as it may reasonably be expected to have significant impact on the election.
Peerless of America, Inc. v. NLRB, 576 F.2d 119, 123 (7th Cir.1978); see Hollywood Ceramics, 140 N.L.R.B. at 224. The second standard, most recently described in Midland National Life Insurance Co., 263 N.L.R.B. 127 (1982), rejects the position of setting aside an election based on the substance of the misrepresentation. Instead, under Midland, the Board will intervene only when the misrepresentation involves the use of "an official Board document [which] has been altered in such a way as to indicate an endorsement by the Board of a party to the election," or "forged documents which render voters unable to recognize propaganda for what it is." Midland, 263 N.L.R.B. at 133 & n. 25. See also St. Elizabeth Hospital v. N.L.R.B., 715 F.2d 1193, 1198 (7th Cir.1983).
At the time the regional director made his recommendations and at the time they were affirmed by the Board, the Hollywood Ceramics standard was in effect. 3 Applying that standard, the regional director found no material misrepresentations. On appeal, counsel for the Board urges us to apply the Midland standard. The company does not dispute that the Board's new policy is a permissible exercise of the Board's discretion, but contends that the new policy should not be applied retroactively to this case.
We note initially that, even applying pre-Midland policies, the Board's decision is supported by substantial evidence. The company's objections, based as they are on certain statements appearing in the union's campaign literature that are obvious expressions of opinion, are entirely without merit. The statements that the company was pushing the employees around, that the incumbent Sheet Metal Workers union had done nothing, and that the Sheet Metal Workers union's relationship with the company was a "cozy little marriage license" are, as found by the regional director, "legitimate campaign propaganda" and not misrepresentations at all. They are precisely the kind of insubstantial "derogatory statements about the other party" that the Board in Hollywood Ceramics specifically noted could not be expected to have any impact on an election. 140 N.L.R.B. at 224. Such language should be left " 'to the good sense of the voters ....' " Baker Canning Co. v. NLRB, 505 F.2d 574, 576 (7th Cir.1974) (citation omitted).
In addition, as noted by the regional director, although the union's campaign literature appeared at least two weeks prior to the election, the company made no effort in its ensuing campaign literature to respond to...
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