N.L.R.B. v. Dane County Dairy

• Decision Date: 09 July 1986
• Docket Number: No. 85-1440,85-1440
• Citation: 795 F.2d 1313
• Parties: 122 L.R.R.M. (BNA) 3051, 104 Lab.Cas. P 11,895 NATIONAL LABOR RELATIONS BOARD, Petitioner, v. DANE COUNTY DAIRY, et al., Respondents.
• Court: U.S. Court of Appeals — Seventh Circuit

Page 1313

795 F.2d 1313

122 L.R.R.M. (BNA) 3051, 104 Lab.Cas. P 11,895

NATIONAL LABOR RELATIONS BOARD, Petitioner, v. DANE COUNTY DAIRY, et al., Respondents.

No. 85-1440.

United States Court of Appeals Seventh Circuit.

Submitted Jan. 8, 1986.

Decided July 9, 1986.

Elliott Moore, N.L.R.B., Washington, D.C., for petitioner.

Fred Gants, Madison, Wis., for respondents.

Before BAUER, WOOD and COFFEY, Circuit Judges.

COFFEY, Circuit Judge.

The National Labor Relations Board granted summary judgment against the respondents' holding that the respondents failed to demonstrate good cause excusing an untimely answer and finding that several affiliated companies were alter egos of Dane County Dairy. We grant the petition of the Board for enforcement of its order.

I

On April 11, 1984, the Drivers, Salesmen, Warehousemen, Milk Processors, Cannery, Dairy Employees and Helpers Local 695 of the International Brotherhood of Teamsters, Chauffeurs, Warehousemen and Helpers of America ("Union") filed with the Milwaukee Regional Office of the National Labor Relations Board a charge against Dane County Dairy ("DCD" or "the Dairy"). The Union alleged that the Dairy had laid off employees represented by the Union and transferred the work performed by them to Bowman Enterprises, Inc.; MAJJAJ Bowman, Inc.; Bowman Farms, Inc.; Mary Ann Bowman, An Individual; Mary Ann Bowman d/b/a MAJJAJ Frigid Freight; Duane Bowman, Jr., An Individual; Duane Bowman, Jr., d/b/a Bowman Enterprises, Inc.; Duane Bowman, Jr., d/b/a Duane Bowman, Jr. & Associates; Duane Bowman, Jr., d/b/a Duane Bowman, Jr. & Family ("affiliated enterprises") ¹ with the intent to discourage membership in the Union and evade its collective bargaining obligations, in violation of Section 7 of the National Labor Relations Act ("Act"), 29 U.S.C. Sec. 157.

Subsequently, the Union filed three amended charges; the first and second charges alleged that the affiliated companies were alter egos of the Dairy and named the affiliated companies as parties. The third charge alleged that the layoffs and the transfer of work were also in retaliation for prior NLRB proceedings instituted against Dane County Dairy. After the charges were filed, a field investigator from the NLRB interviewed various parties and received affidavits from the employees. DCD filed the sworn affidavit of Mary Ann Bowman with the Board disputing the alter ego status of MAJJAJ Frigid Freight and MAJJAJ Bowman, Inc.

On June 13, 1984, the Acting Regional Director of the NLRB Milwaukee Office issued a complaint against the Dairy and the affiliated entities contending that: (1) Dane County Dairy and the affiliated companies constituted a single integrated business enterprise and a single employer within the meaning of the Act; (2) the Dairy laid off union employees without notice to or bargaining with the Union as to the layoffs or their effect; (3) utilized its affiliated companies to perform the work previously done by the laid off employees; (4) refused to give information to the Union necessary to fulfill its role as the exclusive collective bargaining representative for the bargaining unit; and, (5) refused to attend a meeting with the Union, all in violation of Section 8(a)(1), (3) and (5) of the Act (29 U.S.C. Sec. 158(a)(1), (3) and (5)).

The complaint contained a notice of the answer required by 29 C.F.R. 102.20, which provides:

"Answer to complaint; time for filing; contents; allegations not denied deemed admitted.--The respondent shall, within 10 days from the service of the complaint, file an answer thereto. The respondent shall specifically admit, deny or explain each of the facts alleged in the complaint, unless the respondent is without knowledge, in which case the respondent shall so state, such statement operating as a denial. All allegations in the complaint, if no answer is filed, or any allegation in the complaint not specifically denied or explained in an answer filed, unless the respondent shall state in the answer that he is without knowledge, shall be deemed to be admitted to be true and shall be so found by the Board, unless good cause to the contrary is shown."

Each of the respondents were served with the complaint via the United States mail service and Donald Hue, then attorney for the respondents, was served via certifed mail. Additionally, Duane Bowman (the owner of Dane County Dairy, Duane Bowman, Jr. & Family, and Duane Bowman, Jr. & Associates, who was also the mananger or agent of MAJJAJ Bowman, Inc., MAJJAJ Frigid Freight, Bowman Enterprises, Inc. and Bowman Farms, Inc.) was personally served by an employee of the Milwaukee office of the NLRB.

The respondents failed to file an answer within the 10 day deadline; consequently, a Field Examiner for the NLRB sent both Duane Bowman and Attorney Hue letters notifying them that if an answer was not filed by July 12, 1984 the regional office would proceed as if the allegations in the complaint were admitted as true:

"On June 13, 1984, the Acting Regional Director issued a Complaint and Notice of Hearing in the above matter. This document points out the requirement that the allegations in the Complaint are to be answered within 10 days and, if they are not, then the allegations in the Complaint shall be deemed to be admitted as true. To date no answer has been received. Please be advised that if no answer is filed by July 12, 1984, the Region will proceed in this matter on the basis that the allegation[s] in the Complaint are being admitted as true."

In addition, on or about July 17, 1984, an attorney with the General Counsel's office of the NLRB telephoned Donald Hue and repeated the requirement that an answer must be filed. Despite the notice in the complaint, the letter, and the phone call, respondents still failed to file an answer.

On July 18, 1984, the NLRB filed a petition for a temporary injunction pursuant to Section 10(j) of the Act, 29 U.S.C. Sec. 160(j), in the United States District Court for the Western District of Wisconsin naming DCD and the affiliated companies as respondents. The NLRB submitted the depositions of Duane and Mary Ann Bowman to the court which, after a review of the same and a hearing, made findings of fact that:

"8. On or about March 27, 1984 (or shortly thereafter), Dane County Dairy transferred functions it had previously performed to Majjaj Bowman, Inc. and Majjaj Frigid Freight.

9. Mary Ann Bowman, Duane Bowman, and Duane Bowman, Jr., d/b/a Duane Bowman, Jr. & Family, are other non-distinct entities engaged in businesses identical or complementary to the businesses engaged in by Dane County Dairy, Majjaj Bowman, Inc., and Majjaj Bowman Frigid Freight."

As a conclusion of law, the district court held:

"2. Petitioner has reasonable cause to believe that: (1) Dane County Dairy, Majjaj Bowman, Inc.; Mary Ann Bowman, an individual; Mary Ann Bowman, d/b/a Majjaj Frigid Freight; Duane Bowman, Jr., an individual; Duane Bowman, Jr., d/b/a Duane Bowman, Jr. & Family were and are an employer within the meaning of Section 2(2) of the Act;

* * *

* * *

(d) The respondents have engaged in unfair labor practices within the meaning of Section 8(a)(1), (3) and (5) of the Act, affecting commerce within the meaning of Section 2(6) and (7) of the Act, and a continuation of these unfair labor practices will impair the policies of the Act as set forth in Section 1(b) thereof."

Although Bowman Enterprises, Inc.; Bowman Farms, Inc.; Duane Bowman d/b/a Bowman Enterprises; and Duane Bowman d/b/a Duane Bowman, Jr. & Associates were listed as respondents by the court, the court failed to make any findings of fact or conclusions of law as to these entities. The court granted a temporary injunction ordering "respondents, their officers, representatives, agents, servants, employees, attorney and all members and persons acting in concert or participation with them," to restrain from "the commission, continuation or repetition" of the alleged unfair labor practices (terminating the members of the bargaining unit for the purpose of discouraging employees from engaging in collective bargaining; transferring work previously performed by the bargaining unit to employees of Dane County Dairy's affiliated enterprises; refusing to provide the Union with information necessary to fulfill its role as the sole designated collective-bargaining representative for the bargaining unit; failure to bargain over the decision to lay off all bargaining until employees or the effect of the decision; and, failure to bargain over the transfer of the bargaining unit's work to Dane County Dairy's affiliated enterprises.)

On October 23, 1984 the General Counsel of the NLRB filed a motion for summary judgment with the National Labor Relations Board. The General Counsel based his contention that there was no material issue of fact on two grounds: (1) because the respondents failed to file an answer, the allegations in the Complaint must be deemed to be true; (2) the evidence and depositions submitted with the motion demonstrate that there is no material issue of fact. The General Counsel urged the Board to find that the Dane County Dairy and its affiliated companies were in fact alter egos and a single employer under the Act and that the respondents violated the Act "by terminating its delivery routes and driver-employees and re-establishing those routes with an alter ego entity;" "by failing and refusing to furnish the Union with necessary and relevant information;" and "by failing and refusing to meet and bargain with the Union."

The respondents filed a brief in response to the summary judgment motion along with an undated answer to the complaint on December 11, 1984. The respondents argued, inter alia, that they should be allowed to file their untimely answer "on the ground of excusable neglect;" that a grant of summary judgment would be improper; and, that "a Hearing [should] be scheduled to sort out the complex issues presented before...