National Labor Relations Bd. v. Cleveland-Cliffs Iron Co.

• Decision Date: 11 February 1943
• Docket Number: No. 9162.,9162.
• Citation: 133 F.2d 295
• Parties: NATIONAL LABOR RELATIONS BOARD v. CLEVELAND-CLIFFS IRON CO.
• Court: U.S. Court of Appeals — Sixth Circuit

133 F.2d 295 (1943)

NATIONAL LABOR RELATIONS BOARD v. CLEVELAND-CLIFFS IRON CO.

No. 9162.

Circuit Court of Appeals, Sixth Circuit.

February 11, 1943.

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Robert T. McKinlay, of Washington, D. C. (Robert B. Watts, Ernest A. Gross, Gerhard P. Van Arkel, Morris P. Glushein, Louis Libbin, and William K. Sherwood, all of Washington, D. C., on the brief), for petitioner.

Luther Day and Earl W. LeFever, both of Cleveland, Ohio (Luther Day, Thomas F. Veach, Earl W. LeFever, and Jones, Day, Cockley & Reavis, all of Cleveland, Ohio, on the brief), for respondent.

Before SIMONS, HAMILTON, and McALLISTER, Circuit Judges.

SIMONS, Circuit Judge.

The petitioner, in pursuance of §10(c) of the National Labor Relations Act, 29 U.S.C.A. § 160(c), having found the respondent to have engaged in unfair labor practices in violation of §§ 8(1) and 8(3) of the Act, 29 U.S.C.A. § 158(1, 3), by interfering with its employees in their organizing efforts and by discharging certain of them for union activities, issued its cease and desist order on April 11, 1941. It now seeks its enforcement. The respondent, denying the jurisdiction of the petitioner over its activities, assails the order on that ground and upon the further ground that there was lack of substantial evidence to support the findings and conclusions of the Board. It therefore prays that the order be set aside.

The facts bearing upon the jurisdictional question are not in controversy. The issue is solely as to their legal effect. The respondent is an Ohio corporation engaged in the production of iron ore in Northern Michigan. In respect to this activity it is concededly engaged in interstate commerce. Neither its mining operations, its labor relations with its miners or with employees in activities integrated with its mining operations, are, however, here involved. Its alleged unfair labor practices are asserted to have been pursued in three lumber camps located near Munising, Michigan, where it was independently engaged in logging operations, and where it employed about 300 men. Its activity there consisted of cutting trees into logs and loading them on cars of an intrastate railroad for delivery to points within the State of Michigan. Of the materials, equipment, and supplies needed by the respondent for its lumbering operations in 1937, approximately 34%, with a value of $44,000, were purchased from without the state. During the same period respondent produced approximately 45½ million board feet of lumber valued at $655,000. Of this approximately 50% was sold and delivered to the Cliffs-Dow Chemical Company of Michigan, in which the respondent owns 34% of the voting stock and is represented upon its Board of Directors. The Cliffs-Dow Chemical Company operates a plant at Marquette, Michigan, where lumber is manufactured into charcoal and chemical products sold largely to customers outside of Michigan. Another 30% of the respondent's timber was shipped to the Piqua-Munising Wood Products Company which at plants in Marquette and Munising, Michigan, manufactures household wooden ware and tool handles sold mainly to outside customers. The respondent owns 74% of its voting stock. This company as a by-product also produces railroad ties, some of which are sold to interstate railroads. The remainder of the respondent's lumber is manufactured by it into railroad ties, and some of it is likewise sold and delivered to interstate railroads.

It is the respondent's contention that the evidence conclusively establishes its lumbering operations to be wholly an intrastate activity, and that as such the business neither is in, nor in any way affects interstate commerce or the flow of goods in such commerce. It points to the fact that all of its timber was grown, cut, transported, and used within the State of Michigan; that such of it as was purchased by the Cliffs-Dow Chemical Company was processed and converted entirely within the state; that the charcoal and chemicals made by that company were made from commingled wood only part of which came from the respondent's operations; and that it would be impossible to distinguish whether its raw materials were produced by the respondent or by others from whom it made purchases.

The respondent further contends that the evidence shows conclusively that the wood sold to the Piqua-Munising Wood Products Company was processed and converted at the plant of that company at Munising. Although occasionally a carload of wood was shipped by Piqua from Marquette to its Piqua, Ohio, plant, such wood had already been partly processed in the Marquette plant. Both the Chemical Company and the Wood Products Company are separate and distinct entities from the respondent, and neither was wholly dependent upon it for raw materials or upon the continuation of the respondent's logging operations, and other sources of supply were available to them in Michigan. It further points to the fact that prior to the conclusion of the evidence taken in the present case, it had wholly ceased its logging operations, and yet there was neither evidence nor finding that by reason of such cessation either the Chemical Company or the Wood Products Company were in any way curtailed, interfered with, or affected.

It is conceded that approximately 20% of the respondent's timber was manufactured into railroad ties at the respondent's mill at Dixon, Michigan, but these were sold, transported, and delivered wholly within the State of Michigan to three railroad companies, the sole exceptions being two orders of railroad ties delivered at an unspecified time to railroads without the state, and one in 1936 shipped to the Chicago & Great Western Railroad Company which transported it to Minnesota for treatment with creosote. There is, however, no evidence, it contends, that a single tie sold to interstate railroads ever left the State of Michigan except those included in the last mentioned order, and this transaction was concluded long before the occurrence of the alleged unfair labor practices. Of the supplies and equipment which, during 1937, the respondent purchased from without the state, it says that there is no evidence what, if any, portion of it was used in the operation of its logging camps as distinguished from other operations of its Land Department, although conceding that some were for such use. It is insisted, however, that there is no evidence that such purchases involved the transportation of supplies or equipment into Michigan from without the state, and the orders may have been filled wholly, or in part, from stocks and equipment already in Michigan before the purchases were made. It concedes the sale of $4,000 worth of lumber to purchasers outside the State of Michigan, but insists that there is no evidence to show that this lumber came from the logging camps here under consideration, and in any event it was an isolated sale with nothing to show its recurrence.

The respondent therefore urges it as obvious that if its former logging operations affected interstate commerce to any extent, it did so indirectly and remotely and not in an intimate, close, and substantial way. Before there could be any effect whatever upon interstate commerce there must have been a cutting and loading of timber within the State of Michigan, a delivery of it within the state, a commingling of it with other raw materials, its possible retention in store until required for use, and finally its processing and conversion into other products in which form alone it ever crossed state lines or entered into interstate or foreign commerce.

It is upon this factual narrative that we are called upon to determine the jurisdiction of the Board. In a painstaking and exhaustive analysis of the cases the respondent undertakes to distinguish its activities in relation to commerce from those of employers which, in the more important adjudications, have been held subject to the jurisdiction of the Board. This is not a case, it urges, that involves the furnishing of services or products to concerns which use such services or products, as received, directly in interstate activities, eliminating the application of cases like Consolidated Edison Co. v. N. L. R. B., 305 U.S. 197, 59 S.Ct. 206, 83 L.Ed. 126; Consumers Power Co. v. N. L. R. B., 6 Cir., 113 F.2d 38; and N. L. R. B. v. W. H. Kistler Stationery Co., 10 Cir., 122 F.2d 989. It is not a case involving the monopoly of a public utility which furnishes light or power necessary for the operation of plants making goods for interstate sales, again distinguishing it from the Consolidated Edison and Consumers Power cases; nor a case involving interstate instrumentalities and so eliminating Newport News Shipbuilding & Dry Dock Co. v. N. L. R. B., 4 Cir., 101 F.2d 841, and Virginian R. Co. v. System Federation, 4 Cir., 84 F.2d 641, affirmed 300 U.S. 515, 57 S.Ct. 529, 81 L.Ed. 789; nor a case involving the processing of goods coming into or going out of the plant of the employer in interstate commerce as in N. L. R. B. v. Fainblatt, 306 U.S. 601, 307 U.S. 609, 59 S.Ct. 668, 83 L.Ed. 1014; and N. L. R. B. v. Bradford Dyeing Ass'n., 310 U.S. 318, 60 S.Ct. 918, 84 L.Ed. 1226. It is not a case, it says, like Santa Cruz Fruit Packing Co. v. N. L. R. B., 303 U.S. 453, 58 S.Ct. 656, 659, 82 L.Ed. 954, because its home-grown and home-processed products did not go directly from its logging camps into interstate commerce, and its employees were not engaged in loading interstate shipping instrumentalities. And so on.

But if this analysis fails to disclose adjudication of jurisdiction over employees in precisely identical activities, it still does not follow that the respondent is beyond the jurisdiction of the Board if the principles governing decision apply with equal reason to it. It has been held that "the close and intimate effect which brings the subject within the reach of federal power may be due to activities in relation to productive...