National Labor Relations Board v. Deena Artware
| Decision Date | 10 November 1953 |
| Docket Number | No. 11156.,11156. |
| Citation | 207 F.2d 798 |
| Parties | NATIONAL LABOR RELATIONS BOARD v. DEENA ARTWARE, Inc. |
| Court | U.S. Court of Appeals — Sixth Circuit |
George J. Bott, A. Norman Somers, Washington, D. C., Jack G. Evans, Regional Director, Cincinnati, Ohio, Robert G. Johnson, Washington, D. C., for petitioner.
James G. Wheeler, Paducah, Ky., Wheeler & Marshall, Paducah, Ky., of counsel, for respondent.
Before SIMONS, Chief Judge, and MARTIN and MILLER, Circuit Judges.
On July 30, 1952, this Court sustained the petition of the National Labor Relations Board in this case for enforcement of its order of October 25, 1949, which among other things ordered that the respondent, Deena Artware, Inc., reinstate certain employees alleged to have been discriminatorily discharged, and to make them whole for lack of pay suffered by reason of such discharge. N. L. R. B. v. Deena Artware, Inc., 6 Cir., 198 F.2d 645. Certiorari was thereafter denied by the Supreme Court. 345 U.S. 906, 73 S.Ct. 644. The amount due the employees is unliquidated, depending upon several unknown factors which will have to be determined by further proceedings before the Board. The Board estimates the amount to be approximately $100,000.
In another case, United Brick & Clay Workers v. Deena Artware, Inc., Deena Artware recovered a judgment in the U. S. District Court for the Western District of Kentucky against the United Brick and Clay Workers Union and the American Federation of Labor in the amount of $29,985.85, for damages resulting from an illegal secondary boycott. That judgment was affirmed by this Court on July 30, 1952, No. 11,403, 198 F.2d 637. Certiorari was thereafter denied by the Supreme Court. 344 U.S. 897, 73 S.Ct. 277; Id., 344 U.S. 919, 73 S.Ct. 346. When the appeal was taken from the District Court to this Court, the judgment was superseded by depositing with the Clerk of this Court certain United States Government Bonds in the par value of $45,000. Since the affirmance of the judgment, United Brick & Clay Workers and the American Federation of Labor have paid in to the Clerk of this Court the sum of $34,404.61, which was in full of the judgment with interest thereon to date of payment, and unpaid court costs. The bonds were thereupon returned to the depositors. On December 15, 1952, Deena Artware executed two assignments with respect to its interest in this judgment, one of these assignments in the amount of $15,000 being made to Deena Artware's attorney for legal services, and the other assignment, covering the balance of the unpaid judgment, being made to Deena Products Company, of which Deena Artware is a subsidiary, in part payment of an alleged indebtedness owing by Deena Artware to Deena Products Company. The assignees are asking that the proceeds of the judgment be distributed to them according to their respective interests.
The Board has moved in this action for (1) a temporary restraining order enjoining Deena Artware, Deena Products Company and George H. Weiner, who is the President of both Companies, from giving effect to the assignment to Deena Products Company; (2) that the Government Bonds held by the Clerk, or the proceeds therefrom, to the extent of the amount of the assignment to Deena Products Company, be impounded and not paid over either to Deena Artware or Deena Products Company, and (3) that a rule issue directing Deena Artware, Deena Products Company and Weiner to show cause why an order should not issue requiring them, and each of them, to produce and permit the Board to inspect and copy the books and records which show the transactions between Deena Artware and Deena Products Company, for the purpose of determining whether the affairs of Deena Artware are being operated for the purpose of rendering it without funds to satisfy the back-pay obligation under the Board's order as enforced by this Court, and whether the assignment was without valid consideration. The motion alleges that Deena Products Company is substantially owned and completely controlled by Weiner who also controls and is President of Deena Artware; that by reason of his dominant position in these corporations he is able to control the financial transactions between them which occur in the course of their related activities, and to direct the flow of assets into each of them; that there is reason to believe that Deena Artware does not have sufficient funds with which to satisfy its back-pay obligation; that the assignment to Deena Products Company was made without valid consideration; that Weiner had made the statement that the discharged employees would never collect any portion of their back-pay claim, in that he would protract the litigation as long as possible and would place the Company in bankruptcy if litigation over the back-pay claims went against him; that the Board's regional office had requested Deena Artware to give assurances that funds would be available to meet the back-pay obligation when the time arrived for payment; that Deena Artware had replied that "under the circumstances, we are not able to give you assurances that funds will be available to meet the demands, the amount of which is unknown to us"; that Deena Artware has engaged in a course of depleting its assets in order to avoid payment of the back-pay award, and that there is immediate danger that the funds held as security for the judgment debt owed Deena Artware in case No. 11,430 will be paid over to Deena Products Company unless they are impounded by this Court. Affidavits were filed in support of these allegations. Deena Artware has objected to the motion, and although admitting the execution of the assignments, and that it made the statement that it could not give assurances that funds would be available to meet the back-pay demands, has denied that the assignment to Deena Products Company was without consideration or that Deena Artware was engaged in a course of depleting its assets in order to avoid payment of the backpay award. It has filed counter-affidavits in support of its position.
Petitioner did not challenge the validity of the assignment to respondent's attorney. Irrespective of the assignment, the attorney...
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National Labor Relations Board v. Deena Artware
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