Nestle Ice Cream Co. v. N.L.R.B.
| Decision Date | 05 April 1995 |
| Docket Number | Nos. 93-6307,93-6410,s. 93-6307 |
| Citation | 46 F.3d 578 |
| Parties | 148 L.R.R.M. (BNA) 2454, 129 Lab.Cas. P 11,283 NESTLE ICE CREAM COMPANY, formerly doing business as Nestle Dairy Systems, Inc., Petitioner/Cross-Respondent, v. NATIONAL LABOR RELATIONS BOARD, Respondent/Cross-Petitioner, General Teamsters & Food Processing Local Union 87 and Operating Engineers Local 501, Intervenors. |
| Court | U.S. Court of Appeals — Sixth Circuit |
Richard A. Leasia, David J. Murphy (argued and briefed), Littler, Mendelson, Fastiff, Ticy & Mathiason, San Jose, CA, for Nestle Ice Cream Co.
Aileen A. Armstrong, Deputy Assoc. Gen. Counsel, Linda Dreeben (briefed), Robert J. Englehart (argued and briefed), N.L.R.B., Appellate Court Branch, Washington, DC, for N.L.R.B.
David A. Rosenfeld, Van Bourg, Weinberg, Roger & Rosenfeld, San Francisco, CA (argued and briefed), for General Teamsters & Food Processing Local Union 87 and Operating Engineers Local 501.
Before: RYAN and BATCHELDER, Circuit Judges; and EDGAR, District Judge. *
Petitioner/Cross-Respondent, Nestle Ice Cream Company, petitions for review of a National Labor Relations Board decision holding that Nestle committed an unfair labor practice by refusing to bargain with the intervenors, General Teamsters & Food Processing Local Union 87 and Operating Engineers Local 501 (the Unions). The Board petitions for enforcement of its bargaining order.
We deny enforcement and reverse the Board's bargaining order because the Unions conferred impermissible preelection benefits on Nestle employees, rendering invalid the representation election in which the Unions were chosen.
On November 18, 1991, the Unions jointly petitioned to represent the production and maintenance employees at Nestle's Bakersfield, California, ice cream plant. Nestle and the Unions agreed to hold a representation election, and scheduled the election for March 13, 1992. Just prior to election day, the Unions staged several campaign events. On March 9 or 10, the Unions distributed flyers publicizing that Teamsters President Ron Carey would make an "important announcement " on March 12. Around that time, the Unions distributed another set of flyers; these invited employees to hear President Carey make a "major announcement for Nestle employees, that may have a sizeable impact on their future!"
As advertised, on the day before the election, Carey made two appearances. First, during the afternoon, Carey appeared at the plant's entrance and announced that the Teamsters had filed a lawsuit against Nestle. This announcement attracted local newspaper attention. Then, in the evening, approximately 100 of the 334 Nestle employees attended the advertised Teamsters meeting. As related by Nestle employees, Carey said "he wanted employees to vote for the unions." Carey then presented an $18,000 check to a Teamsters member from another company; the check represented an arbitration backpay award secured with the Teamsters' help. Next, a Teamsters attorney, David Rosenfeld, reported that the Teamsters "had filed a lawsuit against Nestle to get backpay for employees, double or triple the amount ... owed." "Nestle had not paid employees the right amount of wages," Rosenfeld asserted, and the Teamsters' "calculations" estimated that "$35,000 per employee" was due. According to the Board's Regional Director, Rosenfeld also warned that "there were no guarantees of winning the suit; it would be a long and difficult battle."
Carey then said that the union needed the employees' votes. Finally, Ward Allen, a Teamsters' business agent, stated, "[W]e're doing this for you, you've got to support us," referring to the lawsuit. Flyers bearing reproductions of portions of the complaint filed in the lawsuit were distributed. Apparently, after the announcement about the lawsuit, the prospect of winning $35,000 was the centerpiece of employee conversation. On March 13, election day, at least one employee heard over forty employees talking about the damages award; others confirmed that they too heard employees discussing the money. The Unions won; the tally of unchallenged ballots showed 192 for and 126 against the Unions.
On election day, Nestle removed the Teamsters' suit to federal court; the Teamsters had sued in California state court. Ostensibly filed under the Racketeer Influenced and Corrupt Organizations Act (RICO), 18 U.S.C. Sec. 1964, the complaint alleged that Carnation Company, Nestle's predecessor, unlawfully recognized Teamsters Local 87 as the Bakersfield collective bargaining representative in 1988. The Teamsters alleged that Nestle, Carnation, and former Teamsters officials conspired to enter into the unlawful recognition so that Carnation could pay "substantially less wages and benefits" than would otherwise be paid "if there had been legitimate good faith bargaining with a freely and lawfully chosen bargaining representative." The former Teamsters officials allegedly entered into the "scheme ... so that money would be paid to Local 87 and therefore directly and indirectly would be paid" to the officials. The Teamsters purported to "bring this action in its representative capacity on behalf of all past and current employees of the diary [sic] plant." For damages, the Teamsters sought "reimbursement" of "unlawfully exacted dues" for "[t]he class which Plaintiffs [Teamsters] represent." In addition, it was alleged that "[t]he class of employees represented by Plaintiffs has been damaged in a sum of lost wages and benefits."
On August 11, 1992, the district court dismissed the complaint for failure to state a claim, but granted the Teamsters ten days to amend the complaint. After amending the complaint, Nestle again moved to dismiss for failure to state a claim; this time, however, Nestle also moved for sanctions. Before the district court could decide the motions, the Teamsters agreed to a dismissal of the complaint with prejudice; in exchange, Nestle withdrew its motion for sanctions. The district court approved the stipulated dismissal on October 26, 1992.
Meanwhile, on March 19, 1992, Nestle filed objections to the Unions' preelection conduct. After an investigation, the regional director overruled Nestle's objections. Nestle filed exceptions to the regional director's report, along with supporting affidavits and exhibits. The Unions opposed the exceptions, but apparently did not file supporting affidavits.
On May 28, 1993, the Board adopted, without a hearing, the regional director's findings and recommendations. Nestle Dairy Sys., Inc., 311 N.L.R.B. 987 (1993) (2-1 decision). The majority held that the Unions had not conferred a benefit on the employees by filing the lawsuit. Id. at 987-88. Also, the majority found that even if the filing of the suit conferred a "tangible" benefit, the benefit was not "sufficiently substantial or direct to warrant finding that it would have a reasonable tendency to interfere with the employees' free choice in the election." Id. at 988. Furthermore, the Board expressed a "public policy" concern that a decision against the Unions would have a "chilling effect" on a union's salutary initiation of suits and administrative proceedings, noting that the First Amendment guarantees a right of access to courts. Id. The majority analogized the Unions' suit to Occupational Safety and Health Administration (OSHA) complaints and unfair labor practice charges. Id. Accordingly, the Board certified the Unions.
In order to obtain judicial review, Nestle refused to bargain with the Unions. On June 15, 1993, the Unions filed an unfair labor practice charge against Nestle. Ultimately, on September 24, 1993, the Board found that Nestle had committed an unfair labor practice and ordered the company to bargain with the Unions. Nestle filed this timely petition for review of the Board's decision; the Board cross-applied for enforcement of its bargaining order. The Unions are intervenors on appeal.
Nestle raises five issues on appeal. However, because we dispose of the case on the conferring of impermissible benefits, we discuss that issue only. Nestle complains that the Unions conferred an impermissible preelection benefit on Nestle employees by filing the class action lawsuit. Nestle analogizes the instant facts to cases in which the Board and this court have set aside elections because unions dispensed preelection benefits to voting employees. For example, the Board has vetoed elections where unions gave free life insurance and free medical screenings before the election. Nestle argues that the Unions here similarly provided free legal services by filing the lawsuit on behalf of the employees. Specifically, Nestle points out that the California state court charges $121 to file suit. Also, Nestle complains that the Unions secured an attorney's representation and must have paid attorney's fees on behalf of the employees.
In response, the Board argues that the Unions conferred no "tangible" benefit by filing the lawsuit. The potential damages award was speculative, and its existence depended on factors outside of the Unions' control, namely a judge and jury's decisions. In addition, the Board distinguishes past Board decisions prohibiting unions from offering free preelection benefits--those cases involved benefits that had no connection to the employer-employee relationship. The free life insurance and medical screenings given in other cases were given to the employees as individuals, not as employees. The services provided by the Unions here were connected to the employees as employees. Also, the Board characterizes the suit as a legitimate means for showing the Unions' suitability for selection.
Finally, the Board sounds a "chilling effect" warning: the right to petition courts for redress, guaranteed by the First Amendment, will be chilled by disallowing the Unions to file...
To continue reading
Request your trial
-
PRAGOVICH v. IRS
...file such suits." As the government acknowledges, "there is no First Amendment right to `baseless litigation.'" Nestle Ice Cream Co. v. N.L.R.B., 46 F.3d 578, 585 (6th Cir.1995) (citing Bill Johnson's Restaurants, Inc. v. N.L.R.B., 461 U.S. 731, 743, 103 S.Ct. 2161, 76 L.Ed.2d 277 (1983)). ......
-
Rosania v. Taco Bell of America, Inc.
...First Amendment right to petition the government for redress. Id. at 741, 103 S.Ct. 2161. See also Nestle Ice Cream Co. v. National Labor Relations Bd., 46 F.3d 578, 585 (6th Cir.1995). In fact, in Bill Johnson's, the Court The filing and prosecution of a wellfounded lawsuit may not be enjo......
- Aday v. Westfield Ins. Co.
-
SCIOTO COUNTY WATER DIST. NO. 1 v. SCIOTO WATER
...right to petition the government for redress of grievances includes the right to seek relief from the courts. Nestle Ice Cream Co. v. N.L.R.B., 46 F.3d 578, 585 (6th Cir.1995) (citing California Motor Transport Co. v. Trucking, Unltd., 404 U.S. 508, 510, 92 S.Ct. 609, 611-12, 30 L.Ed.2d 642......