NLRB v. CARLTON McLENDON FURNITURE CO. INC.

Decision Date09 January 1974
Docket NumberNo. 73-1598.,73-1598.
Citation488 F.2d 58
PartiesNATIONAL LABOR RELATIONS BOARD, Petitioner, v. CARLTON McLENDON FURNITURE CO., INC., Respondent.
CourtU.S. Court of Appeals — Fifth Circuit

Elliott Moore, Deputy Associate Gen. Counsel, N.L.R.B., Washington, D.C., Charles M. Paschal, Jr., Director, Region 15, N.L.R.B., New Orleans, La., Allen H. Feldman, N.L.R.B., Washington, D.C., for petitioner.

C. Lash Harrison, John Bacheller, Jr., Atlanta, Ga., for respondent.

Before THORNBERRY, SIMPSON and CLARK, Circuit Judges.

THORNBERRY, Circuit Judge:

This application for enforcement of a National Labor Relations Board order comes to us after the usual procedural journey has been made. In November 1971, the United Brotherhood of Carpenters and Joiners, Southern Council of Industrial Workers, AFL-CIO (Union) filed a petition for a representation election pursuant to § 9 of the National Labor Relations Act, aimed at Carlton McLendon Furniture Company (Company). The Regional Director of the Board directed an election which ended with 41 votes for the Union, 38 votes against the Union, and 13 challenged ballots, out of approximately 105 eligible voters. After the challenges to ballots had been considered by the Regional Director, the final tally was 44 for the Union and 39 against. The facts surrounding that election furnished the foundation for the Company's continued resistance.

Within the twenty-four hour period immediately prior to the election, the Union passed out to the employees of the Company a handbill stating that the Union had won a representation election at another company, Bes-Pak, by a vote of 34 to 33. In fact, the election result was 32 for the Union, 33 against, and two challenged ballots.1

The Union's campaign to organize the Company's employees was conducted concurrently with its effort to organize the Bes-Pak employees. Some of their organizing meetings were held jointly, and it is undisputed by all that the Union was conducting a joint campaign. The Company contended before the Board and argues here that the handbill constituted a material misrepresentation which destroyed the required laboratory conditions and which rendered the election invalid.

Additionally, the Company objects to conduct by the Union observer in the polling area which, it alleges, interfered with the laboratory conditions necessary to a free and fair election by creating an impression that the Union and not the Board was in charge of the election. During the election, and in the presence of six employees in all who were standing in the voting line, the Union observer turned four of these employees away with the demonition "you, you, you, and you can't vote." The observer gave no reason for his action, and the Board agent then present did not intercede. The two employees remaining in the line proceeded to cast their ballots, as the four challenged employees left the voting area. The four returned shortly with a Company payroll clerk whose conversation with the Board agent resulted in the four employees voting without further challenge.

The Company argued before the Regional Director and before us that either or both of these objections require that the election be set aside, or alternatively that the Board should be required to hold a full hearing in the face of the Company's prima facie showing of substantial election irregularities. On the basis of an ex parte administrative investigation, the Regional Director rejected all of the Company's objections,2 having found that they presented no substantial or material issues with respect to conduct affecting the results of the election. Undaunted, the Company filed with the Board a request for review of the regional director's disposition of its objections. The Board denied this request in a four-line telegram which concluded that the Company's request "raises no substantial issues warranting review." A motion for reconsideration of the Board's denial of the Company's request for review was likewise denied "as lacking in merit."

Shortly thereafter, the Union filed unfair labor practice charges alleging that the Company had refused to bargain in violation of §§ 8(a)(1) and (5) of the Act, complaint issued, the Company answered by denying the validity of the Union's certification, the Board's general counsel moved for summary judgment, and the Board granted the motion, ordering the Company to bargain collectively with the Union. The case has inexorably found its way to this Court.3

It will not end with us today, however, for although we do not set the election aside, we deny the Board's application for enforcement and remand for a full adversary hearing to determine the extent to which the challenged Union conduct affected the results of the election.

We begin our analysis of the Company's contentions by noting that Congress has vested the Board with broad discretion in dealing with matters relating to representation proceedings. N. L. R. B. v. Muscogee Lumber Co., Inc., 5th Cir. 1973, 473 F.2d 1364, 1366. And thus, before this court can invalidate an election, the party objecting to the enforcement action must prove that union misconduct materially affected the results of the election, and its proof must be such as to show that the Board's findings to the contrary lack substantial evidentiary support. N.L.R.B. v. Monroe Auto Equipment Co., 5th Cir. 1972, 470 F.2d 1329, 1333; N.L.R.B. v. Golden Age Beverage Co., 5th Cir. 1969, 415 F.2d 26, 30; N.L.R.B. v. White Knight Manufacturing Co., 5th Cir. 1973, 474 F.2d 1064, 1067.

Even though the objecting party is not entitled to have the election set aside, he may still have a right to a full adversary hearing. Rules promulgated by the Board require an investigation if post-election objections are filed. See 29 C.F.R. § 102.69. The Regional Director is permitted to make an ex parte investigation, but if substantial and material factual issues are found to exist, a full hearing is required. N.L.R.B. v. Air Control Products of St. Petersburg, Inc., 5th Cir. 1964, 335 F.2d 245, 249; N.L.R.B. v. Skelly Oil Co., 8th Cir. 1973, 473 F.2d 1079, 1083. A full hearing is required in such cases, not because any statute commands it, but because the Board has promulgated rules requiring a hearing in those circumstances. N.L.R.B. v. Overland Hauling, Inc., 5th Cir. 1972, 461 F.2d 944. And the determination of whether the Company has raised a substantial and material factual issue is "a question of law and ultimately a question for the courts." Luminator Division of Gulfton Industries, Inc. v. N.L.R.B., 5th Cir. 1972, 469 F.2d 1371, 1374.

In order to secure a hearing, the objecting party must present a prima facie case warranting setting the election aside. United States Rubber Co. v. N.L.R.B., supra, 373 F.2d at 606. This means that there must be "specific evidence of specific events from or about specific people" in support of allegations having a basis in law sufficient to overturn the election. N.L.R.B. v. Douglas County Electric Membership Corp., 5th Cir. 1966, 358 F.2d 125, 130. As to how specific the evidence must be, the Court in United States Rubber Co., supra, said that the objections must not be "`nebulous and declamatory assertions, wholly unspecified,' nor equivocal hearsay." Id., 373 F.2d at 606.4 We find that the present record is not conclusive as to the impact of the handbill and the Union observer's conduct, that a substantial and material factual issue as to impact exists, and that the Company has presented a prima facie case with sufficient specificity to warrant a full adversary hearing. The reasons for our holding and for our conclusion that the Board's findings to the contrary are unreasonable are set out below.

The Handbill

This Court has devised the following test for evaluating questionable campaign communications: (1) whether there has been a misrepresentation of a material fact; (2) whether the misrepresentation came from a party who was in an authoritative position to know the truth or who had special knowledge of the facts; (3) whether the other party had adequate opportunity to reply and to correct the misrepresentation; and (4) whether the employees had independent knowledge of the misrepresented fact, so that they could effectively evaluate the propaganda. N.L.R.B. v. Southern Foods, Inc., 5th Cir. 1970, 434 F.2d 717, 720; N.L.R.B. v. Cactus Drilling Corp., 5th Cir. 1972, 455 F.2d 871, 874.

The Regional Director found:

. . . that while the results of the Bes-Pak election may have been of some importance to Employer\'s employees, those results would not seem to be so material as to require complete certainty that employees were correctly informed of those results, that in view of the fact that Petitioner had unfair labor practice charges pending on behalf of the two challenged voters at Bes-Pak, its representation does not constitute a substantial departure from what it believed the truth to be, and that Employer had an ample opportunity to effectively reply to the handbill and did, in fact, reply by posting the official tally of ballots near to the employees\' timeclock . . .

And thus, the Regional Director concluded, the handbill did not constitute grounds for setting the election aside. The Board summarily concluded that the Company was attempting to relitigate the issues raised and determined in the previous representation proceeding in defiance of the Board's nonrelitigation rule, and thus affirmed the Regional Director's findings. In our opinion, the Regional Director did not apply the correct legal standard in part, and in part made findings which have absolutely no support in the record.

First, we believe that the message expressed on the handbill was a misrepresentation and that it was a material misrepresentation. The sole subject of the handbill was the successful election at Bes-Pak. Both companies, though separately owned, were the subjects of a joint organizing effort. The employees...

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