NLRB v. Trans Ocean Export Packing, Inc.

• Decision Date: 16 March 1973
• Docket Number: No. 23823.,23823.
• Citation: 473 F.2d 612
• Parties: NATIONAL LABOR RELATIONS BOARD, Petitioner, v. TRANS OCEAN EXPORT PACKING, INC., and DeWayne F. Titus, Respondents.
• Court: U.S. Court of Appeals — Ninth Circuit

473 F.2d 612 (1973)

NATIONAL LABOR RELATIONS BOARD, Petitioner, v. TRANS OCEAN EXPORT PACKING, INC., and DeWayne F. Titus, Respondents.

No. 23823.

United States Court of Appeals, Ninth Circuit.

January 2, 1973.

Rehearing Denied March 16, 1973.

Peter A. Eveleth, Atty. (argued), Marcel Mallet-Prevost, Asst. Gen. Counsel, Washington, D. C., Ralph E. Kennedy, Director, Region 21, NLRB, Los Angeles, Cal., for petitioner.

Gordon W. Nelson, Hayward, Cal. (argued), Don Laniewski, Los Angeles, Cal. (argued), W. James Knowles, Santa Monica, Cal., Margolis & McTernan, Los Angeles, Cal., for respondents.

Before HAMLEY, DUNIWAY and TRASK, Circuit Judges.

HAMLEY, Circuit Judge:

On August 30, 1968, the National Labor Relations Board (Board) issued its cease and desist order in an unfair labor practice proceeding against Trans Ocean Export Packing, Inc. (Company). Among other things, the Board order required the Company to make whole thirteen warehouse employees whom the Company had laid off to discourage support for a union. In order to implement this provision, the order required that the Company, its officers, agents, successors and assigns:

"Preserve and make available to the Board or its agents, upon request, for examination and copying, all payroll records, social security payment records, time cards, personnel records and reports, and all other records necessary or useful to determine the amounts of backpay due under the terms of this Board order."

The Company failed to comply with these provisions of the Board order, and the Board applied to this court for enforcement of that order. On February 27, 1969, we entered a judgment enforcing the Board order.¹ The Company did not comply with our order and accordingly the Board filed its petition for an adjudication in civil contempt.

We subsequently permitted the Board to amend this petition to add DeWayne F. Titus, then president and sole stockholder of the Company, as an additional respondent. The petition was also amended to add allegations to the effect that Titus is responsible for the failure of the Company to comply with our order of February 27, 1969.

After respondents answered, argument was had before this court. At this time it developed that there were unresolved issues of fact concerning respondents' awareness of the terms of our judgment of February 27, 1969, and the ability of respondents to comply with the provision of our order requiring the Company to make available to the Board or its agents, for examination and copying, payroll and other records needed in determining the amount of backpay due under the terms of the Board order of August 30, 1968. Accordingly, we appointed The Honorable Philip J. La Macchia, a hearing examiner attached to the United States Civil Service Commission, as Special Master to take testimony and receive evidence with respect to the issues raised by the pleadings, and to report thereon, including recommended findings of fact and conclusions of law.

After proceedings before him the Special Master filed his report and recommendations on August 9, 1972. The Special Master recommended detailed findings of fact, the substance of which is that respondents were fully aware of the terms of our judgment of February 27, 1969, that Titus was responsible for the failure of the Company to provide the Board with the required payroll and other records and that respondents were fully able to comply with our judgment requiring them to turn over these records for examination and copying.

In the course of his report, the Special Master recommended findings to the effect that, in his effort to frustrate compliance with our judgment, Titus had arranged to stage a fake burglary of the Company's office, and a fake theft of the records in question, but in fact the Company, at all times material to this proceeding, had these records under its custody and control. Pursuant to the terms of our order appointing a Special Master, respondents filed objections to the report, and a brief in support of their objections. The Board filed a brief in support of the report. The Board later requested further oral argument but we have determined to deny this request.

In their objections to the Special Master's report, respondents raise four questions. The first of these is whether the Company and Titus had notice of the February 27, 1969, judgment of this court.

At the time of the enforcement proceedings W. James Knowles was the attorney for the Company. He testified that he received a copy of the court judgment of February 27, 1969. Respondents concede that if one accepts Knowles' testimony "one is forced to the conclusion that TRANS OCEAN EXPORT PACKING had notice thereof." But they assert that it was not proved that Titus received such notice. In support of this position, respondents point to the testimony of Knowles that this court's judgment was called to the attention "of either Mr. Titus, directly, or Mr. Watson, at one point." Calling attention to the "or" used by Knowles in this testimony, respondents assert that this testimony is too equivocal to establish that Titus had notice.

But in the very next breath, in his testimony, Knowles stated: "And they the court judgment and other papers were subsequently discussed between myself and Mr. Titus on other occasions." Moreover, Knowles' testimony concerning his conferences with Titus from time to time regarding the Board's efforts to secure compliance with the court order, and describing Titus' various efforts to frustrate compliance, warrant the inference that Titus was fully informed concerning the court judgment.

We approve and accept the Special Master's recommended finding that both respondents, at all times material, were fully aware of the terms of our judgment entered on February 27, 1969.

As a second objection, respondents raise the question of whether they had the ability to comply with the provision of the court judgment pertaining to the turning over of payroll and other records to the Board for examination and copying.

The Special Master made meticulous recommended findings concerning respondents' control and custody of the Company's records. These recommended findings led the Special Master to conclude that respondents did have such custody and control at all times material to this proceeding. Respondents do not call attention to any evidence which would justify a contrary conclusion. Instead, they advance a number of collateral issues which we now notice.

Respondents assert that neither the petition nor amended petition alleges that either respondent had the ability to comply with the provisions of the court judgment pertaining to corporate records. In support of the contention that such allegations are essential, respondents refer to the California law on the subject, as announced in Farnham v. Superior Court, 188 Cal.App.2d 451, 10 Cal.Rptr. 615 (1961).

We conclude that the Board's failure to make this allegation is not fatal to the petition. First, the Company's contention that Rule 69(a), Fed.R.Civ.P., requires application of California procedural requirements is incorrect.

Rule 69 is entitled "Execution," and the first two sentences of paragraph (a) of that rule, upon which respondents rely, read:

"(a) In General. Process to enforce a judgment for the payment of money shall be a writ of execution, unless the court directs otherwise. The procedure on the execution, in proceedings supplementary to and in aid of a judgment, and in proceedings on and in aid of execution shall be in accordance with the practice and procedure of the state in which the district court is held, existing at the time the remedy is sought, except that any statute of the United States governs to the extent that it is applicable."

This rule has no applicability here as it relates only to procedures on execution of a district court money judgment. While the Board order of August 30, 1968, required the Company to make whole certain employees for lost wages, no money judgment was entered and the employees are not parties to the proceedings.

In the instant proceeding the Board is merely seeking to require respondents, through the compulsion of a civil contempt proceeding, to turn over books and records as mandated by our judgment of February 27, 1969. We agree with the Special Master's observation that

"to analogize proceedings to enforce an order of the Board to vindicate national policy under a Federal statute to proceedings for enforcement of a mere debt demonstrates a serious misunderstanding of the law. Fleming v. Warshawski sic Co., 123 F.2d 622, 625 (1941)."

Second, although inability to comply with a judicial decree constitutes a defense to a charge of civil contempt, United States v. Bryan, 339 U.S. 323, 330-331, 70 S.Ct. 724, 94 L.Ed. 884 (1950), the federal rule is that one petitioning for an adjudication of civil contempt does not have the burden of showing that the respondent has the capacity to comply. United States v. Fleischman, 339 U.S. 349, 362-363, 70 S.Ct. 739, 94 L.Ed. 906 (1950); Cutting v. Van Fleet, 252 F. 100, 102 (9th Cir. 1918). The contrary burden is upon the respondent. To satisfy this burden the respondent must show "categorically and in detail" why he is unable to comply. In re Byrd Coal Co., Inc., 83 F.2d 256 (2d Cir. 1936). Since the Board did not have the burden of proof as to respondents' ability to comply, it was under no obligation to allege such ability in its petitions to this court.

The second collateral attack respondents make upon the Special Master's recommended findings concerning respondents' ability to comply is that the Board's amended petition is not verified. Respondents refer to N.L.R.B. v. Arcade-Sunshine Co., Inc., 74 U.S.App.D.C. 361, 122 F.2d 964, 965 (1941), where the court said that it...