Cormier Hosiery Mill

()RMIER I()SIFRY MIll. Cormier Hosiery Mill, Inc. and Central New lamp- shire Dye, Inc. and International Ladies' Garment Workers' Union AFL-CIO. Case I CA 13713 June 25. 1979 DECISION, ORDER, AND DIRECTION OF SECOND ELECTION Upon a charge filed on October 6, 1977,' and an amended charge filed on November 1, by Interna- tional Ladies' Garment Workers' Union, AFL-CIO. herein called the Union, and duly served on Cormier Hosiery Mill, Inc., and Central New Hampshire Dye. Inc., herein called Respondent, the General Counsel of the National Labor Relations Board, by the Re- gional Director for Region 1, issued a complaint on November 16, against Respondent, alleging that Re- spondent had engaged in and was engaging in unfair labor practices affecting commerce within the mean- ing of Section 8(a)(5) and (I) and Section 2(6) and (7) of the National Labor Relations Act, as amended. Copies of the charge, complaint, and notice of hear- ing before an administrative law judge were duly served on the parties to this proceeding. With respect to the unfair labor practices. the com- plaint alleges in substance that on July 21, following a Board election in Case I RC- 14710, the Union was duly certified as the exclusive collective-bargaining representative of Respondent's employees in the unit found appropriate,2 and that, commencing on or about August 5, and at all times thereafter, Respon- dent has refused, and continues to date to refuse, to bargain collectively with the Union as the exclusive bargaining representative, although the Union has re- quested and is requesting it to do so. On November 28, Respondent filed its answer to the complaint, ad- mitting in part and denying in part the allegations in the complaint. On December 23, counsel for the General Counsel filed directly with the Board a Motion for Summary Judgment. Subsequently, on January 4, 1978, the Board issued an order transferring the proceeding to the Board and a Notice To Show Cause why the Gen- eral Counsel's Motion for Summary Judgment should I Unless otherwise indicated, all dates are in 1977. 2 Official notice is taken of the record in the representation proceeding, Case I-RC-14710, as the term "record" is defined in Secs. 102.68 and 102.6 9(g) of the Board's Rules and Regulations. Series 8. as amended. See LTV Electrorysrtems, Inc. 166 NLRB 938 11967), enfd. 388 F2d 683 (4th Cir 1968); Golden Age Beverage Co., 167 NLRB 151 (1967). enfd. 415 F.2d 26 (5th Cir. 1969): nterOtpe Co. v. Penello, 269 F.Supp. 573 (D.C.Va. 1967). Follett Corp., 164 NLRB 378 1967), enfd. 397 F.2d 91 (7th Cir 1968): Sec. 9(d) of the NLRA. as amended. On March 16. 1978. Respondent filed a motion to file supplemental cita- tion of authority, asserting that the Board should consider Drug Package, Inc. v. N.L.R.B., 570 F.2d 1340 (8th Cir. 1978). in deciding the instant case We shall take official notice of the decision in that case. not he ranted. Respondent thereafter iled an objec- tion to the General Counsel's Motion for Summary Judgment and a response to the Notice To Show Cause. As an affirmative defense. Respondent alleges in its response that it is not obligated to bargain with the Union because the results of the election in Case I RC-14710 were invalid, based on Respondent's ob- jections to the election alleging that statements made by the Union prior to the election constituted misrep- resentations under the Board's Hollywood Ceramics rule. Respondent further asserts that the Board acted improperly in applying the standards set forth in Shopping Kart Food .Market, Inc.1. to the conduct in this case inasmuch as the misrepresentations. the in- vestigation. and the Regional Director's Report on Objections all occurred before the Board issued Shop- ping Kart. FinalI,. Respondent urges that, if Shopping Kart standards are to be applied, the case should be remanded for investigation to see whether the facts in this case come within any of the Shopping Kart excep- tions. lipon the entire record in this proceeding. the Board makes the following: Ruling on the Motion for Summary Judgment It is well settled that in the absence of newl dis- covered or previously unavailable evidence or special circumstances a respondent in a proceeding alleging a violation of Section 8(a)(5) is not entitled to reliti- gate issues which were or could have been litigated in a prior representation proceeding.' All issues raised b Respondent in this proceeding were or could have been litigated in the prior repre- sentation proceeding, and Respondent does not offer to adduce at a hearing any newly discovered or previ- ously unavailable evidence. However, we find that the recent reformulation of the Board's policy concerning election campaign misrepresentations, announced in General Knit f California, Inc..6 constitutes a special circumstance requiring the Board to reexamine the decision in the representation proceeding.' While the underlying representation case was de- cided under Shopping Karlt, we find that it will effectu- ate the purposes of the Act to apply General Knit in this case, bearing in mind the need to balance any Ho llHood (Ceramics Compans. Inc. 140 NLRB 221 (19621 4228 NLRB 1311 (1977). See Pittsburgh Plate Glass Co v N.L.R B, 313 LI.S. 146. 162 (1941): Rules and Regulations of the Board. Secs. 102.67(f) and 102.6 9 1c) 239 NLRB 619 (1978). 'The Board's decision, reported at 230 NLRB 1052 (1977). declined to adopt the recommendation of the Acting Regional Director for Region I. and found the Union's campaign statements unobjectionahle under Shopping Kart without declining whether they' would have constituted mlsrepresenta- tions under Hols,w1ood Ceramics 243 NLRB No. 5 I)l'(IS(()NS NA I I)NAI I.AB()R RIA I ONS IO()A\RI) harm to the Lni on against "the mischief o' producing a result which is contralrv to a statutory design or to legal and equitable principles."' Absent special cir- cumstances, the Board has traditionally applied the pronouncement of a new rule of' law to the case in which it arose and to all pending cases.' We shall, therefore. apply the rule expressed in (;cneral K'n to the present case. In these circumstances. and considering our lind- ings of fact as set l'orth iftlo. we slill deny the Mo- tion for Su nmary Judgment. On the basis of the entire record, the Board makes the following: I:INI)IN(iS ()I A( I I. It IILSINIESS (11 RI SP()NI)I-N I Respondent is a New Hampshire corporation en- gaged in the manufacture. sale, and distribution of hosiery and textile products from its principal office and place of( business at 114 Lexington Street ()'Shea Industrial Park, Laconia, New lampshire. At all times material herein. Respondent has caused large quantities of hosiery and textile products maiinutc- tured by it to be purchased and transported in inter- state commerce from and through various States of the United States other than the State of New lanlp- shire. Respondent annually receives at its aconia plant goods valued in excess o' $50,000 directly from points located outside the State of' New Hampshire. Respondent annually ships from its I.aconia plant goods valued in excess of $50,000 directly to points located outside the State of New l lampshire. We find, on the basis of the foregoing that Respon- dent is, and has been at all times material herein, an employer engaged in commerce within the meaning of Section 2(6) and (7) of the Act, and that it will effectuate the policies of the Act to assert jurisdiction herein. 11. 1111 I.ABOR O)R(iANIZ.AIIHON INVOi( inl) International Ladies' Garment Workers' Union, AFL-CIO, is a labor organization within the mean- ing of Section 2(5) of the Act. Seurities and Exihange (rmmssion . (herner (rprat.ll 332 I1 S. 194. 203 (1947) Iailure to a;pply General Kni in this proceeding would he contrary to he "statutor) design." inasmuch ais the primar reason Ikrr an- dotting the Shopping Karl rule and returning t Holhsv )ad ( eranli ,, as our conclusion hat the Shping Karl rule was inadequate to prolert emploee free choice 'See, e.g.. Thomas, E. Gates & Sons. Inc-. 229 NL RB 705 (19771 lapplying Shropping h(lr): II & . Bnh ( ,, 188 NlRB 720 (1971) (applbing he pnnciples ol The .aidlaw (Corporrarn. 171 NRB 1366 (1968)). enid. 456 F.2d 357 (2d (ir. 1972)1: Dela.k Metal urniur. (ormpantv, 121 NI.RB 995. 1006 (1958): Pacisi ( sxl.s 4 sotriaron ,I PulI ailnd Paper Mmnilrul(rureri, 121 NIRB 990. 994 (958). (C Exslelior IUndreniarl Inc, 156 NI RB 1236. In. 5 1196). 111. 111, tI NI AIR R IA()RM II( :S A. 7 R'.eSennito Pe'cding I. The unit lhle htllowling employees of Responliicnt constitute a unit appropriate ior collective-bargaining purposes within the meaning o Section 9(h) ol' the Act: All production and Iaintcnance e lilo ccs of Respondent employed at its I.aconia. New I lampshire, plant, exclusive of oflice clercial em- ployees professional employees, IBM room em- ployees, leadmen. floorladies. guards and till su- pervisors as defined in Section 2(11) of the Act. 2. The certification On or about October 27 and 28, 1976. a ma jorit of' the employees of Respondent in said unit, in a secret- ballot election conducted under the supervision of the Regional [)irector ftbr Region I. designated the Union as their representative for the purpose of' collective bargaining with Respondent. hereafter, timely ob- jections to the conduct of' the election were filed b Respondent, and the Regional l)irector caused an in- vestigation of those objections to be conducted. As is more fully set frth in the attached portion of the Acting Regional Director's Report on Objections and ('hallenged Ballots omitted from publication]. a central campaign issue prior to the election was Re- spondent's financial condition. The Union had claimed repeatedly that Respondent's claims of poor financial condition were lfalse and had promised that "bef'ore ou go to an election, each and every one of you will know the truth." The Union had distributed copies of certain financial records, and had inter- preted them as indicating that Respondent was finan- cially sound and could afford raises: in response. Re- spondent had asserted that other records indicated that it was losing money. The Union had also pub- licly requested that it be allowed to have its account- ants analyze Respondent's financial records. Finally. the Union addressed a letter to Odilon Cormier. Re- spondent's president, which stated, in relevant part: Y()t (I.AIM A AID [I:INAN( IAI] SIAII MINI. I)() Y)t SII()H I llS HAI) SI AIIMINI HlF( AL SI: SINS S IS BAID )R I)) Y snow tills BAID SAIiLMtNl Hl ('AtSl O) ( )RMIIR ()F (ORMIIiR IIO()SIFRY Ml. IN . Nl W IIAMP- SIlRI I ()ANI:) O()I)Y ('ORMIFR OF ( ORNMIl R FABRI( IN NEW YR()RK (11 $2,000.I0X)????'?? The letter ended by asking that Cormier "please now tell the people the truth." Copies of the letter were distributed to employees less than 24 hours before the election, and the letter was posted in the plant on the day of' the election. There was evidence that its con- 2, (()RMIIER i()SIIlR MIII. 1. tents were urther emnphasized by one o' tile t l nio's agents 1 ho. according to one witness. shouted to e C11- ployees as the) left the plant the day beflore the lec- tion: ()dy ( ormier stole $2 million o' Voulr money and put it in New York." The Acting Regional )irector concluded that the Union's references to a $2 million loan to ('ormier Fabric, a whollI owned marketing subsidiary of Re- spondent. constituted a misrepresentation. le found that the tra nsaction referred to was an account receiv- able of $1.908,)0( lor fabric knitted bh Respondent and sold bhv the New York subsidiary. Hle ound that. by distorting both the nature and the amount of the transaction, the Union made it unlikely that Respon- dent could identifv the transaction and respond to the misrepresentation prior to the election. lie also noted that, inasmuch as the misrepresentation occurred less than 24 hours before the election. Respondent could not have held a meeting to explain the error.' and therefore could not have effectively refuted the attack on the credibility of its representatives. For these rea- sons, the Acting Regional Director recommended that the election he set aside, under standards set forth in Hollv/wood Cramics, supra. The Union excepted to this recommendation, and Respondent filed a reply to the exceptions and a sup- porting brief. Thereafter, the Board announced its opinion in Shopping Kart, spra. and subsequently. based on that case, overruled the objections to the election and certified the Union on July 21. 1977. Re- spondent's motion for reconsideration was denied. B. The Requesi To Bargain and Reslpondent'v Rc/itsal Commencing on or about August I. 1977. and at all times thereafter, the Union has requested Respon- dent to bargain collectively with it as the exclusive collective-bargaining representative of all the employ- ees in the above-described unit. Commencing on or about August 5, 1977. and continuing at all times thereafter to date, Respondent has refused, and con- tinues to refuse, to recognize and bargain with the Union as the exclusive representative for collective bargaining of all employees in said unit. For the reasons set forth in the portion of the Act- ing Regional Director's Report on Ohbjections and Challenged Ballots, attached hereto as an Appendix, we find that the Union's last-minute campaign state- ments constituted substantial misrepresentations made at a time when there was no opportunit for an effective reply, and therefore conclude that those statements so interfered with the conduct of a free and fair election as to warrant setting aside that elec- Citing, inter a/ia. Pecr/es P/lvuO ( ordipani., 1()7 N RB 427 (1154 tion. I' Aecordingl . as thle certification of' the L nion as collective-hbargaining representative 1for the unit tound appropriate was based upon an invalid elec- tion. we shall revoke the certification, set aside the election. and direct that a second election shall be held at a time to he determined hb tile Regional Di- rector for Region 1. In iew ofl our decision herein. we shall dismiss the collmplaint. ORI)lR 'Pursuant t Section 10(c) of the National abor Relations Act, as amended, the National I abor Rela- tions Board herebh orders that the complaint he. and it hereh\b is, dismissed in its entirety. I I IS t IIIt IILR O()RI I) that the election in Case K( 14710 he set aside and that the certification is- sued in that case he. and it herebh is, revoked. II IS I R III I-R ()RI)TRI I) tha t the proceeding s in Case I RC 14710 be. and the herehby are, remanded to the Regional Director for Region I for further ac- tion in accordance with this Decision. [Di)rection of Second Election omitted Irom publi- cation.]' 2 M MINBER PINt I . dissenting: For the reasons set orth in m: dissenting opinions in General Knitl and Blikan-lr l 'h/r.t , I ;believe that the Shopping Kharl decision"s was properly applied in the underling representation proceeding so as to overrule the Employer's misrepresentation objections and certitfy the Petitioner."' I would therefore grant the General Counsel's Motion for Summary Judg- ment and issue a bargaining order. In contrast. the Board's decision today vacates the Union's certification and dismisses the complaint. marking the third time that such drastic and extraor- dinarN action has been taken by the General Knit ma- jorityv. In Mour additional cases, misrepresentation ( ,renra/ ,,. supral: tit/!s/ d (c,,train. pra While t is unfortunate that the ntersal between the elcotion herein and the final res.olutln of the L nion's status has been delayed bh) procedures before the Board. we re constrained to note that the dela) is largels due to the necesst lfor Respondent. through a technical refusal to bargain. to chal- lenge the certiticatlin lf the I nn tollowing an election in whlth employee free cholce was seriousl3 compromlsed hIs the llon', misleading campaign statements. Hiad the principles of H4 ll Hxd (C(ruan. l been applied in the first instance. there might well hase been a alid second eleclion in which the emplorees could hase epressed their true sentiments concernilng the nion. The sote in the election conducted in 1977 was not. in our opinion. an accurate reflection if the wishes of ain uncoerced mnaJorit? of emplhs ees. and the unwise certification of Ihe 'nlon based on that election necessitated the subsequent proceedings which he, regrettably. delased the holding ,of a ,ahd election which might result in an appropriate certification 1 E titsr ltootnote nited rom publication (eneral Ati , ( .il/.ro In . 239 Nl .R B 6 19 1978) 4 Bla(A in.-i hcr ( hemc../ [vtl, in Si rn//m' ('r iratlon.r 29 NR B 637 119781 ' Shoppng Aari Filood 'IearA. 1,, 228 NlRB 1311 (1977) I230 NlRB 1052 11977) i The ,Ih¢r I-t, , vix'~ ir Nal llIl..l ( U,,tli I } iliung drhtst'i h; Sha/iotn Nursig bmOe. 241 NRB No. 9 (1979). and Bl., Aian hl.r. mupro 21 DEC[)(ISIONS O() NAI IONAL L.ABOR Rl.AI IONS BOARDI objections filed by employers have been either sus- tained or remanded for further investigation or hear- ing.'8 On the basis of the majority's own decisions, it is thus clear, only months after General Knit was de- cided, that Board application of the Hollywood Ce- ramics rule' 9 does indeed delay and frustrate collec- tive bargaining, as I have long maintained. In this case, the employees voted for union repre- sentation more than 2 years ago. The Union was cer- tified 9 months later and 5 more months elapsed be- fore the refusal-to-bargain case was initiated and transferred to the Board for decision. Now the em- ployees are back to square one. While they wait once again for this case to wind its way down the corridors of Board procedure, they will, of course, have the comfort of the majority's observation that "i]n gen- eral . . . it seems that the problems of delay [under Hollywood Ceramics] has been greatly exaggerated." 0 MEMBER MURPHY, dissenting: This is another example of the inordinate delay caused by the Board majority's insistence on follow- ing an outdated and outmoded rule--Hollywood Ce- ramics.l' The Board here is again denying employees their right to be represented by the collective-bargain- ing agent of their choice. Although the Union won the election here, the Board is directing that it be rerun. Contrary to my colleagues in the majority---and obviously-I would grant the General Counsel's Mo- tion for Summary Judgment in this case. As stated in my dissent in General Knit of California, Inc.,22 I ad- ' Fontaine Truck Equipment Co., 241 NLRB No. 164 (1979); San Fran- cisco Hosts. Inc., 241 NLRB No. 53 (1979): Jamak, Inc.. 239 NLRB 1274 (1979): General Knit, supra. t" Hollywood Ceramics Company. Inc, 140 N 1 R B 221 (1962). x General Knit, supra, at 624. 21 140 NLRB 221 (1962). 2l 239 NLRB 619. here to the principles set tforth in my concurring opin- ion in Shopping Kurt Food Market, Inc.,2 and I be- lieve that the Board properly relied upon Shopping Kart in certifying the Union in Case I RC-14710. Accordingly, I find Respondent's present refusal to bargain with the Union to be unlawful. Additionally, although I concurred with the major- ity in Blackman-Uhler Chemical Division -Snallov Corporation,24 I did so purely on the ground that Shopping Karl should not be applied retroactively. There, when the original representation proceeding and the later summary judgment case were decided, the test of preelection misrepresentations as objec- tionable conduct was that set frth in Hollywood Ce- ramic.s CompanY Inc.. and I was of the opinion that under those particular circumstances, the same test should remain applicable in that case. In the instant case, however, as noted above, the Board applied Shopping Karl in the representation case; that same standard should be applied in this case, which is merely an outgrowth of that proceeding. Thus, my position here is consistent with the one I took in Blacklman-Uhler, albeit the results are dissimilar. I wholeheartedly agree with Member Penello that the majority decision here exemplifies the problems of undue delay caused by the majority's insistence on returning to the Hollywood Ceramics rule, and, thus, I fully endorse the comments made by Member Penello in the last paragraph of his dissent herein. I simply would add that the majority's adamance in making General Knit retroactive to representation cases de- cided under Shopping Kart exhibits a slavish adher- ence to a point of view whose rigid application is achieved at the expense of the employees and the very collective-bargaining process which this Agency is en- trusted to further and safeguard. 23228 NLRB 1311. 24 239 NLRB 637. 22