Kipbea Baking Co., Inc.

KIPBEA BAKING COMPANY, INC., ETC. 411 terest of Safeway. I think it to be a sophism to argue, as one must to support the complaint, that the meat merchandising manager was thus induced and encouraged "to engage in a strike or a refusal in the course of his employment to use, manufac- ture, process, transport, or otherwise handle or work on any goods, articles, mate- rials, or commodities or to perform any services ." Safeway, through the agency of its meat merchandising manager, or otherwise could have decided that its business would be more profitable if the leafleting was stopped and that therefore in the exercise of good business judgment , it would be best for it to cease dealing with Peyton . It does not follow, however, that Safeway was thus subjected to a compul- sion deriving from any inducement or encouragement of its meat merchandising manager to engage in a strike or otherwise to refuse to perform services in connec- tion with his employment . I consider it not reasonable to conclude that the Re- spondent was attempting in any fashion to deprive Safeway of any sort of services theretofore rendered to it by its meat merchandising manager. This "manager" or "supervisor," however he may be termed, rather than being induced to act against his employer, was attempting to discover an answer to the problem (presumably of reduced sales) brought about by the leaflet. I find that the Respondent has not violated the Act in respect to the meat merchandising manager or to Safeway. Upon the same considerations the same conclusion is reached as to Furr. The sum of the evidence as to Furr, is that the manager was asked to aid the Respondent by lessening his purchases from Peyton. If the manager desired to help the Respond- ent and if his employer did not object , I suppose that he was free to do so. Depend- ing upon the authority of the Furr manager in matters of policy, he might have decided to go along with the Respondent's request or to ignore it and at all times be acting only in the interest of his employer . There is nothing in the factual situa- tion presented which suggests to me an inducement or encouragement of any sort offered to the Furr manager to strike or to refuse to perform any sort of services for his employer . I find therefore that no violation of the Act is presented in respect to Furr or its manager. CONCLUSIONS OF LAW 1. The Respondent is a labor organization within the meaning of Section 2(5) of the Act 2. Peyton, Safeway, and Furr are persons within the meaning of Section 2(1) and Section 8(b) (4) of the Act. 3. The Respondent has not engaged in unfair labor practices within the meaning of Section 8(b) (4) (i) of the Act. [Recommendations omitted from publication.] Kipbea Baking Company, Inc.; H & L Baking Company, Inc.; and Edwin Seiferth, Helen Seiferth, and Lorraine Zah and Local 3, Bakery and Confectionery Workers International Union of America. Case No. 2-CA-6947. May 3, 1961 DECISION AND ORDER On August 15, 1960, Trial Examiner Arthur E. Reyman issued his Intermediate Report in this case, recommending that the complaint be dismissed in its entirety, as set forth in the copy of the Intermedi- ate Report attached hereto. Thereafter the General Counsel and the Charging Party filed exceptions to the Intermediate Report and the Respondent and General Counsel filed briefs. Pursuant to the provisions of Section 3 (b) of the Act, the Board has delegated its powers in connection with this case to a three- member panel [Members Rodgers, Leedom, and Fanning]. 131 NLRB No 56. 412 DECISIONS OF NATIONAL LABOR RELATIONS BOARD The Board has reviewed the rulings made by the Trial Examiner at the hearing and finds that no prejudicial error was committed. The rulings are hereby affirmed. The Board has considered the Inter- mediate Report, the exceptions, the briefs, and the entire record in this case, and hereby adopts the findings, conclusions, and recom- mendations i of the Trial Examiner. [The Board dismissed the complaint.] I Member Rodgers would not find, as implied by the Trial Examiner , that the Respond- ents Kipbea Baking Company and Edwin Seiferth were under a duty to bargain with the Union concerning its intentions to cease its baking operations. INTERMEDIATE REPORT AND RECOMMENDED ORDER STATEMENT OF THE CASE This is a proceeding under Section 10(b) of the National Labor Relations Act as amended (61 Stat. 131; 28 U.S.C.A., sec. 151 et seq.; Public Law 86-257, 1959), herein called the Act. Upon the basis of a charge duly filed on October 23, 1959, and a first amended charge filed November 23, 1959, by Local 3, Bakery and Confectionery Workers International Union of America, the General Counsel of the National Labor Rela- tions Board , on behalf of the Board, by the Regional Director for the Second Region, issued a complaint and notice of hearing herein. The charge asserted (as did the amended charge), that the Respondents named in the complaint had engaged in and were engaging in unfair labor practices within the meaning of Section 8(a)(1), (3), and (5) of the Act. The complaint sets forth allegations of violations of Section 8(a)(1), (3), and (5) of the Act. These allegations of interference, intimidation, coercion, discrimi- natory discharges, and refusal to bargain, as set forth in the complaint, may be sum- marized as follows: The Respondents named in the complaint are Kipbea Baking Company, Inc., H & L Baking Company, Inc., Edwin Seiferth, Helen Seiferth, and Lorraine Zah.1 It is said in the complaint that at all times since August 1956, Local 3 has been the representative for the purposes of collective bargaining of a majority of the em- ployees in a unit described as All production and maintenance employees of Respondents, meaning Kipbea and H & L, exclusive of guards, and all supervisors as defined in Section 2(11) of the Act and that by virtue of Section 9(a) of the Act, said Local 3 has been and is now the exclusive representative of all the employees in the described unit for the pur- poses of collective bargaining with respect to rates of pay, wages, hours of employ- ment and other conditions of employment; that since on or about April of 1959, the Respondents have refused to bargain collectively with Local 3 as such exclusive bargaining representative of the employees within the described unit; and further, that the Respondents have failed and refused to negotiate and discuss with Local 3 termination of the business operations of the Respondent or Respondents at its Bronx plant and a transfer to a plant in Mamaroneck, New York; that the Respond- ents have failed and refused since on or about July 1, 1959•, to recognize Local 3 as such exclusive bargaining representative of its employees; and (as an amendment to the original complaint) since on or about February 4, 1960, and at all times since, the Respondents have recognized and bargained with and signed a collective agreement with Local 76, United Industrial Workers, in spite of the fact that a ques- tion concerning representation then, and prior thereto, and since, has existed. It further is alleged in the complaint as amended that in June 1959, H & L acquired from Kipbea a substantial portion of its baking equipment, other physical assets, I Local 3, Bakery and Confectionery Workers International Union of America, the Charging Party herein, may sometimes be referred to as Local 3 or the Union ; Kipbea Baking Company, Inc, may be referred to as I{ipbea ; H & L Baking Company, Inc, may be called H & L ; and Edwin Seiferth, Helen Seiferth, and Lorraine Zah, the other Respondents named , may be called either a Respondent or by name. KIPBEA BAKING COMPANY, INC., ETC. 413 good will, and other trade assets of Kipbea; that after July 1, 1959, H & L main- tained its principal office and place of business at Kipbea's Mamaroneck plant; that since July 1, H & L has produced pies and cakes under the trade name of Kipbea; that between July 1 and November 1959, H & L sold its products to Kipbea exclu- sively, and since November 1959 has sold the major portion of its product to Kipbea. The complaint goes on further to say that Kipbea and H & L are and at all times herein have been affiliated enterprises with common officers, directors, and oper- ators, and constitute a single integrated business enterprise; and that the directors formulate and administer a common labor policy for these companies affecting the employees of each of them. The complaint alleges that since April 1959, Respondents have refused to bargain with Local 3; that the Respondents failed to notify Local 3 of the termination of business operations in the Bronx and refused to negotiate and discuss with Local 3 their termination of business operations at the Bronx plant, and since July 1, 1959, have refused to recognize Local 3 as the exclusive bargaining representative of its employees. It further is set forth in the complaint that the Respondents discharged certain of Kipbea's bakers, employees at the Bronx plant. The complaint says that the Respondents have refused to reinstate these employees of Kipbea at its Bronx plant; that such refusal was because these employees were members of Local 3, and because of that the Respondents are guilty of unfair labor practices under the Act.2 The Respondents and each of them filed timely answer to the complaint, effec- tively denying the allegations of violations of the Act. In their answer, Respondents set up a separate defense which in substance says that H & L was incorporated by Lorraine Zah in May 1959; that Lorraine Zah is the sole owner and holder of all of its issued and outstanding stock; that she is related to the Seiferths (meaning the Respondents Edwin Seiferth and Helen Seiferth) and worked for Kipbea prior to the time she went into business for herself; but aside from the occasional advice which she has received from Edwin Seiferth and assistance in obtaining business space and aid in the purchase of equipment, neither Edwin Seiferth nor Helen Seiferth have had any connection in the way of control with H & L, the sole property of Lorraine Zah; and that Lorraine Zah has no connection with Kipbea. Pursuant to notice, this case came on to be heard before the duly designated Trial Examiner at New York, New York, on April 4, 1960, and was closed on April 14. At the hearing the General Counsel and the Respondents appeared and were represented by counsel. The Charging Party did not appear. Each of the parties who appeared was afforded full opportunity to be heard, to examine and cross- examine witnesses, to introduce relevant and material evidence, to engage in oral argument on the record, and to file briefs and proposed findings of fact and conclu- sions of law. Counsel for the Respondent filed a brief which has been carefully considered. Upon the entire record in the case , the Trial Examiner makes the following: FINDINGS OF FACT 1. THE BUSINESS OF KIPBEA BAKERY CO., INC., H & L BAKERY COMPANY, INC., EDWIN SEIFERTH, HELEN SEIFERTH, AND LORRAINE ZAH At all times mentioned herein prior to July 1, 1959, Kipbea Baking Company, Inc., maintained its principal office and place of business at 1218 Brook Avenue in the borough of the Bronx, city and State of New York, where it had been engaged in the manufacture, sale, and distribution of cakes, pies, and other related bakery products, and at all times mentioned since on or after July 1, 1959, has maintained its principal office and place of business at 147 Plaza Avenue, Mamaroneck, State of New York, and is now and has been during the time stated in the complaint continuously engaged in said plants and places of business in the sale and distribution of pies, cakes, and related bakery products. The complaint asserts, and the assertion seems supported by the facts herein, that since on or about July 1, 1959, and until about the month of November 1959, the production of H & L was sold to Kipbea, exclusively, and since in or about the month of November 1959, the major portion of the production of H & L has been sold to Kipbea;,and that since on or about July 1, 1959, Kipbea has purchased and distributed the pies, cakes, bakery products, and related products of H & L ex- clusively. During the year ending June 30, 1959, Kipbea, in the course and conduct of its business operations, caused to be purchased, transferred, and delivered to its Bronx 2 The complaint as amended at the hearing, and the amended answer following such amendments, will hereinafter be referred to as the complaint and the answer. 414 DECISIONS OF NATIONAL LABOR RELATIONS BOARD plant sugar, flour, shortening, eggs, fruits, dairy products, and other goods and materials, valued at in excess of $50,000, of which goods and materials, valued in excess of $50,000, were transported to the Bronx plant from, and received from, other enterprises, located in the State of New York, such other enterprises having received such goods and materials in interstate commerce from States other than the State wherein they are located.3 It is found that Kipbea and H & L, Edwin Seiferth, Helen Seiferth and Lorraine Zah are and have been at the times maerial hereto, employers engaged in commerce within the meaning of Section 2(6) and (7 ) of the Act. II. THE LABOR ORGANIZATION INVOLVED Local 3, Bakery and Confectionery Workers International Union of America, is and at all times material hereto, has been a labor organization within the meaning of Section 2(5) of the Act. III. THE UNFAIR LABOR PRACTICES (a.) Background Local No. 3 and Kipbea on July 1, 1956, entered into a collective-bargaining agree- ment governing the terms and conditions of employment of those employees of Kipbea employed within the bakery. This agreement superseded a prior agreement. By its terms, it expired on January 31, 1957. On August 26, 1957, the parties modi- fied the theretofore existing agreements by a written collective agreement to run effective as of January 1, 1957, until January 31, 1960. In this last agreement, the employer recognized the Union as the sole collective-bargaining representative "of all employees employed in its establishment or establishments" and agreed to employ only members of the Union in good standing. Among the clauses in this agreement is one providing for vacation pay and usual clauses dealing with wages , hours, and other working conditions. Kipbea was organized as a corporation in May 1956, engaged in the operation of a wholesale bakery at the Brook Avenue address in the Bronx, and manufactured pies and cakes for sale to restaurants and other consumers . In about April 1959, Kipbea decided to give up baking as such and to act solely as a distributor of bakery products. Having decided, in April 1959, to give up baking, Kipbea notified its bakers of its decision, and notified Local 3 of the Bakers Union and Local 802 of the Team- sters (Bakery Drivers Local 802, International Brotherhood of Teamsters, Chauf- feurs, Warehousemen and Helpers of America) that as of June 30, 1959, it would no longer engage in baking. At this time Edwin Seiferth, president of Kipbea, owned 75 percent of the cor- porate stock, his wife, Helen, owned the other 25 percent. At this time, too, Lor- raine Zah, a cousin of the Seiferths, worked for Kipbea, was in active employment within the bakery, and was a member of Local 3. At the time Kipbea discontinued baking, Lorraine Zah formed H & L, a corpora- tion, to engage in baking operations.4 After the founding of H & L, Miss Zah com- menced baking operations in July 1959 at the Mamaroneck plant. According to the Respondent, the lease of premises in Mamaroneck was made by the landlord to 3 At the hearing it was stipulated that Kipbea, during the period June 1958-June 1959, purchased flour which originated outside the State of New York from the Raymond -Hadley Corporation, in the amount of $13,297; that during the same period Kipbea purchased from J. F Braun and Sons , cocoa powder which originated outside the State of New York in the amount of $353; that during this period Kipbea purchased pineapple from Kennedy Menke Company, originating from outside the State of New York, in the amount of $4,062 ; that during this same period Kipbea purchased ground ginger from Archibald and Kendall, Inc, in the amount of $340, ginger having been imported into this country from Africa and then powdered and thereafter as a powdered root delivered to the buyer ; that during this period of time Kipbea purchased sugar from Sucrest Sugar Division of American Molasses Company, in the amount of $14,491, such sugar being dry sugar, re- fined from raw sugar imported from areas outside the continental United States, sub- sequently refined at a refinery located in Brooklyn, New York Without regard to the items set forth in the stipulation noted in this margin ( constituting purchases amounting to $32,543), other data contained in the record show that the Board, under its dollar- volume standard , as applicable to the types of business herein mentioned , are applicable and jurisdiction should be taken by the Board 4 As explained by Miss Zah at the hearing, the H and the L in the name of the corpora- tion stood for Helen ( Mrs. Seiferth ) and Lorraine (Miss Zah). KIPBEA BAKING COMPANY, INC., ETC. 415 Seiferth because the landlord refused to make a lease to Lorraine Zah because the landlord would not rent to a woman or a new corporation. On May 25, 1959, Edwin Seiferth took the lease in his personal name and at about the same time sub- leased 80 percent of the space to H & L and 20 percent to Kipbea. The subleases were approved by the landlord on May 26. Miss Zah advanced a substantial amount of money to the Seiferths in support of the enterprise. Between June 30 and July 1, 1959, Kipbea purchased pies for distribution from Miller Pie Company in New Jersey. During the month of May 1959, Edwin Seiferth had communicated with John Hart, business agent of Local 3, and suggested to him that the bakers, members of the Union employed by Kipbea, could take their vacations during that month because said 'Seiferth, he was required to vacate the premises on Brook Avenue in the Bronx before July 1. The bakers employed by Kipbea were so notified. Some of the equipment used by Kipbea in the Bronx had been condemned by the health department of the State of New York and was dismantled and destroyed; other of the equipment, including rolling machine, pie plates, and other miscellane- ous material, was transferred by Kipbea to H & L upon the payment of a nominal sum of money by Miss Zah, as president of H & L, to Kipbea. Such equipment and supplies were transported from the Bronx to Mamaroneck and set up in the premises occupied jointly by Kipbea and H & L after July 1, 1959. Not only Local No. 3, but its member bakers employed by Kipbea on Brook Avenue in the Bronx, had full notice that Kipbea intended to move from the Bronx address and that it intended to take over quarters in Mamaroneck. This knowledge was conveyed by Seiferth in May, and was common knowledge during May and June; the move of Kipbea to Mamaroneck to the premises above described had well advance notice. Just before July 1, John Hart, business agent of Local 3, together with the bakers previously employed by Kipbea, appeared at the Mamaroneck premises and told Mrs. Seiferth, who was on the job at the time, "Here are your bakers." Mrs. Sei- ferth took the position at that time that they were not "Kipbea's bakers" and asked them (that is, Hart and the seven or eight bakers with him), to leave the premises, since Kipbea was not then engaged in baking. It appears that a heated discussion ensued, during which Mrs. Seiferth asked for police protection, police arrived, and Hart and the bakers left. On July 1, Local 3 commenced picketing H & L at Mamaroneck and on July 2, Local 802 of the Teamsters sent a telegram to Kipbea advising that Company that unless it settled its strike with Local 3, Teamsters drivers would not cross the picket line set up by Local 3. The Respondent contends that a proper approach to the testimony given at the hearing on either side, in order to realize Respondent's claim that the testimony of the Board's witnesses , union officers, and members who are named as defendant in pending court actions were highly prejudiced and unworthy of serious consider- ation, requires certain background information. I see no serious reason why the Board should consider litigation in a civil action for injunction in a State court in connection with this case.5 This instant case was heard, so far as I am concerned, de novo, and without regard to what was testified to or said in a State court proceed- ing. It should be noticed, however, that the actions brought by Kipbea and H & L still are -pending in the Supreme Court, Westchester County, New York, wherein the corporate Respondents seek to recover money damages from Local 3 and Local 802. (b) The essential facts I quite agree with the Respondent in its assertion that the Union and its members had more than adequate notice of the removal of the business of Kipbea from the 5 At the hearing hereof, this Trial Examiner refused to take into evidence certain occur- rences concerning State court litigation involving the parties hereto However, it may be well, upon the insistence of counsel for the Respondent, to relate these following facts offered by the Respondents, In October 1959, because of alleged tortious wrongs committed by the officers and members of Local 3 and Local 802, in violation of the New York State Labor Rela- tions Law, Kipbea and H & L instituted separate action in the Supreme Court, Westchester County, New York, to enjoin the continuance of said Act, and for damages. Almost immediately after these actions were started, Local 3, by its attorneys, made a complaint of unfair labor practices against these Respondents, before the 'National Labor Relations Board, following which this proceeding was instituted. 416 DECISIONS OF NATIONAL LABOR RELATIONS BOARD Bronx to Mamaroneck. I refer to Local 3. The changeover of operations of Kipbea, so far as the Teamsters Local 802 is concerned, was also well known. I cannot find a so-called runaway shop situation in this case. What I do find, however, is a situation wherein Kipbea, in the exercise of corporate discretion, decided to move from one position in this particular industry into another position: that is, to desert baking for delivery. I also can find within the whole record here that Lorraine Zah, closely connected with the Seiferths, was given the opportunity and accepted it, to organize H & L. The General Counsel has proved precisely that this is a family operation. So far as the legality of the moves as were made, the Act prevents such moves if made for the purpose of discouragement or encouragement of union activity. I find no such situation here. After picketing had begun at the Mamaroneck premises on July 1, and United Independent Workers Union, Local 93, C.U.A. (Independent), had filed a petition with the New York State Labor Relations Board (Case No. SE-31850), a meeting was held before Examiner Irving Stone at which, following a letter sent to H & L Baking Company, dated July 2, 1959, by Examiner Stone, Business Agent Hart from Local 3 and another representative from that Local and one Nick Simonetti, repre- senting Local 802 of the Teamsters, the president of Local No. 3, Frank Dutto, and counsel for the Company, among others, were present, conferred with respect to a petition filed on behalf of Local 93 for recognition and as representative of bakers, helpers, apprentices, and porters employed by H & L Baking Company at Mamaro- neck. During the course of this conference, Examiner Stone received a telephone call, called Dutto who spoke on the telephone, the meeting closed and subsequently H & L received a letter from the New York State Board to the effect that the petition for representation theretofore filed by Local 93 had been withdrawn .6 At this time the premises occupied jointly by Kipbea and H & L were being picketed by Local 3. Prior thereto, John Strauss, president of Local 802, had dis- patched a message by way of telegram to Kipbea Baking Company at Mamaroneck, as follows: We have been advised a strike is in progress against your company by Bakery Workers Union Local 3 and the said union is picketing. This will constitute 24 hours notice pursuant to our contract that members of this union will feel free to refuse to work for your company on and after July 5 if the strike is still in progress at that time. Picketing by Local No. 3 continued at Mamaroneck premises after Local 93 had withdrawn its petition from the State Labor Relations Board. During the course of the picketing Local No. 3 pickets passed out and circulated the following leaflet: RUNAWAY SHOP H & L Baking Company (Kipbea Baking Co.) Workers LOCKED OUT THESE ARE THE FACTS: On Tuesday morning July 10th, without notice to his employees and in vio- lation of a union agreement, Mr. Edwin Seiferth, President of the Kipbea Baking Company, 1218 Brook Avenue, Bronx, New York, removed all baking equip- ment from his plant and moved to 147 Plaza Avenue, Mamaroneck, N.Y., forming a new Company called H & L Baking Company. Mr. Seiferth has had a signed union contract with Bakers Union Local 3 for many years. The present agreement expires January 31, 1960. In addition to removing his plant and refusing to employ his workers, Mr. Seiferth owes his employees several weeks pay which he refuses to pay. Bakers Union Local 3 has placed picket lines at the Mamaroneck Plant and Kipbea's retail outlet, which is located at 167th Street and Webster Avenue, Bronx, to compel the Employer to rehire the 9 workers, many of whom have been employed at Kipbea Baking Company for as long as twenty-five years. Mr. Seiferth, in moving his plant to Mamaroneck, N.Y., is attempting to run away from this obligations under a contract negotiated with Bakers Union Local 3 and thereby seeking a source of cheaper labor. BAKERS UNION LOCAL 3 APPEALS TO ALL CONSUMERS OF KIPBEA BAKING COMPANY and/or H & L BAKING COMPANY NOT TO 6 Examiner Stone sent a letter to H & L dated July 2 ; the conference at his office, subsequent to which Local 93 withdrew its petition , was on July 8. KIPBEA BAKING COMPANY, INC., ETC. 417 PATRONIZE BAKERY PRODUCTS SOLD BY MR . SEIFERTH, OWNER OF THESE TWO COMPANIES. DON'T CROSS OUR PICKET LINES !!! YOUR COOPERATION IS APPRECIATED Baker Union Local 3 41-07 Crescent Street Long Island City, N.Y. STillwell 4-3476 Business Agent John Hart said that he, in April 1959 , discussed with Edwin Sei- ferth the question of vacations and at that time Seiferth told him he wanted vaca- tions taken before July, because he would have to be out of the Bronx plant before then; Hart said further, that he asked Seiferth if he was going to take the bakers with him when he left the Bronx plant , and that on June 27 or 28, he asked Seiferth when he was going to move and said that Seiferth told him as soon as possible he would transfer the bakers. This substance of the testimony of Hart leads me to wonder whether, when he knew from Seiferth himself that Kipbea was going to move from the Bronx location to a new place of business as early as in May, why he did not at that time, when he knew the Bronx plant would be closed by at least June 30, take up with Seiferth the question of the employment of bakers at such a new location as Seiferth might find . I cannot find from the testimony of Hart the time he first learned that Kipbea (Seiferth) was giving up baking operations and in- tended to devote its efforts solely to distribution of bakery products . It seems to me, in view of the discussions he had with Edwin Seiferth between April and June 30, thathe was well aware of the fact. Saverrio Mattero, a Kipbea baker, who testified that he worked on June 30 and had heard rumors about the plant moving around March or April , I am sure knew before then that Kipbea planned to move from the Bronx to another location. His testi- mony shows that he had followed the moving operation from the Bronx to the Mamaroneck plant to the point where one night he had gone to Mamaroneck and observed, looking through a window, equipment which he said belonged to Kipbea being moved into the Mamaroneck plant . The testimony of Carlo Cafiero, a mem- ber of Local 3, who testified that he worked on June 30, is still more unbelievable in connection with the claim that he did not know until June 30, when he started to mix cake, that Kipbea had any plans for moving equipment or plant . Cafiero incon- sistently testified that during the early part of May he had visited the Mamaroneck premises and saw a tray oven being built. The premises were not leased by Seiferth until about May 25 . I do not credit the testimony of Cafiero. Nicholas Simonetti , business agent of Local 802, testified that he, on July 3, tele- phoned Seiferth and that the latter told him: he wanted no part of Local 3; that if it cost him $20 ,000 to get rid of Local 3 he would do everything he could to get rid of them ; and that H & L wanted no part of Local 3. Although Simonetti could not remember any part of his conversation alleged to have been had with Seiferth on July 1 or 2 regarding the sending of the telegram, he was positive that Seiferth had told him on July 3 that he intended to get rid of Local 3. I have placed no reliance on the testimony of Simonetti. Three delivery drivers , members of Teamsters Local 802, testified at the hearing herein. Merwyn Freeman, Lew Sanders, and Martin Mayer told slightly different stories from the witness stand, although in essence they were about the same. Free- man testified that the employment of all the drivers was terminated on June 30. Sanders testified that 2 or 3 weeks before the closing down of the Bronx plant, Sei- ferth had told him he was going to get rid of the bakers and move to Westchester County and that about a week before the move was made, Seiferth told him he was going to dissolve Kipbea and gat rid of the bakers ; while Mayer testified that about a week before the plant was closed down in the Bronx, Seiferth told him that by the end of June he would be in Mamaroneck, that he was closing Kipbea and setting up the H & L operation in order to get away from Local 3. The fact as disclosed with regard to the termination of employment of drivers on June 30 is not substantiated by the telegram sent by the Union to Kipbea on July 2; the testimony of Sanders must be discounted because it is clear that the bakery drivers , members of the Teamsters Union, were apprised either by observa- tion or by actual notification by Seiferth that the Bronx plant would be vacated before July 1; I simply do not believe the testimony of Mayer to the effect that it was only 1 week before the plant in the Bronx closed that Edwin Seiferth told him 599198-62-vol. 131-28 418 DECISIONS OF NATIONAL LABOR RELATIONS BOARD that he had planned to close Kipbea and start another operation under the name of H & L in Mamaroneck. On the basis of the testimony presented by witnesses called by the General Counsel, other than Edwin Seiferth and Lorraine Zah as adverse witnesses, I am inclined to believe that their testimony was loose, based largely on hearsay or what they thought the facts should be, and in each case not accurate . I cannot put in- ference upon inference and find motivation on what bakery workers or bakers or drivers may have thought the situation entailed at the time. As found above, the operations of Kipbea and H & L were very closely connected. Lorraine Zah made no secret of the fact that she was a cousin of the Seiferths. She worked for Kipbea after it was incorporated in 1956; she had loaned money to her cousin, Edwin Seiferth, in 1956 and 1957 by way of putting up stocks which were hypothecated with a bank as security for loans made to Seiferth personally; or that the bank sold her stock to repay the Seiferth loans. On about January 6, 1958, Seiferth assigned to Miss Zah his stock in Kipbea and other assets as collateral se- curity for his indebtedness in the amount of about $80,000. At that time he had repaid to her some $20,000 out of $100,000 indebtedness. I can go only on the testimony within the record-I cannot surmise financial manipulations between these cousins. As stated above, I find the family relationship inherent here, but I can- not find that the family relationship and financial transactions had anything to do with the dealings between Kipbea and Local 3 and the dealings between Kipbea and H & L with the Teamsters Local, other than .that it seemed appropriate, on the ad- vice of counsel, to rearrange the business relationship within the Seiferth and Zah family for a more efficient and effective operation. This involved the removal from the old location in the Bronx to a new location in Westchester (Mamaroneck). Without regard to the corporate condition of Kipbea as to assets and liabilities and the financial arrangements between Edwin Seiferth and Lorraine Zah, it be- comes necessary to decide whether or not, on the facts in this case, these arrange- ments as such, are material to the discovery of whether or not the financial transac- tions, the financial position of the parties, prompted them to try to discriminate against the Union, Local 3, or to establish a runaway shop to dispose of their ob- ligations under collective-bargaining agreements with Local 3 and the Teamsters. As nearly as I can find, Seiferth dealt honestly and freely with representatives of Local 3 and Local 802 as early as April 1959, when he made it clearly apparent that his business operations would require a move to a new location in order for him to continue in business. The mere fact in itself that he asked the business agent of Local 3 to schedule his men for early vacations, so they would have the benefit of existing contractual benefits before he closed his Bronx plant, leads me to believe that he was acting in good faith. Edwin Seiferth, a credible witness, having tried to arrange for eary vacations with Hart, and to meet his obligations under his contract with Local 3, and having seen that his bakers and others had taken their vacations prior to June 30, discussed the business situation with Helen Seiferth and Lorraine Zah at a time when he thought his obligations toward the Union had been discharged and after he had notified, not only Local 3 but Local 802 of the Teamsters, of his decision to aban- don baking as such and confine the operations of Kipbea to distribution. It seems clear that Edwin Seiferth was not at any time an officer or stockholder of H & L and it seems equally plain that Lorraine Zah was never an officer or direc- tor of Kipbea, although she had been engaged actively as a baker for Kipbea after finishing school in 1958, working in the office and acquiring an overall knowledge of this branch of the baking industry. The testimony, uncontroverted here, shows at least by inference that Lorraine Zah was financially responsible. Her cousin, Edwin Seiferth , had experience concerning the requirements of this branch of indus- try, but nevertheless at times performed many duties including the driving of trucks, to accomplish the distribution of bakery products for Kipbea. (c) Occurrences after the move from the Bronx to Mamaroneck H & L commenced baking on about July 10, 1959. Picketing by Local 3 started on July 1 or 2. An essential question to be decided in this respect is whether or not Kipbea as a corporation had a right to change its method of business from baker to distributor. There was at this time a valid and subsisting collective-bargaining agreement be- tween Kipbea and Local 3 covering its operations in the Bronx As above noted the agreement between Kipbea and Local No. 3, running from January 1957 until January 1960 provided , among other things, that the Company recognized the Union as the sole collective bargaining representative "of all employees employed in its establishment or establishments." KIPBEA BAKING COMPANY, INC., ETC. 419 It is argued on behalf of Kipbea that the collective agreement, 1957-60, applied only to the operations of Kipbea in the Bronx and did not essentially deprive it of the right to change its method of operation, without coming within the contraven- tion of Section 8(a)(1) of the Act. Concluding Findings (a) Alleged violations of Section 8(a) (3) and (1) I cannot find that this is a true runaway shop situation for the simple reason that Local 3, through Hart and its members who were employed by Kipbea were in- formed by Edwin Seiferth in April or at latest in May, that he intended, for busi- ness economic and personal financial reasons, to change the location of his place of business. That Hart, -as business agent of Local 3, failed to understand the im- port of the proposed move, which he was told would be not later than June 30, im- posed no burden on Seiferth to obtain the permission of Hart or any other repre- sentative of Local 3 to make the move. Therefore, it is impossible to find a true runaway shop situation. See Maxm. Jo flee; et al., d/b/a M. M. Jo flee Overall Com- pany 74 NLRB 1568; Harry Heisler, et al., doing business as Heisler Manufacturing Company, 71 NLRB 1114; Salant & Salant, Inc., et al., 66 NLRB 24. In regard to the assertions made herein by the General Counsel that the bakers employed at Kipbea were "discriminatorily discharged" because of their member- ship or activities on behalf of the Union, they are unsupported by the evidence. The General Counsel, among other cases relies upon Bermuda Knitwear Corpora- tion, 120 NLRB 332, where the employer was found to have discriminatorily dis- charged its employees in violation of Section 8 (a) (3) and (1), and moved its ship- ping department from New York City to Saugerties, New York, "solely as a pretext tor these discharges." No such similar set of circumstances have been shown as applicable to the case at bar When the bakers formerly employed by Kipbea, members of Local 3, appeared at the Mamaroneck plant on July 1, they primarily were interested, it seems to me, in assuring job rights against Kipbea and not against H & L. They knew the score- they had been told and were well advised that Seiferth was giving up baking as such and was going back as a distributor only. They also well knew that H & L was the baking end of an arrangement made between Seiferth and H & L, and that H & L was the baker, not Kipbea. The General Counsel relies, too, on Dunkirk Broadcasting Corporation, et al., 120 NLRB 1588, wherein an argument that corporate stock control change resulted in a new employer "entity" at a time when the Union was a certified bargaining representative was rejected by the Board. I find no close similiarity between the circumstances there and the facts of the instant case. I think the same about an- other case relied upon by the General Counsel, N.L.R.B. v. Deena Artware, Inc., 361 U S. 398, a case recently decided by the Supreme Court of the United States, in which a backpay issue was mainly involved and secondarily considered was a "single enterprise" situation. Here, I do not consider of prime importance whether, after the move from the Bronx to Mamaroneck, Kipbea and H & L be considered as a single enterprise, or a family enterprise. I think the essential fact to be decided is first, whether or not Kipbea and H & L as a combined enterprise can be found to have refused, in viola- tion of the Act, employment to the bakers formerly employed by Kipbea at the Bronx establishment and second, whether Kipbea or H & L refused to bargain col- lectively with Local 3. I find that the change of location and method of operation of Kipbea, together with the financial arrangements between Kipbea and H & L was not a temporary expedient On the contrary I believe it was to be permanent, insofar as business operations can be maintained. See Twenty-fourth Annual Report of the National Labor Relations Board, 1959, pp. 67, 68. I find here no violation of Section 8(a) (3) insofar as either Kipbea or H & L or the individual Respondents are concerned nor do I find a consequent violation of Section 8 (a) (1). (b) Alleged violations of Section 8(a) (5) and (1) Two questions remain to be answered: First, was the demand by Business Agent Hart and the bakers, as made in the Mamaroneck plant on July 1, directed to H & L or to Seiferth (Kipbea)? The leaflet, quoted above, distributed publicly, shows that the main demand and the picketing was made by Local 3 against Seiferth as Kipbea and not H & L. I so find. Second, can H & L be found to have refused 420 DECISIONS OF NATIONAL LABOR RELATIONS BOARD to bargain with Local 3 after the move from the Bronx to Mamaroneck ? I find, in the particular circumstances of this case, that there was no real refusal to bargain. N.L.R.B. v. Albert Armato, et al., 199 F. 2d 800 (CA. 7), relied upon by the General Counsel in this case, seems to me to be the best authority available for the proposition that the purchaser of a manufacturing business who takes over opera- tion of the seller's plant, with knowledge of collective-bargaining agreement or agree- ments between the seller and the labor union certified by the Board as exclusive bargaining representative of seller's employees, acted improperly in refusing to bar- gain with the union after certification and after the contract was in effect for a period of time. Following the principles laid down in this case, affirming an Order of the Board, I find that neither Kipbea nor H & L, in the circumstances of this case, can be accused of a refusal to bargain, either with Local 3 or with any other union. In view of the advance notice given to Hart as a representative of Local 3 and the bakers that Seiferth, as the operating head of Kipbea, intended to remove him- self from the Bronx to another location, and further considering the fact that this is a comparatively small bakery operation, I find no reason to think that the financial arrangements and the change of operation as to location were not bona fide as between the Seiferths and their cousin, Lorraine Zah. Had the Union, meaning Local 3, been intent on its efforts to preserve its rights, it had adequate opportunity so to do before June 30. Having slept on its rights, it cannot now be heard to say what it believes should have been done by Kipbea when the opportunity first was presented to it before the change of operations was made. On the preponderance of the evidence herein, and on the whole case, I find the allegation of the complaint not -sustained by the proof adduced at hearing. Upon the above findings of fact and upon the entire record of the case, I make the following: CONCLUSIONS OF LAW 1. The Respondents, Kipbea Baking Company, Inc., H & L Baking Company, Inc., and Edwin Seiferth, Helen Seiferth, and Lorraine Zah are engaged in com- merce within the meaning of Section 2(6) and (7) of the Act. 2. Local 3, Bakery and Confectionery Workers International Union of America, is a labor organization within the meaning of Section 2(5) of the Act. 3. The Respondents named herein are not and have not engaged in unfair labor practices as alleged in the complaint. [Recommendations omitted from publication.] Morgan Linen Service, Inc. and Milk Drivers and Dairy Employees Union Local No. 338, International Brotherhood of Teamsters, Chauffeurs, Warehousemen and Helpers of America, Petitioner Central Coat, Apron and Linen Service, Inc. and Milk Drivers and Dairy Employees Union Local No. 338, International Brotherhood of Teamsters, Chauffeurs, Warehousemen and Helpers of America, Petitioner New York Globe Laundry, Inc. and Milk Drivers and Dairy Employees Union Local No. 338, International Brotherhood of Teamsters, Chauffeurs, Warehousemen and Helpers of America, Petitioner. Cases Nos. P2-RC-10922, 2-RC-10957, and 2-RC-10969. May 3, 1961 DECISION AND ORDER Upon separate petitions duly filed under Section 9(c) of the Na- tional Labor Relations Act, a consolidated hearing was held before 131 NLRB No. 58.