Perma Vinyl Corp.

968 DECISIONS OF NATIONAL LABOR RELATIONS BOARD Perma Vinyl Corporation , Dade Plastics Co. and United States Pipe and Foundry Company and International Ladies' Garment Workers Union , AFL-CIO. Case 12-CA-2946. May 24,1967 SUPPLEMENTAL DECISION AND AMENDED ORDER BY CHAIRMAN MCCULLOCH AND MEMBERS FANNING, BROWN, AND ZAGORIA On April 14, 1965, the National Labor Relations Board issued a Decision and Order in the above- entitled case finding that Respondent Perma Vinyl Corporation had discriminated against certain employees in violation of Section 8(a)(3) and (1) of the National Labor Relations Act, as amended.' The Board's Order directed, inter alia, that the Respondent offer immediate and full reinstatement to four of the discriminatees and make whole all five discriminatees for any loss of pay suffered by reason of Respondent's discrimination against them. Subsequent to hearing in that proceeding, but prior to issuance of the Trial Examiner's Decision, U.S. Pipe purchased Perma Vinyl's facilities and business. Thereafter, a controversy arose as to U.S. Pipe's responsibility for remedying the unfair labor practices and making whole the discriminatees, and Perma Vinyl requested that certain aspects of compliance be presented to the Board for determination. On July 23, 1965, the Acting Regional Director for Region 12 issued and served upon Perma Vinyl and U.S. Pipe a backpay specification and notice of hearing. On August 13 and 18, 1965, Perma Vinyl and U. S. Pipe, respectively, filed answers thereto. Upon appropriate notice, a hearing was held before Trial Examiner Morton D. Friedman for the purpose of determining the matter of responsibility for remedying the unfair labor practices involved. All parties were afforded full opportunity to be heard, to examine and cross-examine witnesses, and to adduce evidence bearing on the issues to be heard. The amounts due the discriminatees to the date of the sale of Perma Vinyl's assets and facilities to U. S. Pipe were stipulated at the hearing and it appears that such sums were paid the discriminatees by Perma Vinyl. Accordingly, the issue left for resolution by the Trial Examiner was whether U. S. Pipe was a successor of Perma Vinyl responsible for remedying the unfair labor practices of its predecessor by reinstating the discriminatees and making them whole for any loss of pay since the date it succeeded to Perma Vinyl's business. On January 7, 1966, the Trial Examiner issued his Supplemental Decision and Order finding that U.S. Pipe was not obligated to remedy the unfair labor practices of Perma Vinyl and recommending that the backpay specifications herein be dismissed as to it, as set forth in the attached Supplemental Decision and Order. Thereafter, the General Counsel filed exceptions to the Trial Examiner's Supplemental Decision and a supporting brief and U. S. Pipe filed cross-exceptions and a supporting brief. The Board has reviewed the rulings of the Trial Examiner made at the hearing and finds that no prejudicial error was committed. The rulings are hereby affirmed. The Board has considered the Supplemental Decision and the entire record in this case, including the exceptions, cross-exceptions, and briefs, and, finding merit in General Counsel's exceptions, adopts the findings and conclusions of the Trial Examiner only to the extent consistent with this Decision and Order. U. S. Pipe acquired Perma Vinyl's business with knowledge of the unfair labor practice proceeding against that company. Upon consummation of the sale and transfer of assets to it, U. S. Pipe continued to operate the former facilities of Perma Vinyl without substantial change. The operation was continued at the same location. Essentially the same personnel were employed and they worked under the direction and control of supervisors who had been on Perma Vinyl's payroll. Sorosky, president of Perma Vinyl, who had personally participated in that Company's unlawful activity, became plant manager under U. S. Pipe. In that capacity, he made a speech to the employees in opposition to the Union. The Trial Examiner found, as the General Counsel conceded, that the transfer of the business from Perma Vinyl to U. S. Pipe was a bona fide transaction and that U. S. Pipe was neither an alter ego of Respondent nor a participant in an attempted evasion of the obligations imposed upon Perma Vinyl by the Board. He further found that the instant case falls within the rule of Symns Grocer Co.2 which holds that a bona fide purchaser with knowledge of unfair labor practices of its predecessor is not responsible for remedying the unfair labor practices, explaining that "No provision of the Act authorizes the Board to impose the responsibility for remedying unfair labor practices on persons who did not engage therein." However, particularly influenced by the thinking reflected in more recent court decisions, we are persuaded that the Board's past restrictive view of its remedial powers in this area should be reexamined. The deficiency of our past position and the need for its reevaluation is suggested by this pertinent observation of the Supreme Court in the Wiley opinion:3 ' 151 NLRB 1679. Perma Vinyl has since been renamed Dade Plastics Co. z 109 NLRB 346. ' John Wiley & Sons, Inc. v. Livingston , 376 U.S. 543, 549. 164 NLRB No. 119 PERMA VINYL CORP. 969 Employees ... ordinarily do not take part in negotiations leading to a change in corporate ownership. The negotiations will ordinarily not concern the well-being of the employees, whose advantage or disadvantage, potentially great, will inevitably be incidental to the main considerations. The objectives of national labor policy, reflected in established principles of federal law, require that the rightful prerogative of owners independently to rearrange their businesses and even eliminate themselves as employers be balanced by some protection to the employees from a sudden change in the employment relationship. Especially in need of help, it seems to us, are the employee victims of unfair labor practices who, because of their unlawful discharge, are now without meaningful remedy when title to the employing business operation changes hands. We believe that the Board is empowered to require more effective action in the matter of remedying unfair labor practices. We find this authority in the Act's delegation of broad administrative power to the Board to frame such remedial orders "as will effectuate the policies of the Act." In the exercise of this authority the Board is not, of course, restricted to requiring remedial action by the offending employer alone; hence its orders run to such employer's successors and assigns as well.4 There can be no doubt, for example, that the successor or assign who operates as a disguised continuance of the old employer or to whom the business has been transferred as a means of evading liability under the Act may thus be reached. Depending upon the circumstances attending the transfer of the business, others may also be bound as successors or assigns to remedy the unfair labor practices committed against employees of the business.5 Recently, such liability was imposed upon the successor who had agreed to assume the debts, liabilities, and obligations arising from his predecessor's unfair labor practices.6 To further the public interest involved in effectuating the policies of the Act and achieve the "objectives of national labor policy, reflected in established principles of federal law,"7 we are persuaded that one who acquires and operates a business of an employer found guilty of unfair labor practices in basically unchanged form under circumstances which charge him with notice of unfair labor practice charges against his predecessor should be held responsible for remedying his predecessor's unlawful conduct. 8 In imposing this responsibility upon a bona fide purchaser, we are not unmindful of the fact that he was not a party to the unfair labor practices and continues to operate the business without any connection with his predeccessor. However, in balancing the equities involved there are other significant factors which must be taken into account. Thus, "It is the employing industry that is sought to be regulated and brought within the corrective and remedial provisions of the Act in the interest of industrial peace."" When a new employer is substituted in the employing industry there has been no real change in the employing industry insofar as the victims of past unfair labor practices are concerned, or the need for remedying those unfair labor practices. Appropriate steps must still be taken if the effects of the unfair labor practices are to be erased and all employees reassured of their statutory rights. And it is the successor who has taken over control of the business who is generally in the best position to remedy such unfair labor practices most effectively. The imposition of this responsibility upon even the bona fide purchaser does not work an unfair hardship upon him. When he substituted himself in place of the perpetrator of the unfair labor practices, he became the beneficiary of the unremedied unfair labor practices. Also, his potential liability for remedying the unfair labor practices is a matter which can be reflected in the price he pays for the business, or he may secure an indemnity clause in the sales contract which will indemnify him for liability arising from the seller's unfair labor practices.' ° Such are the considerations which have influenced our decision to hold a bona fide purchaser in the position of U. S. Pipe responsible as a successor for taking measures to mitigate the effects of a predecessor's unfair labor practices and restore to employees the free exercise of their rights guaranteed by the Act. If the unfair labor practice has been the discriminatory discharge of employees, this responsibility should include the reinstatement of the discriminatees without loss of pay. Of course, no such adjudication of liability can be made without affording the bona fide purchaser a full opportunity at a hearing, after adequate notice, to present evidence on the question of whether it.is a successor which is responsible for remedying a predecessor's unfair labor practices. The successor would also be entitled, of course, to be heard against the enforcement of any order issued against it. As has already been indicated, U. S. Pipe cannot validly 4 Regal Knitwear Company v. N.L.R.B., 324 U.S. 9. 5 Regal Knitwear Company v. N.L.R.B., supra ; LeTourneau Company of Georgia v . N.L.R.B., 150 F.2d 1012 (C.A. 5). 6 Liberty Electronics Corp ., 143 NLRB 605. Also see Sinko Manufacturing and Tool Company, 154 NLRB 1474 , enfd. in pertinent part sub nom . Plastic Workers Union Local 18 v. N.L.R.B., 369 F.2d 226 (C.A. 7). 7 See excerpt above from Wiley decision. ' See Alexander Milburn Company, 78 NLRB 747. To the extent of its inconsistency with this Supplemental Decision, the Symns Grocer Co. case is hereby reversed. °N.L.R.B. v. Arthur J. Colten, d/b/a Kiddie Kover Mfg. Co., 105 F.2d 179, 182 (C.A. 6). 10 The contract of sale in the instant case provides for indemnity by Perma Vinyl of U.S. Pipe for all damages, costs, and expenses arising on account of liability on obligations of Perma Vinyl not assumed by U.S. Pipe under the terms of the contract. 970 DECISIONS OF NATIONAL LABOR RELATIONS BOARD claim that it was denied due notice and a fair hearing AMENDED ORDER in this case.'' Our discussion thus far has dealt only with the bona fide purchaser of the employing enterprise. With respect to the offending employer himself, it must be obvious that it cannot be in the public interest to permit the violator of the Act to shed all responsibility for remedying his own unfair labor practices by simply disposing of the business. If he has unlawfully discharged employees before transferring ownership to another, he should at least be required to make whole the dischargees for any loss of pay suffered by reason of the discharges until such time as they secure substantially equivalent employment with another employer. To the extent and in the manner indicated herein, the offending employer and his successor share a joint and several responsibility in the matter of backpay. These are the principles by which we will be guided in future cases. In this case, however, we shall not require any further action by Perma Vinyl. As already noted, it has paid the amount of backpay owing to the discriminatees at the time of the sale to U. S. Pipe. The Trial Examiner has not found any further responsibility on the part of Perma Vinyl and the General Counsel does not now claim any. With respect to U. S. Pipe, at the time of its takeover of Perma Vinyl's business, Board law imposed no obligation upon it to take any action regarding the unremedied unfair labor practices of its predecessor. We believe it would be inequitable now to require of it the full remedial action which we believe needs to be taken in the appropriate case by successors like it if the policies of the Act are to be meaningfully effectuated. However, consistent with equitable considerations, there is action which U. S. Pipe can take in remedying the unfair labor practices in the present circumstances. Work performed by the discriminatees for Perma Vinyl continues to be necessary in the U. S. Pipe operation. If the discriminatees were to be reinstated in their former or substantially equivalent jobs upon request therefor, that would plainly serve a salutary purpose, without subjecting U. S. Pipe to any unfair burden. In the circumstances, we shall order U. S. Pipe to reinstate the discriminatees as indicated upon application therefor. We shall also require U. S. Pipe to make whole these employees for any loss of pay suffered by reason of its refusal, if any, to reinstate them in the manner provided, by payment to each of them of a sum of money equal to the amount he normally would have earned as wages during the period from 5 days after the date on which he applied for reinstatement to the date of the Respondent's offer of reinstatement, less his net earnings, if any, during such period, with interest thereon at 6 percent per annum in accordance with the Board's usual practice.12 Pursuant to Section 10(c) of the National Labor Relations Act, as amended, the National Labor Relations Board hereby orders that United States Pipe and Foundry Company, Miami, Florida, its officers, agents, successors, and assigns, shall take the following action which the Board finds will effectuate the policies of the Act: 1. Upon application, offer to George Munoz, Max Labrador, George Tarajano, and Juan Jose Tarajano immediate reinstatement to their former or substantially equivalent positions and make them whole in the manner set forth in our Supplemental Decision. 2. Preserve and, upon request, make available to the Board or its agents, for examination and copying, all payroll records, social security payment records, timecards, personnel records and reports, and all other records necessary for determining the amount of backpay due under the terms of this Order. 3. Post at its plants in Miami, Florida, copies in Spanish and English, of the attached notice marked "Appendix." 13 Copies of said notice, to be furnished by the Regional Director for Region 12, after being duly signed by a representative of United States Pipe and Foundry Company, be posted by it immediately upon receipt thereof, and be maintained by it for 60 consecutive days thereafter, in conspicuous places, including all places where notices to employees are customarily posted. Reasonable steps shall be taken by United States Pipe and Foundry Company to insure that said notices are not altered, defaced, or covered by any other material. 4. Notify the Regional Director for Region 12, in writing, within 10 days from the date of this Amended Order, what steps have been taken to comply herewith. ii Thus, the procedural mandate of rule 65(d) of the Federal Rules of Civil Procedure which the Supreme Court held in the Regal Knitwear case, supra, was applicable to orders issued by the Board has been complied with. See Liberty Electronics Corp , supra it F W Woolworth Company, 90 NLRB 289, Isis Plumbing & HeattngCo , 138 NLRB 716 is In the event that this Amended Order is enforced by a decree of a United States Court of Appeals, there shall be substituted for the words "A Supplemental Decision and Amended Order" the words "A Decree of the United States Court of Appeals, Enforcing an Amended Order " APPENDIX NOTICE To ALL EMPLOYEES Pursuant to a Supplemental Decision and Amended Order of the National Labor Relations Board, and in order to effectuate the policies of the National Labor Relations Act, as amended, we hereby notify our employees that: PERMA VINYL CORP. WE WILL upon application, offer to George Munoz, Max Labrador, George Tarajano, and Juan Jose Tarajano immediate reinstatement to their former or substantially equivalent positions and make such applicants whole for any loss of pay suffered by reason of our refusal, if any, to reinstate them within 5 days after application. WE WILL notify the employees entitled to reinstatement, if presently serving in the Armed Forces of the United States, of their right to reinstatement, upon application, in accordance with the Selective Service Act and the Universal Military Training and Service Act, as amended, after discharge from the Armed Forces. UNITED STATES PIPE AND FOUNDRY COMPANY (Employer) Dated By . (Representative) (Title) This notice must remain posted for 60 consecutive days from the date of posting and must not be altered, defaced, or covered by any other material. If employees have any questions concerning this notice or compliance with its provisions, they may communicate directly with the Board's Regional Office, 706 Federal Office Building, 500 Zack Street, Tampa, Florida, Telephone 228-7711. SUPPLEMENTAL TRIAL EXAMINER'S DECISION AND ORDER STATEMENT OF THE CASE MORTON D. FRIEDMAN, Trial Examiner: This supplemental proceeding to determine backpay, with all parties represented, was heard before the duly designated Trial Examiner in Miami, Florida, on October 11, 1965, on the specification of the General Counsel dated July 23, 1965, and the answers of the Respondents. At the hearing, the amounts of backpay due by Perma Vinyl Corporation, also known as Dade Plastics Co., were determined and settled between the General Counsel and the said Respondent. Generally, then, the issue litigated was the liability, if any, of United States Pipe and Foundry Company, herein called U. S. Pipe, for backpay. All parties were afforded full opportunity to examine and cross-examine witnesses, to introduce evidence, to present oral argument and thereafter to file briefs. None of the Respondents offered any evidence at the hearing. Briefs were received from counsel for the General Counsel and from Respondent U. S. Pipe. Upon my observation of the witnesses, and upon consideration of the pleadings, the testimony, the exhibits, and the entire record in this case, I make the following findings and conclusions. ' Jurisdiction over Perma Vinyl Corporation and Dade Plastics Company, which is the same company as Perma Vinyl, has been 1. THE BUSINESS OF U. S. PIPE 971 U. S. Pipe is a New Jersey corporation with its principal office and place of business located at Birmingham, Alabama. It operates plants in several of the States of the United States including plants involved in this proceeding which are located in Miami, Florida. U. S. Pipe is engaged in the manufacture and sale of cast iron pipe and pipefittings and at its Miami plants in plastic pipes and related products. It annually sells and ships directly across State lines in interstate commerce products which are valued in excess of $1 million. It is admitted, and I find, that U. S. Pipe is now, 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. I further find that it will effectuate the policies of the Act to assert jurisdiction herein. I IT. BACKGROUND AND ISSUES On May 22, 1964, International Ladies' Garment Workers Union filed charges against Perma Vinyl Corporation, herein called Perma Vinyl, alleging violations of Section 8(a)(1) and (3) of the National Labor Relations Act, herein called the Act. A hearing, with all parties represented, was held during the month of September 1964. On October 29, 1964, U. S. Pipe entered into a binding agreement with Perma Vinyl Corporation to purchase the assets of Perma Vinyl, the details of which agreement and final sale are hereinafter fully set forth. On December 23, 1964, the Trial Examiner issued his Decision finding, inter alia, that Perma Vinyl had violated Section 8(a)(3) and (1) of the Act. On April 14, 1965, the Board issued its order adopting with minor changes the recommendations of the Trial Examiner directing Perma Vinyl, its officers, agents, successors, and assigns, to take certain affirmative action including offering of reinstatement to four discriminatees and the making whole of five discriminatees. Thereafter, by reason of the purchase by U. S. Pipe of Perma Vinyl's facilities and business, a controversy arose as to U. S. Pipe's responsibility for remedying the unfair labor practices and making whole the discriminatees. Moreover, Perma Vinyl requested that certain aspects of compliance be presented to the Board for determination. As noted above, pursuant to notice, a hearing was held before me on October 11, 1965. At the outset of the hearing, Perma Vinyl stipulated that it and Dade Plastics Co. were one and the same corporation and business entity and further stipulated the amounts due to the discriminatees up to and including the date of the sale of Perma Vinyl's assets and facilities to U. S. Pipe. The amounts were fixed as follows: Max Labrador $413.43 Jorge Tarajano 1,260.27 Arturo Diaz 31.20 George A. Munoz 500.00 As I have been administratively advised that the foregoing sums were paid on the date of the hearing, I will omit from the order set forth at the end of this Supplemental Decision any provision for the payment thereof. The backpay specification herein alleges that U. S. Pipe is a successor or assign of Perma Vinyl and as such is responsible for remedying the unfair labor practices asserted heretofore in the proceeding to which this proceeding is ancillary 972 DECISIONS OF NATIONAL LABOR RELATIONS BOARD pursuant to the Board's Order and further alleges that U. S. Pipe is liable for backpay along with Perma Vinyl less any amount which may have been contributed by Perma Vinyl. The answer of U. S. Pipe denies liability for remedying the unfair labor practices and for backpay on the ground that on December 15, 1964, when U. S. Pipe acquired substantially all of the assets of Perma Vinyl, U. S. Pipe assumed certain designated liabilities of Perma Vinyl but did not then or at any other time assume or agree to assume any liability of Perma Vinyl prospective, contingent, accrued, or otherwise in regard to the remunerate of the discriminatees. The answer further denies that U. S. Pipe is a successor to Perma Vinyl or that it is responsible as such successor to remedy the unfair labor practices. At the hearing, counsel for the General Counsel conceded that U. S. Pipe was a bona fide purchaser but that it had knowledge of the pending unfair labor practices against Perma Vinyl and therefore it is a successor employer and liable to remedy the prior unfair labor practice of the seller, Perma Vinyl. This, of course the Respondent denied. Accordingly, the principal issue submitted for resolution is whether U. S. Pipe is such a successor to Perma Vinyl as to render it liable for remedying the unfair labor practices and to make whole the discriminatees from the date it succeeded to the ownership of the assets and the business of Perma Vinyl. A second issue is the amount of the backpay due the discriminatees from U. S. Pipe in the event it is found that U. S. Pipe is, indeed, a successor liable for the same. III. FINDINGS OF FACT AND CONCLUSIONS A. The Events As heretofore related, on October 29, 1964, after the hearing in the unfair labor practice proceeding but before the Trial Examiner rendered his decision, Perma Vinyl and U. S. Pipe entered into an agreement whereby Perma Vinyl agreed to sell and U. S. Pipe agreed to purchase the assets of Perma Vinyl. The date of the closing of the sale and the settlement of all of the items contemplated by the sale was fixed as December 15, 1964. In the meantime, however, on November 17, 1964, by corporate resolution, the board of directors of U. S. Pipe ratified the agreement to purchase. Thereafter, on November 25, 1964, the business manager of the Charging Party sent to Perma Vinyl Corporation a letter, a copy of which was mailed to and received by U. S. Pipe and Foundry on November 27, 1964. This letter advised that the Charging Party had been informed that Perma Vinyl had been purchased by U. S. Pipe. It also stated that the Charging Party represented a majority of Perma Vinyl's employees and requested recognition. The letter further reminded Perma Vinyl of the unfair labor practice case pending before the Board. In view of the fact that U. S. Pipe received a copy of this letter on November 27, 1964, it was informed and had knowledge of the pending unfair labor practice proceeding as of that date. On December 15, 1964, the sale of Perma Vinyl's assets and business to U. S. Pipe was finalized by the execution of a closing agreement and the necessary papers were exchanged. This final agreement states in pertinent part: 2. In payment for the assets described above in paragraph 1 U. S. Pipe shall: (a) Assume the liabilities of Perma Vinyl that are reflected on the statement attached hereto as Exhibit B, provided, however, that it is specifically understood and agreed that U. S. Pipe shall not and does not assume any liability of Perma Vinyl, whether determined or contingent, that is not reflected on said Exhibit B. Exhibit B of said agreement consists of a number of schedules listing liabilities of Perma Vinyl assumed by U. S. Pipe covering numerous items such as accounts payable, notes payable, accrued taxes, other accrued expenses, stockholder liability, and others. However, the schedule does not include nor mention in any way the possible liability of Perma Vinyl for backpay which could have ensued from the unfair labor practice proceeding than pending upon which the Trial Examiner had not as yet issued his decision. The final agreement, in addition to the assumption of liabilities clause as listed in Exhibit B, contained an indemnification clause which reads as follows: Perma Vinyl agrees to and does hereby indemnify and hold harmless U. S. Pipe and its successors and assigns from and against any and all damages, costs and expenses (including attorney's fees) resulting from the breach of any of the warranties, representations or covenants made by Perma Vinyl to U. S. Pipe herein and the assertion by a third party of a claim against U. S. Pipe or the properties to be acquired by U. S. Pipe hereunder on account of a liability of obligation of Perma Vinyl not assumed by U. S. Pipe under the terms hereof, including, without limitation , any claims of creditors of Perma Vinyl under applicable bulk sales laws. After the consummation of the sale and the transfer of the assets and assumption of the liabilities as set forth above, U. S. Pipe continued to operate the facilities of Perma Vinyl, manufacturing in large part the same plastic pipe and related items that Perma Vinyl had manufactured. It also employed at the former Perma Vinyl facilities essentially the same personnel including a number of the same supervisors. Additionally, on December 1, 1964, U. S. Pipe entered into an employment agreement with Louis Sorosky, the president of Perma Vinyl who, from that time until April 6, 1965, was employed by U. S. Pipe as manager of the plastics division of the latter company. In the main case herein, the Board found that Sorosky had personally participated in the unfair labor practice activities which the Board found were engaged in by Perma Vinyl. Additionally, during Sorosky's tenure as manager of U. S. Pipe plastics division, he made a speech to the employees which was prepared by counsel for the U. S. Pipe in which he spoke against the organizing of the plastics division employees by the United Steel Workers Union which had succeeded to the interests of the Charging Party herein. B. Concluding Ftndings Counsel for the General Counsel contends, in substance, that U. S. Pipe's purchase and takeover of Perma Vinyl's facilities and business made no change in the employing industry. He further contends that although U. S. Pipe had ample notice several weeks before the closing date of the pending unfair labor practice case against Perma Vinyl and although U. S. Pipe assumed certain listed liabilities, the closing contract was strangely PERMA VINYL CORP. 973 silent with regard to possible liabilities from the pending unfair labor practices proceeding. He argues that this silence can be construed only as a lack of good faith indicating complete disregard for the rights of the employees involved. He then concludes that this circumstance together with the indemnification clause in the sales agreement plus the employment by U. S. Pipe of Louis Sorosky, the chief perpetrator of the unfair labor practices, removes U. S. Pipe from the protection afforded by the Symns Grocer Co. case which holds a bona fide purchaser of a business, with knowledge of unfair labor practices of his predecessor, is not responsible for remedying such unfair labor practices,2 and renders U. S. Pipe liable as a successor. On the other hand, U. S. Pipe contends that under Federal Rule 653 the enforceability of a Board Order against a "successor" is dependent not upon the mere fact of successorship, but upon the relationship that exists between the Respondent named in the Board Order and the so-called successor. U. S. Pipe further argues that no showing was made that it acted in concert or participated with Perma Vinyl or that U. S. Pipe was merely a "disguised continuance" of Perma Vinyl. It contends that, therefore, since the sale was bona fide, as conceded by counsel for the General Counsel, U. S. Pipe has no obligation to remedy the unfair labor practices even though it had notice of the same (citing the Symns Grocer Co. case)." I find merit in the contentions of U. S. Pipe. Whether a succeeding owner is a "successor" under Federal Rule 65(d) depends upon an appraisal of his relations and behavior and not upon mere construction of the terms of the Board Order which cites "successors and assigns."5 Thus, although it is settled that remedial orders of the Board may be enforced against the successors and assigns of one who has violated the Act,6 whether a successor is liable is a question of fact which turns on whether, for example, it is the alter ego of the original Respondent or whether it has participated in an attempted evasion of obligation imposed by the Board.7 As noted above, counsel for the General Counsel conceded that the sale was bona fide. Accordingly, there can be no claim that U. S. Pipe is the alter ego of Perma Vinyl or that it participated in an attempted evasion of obligations imposed by the Board. There remains, however, the General Counsel's argument that the fact that U. S. Pipe was aware of the pending unfair labor practices proceeding and yet failed to provide for the possible liability arising thereform indicated a less than good faith lack of regard for the rights of the discriminatees. There would seem to be two answers to this. In the first place, the conceded fact that U. S. Pipe use a bona fide purchaser precludes a finding of bad faith. Secondly, the General Counsel's contention, if credited, would eliminate the Symns Grocer Co. doctrine and make it absolute that any bona fide purchaser with knowledge of pending unfair labor practice proceedings must assume i 109 NLRB 346 Federal rule 65(d) provides in pertinent part as follows Every order granting an injunction and every restraining order is binding only upon the parties to the action, their officers , agents, servants, employees and attorneys, and upon those persons in active concert or participation with them who received notice of the order by personal service or otherwise ' 109 NLRB 346 5 Regal Knitwear Co v N L R B , 342 U S 9,15 " Regal Knitwear Co v N L.R B, supra, N L R B v Ozark liability therefor if he assumes payment of any of the sellers liabilities. Yet, the Board has but recently reaffirmed the Symns doctrine and held that a bona fide purchaser with knowledge of the unfair labor practices of his predecessor, is not responsible for remedying such unfair labor practices.8 Counsel for the General Counsel further argues that the instant case marks an exception to the Symns case rule in that the hiring of Sorosky makes the instant proceding analogous to the situation in the decision issued by the Board in Washington Suburban Lines." In that case, the Board found that the purchaser, named Parran, was responsible as successor to remedy the unfair labor practices of the seller, Oriole. Parran was manager of Oriole and after becoming manager, the sale of Oriole to Parran was made. During the pendency of the sale, Oriole committed certain unfair labor practices and Parran personally participated in some of the unfair labor practices. The Board found that the basis of the entire record in the case, and particularly because of the status of Parran as the prospective purchaser of Oriole at th'e time of Oriole's unfair labor practices and his active participation in those unfair labor practices, that Parran, a successor, was obligated to remedy Oriole's unfair labor practices. It should also be noted that the Board also found that Parran independently violated the Act after the purchase of the business. However, the Washington Suburban Lines case is distinguishable from the case at bar in that although Sorosky, former president of Perma Vinyl, who participated in the unfair labor practices became a manager of U. S. Pipe, he was not a principal at any time of U. S. Pipe as was Parran in the Washington Suburban Lines case. Moreover, Sorosky committed no unfair labor practices after the sale was made. Thus, it cannot be said that under the circumstances of this case because Sorosky was employed by U. S. Pipe, the latter should be obliged to remedy the unfair labor practices of Perma Vinyl. The General Counsel further argues that because U. S. Pipe agreed in its sales contract with Perma Vinyl to assume certain liabilities of the seller, it should be held liable to remedy the unfair labor practices also. In support of this contention, the General Counsel cites the Sinko case.1o However, in the Sinko case the purchaser, although also.a bona fide purchaser, specifically agreed to assume the liabilities arising from pending unfair labor practice litigation against the predecessor. Subsequently, when the successor began to conduct the operations which were formerly carried on by its predecessor it became liable for remedying the unfair labor practices. However, in the instant case, U. S. Pipe limited its liabilities, as set forth heretofore, to the liabilities supplied by Perma Vinyl in schedule B of the sales contract. Thus, by assuming the only obligations supplied by Perma Vinyl in the schedule of liabilities, U. S. Pipe did not voluntarily or specifically agree to assume the unfair labor practice liability of Perma Vinyl. t I Hardwood Company, 282 F 2d 1 (C A 8 (1960)) 1 N L R B v Mastro Plastics Corporation, 354 F 2d 170 (C A 2), N L R B v Deena Artware, Inc, 361 U S 398 (1960), Southport Petroleum Company v N L R B , 315 U S 100, 106 (1942) 8 Great Leopard Market Corp , 150 NLRB 1384 9 Oriole Motor Coach Lines, Inc , t/a Washington Suburban Lines, 114 NLRB 808 10 Sinko Manufacturing and Tool Company, 154 NLRB 1474 11 Compare the instant case also to Liberty Electronics Corp , 143 NLRB 605 974 DECISIONS OF NATIONAL LABOR RELATIONS BOARD The only additional fact which requires discussion is that the sales agreement included an indemnification clause whereby, in certain respects at least , Perma Vinyl to save harmless U. S. Pipe from any liability that U. S. Pipe might be obligated to satisfy as to matters which arose from the sale because of the acts of Perma Vinyl prior to the sale. I do not find it necessary to discuss here whether this indemnification clause specifically protects U. S. Pipe against possible backpay claims. However, even assuming that U. S. Pipe could successfully invoke this clause in the event it would be forced to remedy the unfair labor practices, it is not for me to carve out an exception to the Symns Grocer Co. doctrine to hold that in those cases where a bona fide purchaser is promised indemnification by the seller, the purchaser is responsible for the remedying of the seller's unfair labor practices. Moreover, the record here fails to reveal that Perma Vinyl is in such financial condition as would enable U. S. Pipe to obtain reimbursement from Perma Vinyl. In sum then, the rule of law announced in Symns Grocer Co. and affirmed by later Board cases is that a bona fide purchaser with knowledge of unfair labor practices of its predecessor is not responsible for remedying these violations by offering reinstatement and backpay. U. S. Pipe concededly is a bona fide purchaser and, because the record does not reveal that any of the exceptions which the Board has carved from the Symns doctrine have been presented herein, it accordingly follows that U. S. Pipe- is not obligated to remedy the unfair labor practices of Perma Vinyl. Accordingly, for the foregoing reasons, I shall recommend that the backpay specification insofar as it applies to U. S. Pipe be dismissed. In addition, because Perma Vinyl and Dade Plastics have already settled and paid the backpay due from Perma Vinyl to the discriminatees up to and including November 30, 1964, I shall not include in the Recommended Order any provisions for payment by those companies. RECOMMENDED ORDER It is hereby ordered that the backpay specification herein be dismissed insofar as they allege that United States Pipe and Foundry Company be held liable for the payment of backpay.