Offshore Mariners United

OFFSHORE MARINERS UNITED 745 Offshore Mariners United and International Trans- port Workers Federation and Trico Marine Op- erators, Inc. Cases 15–CC–832 and 15–CC–833 November 22, 2002 ORDER DENYING PETITION TO REVOKE SUBPOENA BY MEMBERS LIEBMAN, COWEN, AND BARTLETT This matter is before the Board on a Petition to Revoke Subpoena Ad Testificandum A-450645 filed by David Eckstein. The subpoena at issue was served on Eckstein by the General Counsel on May 14, 2002, as part of the Regional Office’s investigation of charges filed against Offshore Mariners United (OMU) by Trico Marine Op- erators, Inc. (Trico). The charges allege, inter alia, that OMU violated Section 8(b)(4)(i) and (ii)(B) of the Act by inducing or encouraging employees of Trico’s cus- tomers to refuse to perform any work related to Trico, and by threatening Trico’s customers, all with an object of forcing or requiring the customers to cease doing business with Trico. The Region’s investigation disclosed that David Eck- stein, a former field director for OMU, had written letters during his tenure as the OMU field director to two of the Employer’s largest customers concerning the Employer’s alleged antiunion/antiworker activities, and sought to meet with these customers and discuss those issues. In a followup letter to one of the customers, Eckstein stated that the OMU was contacting the customer in an attempt to highlight the inherent problems of doing business with such a company. The Region was unsuccessful in gain- ing the voluntary cooperation of Eckstein, and therefore issued the subpoena seeking his testimony concerning the allegations in the charges. After receiving the subpoena, Eckstein timely filed a Petition to Revoke. The General Counsel filed a motion in opposition, and a motion to expedite. Eckstein also filed a request for hearing and oral argument.1 Each party has also filed various responses to the filings of the other party. Eckstein’s arguments for revocation of the subpoena are as follows: First, Eckstein argues that the service of the subpoena was improper because it was sent via fac- simile. Eckstein then asserts that the subpoena is overly broad and vague because there is no indication what form Eckstein’s testimony will take, what areas of in- formation the witness will be expected to provide, or whether such questions are within the purview of permis- sible inquiry. Eckstein further argues that because he is no longer employed by the OMU, he is not within the 1 This motion is denied. Board’s scope of authority. In addition, Eckstein asserts that the subpoena is unduly burdensome because he must travel over a 1000 miles (from Chicago to New Orleans) to comply with the subpoena, and that the Region can obtain whatever information it seeks by other means. Finally, Eckstein maintains that the General Counsel does not have the authority to issue this precomplaint subpoena, and that the General Counsel has sufficient evidence to make a determination on whether to issue a complaint without Eckstein’s testimony. We deny the Petition to Revoke. Section 102.31(b) of the Board’s Rules and Regulations provides that the Board shall revoke a subpoena if the evidence sought does not relate to any matter under investigation, if the subpoena does not describe with sufficient particularity the evidence whose production is required, or if for any other reason sufficient in law the subpoena is otherwise invalid. None of these criteria are met here. Specifically, there is no merit in Eckstein’s contention that service of the subpoena was improper. The General Counsel has attached to his opposition documents show- ing that on May 14, 2002, the subpoena was sent to Eck- stein’s principal office or place of business by Federal Express and that the subpoena was received the next day. Eckstein does not challenge the authenticity of these documents. The General Counsel also states that the facsimile sent to Eckstein’s attorney was merely a cour- tesy copy, and is not relied on to establish service. The General Counsel’s method of service is authorized under Section 102.113(c) of the Board’s Rules, which states that “[s]ubpoenas shall be served upon the recipient . . . by leaving a copy thereof at the principal office or place of business of the person required to be served.” Nor has Eckstein provided any other basis for revoking the subpoena. The subpoena is not overly broad or vague, because the subpoena ad testificandum set forth the specific scope of the inquiry by notifying Eckstein that he is required to testify in the matter of Offshore Mariners United, Cases 15–CC–832 and 15–CC–833. In addition, there is no merit in Eckstein’s contention that because he is no longer employed by OMU, it is outside the scope of the Board’s authority to subpoena him to testify in this matter.2 Further, any burden imposed on Eckstein by the requirement that he travel to New Or- leans would appear to be outweighed by the fact that both Eckstein’s attorney and the Board agent assigned the case have offices in that area. Thus, we find that 2 See NLRB v. The Bakersfield Californian, 128 F.3d 1339, 1342 (9th Cir. 1997) (NLRB has authority to issue investigatory subpoenas to nonparties in unfair labor practice proceedings). See also NLRB v. Lewis, 310 F.2d 364, 366 (7th Cir. 1962); Link v. NLRB, 330 F.2d 437, 439 (4th Cir. 1964). 338 NLRB No. 88 DECISIONS OF THE NATIONAL LABOR RELATIONS BOARD 746 compliance with the subpoena would not be unduly bur- densome.3 In addition, there is no merit to Eckstein’s contention that the Board does not have the authority to issue a precomplaint subpoena. It is well established that, under Section 11(1) of the Act, the “Board may is- sue subpoenas requiring both the production of evidence and testimony during the investigatory stages of an unfair labor practice proceeding.”4 Moreover, it is clear that “the information sought appears relevant to the charges under investigation.”5 Accordingly, after carefully con- sidering this matter, we deny the Petition to Revoke. Advancing two arguments not made by Eckstein, our dissenting colleague would grant the petition to revoke. Although it is unnecessary for us to address the dissent’s contentions because they were not raised by Eckstein, we find, in any event, that they lack merit. The dissent’s initial argument is that the petition to re- voke should be granted because the Regional Director issued the subpoena without prior clearance from the Division of Operations Management, as allegedly re- quired by Section 11770.2 of the NLRB Casehandling Manual, Part I, Unfair Labor Practice Proceedings. This argument is flawed for three reasons. First, the Casehandling Manual was prepared by the General Counsel pursuant to his authority under Section 3(d) of the Act. The Casehandling Manual itself states that it is intended “only to provide . . . guidance for the Agency’s staff” and is “not a form of authority binding on the General Counsel or on the Board.”6 For this rea- son, the dissent errs in relying on the Casehandling Man- ual as a basis for granting the petition to revoke the sub- poena. Second, on May 1, 2000, then-General Counsel Leo- nard R. Page issued a memorandum substantially increasing the authority of the Regional Offices to issue investigative subpoenas without first obtaining approval from headquarters.7 The wording of this memorandum is broad enough to authorize the issuance of the subpoena in issue here.8 Thus, this memorandum effectively rebuts the dissent’s contention that the subpoena was not validly issued. 3 Of course, the parties remain free to reach an accommodation on an alternative location for the taking of Eckstein’s testimony. 4 NLRB v. North Bay Plumbing, 102 F.3d 1005, 1008 (9th Cir. 1996). 5 NLRB v. Playskool, Inc., 431 F.2d 518, 520 (7th Cir. 1970). 6 See the section entitled, “Purpose of Manual.” 7 See Memorandum GC 00-02, “Investigative Subpoenas.” 8 The memorandum states, inter alia, that “[Regional] Directors and their designees are authorized to issue investigative subpoenas ad testi- ficandum and duces tecum to charged parties and third-party witnesses whenever the evidence sought would materially aid in the determina- tion of whether a charge allegation has merit and whenever such evi- dence cannot be obtained by reasonable voluntary means.” Third, on October 3, 2002, the present General Coun- sel, Arthur F. Rosenfeld, personally submitted a “Motion Requesting Expedited Ruling on Validity of Investigative Subpoena In Statutory Priority Cases.” In so doing, the General Counsel reaffirmed and ratified the Regional Director’s issuance of the subpoena in issue. This is yet another reason for rejecting the dissent’s claim that the Regional Director exceeded his authority. The dissent’s remaining argument is that the Board’s policy against pretrial discovery is both unfair and ineffi- cient. In his view, the Board should provide “full pre- trial discovery to all parties involved in Board proceed- ings.” Because the Board’s rules currently do not pro- vide discovery rights to all parties, the dissent contends that the petition to revoke the subpoena should be granted. We respectfully decline our dissenting col- league’s invitation to profoundly alter Board policy in this area. “Pretrial discovery in Board proceedings is neither constitutionally nor statutorily required.” NLRB v. Washington Heights, 897 F.2d 1238, 1245 (2d Cir. 1990). Historically, the Board has prohibited disclosure of documents in the possession of the General Counsel, whether in response to a subpoena or otherwise, without the General Counsel’s written consent.9 The Board’s policy is well established and has been sustained by the circuit courts.10 Further, Congress has long recognized the Board’s policy and never changed it.11 The Board’s policy is based not merely on the “cost and inconvenience full discovery would impose on ad- ministrative proceedings.”12 More fundamentally, as discussed in Robbins Tire, supra, the Board’s policy is grounded in “the peculiar character of labor litigation,” 9 See Sec. 102.118(a) of the Board’s Rules and Regulations. A lim- ited exception to this rule is set forth in Sec. 102.118(b)(1), which requires the production of statements by the General Counsel or Charg- ing Party witnesses after they have testified. 10 See cases cited in NLRB v. Robbins Tire & Rubber Co., 437 U.S. 214, 237 fn. 16 (1978). 11 See Robbins Tire, supra, 437 U.S. at 238–239 (stating that in en- acting the investigatory records exemption to the Freedom of Informa- tion Act in 1966, Congress “was particularly concerned that premature production of witnesses’ statements in NLRB proceedings would ad- versely affect that agency’s ability to prosecute violations of the NLRA, and . . . the legislative history of the 1974 amendments affords no basis for concluding that Congress at that time intended to create any radical departure from prior, court-approved Board practice.”). 12 P.S.C. Resources, Inc. v. NLRB, 576 F.2d 380, 386 (1st Cir. 1978). See Emhart Industries v. NLRB, 907 F.2d 372, 378 (2d Cir. 1990) (“Pre-trial discovery, perhaps the primary source of delay in civil ac- tions, is almost never allowed by the Board.”); David R. Webb Co., 311 NLRB 1135, 1136 (1993) (“Even granting that some advantages may be gained from prehearing discovery, the fact remains that it can be productive of delay, offering, as it does, abundant opportunities for collateral disputes.”). OFFSHORE MARINERS UNITED 747 where “witnesses are especially likely to be inhibited by fear of the employer’s or—in some cases—the union’s capacity for reprisal and harassment.”13 As the Supreme Court recognized, “both employees and nonemployees may be reluctant to give statements to the NLRB investi- gators at all, absent assurances that unless called to tes- tify in a hearing, their statements will be exempt from disclosure until the unfair labor practice charge has been adjudicated.”14 The Court specifically cautioned that the possibility that a “change in the Board’s prehearing dis- covery rules will have a chilling effect on the Board’s sources cannot be ignored.”15 We therefore adhere to the Board’s longstanding policy and reaffirm it.16 Accordingly, having rejected the various arguments presented both by Eckstein and our dissenting colleague, we deny the petition to revoke the General Counsel’s investigatory subpoena. MEMBER COWEN, dissenting. Contrary to my colleagues, who deny David Eckstein’s Petition to Revoke Subpoena No. A-450645, I would grant the petition because the prehearing discovery sought by the General Counsel is not provided for under the Board’s rules. I also believe that it is important for the Board to reexamine the appropriateness of the Board’s rules governing prehearing discovery. The Federal Rules of Civil Procedure generally do not apply to administrative proceedings, Silverman v. Com- modity Futures Trading Commission, 549 F.2d 28, 33 (7th Cir. 1977), and the Board has not adopted the use of those rules for prehearing discovery. NLRB Casehan- dling Manual, Part One, Unfair Labor Practice Proceed- ings, Section 10292.4. The NLRB Casehandling Manual specifies just four situations in which the Regional Direc- tor may issue an investigatory subpoena without clear- ance by the Division of Operations Management. Id. at Sec. 11770.2. These are situations where (1) a potential witness is willing to testify or produce records only if subpoenaed; (2) the subpoena seeks information from a party to obtain “commerce” information for determina- tion of Board jurisdiction over that party; (3) the sub- 1965), the Fourth Circuit stated: 13 437 U.S. at 240 (quoting Roger J. Au & Son v. NLRB, 538 F.2d 80, 83 (3d Cir. 1976)). 14 Id. 15 Id. at 241. 16 In reaffirming the Board’s longstanding policy, Member Bartlett recognizes that the Board’s policy provides the General Counsel with an advantage, and creates the potential for abuse of the subpoena power during the pretrial investigation. However, he believes that the answer to these concerns is for the Board to do what we have done here: scruti- nize the General Counsel’s investigative subpoena, in light of the objections raised in the petition to revoke, to ensure that the subpoena conforms to the provisions of Sec. 11 of the Act and Sec. 102.31 of the Board’s Rules and Regulations. poena seeks procurement of an eligibility list for an im- pending election, or (4) the subpoena seeks the payroll list of union employees to determine the majority status of a union in an unfair labor practice case. In this case, the General Counsel has directed that Eckstein appear “for the purpose of giving testimony before an agent of the National Labor Relations Board” in Offshore Mariners United (Trico Marine Operators, Inc.), Cases 15–CC–832 and 15–CC–833. This informa- tion request falls outside the four areas of inquiry al- lowed in Section 11770.2 of the NLRB Casehandling Manual.1 Therefore, I would find that the petition to revoke the General Counsel’s investigatory subpoena should be granted. Although the General Counsel may compel the production of certain limited types of information prior to hearing, all other parties appearing before the Board do not have the ability to seek pretrial discovery. The Board Rules prohibit any employee of the Board, regional director or administrative law judge from producing “any files, documents, reports, memoranda, or records of the Board or of the General Counsel, whether in response to a subpoena duces tecum or otherwise” except as might be required under the Freedom of Information Act or upon the written consent of the Board, the Chairman of the Board or the General Counsel. 29 CFR § 102.118(a)(1) (2001). The Board’s failure to provide discovery rights for all parties has resulted in what has been described as “trial by ambush” for parties accused of violating the Act. New England Medical Center Hospital v. NLRB, 548 F.2d 377, 387 (1st Cir. 1977); Capital Cities Communications, Inc. v. NLRB, 409 F.Supp. 971, 977 (N.D.Cal.1976). Courts have criticized the unfairness of the Board’s restrictive discovery rules. NLRB v. Hareman Garment Corp., 557 F.2d 559, 563 (6th Cir. 1977); Pepsi-Cola Bottling Co. v. NLRB, 92 LRRM 3527 (D. Kan. 1976).2 In NLRB v. Southern Materials Co., 345 F.2d 240 (4th Cir. 1 Specifically, the investigatory subpoena is not covered by the first area of inquiry because Eckstein has not expressed a willingness to testify or produce records if subpoenaed. 2 The General Counsel has an inherent advantage in discovery be- cause the Board has afforded the General Counsel certain discovery rights that are not afforded to any other parties, and because respon- dents are naturally inclined to cooperate with the General Counsel during the investigative stage based on their interest in avoiding litiga- tion. As long as this imbalance in discovery exists, the Board should narrowly circumscribe the discovery available to the General Counsel. Providing discovery to the General Counsel beyond the areas outlined in Sec. 11770.2 of the NLRB Casehandling Manual, above, while deny- ing discovery to companies or unions accused of violating the Act, would only enhance the “trial by ambush” that unfairly prejudices the parties appearing before the Board. The Board should therefore restrict discovery to those areas delineated in Sec. 11770.2 of the NLRB Case- handling Manual. DECISIONS OF THE NATIONAL LABOR RELATIONS BOARD 748 . . . the Board, acting in a quasi judicial capacity as it does, should freely permit discovery procedure in order that the rights of all parties may be properly protected. Id. at 244. See also NLRB v. Miami Coca-Cola Bottling Co., 403 F.2d 994, 996 (5th Cir. 1968); NLRB v. Rex Dis- posables, 494 F.2d 588, 592 (5th Cir. 1974). It is incumbent upon the Board to address the unfairness and inefficiency embodied in its current discovery procedures.3 The primary purpose of prehearing discovery is to en- sure that a party has “an adequate opportunity to prepare or develop his defense to the charges leveled against him.” Conway v. Asbestos Workers, 209 F.Supp.2d 731 (N.D. Ohio 2002), citing Yashon v. Hunt, 825 F.2d 1016, 1026 (6th Cir. 1987). The Board’s current discovery procedures do not allow a party charged with an unfair labor practice to obtain information it may need to pre- pare or develop its defense. Pepsi-Cola Bottling Co., supra (“Counsel for parties charged with unfair labor 3 Although there is no constitutional or statutory requirement that discovery be available in administrative proceedings, the administrative hearing procedure must still comply with the fundamentals of due process. See Silverman, supra; NLRB v. Carolina Food Processors, Inc., 81 F.3d 507, 512–513 (4th Cir. 1996); Swift & Co. v. U.S., 308 F.2d 849, 851 (7th Cir. 1962). practices must, of necessity, engage in considerable guesswork.”). Discovery for all parties in Board pro- ceedings is preferable because it allows the parties to assess their positions more thoroughly and determine whether to seek a resolution or proceed forward through the administrative hearing process. With full pretrial discovery available to all parties, parties would be better able to narrow and resolve issues and thereby expedite hearings or even avoid hearings altogether. I therefore encourage my colleagues to reexamine the appropriate- ness of the current Board discovery rules, and recom- mend that they consider providing full pretrial discovery to all parties involved in Board proceedings. Because there currently is no right to pretrial discovery, I would grant Eckstein’s petition to revoke the General Counsel’s investigatory subpoena.4 4 I agree with my colleagues that the information which the General Counsel seeks appears relevant to the charges under investigation, but this alone does not entitle the General Counsel to compel production of the information prior to hearing under the extant Board discovery rules. This situation does, however, provide a further example of why the Board’s discovery rules should be amended to allow for full pretrial discovery for all parties.