Cherokee Equity Corp., Inc.

1080 DECISIONS OF THE NATIONAL LABOR RELATIONS BOARD Cherokee Marine Terminal , Division of Cherokee Equity Corporation, Inc. and Oil, Chemical, and Atomic Workers International Union, Local 3- 516, AFL-CIO and Drivers, Warehousemen, Maintenance and Allied Workers of America, Local Union No. 1, Party in Interest. Case 26- CA-11031 28 January 1988 DECISION AND ORDER By CHAIRMAN STEPHENS AND MEMBERS JOHANSEN AND BABSON On 7 March 1986 Administrative Law Judge Nancy M. Sherman issued the attached decision. The Respondent filed exceptions and a supporting brief, and the General Counsel filed an answering brief, cross-exceptions and a supporting brief, and a request for oral argument. i On 15 August 1986 the Board scheduled oral ar- gument because this case raised important issues re- garding whether the Board should routinely in- clude visitatorial clauses in its orders On 22 Sep- tember 1986 the Respondent, the General Counsel, the Charging Party, the American Federation of Labor and Congress of Industrial Organizations (AFL-CIO), and the Chamber of Commerce of the United States of America presented oral argument before the Board.2 The National Labor Relations Board has delegat- ed its authority in this proceeding to a three- member panel. The Board has considered the decision and the record in light of the exceptions, briefs, and oral argument and has decided to affirm the judge's rul- ings, findings,3 and conclusions, to modify his remedy,4 and to adopt the recommended Order as modified. 1 The Respondent subsequently filed a motion to strike those portions of the General Counsel's answering brief addressing the judge's recom- mended visitatorial remedy on the grounds that the General Counsel did not file cross-exceptions on this issue The General Counsel filed a re- sponse to the motion in view of the decision herein, the Respondent's motion to strike is denied 2 The AFL-CIO and the Chamber of Commerce appeared as amici curiae The Council on Labor Law Equality submitted a posthearmg arnicus curiae brief s The Respondent has excepted to some of the judge's credibility find- ings The Board's established policy is not to overrule an administrative law judge's credibility resolutions unless the clear preponderance of all the relevant evidence convinces us that they are incorrect Standard Dry Wall Products, 91 NLRB 544 (195), enfd 188 F 2d 362 (3d Cir 1951) We have carefully examined the record and find no basis for reversing the findings 4 in accordance with our decision in New Horizons for the Retarded, 283 NLRB 1173 (1987), interest on and after 1 January 1987 shall be computed at the "short-term Federal rate" for the underpayment of taxes as set out in the 1986 amendment to 26 US C § 6621 Interest on amounts accrued prior to I January 1987 (the effective date of the 1986 amendment to 26 US C § 6621) shall be computed in accordance with Florida Steel Corp, 231 NLRB 651 (1977) The General Counsel submits that the Board should routinely include in its remedial orders the following "model" visitatorial clause: For the purpose of determining or securing compliance with this Order, the Board, or any of its duly authorized representatives, may obtain discovery from the Respondent, its offi- cers, agents, successors or assigns, or any other person having knowledge concerning any compliance matter, in the manner provid- ed by the Federal Rules of Civil Procedure. Such discovery shall be conducted under the supervision of the United States Court of Ap- peals enforcing this Order and may be had upon any matter reasonably related to compli- ance with this Order, as enforced by the Court. Such a clause would permit the Board to examine the books and records of a respondent and to take statements from its officers and employees and others for the purpose of determining or securing compliance with a court-enforced order. Counsel for the General Counsel first requested this clause in the posthearing brief to the judge pursuant to in- structions from the General Counsel as part of an effort to persuade the Board to include visitatorial clauses in all remedial orders. Thus, the specific re- quest was based not on the facts of this case but on more general arguments regarding the Board's en- forcement powers and recurring compliance prob- lems in prior unrelated cases. The judge recom- mended the granting of visitatorial rights even greater than those requested by the General Coun- sel.5 The General Counsel's argument, stated in the model brief and reiterated at oral argument, is that routine visitatorial protection is needed because the Board is often unable to obtain sufficient informa- tion to determine whether compliance with court- enforced orders is possible or has been achieved. In this regard, the General Counsel maintains that it is difficult for the Board to obtain documentation concerning both the alleged financial inability to comply and the possible alter ego status of a non- party The General Counsel further contends that law violators can resist compliance by employing delay tactics such as concealment of assets and fraudulent utilization of bankruptcy procedures. Thus, the General Counsel asserts that in the ab- sence of a procedure to compel information from respondents concerning compliance, unfair labor s The judge recommended visitatorial rights that would additionally permit preenforcement discovery At the oral argument, the General Counsel continued to request inclusion of the model clause, rather than the provision recommended by the judge 287 NLRB No. 53 CHEROKEE MARINE TERMINAL practices can go unremedied. The General Counsel further contends that although visitatorial clauses would be sought routinely to deter potentially re- calcitrant respondents, it would only be necessary to enforce such clauses "in a limited number of cases" when there is trouble with compliance. The Respondent's contention, stated in its exceptions and at the oral argument, is that a visitatorial clause should be carefully tailored to the facts of a specific case, and that the record in this case does not support a visitatorial remedy. It is beyond question that the Board strives to ensure full compliance with its remedial orders and to minimize potential problems of enforcement, such as those described by the General Counsel. We nevertheless conclude, on careful consider- ation, that the requested visitatorial clause is over- broad and that its routine inclusion would not fur- ther the Board's remedial goals more effectively than enforcement mechanisms already available. Therefore, broad visitatorial rights, such as those requested, will remain an extraordinary remedy to be used only when warranted by the facts of a par- ticular case. At the outset we note that the Board has recog- nized the need for vistatorial-type clauses in specif- ic remedial contexts. For example, in F. W. Wool- worth Co, 90 NLRB 289, 294-295 (1950), the Board stated that in previous cases it was ham- pered in its efforts to secure compliance with back- pay and reinstatement orders by the refusal of em- ployers to permit access to payroll and other records The Board therefore ordered the respond- ent to make available to the Board or its agents, on request, "all payroll records, social security pay- ment records, time cards, personnel records and re- ports, and all other records necessary to analyze the amounts of back pay due and the right of rein- statement" under the terms of the order. Since Woolworth, the Board has routinely included the above visitatorial-type provisions granting access to relevant records of a respondent in all cases involv- ing backpay liability.6 THe Board has also used a type of visitatorial clause in cases involving the discriminatory oper- ation of hiring halls.7 For example, in Laborers Local 282 (Millstone Construction), 236 NLRB 621, 645 (1978), the Board ordered the respondent union to make records of its hiring hall operations avail- able to the Board "to facilitate the computation of backpay and assure equal referral treatment." In Iron Workers Local 373 (Building Contractors), 232 NLRB 504, 506 (1977), the Board ordered that 6 See, e g , Community Electric Service, 271 NLRB 598, 601 (1984) ° See, e g, Plumbers Local 403 (Pullman Power), 261 NLRB 257, 270 (1982), enfd 710 F 2d 1418 (9th Cir 1983) 1081 such hiring hall records be maintained and made available to the Board for a period of 2 years "in light of the consistent pattern of discrimination . over an extended period of time." In addition, the Board granted limited visitatorial rights as part of a subcontracting remedy in Smyth Mfg. Co., 277 NLRB 680 (1985). In that case the Board found that the respondent's cessation of operations consti- tuted an unfair labor practice and ordered the re- spondent to make its employees whole for loss of earnings and to cease certain subcontracting oper- ations. Regarding the subcontracting remedy, the Board rejected the General Counsel's request for a visitatorial clause permitting discovery of specific documents relating to the respondent's manufactur- ing, sales, and subcontracting operations generally. Rather, the Baord found that the information pro- vision should track the subcontracting provision of the order, thereby providing for the inclusion of a narrower visitatorial cluase limited to documents and records related to subcontracting.8 However, despite the Board's success with the visitatorial remedy in those specific contexts, we are concerned that hardship could result from the routine inclusion of a standard provision, i.e., one that is not tailored to a specific violation or remedy or to other facts indicative of a need for access to certain categories of evidence to ensure compli- ance. ' Smyth Mfg. Co., above.9 We are especially troubled by practical concerns regarding the ad- ministration of the model clause advanced by the General Counsel and by the potential for abuse in- herent in its lack of limits, specificity , and proce- dural safeguards . In this regards, we particularly note that the clause sets no time limit on the Board's access to statements and records . An open- ended visitatorial clause could infringe on the Sec- tion 11 investigative process and thereby pose un- necessary hardship to a respondent. For example, despite the passage of time since the issuance of a remedial order, a new charge could be treated as "reasonably related to compliance" for purposes of obtaining discovery rather than as a separate unfair labor practice to be investigated.10 " The clause included in the order directed the respondent to Preserve and furnish to the Board or its agents on request , for exami- nation and copying , all documents and records related to subcon- tracting or assigning to others the manufacture of parts for or on behalf of Symth Manufacturing Co, Inc 9 See also US v Bausch & Lomb Co, 321 U S 707, 727-728 (1944), in which the Court, considering the appropriateness of a visrtatorial clause as part of an antitrust remedy , stated that circumstances of each case con- trol the breadth of the order and that other provisions of the antitrust decree were important considerations 10 Although the visitatorial clause in Smyth Mfg Co, above, was to continue as long as necessary to police compliance with the subcontract- ing remedy, the Board noted that the clause would be subject to modifi- cation if warranted by subsequent events 277 NLRB at 684 1082 DECISIONS OF THE NATIONAL LABOR RELATIONS BOARD We further note that the model visitatorial clause is not specific concerning those third parties who would be included in the order, but simply permits discovery from "any other person having knowl- edge concerning any compliance matter ." In this regard , we are not persuaded, by the General Counsel 's assertion that the Federal Rules of Civil Procedure , particularly Rules 65 (d) and 69, provide adequate guidance for the administration of the vi- sitatorial clause with respect to third parties be- cause the model clause on its face goes beyond the scope of these rules. i i In additional to lacking specificity , the visitatorial clause requested by the General Counsel has no apparent procedural safe- guards By contrast, the visitatorial clause ap- proved by the Supreme Court in U.S. v. Bausch & Lomb, 321 U.S. at 718 at fn. 3, specifically limited questioning by the Department of Justice to "offi- cers or employees" of the antitrust defendants and further provided "that any such officer or employ- ee may have counsel present at such interview." i 2 Additionally, it is not clear that, as the General Counsel contends, discovery pursuant to the visita- torial clause should be supervised by the courts of appeals. In this regard , the court in NLRB v. Stein- erfilm, Inc., 702 F.2d 14, 16-17 (1st Cir. 1983), sug- gested that an appellate court is not institutionally well-suited to manage information-gathering ef- forts. The court further stated that although an ap- pellate court can monitor discovery occasionally, its use as a matter of course is "impractical and un- desirable." In this regard , the court contrasted the position of an appellate court, which is not used to supervising discovery , with a district court, which handles such matters routinely. In light of the above concerns regarding the ad- ministration of routinely included visitatorial clauses and their potential for abuse , we are not persuaded that, as the General Counsel contends, the visitatorial remedy is perferable to already ex- isting procedures , particulary the Section 11 admin- istrative subpoena . The General Counsel contended at the oral argument that Section 11 subpoenas are not used in the precontempt stage because the sub- poenas are not self-enforcing to enforce a subpoena in U.S . district court and thereafter, if a respondent 11 Rule 65 (d) states in pertinent part that injunctions are binding on "the parties to the action, their officers, agents , servants , employees, and attorneys, and upon those persons in active concert or participation with them who receive actual notice of the order " Rule 69 , which permits discovery of the assets of any person, including the judgment debtor," in aid of a money judgment , has been limited by the courts to the assets of an alter ego See Stock Corp v That Teak Products, 493 F Supp 1210, 1217-1218 (ED Pa 1980) 12 An additional question is whether the requested visitatorial clause provides only for discovery by the Board and, if so, whether the clause creates unnecessmy hardship by not affording a respondent reciprocal discovery rights, for example , regarding the basis of a finding of noncom- pliance exercises its right of appeal. As an example of the delay inherent in the subpoena process, the General Counsel noted that in NLRB v. Dutch Boy, Inc., 606 F.2d 929 (10th Cir 1979), a case involving a consolidated hearing on election objections and charges of continuing unfair labor practices, 21 months passed before the requested information was obtained. We are not convinced, however, that a case like Dutch Boy, involving the initial stages of Board proceedings and procedural and jurisdiction- al issues that develop early in the litigation process, is illustrative of the delay to be exspected in obtain- ing information at the compliance stage of proceed- ings. Moreover, we believe that the Section 11 sub- poena process is just as effective and perhaps more expedient than the administration of visitatorial rights. In this regard, we note that significant delays are inherent in the discovery process under the Federal Rules of Civil Procedure. For example, parties can object to interrogatories; fail to appear for depositions; or request motions to compel, sanc- tions, or protective orders that could involve in camera review. Further, the Federal Rules of Civil Procedure grant parties specified periods in which to respond to discovery requests; Rules 33 and 34, for example, allow between 30 and 45 days to answer interrogatories or produce documents. Ad- ditional time passes as motions to the court are ex- amined and, if necessary, set for hearing. Most im- portantly, it is not clear why an otherwise recalci- trant respondent who has not complied with a Board order enforced by the court of appeals will be more cooperative under a discovery order than under the Section 11 subpoena process. For these reasons, we find that the subpoena process is a viable alternative to visitatorial rights. As another alternative to visitatorial rights, the Board can invoke Rule 69 of the Federal Rules of Civil Procedure to obtain postjudgment discovery in aid of a money judgement against a respondent. The Board also has the authority to engage in cer- tain procedures to effectuate compliance in more specific remedial contexts. For example, the court of appeals in NLRB v. CCC Associates, 306 F.2d 534, 539 (2d Cir. 1962), held that after a Board order requiring payment of backpay is enforced, the Board can conduct an inquiry about alter ego and successor status for purposes of derivative li- ability without petitioning the enforcing court to hold the parties in contempt or requesting its per- mission to conduct supplemental proceedings. Thus, in a supplemental backpay hearing, the Board has the same power it would have had in the initial unfair labor practice hearing. Subse- quently, in Perma Vinyl Corp., 164 NLRB 968 (1967), 398 affd. F.2d 544 (5th Cir. 1968), the CHEROKEE MARINE TERMINAL 1083 Board set forth procedural safeguards to be fol- lowed in requiring remedial action by a successor who was not a party to the unfair labor practice proceeding. Pursuant to Perma Vinyl, the Board must adjudicate the issue of successorship status prior to adjudicating liability against a successor, and the successor is also entitled to be heard against the enforcement of any order issued against it. 13 Finally, although the Board has a strong institu- tional interest in seeing that its orders are enforced, we are reluctant to predict a category of cases that would warrant routine inclusion of the visitatorial clause. Our concern, as indicated above, is that an effort to do so would transform this remedial device into a punitive measure Therefore, we will continue to grant visitatorial rights, on a case-by- case basis, when the equities demonstrate a likeli- hood that a respondent will fail to cooperate or otherwise attempt to evade compliance.14 The Board recently granted visitatorial rights, for example, in Hilton Inn North, 279 NLRB 45 (1986). In that case the judge, finding that the re- spondent had played a "cat and mouse" game with the union regarding the signing of the collective- bargaining agreement, recommended a visitatorial provision to guarantee compliance. On review the Board agreed that a visitatorial clause was warrant- ed "based on the complexity of computing the make-whole remedy here and on all the facts of this case." 279 NLRB 45 fn. 3. We emphasize that visitatorial rights were granted in Hilton not to punish the respondent for its conduct with respect to the collective-bargaining agreement, but because such conduct indicated a future likelihood of an at- tempt to evade compliance 15 Unlike in Hilton, above, the General Counsel's request for a visitatorial clause in this case was not based on any special circumstances; rather, the General Counsel sought and the judge granted visi- tatorial rights on the basis of general arguments for routine inclusion Accordingly, in view of our deci- sion against the routine inclusion' of visitatorial clauses, and in the absence of any evidence indicat- ing a likelihood that the Respondent will attempt to evade compliance, we shall delete the visitatorial clause from the judge's Order. ORDER The National Labor Relations Board adopts the recommended Order of the administatrative law judge as modified below and orders that the Re- spondent, Cherokee Marine Terminal, Divison of Cherokee Equity Corporation, Inc., Nashville, Tennessee, its officers, agents, successors, and as- signs, shall take the action set forth in the Order as modified. Substitute the following the paragraph 2(f). "(f) Notify the Regional Director in writing 20 days from the date of this Order what steps the Re- spondent has taken to comply." William K. Harvey, Esq and John F. Harrington, Esq, for the General Counsel Charles A. Powell III, Esq., of Birmingham, Alabama, for each of the alleged entities named as a Respondent in the formal papers Larry G Abel, of Johnson City, Tennessee, for the Charging Party Dennis Wright, Esq, of Madison, Tennessee, for the Party in Interest I DECISION STATEMENT OF THE CASE 13 As another means to monitor compliance, the General Counsel has, on occasion, made formal requests for discovery to the enforcing court However, the extent to which the courts will permit precontempt discov- ery is an open question In this regard, the court of appeals in NLRB v Steinerftlm, 702 F 2d 14 at 15, denied the General Counsel's request for a discovery order to monitor compliance with the Board's order on the grounds that precontempt discovery was inappropriate "in the absence of any specific statutory authority arising from the decree itself, or some special circumstances " In support of its conclusion the court cited, inter alia, the Board's authority to obtain information through the Sec I1 in- vestigatory power, to include vistitatorial clauses in its decrees, and to engage in postcontempt discovery The court also discussed practical problems surrounding the administration and use of precontempt discov- ery 14 Although, as we have noted, the clause sought by the General Counsel does not necessarily provide more efficient discovery procedures than already exist, we are nonetheless willing to make available this addi- tional means of obtaining information in cases in which it appears possi- ble that the respondent may not cooperate in providing relevant evidence unless given specific, sanction-backed directions to do so 15 We note that the Board in Shoppers Choice, 280 NLRB 1306 (1986), adopted, without comment, the judge's recommended visitatorial remedy We note that the visitatorial remedy in that case does not comport with the analysis here NANCY M SHERMAN, Administrative Law Judge This case was heard before me in Nashville, Tennessee, on 23-25 September 1985. The original complaint was issued on 26 March 1985 and states that it was based on a charge filed on 20 February 1985 by the Oil, Chemical and Atomic Workers International Union, Local 3-516, AFL-CIO (OCAW) The amended complaint was issued on 30 July 1985, and states that it was based on the 20 February charge, a first amended charge filed by OCAW on 27 March 1985, and a second amended charge filed by OCAW on 24 July 1985. The amendment to the amended complaint was issued on 5 September 1985 and states that it was based on the 20 February charge, the 27 March charge, the 24 July charge, and a third amend- ed charge filed by the OCAW on 28 August 1985. As amended at the hearing, the complaint in its final form 1 The Party in Interest , Drivers, Warehousemen, Maintenance and Allied Workers of America, Local No 1, appears as amended at the hearing See infra , part iI,G, l 1084 DECISIONS OF THE NATIONAL LABOR RELATIONS BOARD alleges that Cherokee Marine Terminal, Division of Cherokee Equity Corporation, Inc violated Section 8(a)(5) and (1) of the National Labor Relations Act (the Act) by refusing in January 1985 to recognize and bar- gain with the OCAW with respect to crewmembers on tugboats and harbor boats, and violated Section 8(a)(2) and (1) of the Act by thereafter recognizing Drivers, Warehousemen, Maintenance and Allied Workers of America, Local Union No 1 (Local 1) as the representa- tive of such employees 2 Counsel for the General Coun- sel (the General Counsel) and OCAW contend, in sub- stance, that OCAW was entitled to exclusive recognition because the employees in question were represented by OCAW when they were employed by an alleged prede- cessor (Cumberland-Ohio).3 This predecessor/successorship relationship is denied by Local 1 and by Cherokee, both of which further contend that Local 1 was entitled to recognition because the em- ployees in question allegedly constitute an accretion to a unit of employees represented by Local 1. On the basis of the entire record, including the de- meanor of the witnesses, and after due consideration of the briefs filed by Cherokee4 and by the General'Coun- sel, I make the following FINDINGS OF FACT I JURISDICTION Cherokee Equity Corporation, Inc is a Tennessee cor- poration, of which Cherokee Marine Terminal has been an unincorporated operating division since about August 1983 Cherokee Equity Corporation, Inc. maintains an office in Nashville, Tennessee At all times material, Cherokee Equity Corporation, Inc has been engaged in business as a holding company owning, operating, and managing real estate, and other enterprises and/or mar- ketable securities. Cherokee Marine Terminal Division has an office and place of business in Nashville, Tennes- see Since 31 August 1983, Cherokee Marine Terminal Division has been engaged in the business of loading and unloading barges, using the Cumberland River in Nash- 2 Allegations that four job applicants were unlawfully denied employ- ment were withdrawn pursuant to an informal settlement agreement reached on the first day of the hearing See infra part I1,G,2 s The complaint identifies this alleged predecessor as T L Herbert & Sons , Inc This is the employer party named in OCAW's November 1983-November 1986 collective-bargaining agreement Until about early 1985, T L Herbert & Sons, Inc was a wholly owned subsidiary of Cumberland & Ohio Company, Inc Later in 1985, T L Herbert & Sons, Inc was dissolved and was merged into Cumberland-Ohio Co At the time of the September 1985 hearing before me, Cumberland & Ohio Company, Inc had also been merged into Cumberland-Ohio Co and was in the process of being dissolved At the time of the September 1985 hearing before me, the assets of Cumberland-Ohio Co consisted of some Texas real estate, the MV John S, and cash For the most part, the dis- tinctions between the various corporations named in this footnote are im- material to the present case 4 Counsel's letter of transmittal for this brief states that it is filed on behalf of "Cherokee Marine Division of Cherokee Equity Corporation " A similar representation is made in the initial heading of that brief How- ever, the first sentence of that brief states that it has been submitted "on behalf of respondent employer Cherokee Marine, a division of Cherokee Equity Corporation " The caption on this brief misstates the title of the case as "Cherokee Equity Corporation and Cherokee Marine Terminal, Inc " Moreover , counsel signed that brief and certificate of service as at- torney for "Respondents " See infra, part II,G,1 ville, Tennessee, and storing consigned inventory for dis- tribution Since 3 January 1985, Cherokee Marine Termi- nal Division has also engaged in towing barges on cer- tain parts of the Cumberland, Tennessee, Ohio, and Mis- sissippi Rivers. During the 12-month period ending 30 June 1985, Cherokee Equity Corporation, Inc derived more than $500,000 in gross income from rental property operations and/or management of funds including marketable secu- rities More than $50,000 of this income was derived from stock, bonds, or other marketable securities in the form of interstate sale of the items or from interest or dividend payments received from outside Tennessee During the 12-month period ending 20 February 1985, more than $50,000 in revenue was received in payment for Cherokee Marine Terminal Division's transportation of goods from its Nashville, Tennessee facility to points directly outside Tennessee During the same period, products, goods, and materials valued in excess of $50,000 were received at Cherokee Marine Terminal Di- vision's facility directly from points outside Tennessee It was stipulated that Cherokee Equity Corporation, Inc is and has been at all material times an employer engaged in commerce within the meaning of Section 2(2), (6), and (7) of the Act I find that exercise of jurisdiction over the operations of Cherokee Marine Terminal, Division of Cherokee Equity Corporation, Inc will effectuate the policies of the Act. OCAW and Local 1 are labor organizations within the meaning of Section 2(5) of the Act 11 THE ALLEGED UNFAIR LABOR PRACTICES A. Bargaining History Involving Local 1 Until 1983, Cumberland-Ohio was involved in a number of businesses, including a ready-mix concrete business, brick manufacturing, sand and gravel oper- ations, a concrete block business, and the operation of river terminals and a river transportation business. Cum- berland-Ohio owned business property at its business ad- dress at 1136 Second Avenue North, in Nashville, with one boundary consisting of the Cumberland River, and owned another parcel of land across the river, at 520 Cowan Street in Nashville The structures then on the Cowan Street site consisted of two transit sheds and a dock facility Before 1977, OCAW was the representative of a con- tract unit consisting of "all employees engaged in pro- duction and maintenance at [Cumberland-Ohio's] estab- lishment at 1136 Second Avenue, North, Nashville, Ten- nessee, including warehousemen, truck drivers and the mechanics at [Cumberland-Ohio's] garage," but exclud- ing concrete plant operators, as well as other classifica- tions immaterial here In consequence of a Board-con- ducted election, Local 1 displaced OCAW as the repre- sentative of such employees and was certified in 1977 as the representative of a unit of Cumberland-Ohio's me- chanics, truckdrivers, laborers, barge unloaders, engi- neers, tire changers, crane operators, tow-motor opera- tors, and (perhaps) other classifications At that time, the unit consisted of 17 or 18 employees who worked at CHEROKEE MARINE TERMINAL 1085 Cumberland-Ohio's Cowan Street address, plus about 83 or 93 who worked at Cumberland-Ohio's Second Avenue address. Cumberland-Ohio's towboat employees, who had also been represented by OCAW, continued to be so represented and were not included in this unit (see infra, part II,B) About 1978, Local I and Cumberland-Ohio entered into a collective-bargaining agreement that covered the same unit specified in the OCAW production and main- tenance contract In 1980, Cumberland-Ohio and Local I entered into a second bargaining agreement that covered this same unit, which was to expire by its terms no earli- er than November 1983 The job classifications covered by this contract consisted of unskilled labor, screen crusher operator, garage body paint man, tire repair man, barge labor, warehouse man, flat truck operator, conveyor system operator, front end loader operator, forklift operator, yard repairman welder, bobcat opera- tor, garage mechanic, garage night grease man, mixer truck operator, boom truck operator, bagging machine operator, trailer driver, crane operator, whirley operator, garage bodyman-welder, bodyman, and master mechanic In 1983, an unidentified Kentucky firm bought Cum- berland-Ohio's Second Avenue real estate, its ready-mix concrete operation, its gravel operation, and (apparently) its truck and concrete block operation Thereafter, Local 1 ceased to represent the Second Avenue employees However, until March 1985, Cumberland-Ohio continued to maintain its office, as a lessee, at the Second Avenue address Between 1980 and 1983, Cherokee Equity Corpora- tion, Inc was primarily engaged in the business of ac- quiring, owning, and selling various business and invest- ment properties On an undisclosed date in 1983, Chero- kee Equity Corporation, Inc bought the harbor vessel Martha Anne from Cumberland-Ohio In August 1983, Cherokee Equity Corporation, Inc bought from Cum- berland-Ohio all the assets of Herbert Marine Terminal,-5 including the Cowan Street real estate and appurte- nances The 1983 annual report of Cherokee Equity Cor- poration, Inc states that this facility, "now named Cher- okee Marine Terminal," had about 20 employees, loaded and unloaded barges using the Cumberland River, and stored consigned inventory for distribution James R Sweeney Jr testified that this purchase transaction con- stituted the purchase of an ongoing business, and that the same employees were carried over About the time of this purchase, Cherokee Equity Corporation, Inc set up a division called Cherokee Marine Terminal Division. In November 1983, Local 1 and "Cherokee Marine Termi- nal [by] James R Sweeney, Jr, General Manager," en- tered into a collective-bargaining agreement that covered "all employees engaged in the operation and maintenance at the Company's establishment at 520 Cowan Street, Nashville, Tennessee, including warehousemen, operators and the mechanics," with exclusions immaterial here This agreement was to expire in November 1986 at the earliest The job classifications covered by this agree- ment are set forth infra, part II,F Laying to one side the 5 This was a division either of Cumberland & Ohio, Inc or of a prede- cessor thereto called Herbert Materials, Inc See supra, fn 3 employees hired in connection with Cherokee Equity Corporation, Inc 's purchase of certain assets from Cum- berland-Ohio in December 1984, in 1984 and 1985 11 or 12 employees were covered by Local l's agreement B Bargaining History Involving OCA W In June 1957, the Board certified the OCAW as the exclusive bargaining representative of certain Cumber- land-Ohio employees. At that time, Cumberland-Ohio was engaged (so far as relevant here) only in dredging and in the sand and gravel business By November 1977, Cumberland-Ohio was engaged not only in dredging on the Cumberland and Tennessee Rivers, but also in com- mercial towing More specifically, in accordance with authority granted to Cumberland-Ohio by the Interstate Commerce Commission (ICC), Cumberland-Ohio trans- ported a wide range of cargo on the Cumberland and Ohio Rivers, and engaged in incidental towing on the upper Mississippi River from St. Louis, Missouri, to Cairo, Illinois Cumberland-Ohio also had one harbor vessel and towed sand and gravel on its barges on the Cumberland and Tennessee Rivers The home port of both vessels was in Nashville, Tennessee. As of Novem- ber 1977, Cumberland-Ohio and OCAW were parties to a collective-bargaining agreement that covered the crews of the towboats (namely, the pilot, the chief engineer, the second engineer (oiler), the mate, three deckhands, and the cook) and, inferentially, other classifications In November 1977, in a unit clarification proceeding, the Board excluded pilots from the unit on the ground that' they were supervisors. The Board clarified the bargain- ing unit so as to consist of the following- All employees of [Cumberland-Ohio] employed as regular crew members on tugboats, as regular crew members on harbor boats, and as regular crew members on the dredge boats, excluding all office clerical employees, salesmen, shipping and receiving clerks, watchmen, professional employees, assistant foremen, captains, pilots, guards and supervisors as defined in the Act.6 In November 1983, Cumberland-Ohio and the OCAW entered into a collective-bargaining agreement, which was to be effective by its terms until November 1986 at the earliest and covered a unit of all Cumberland-Ohio's employees employed as regular crewmembers on tow- boats and harbor boats, excluding supervisors and other classifications immaterial here The contract contains wage rates for chief engineer, second engineer, steers- man, cook, mate, tankerman, deckhand, apprentice deck- hand, and call watch deckhand, but not pilot G Most of the findings in this paragraph are based on the Acting Re- gional Director'% decision in the unit clarification case, which decision was never appealed See Fed R Evid 803(8)(C), US v School District of Ferndale, 577 F 2d 1339, 1354-1355 (6th Cir 1978), Complaint of Paducah Towing Co, 692 F 2d 412, 419-421 (6th Cir 1982), Electrical Workers IBEW Local 59 v NAMCO Electric, 653 F 2d 143, 145 (5th Cir 1981), Lloyd v American Export Lines, 580 F 2d 1179, 1182-1183 (3d Cir 1978), cert denied 439 U S 969 (1978), Smith v Ithaca Corp, 612 F 2d 215, 220-223 (5th Cir 1980), Gurabo Lace Mills, 265 NLRB 355 (1982), Rich- mond Refining Co, 212 NLRB 16, 17-18 (1974) The employer named in the decision was T L Herbert & Sons, Inc (see supra, fn 3) 1086 DECISIONS OF THE NATIONAL LABOR RELATIONS BOARD C. The 1984 Purchase by Cherokee Equity Corporation of Certain Cumberland-Ohio Assets On 19 December 1984, Cumberland-Ohio as "Seller," and Cherokee Equity Corporation as "Purchaser," en- tered into a $763,000 contract of sale with respect to the MV Robert D (known at one time as the Robert D. Herbert), the barge Ellen, certain mooring and fleet- ing leases on the Cumberland River in the Port of Nash- ville, and contract and common carrier operating author- ity issued by the ICC for the Cumberland River and cer- tain contiguous portions of the lower Mississippi, lower Ohio, and lower Tennessee Rivers, including a canal be- tween the Tennessee and Cumberland Rivers. The con- tract was executed by Sweeney on behalf of Cherokee Equity Corporation, and contained a representation by Cumberland-Ohio that the property was presently zoned to allow its present use , "which is the proper zoning for its present use and the same continued use contemplat- ed " On that same day, Cherokee Equity Corporation (through Sweeney) and Cumberland -Ohio entered into a written agreement in which Cumberland-Ohio undertook not to compete with Cherokee Equity Corporation in the river transportation business on the Cumberland River at any time before 31 January 1989, and to perform consult- ing services for Cherokee Equity Corporation until 31 January 1986 7 In return, Cumberland-Ohio was to re- ceive a total of $85,000 (plus expenses in connection with consulting operations) extended over a 1-year period Al- though the agreement itself attached a value of $25,000 to the noncompetition undertaking, Sweeney, the "presi- dent and general manager" of Cherokee Marine Termi- nal, testified that Cumberland -Ohio had done no consult- ing work, that he did not "really" plan on its doing any consulting work , and, in effect , that the entire $85,000 consideration had been paid for the agreement not to compete On 22 December 1984, the Waterways Journal, a trade publication that goes to many people in the inland water- ways business, ran a help-wanted advertisement placed by Sweeney, which requested "Experienced and licensed crew members , pilots, engineers, deckhands and cooks" to get in touch with "Cherokee Marine, P O. Box 8128" in Nashville A number of job applicants responded to this advertisement, the record fails to show whether the advertisement caused any Cumberland-Ohio crewmem- bers to apply for work On 26 December 1984, the Robert D returned to Nashville from Cairo When the boat docked, Cumberland-Ohio's president, James A Skinner Jr., went on board and told the crew that he was selling the Robert D. He distributed among the crewmembers job applications that bore the name "Cher- okee Marine Terminal ," which instructed the applicants to mail them to "P O. Box 8128" in Nashville. Skinner told all the crewmembers to fill out these applications and said that he felt sure that they could all go to work with "Cherokee Company " Cherokee's brief states (Br. 6) that Cherokee Marine caused the distribution of these application blanks Among the crewmembers who re- However, the contract contained an express provision affording Cumberland -Ohio the right to operate and engage in other busi- nesses, including river transportation " ceived these application blanks was Everette Lester Miles, the president of the OCAW local Later that same day, that crew left on the John S. for a run to Cairo, Ilh- nois. The John S. returned to Nashville on 10 January 1985 That day, Miles, and inferentially the other crew- members, received layoff slips dated 10 January 1985 8 From 1 to 5 days thereafter, both of the supervisors and two employee crewmembers on the John S began to work for Cherokee The Robert D's title passed to Cherokee Equity Cor- poration , Inc on 3 or 4 January 1985 Effective that same date, and pursuant to an express provision of the contract of sale, Cherokee Equity Corporation, Inc. can- celed a bareboat charter (that is, a charter for a vessel without a crew), which it had issued to Cumberland- Ohio in June 1984 for the MV Martha Anne.9 Thereaf- ter, both vessels were laid up for about 2 weeks . During this period, the name on the Robert D. was changed to the David K, the name on the Martha Anne was changed to the Tract K, and the areas which had borne the old names and Cumberland-Ohio's colors were repainted. The contract of sale had included the fuel on board both vessels as of the date of closing D. Presale and Postsale Operations 1. Routes and vessels Before the sale to Cherokee Equity Corporation, Cum- berland -Ohio was engaged in tramp towage (that is, picking up whatever freight was available going wherev- er Cumberland-Ohio's boat was going), chartering boats fully found (that is, with a full crew and equipment, inter aha), leasing its operating authority to firms which used their own vessels and crews, and "contract business" (that is, using a boat exclusively for transporting cargo for a particular firm) for Cumberland-Ohio's corporate affiliates (see supra , fn 3) 10 During 1984, Cumberland- Ohio used for this business the towboats John S and Robert D, and the barge Ellen, all of which were owned by Cumberland -Ohio, and the Martha Anne, which (as previously noted) Cumberland-Ohio had chartered bare- boat from Cherokee Equity Corporation, Inc. Nashville was the home port of all three vessels Also, from time to time Cumberland -Ohio used leased barges for this business During 1984, and until early January 1985, the Martha Anne moved cargoes back and forth in the Nashville, Tennessee harbor, attended the fleet , and took a few trips to various places, including Clarksville, Tennessee, and Paducah , Kentucky. During 1984, and until early January 1985, the John S and the Robert D mostly oper- 8 Cumberland -Ohio's records show that about eight crewmembers were laid off on 10 January 1985 0 The June 1984 charter agreement for the Martha Anne included an undertaking by Cumberland-Ohio to "provide services to Cherokee Marine Terminal for switching and moving of barges for the con- venience of Terminal at no charge " 10 James Skinner, Cumberland -Ohio's president , testified that it had not had any contract tows for sand and gravel since 1982 It is unclear whether his testimony included contract tows for Cumberland -Ohio's corporate affiliates The towed barges were usually owned by the owner of the cargo, but were sometimes chartered by Cumberland-Ohio CHEROKEE MARINE TERMINAL 1087 ated on the Cumberland, Tennessee, and Ohio Rivers, and on the Mississippi River north of Cairo. Illinois Cumberland-Ohio President Skinner testified, "Occasion- ally, we would go down to Memphis." Miles, a member of Cumberland-Ohio's riverboat crews for the 3 years preceding his separation on 10 January 1985, credibly testified that during this entire period, all of his boats' runs proceeded between Nashville and Cairo; the route to Cairo consisted of the Cumberland River to a canal, along this canal to Paducah on the Tennessee River, along the Tennessee to the Ohio River, and along the Ohio to Cairo at the confluence of the Ohio and Missis- sippi Rivers. Laying Nashville to one side, Paducah and Cairo accounted for most of Cumberland-Ohio's business in terms of dollar volume of sales Although the mileage covered by the ICC operating authority sold to Chero- kee Equity Corporation, Inc by Cumberland-Ohio was much less than the mileage covered by the ICC operat- ing authority which Cumberland-Ohio retained, the transferred authority constituted virtually all the author- ity that Cumberland-Ohio had in fact used in 1984. After this transfer of authority, Cumberland-Ohio could lawful- ly transport only unregulated commodities over the routes in question. Moreover, as previously noted, Cum- berland-Ohio had contractually undertaken not to com- pete with Cherokee Equity Corporation, Inc , on the Cumberland River until 1989 Barges must use this river in order to carry cargo between other navigable rivers and Nashville 2 Riverboat personnel Following the execution of the contract of sale on 19 December 1984, Skinner transmitted to all members of the crews of all three vessels a letter, dated 3 January 1985, which stated that the crews were being permanent- ly laid off due to lack of work for the John S. and the pending sale of the Robert D. The letter went on to say that if operations of the John S. were resumed with Cumberland-Ohio's own personnel, the laid-off crew- members would be contacted for possible reemployment The letter stated that it was being sent out pursuant to the provision in Cumberland-Ohio's bargaining agree- ment with OCAW requiring several days' advance notice of permanent layoff Thereafter, Cumberland-Ohio laid off on various dates up to and including 10 January 1985 all 23 members of the riverboat crews, which crews in- cluded all 17 of the employees covered by Cumberland- Ohio's bargaining agreement with OCAW. Skinner testi- fied that when he advised the employees of their layoff, he was actively seeking work for his other boat, the John S., which after 3 January 1985 was Cumberland-Ohio's only remaining piece of equipment used in the river busi- ness; that he did not then know whether he was going to be able to charter the John S or was going to have to operate it, and that if he had operated it, he would have had to use the crewmembers who were already on Cum- berland-Ohio's payroll. Cumberland-Ohio operated the John S. on the Cumberland River between 3 and 10 Jan- uary, and then tied it up for lack of work Pursuant to a request from laid-off crewmember Miles for a letter of recommendation, on 4 February 1985 Cumberland-Ohio President Skinner gave him a letter stating, inter aha, "We recently sold one of our towboats and certain other assets of the company, and Mr. Miles has been laid off due to lack of work for our remaining vessel." On 14 February 1985, Cumberland-Ohio chartered the John S bareboat to another firm for 3 years, with an option by the charterer to extend the charter for an additional 3 years Under the charter, Cumberland-Ohio had a right to terminate it should the charterer default in prompt payment At the time of the September 1985 hearing before me, this charter was still in effect, and the John S. was sailing under Cumberland-Ohio's colors. Skinner tes- tified that he did not know under whose ICC authority the vessel was operating I infer that the vessel was not operating under the ICC authority retained by Cumber- land-Ohio. After 10 January 1985 and at least until the late Sep- tember 1985 hearing before me, Cumberland-Ohio em- ployed no employees who were covered by its agree- ment with OCAW. Skinner testified that if Cumberland- Ohio went back into the active river business, he "guessed" Cumberland-Ohio would recall its laid-off em- ployees if they were available Before the sale, Cumber- land-Ohio's sole office facilities consisted of about 2000 square feet of rented space at the Second Avenue ad- dress in Nashville, and were staffed by about seven office workers. When the lease for these facilities expired in March 1985, Cumberland-Ohio moved its office to an 800-square-foot rented facility in West Nashville. At the time of the September 1985 hearing, four persons (in- cluding Cumberland-Ohio's president, its vice president/corporate secretary, and a part-time account- ant) occupied this office. These four persons were the only individuals on Cumberland-Ohio's payroll. After mid-January 1985, Cumberland-Ohio was not directly operating on any of the routes it had ever previously sailed The contract of sale included a representation by Cumberland-Ohio that there were no union contracts comprising an obligation on Cherokee Equity Corpora- tion after the closing date; and that there were no liens or claims imposed under the Employee Retirement Income and Security Act.' i Further, the contract of sale obligated Cumberland-Ohio to "terminate all its employ- ees working at the Property unless the parties otherwise agree in writing so that such employees shall have no claim against" Cherokee Equity Corporation, Inc How- ever, in arranging for the transfer to Cherokee Equity Corporation, Inc., of certain ICC authority possessed by Cumberland-Ohio, Skinner advised Attorney Peter A. Greene, who on behalf of both firms later filed with the ICC an application to approve the transfer, "Our Nash- ville management and operating personnel will be em- ployed by Cherokee " A courtesy copy of this letter was sent to Justin P. Wilson, who was a member of the board of directors of Cherokee Equity Corporation, Inc and occupied a similar post with Cumberland-Ohio. Moreover, the contract of sale included a statement that the sale price was subject to adjustments for "Any medi- '' Cumberland-Ohio's 1983-1986 bargaining agreement with OCAW called for certain payments into a pension fund 1088 DECISIONS OF THE NATIONAL LABOR RELATIONS BOARD cal insurance and life insurance premiums paid monthly by [Cumberland-Ohio] for employees who become em- ployed by [Cherokee Equity Corporation] 12 As of 19 December 1984, the date of the contract of sale, Cumberland-Ohio had on its payroll, to man its two towboats and the Martha Anne, about 16 employees cov- ered by the OCAW contract, as well as 6 captains and pilots All 22 had been on the payroll as of 1 December 1984. Between 2 and 16 January 1985, Cherokee hired 14 employees, plus 6 captains and pilots, to man its 1 tow- boat (the David K, formerly the Robert D) and the harbor boat Traci K (formerly the Martha Anne) 13 All six of the captains and pilots had previously worked as such for Cumberland-Ohio Moreover, of the 14 employ- ees, 8 had worked on Cumberland-Ohio's crews between 1 December 1984 and 7 January 1985 Furthermore, as part of the settlement regarding the 8(a)(3) allegations of the complaint (see supra, fn 2), the parties stipulated that four former crewmembers who had been in Cumberland- Ohio's employ until various dates between 22 December 1984 and 10 January 1985 would be construed to have been employed in the appropriate unit on and after 3 January 1985 and until the settlement had been approved by the Regional Director, who approved it on 23 Sep- tember 1985.14 As of the hearing in late September 1985, Cherokee had never had more than 14 crewmembers ex- cluding captains and pilots. The size of the crews on the harbor boat and on the purchased towboat was the same under Cumberland-Ohio and under Cherokee The crew- members in Cherokee's employ were classified as chief engineer, second engineer, cook, mate, deckhand, ap- prentice deckhand, and call watch deckhand. Cumber- land-Ohio had also employed persons with such job clas- sifications Cherokee distributed to the riverboat employees a bro- chure, under the letterhead of Cherokee Marine Termi- nal, headed "Towboat Employee Information effective January 7, 1985 " This brochure set forth, inter alia, the towboat employees' wages, hours, and working condi- tions. They were somewhat different from those called for by OCAW's contract with Cumberland-Ohio The brochure also set forth 14 "Rules and Regulations cover- ing Towboat Employees " The language of these 14 rules was practically identical to the language of the 14 "Rules and Regulations" set forth in the bargaining agreement between OCAW and Cumberland-Ohio 3 Land facilities, means of obtaining business, and cargo The 9 January 1985 application submitted to the ICC by Cumberland-Ohio (as transferor) and Cherokee Equity Corporation (as transferee) to approve the trans- " Cumberland-Ohio's 1983-1986 bargaining agreement with OCAW obligated Cumberland-Ohio to provide certain medical and life insurance benefits As of 7 January 1985, rather similar benefits were provided to the riverboat employees by Cherokee Cumberland-Ohio's layoff notices to crewmembers dated 3 January 1985 told the crewmembers how to keep their group insurance if they had not been reemployed by I Febru- ary 1985 11 No other crewmembers were hired until late March 1985 No crew- member was separated until 3 February 1985 14 See C J B Industries, 250 NLRB 1433 (1980), Jurtak Bros & Co, 253 NLRB 1054, 1069 (1981), enfd 664 F 2d 1074 (7th Cir 1981) fer of authority, which application was offered and re- ceived into evidence without objection or limitation, states, "The officers and operating personnel of transfer- ee are presently engaged in the transportation of proper- ty by water pursuant to the exemption provisions of 49 U S C 10542(a)(1) "15 Laying to one side these represen- tations and Cherokee Equity Corporation's ownership of the Martha Anne for at least 6 months before it was char- tered to Cumberland-Ohio in June 1984, there is no evi- dence that before the operation of the purchased vessels under their new names, Cherokee Equity Corporation, Inc. or any of its divisions operated any vessels of any sort, or employed any crews on any such vessels The application further states- The officers and operating personnel of transferee are presently engaged in exempt motor carrier oper- ations and in the operation of an intermodal termi- nal facility on the Cumberland River at Nashville, TN. Acquisition of the operating authority, equip- ment and facilities pursuant to the transaction which is the subject of this application will enable transfer- or [sic] to broaden the scope of its operations so as to provide the shipping public with additional price service options The operations to be per- formed under the authority to be transferred will be incorporated as an integral part of existing transpor- tation operations of transferee Following Cherokee Equity Corporation's 1983 acquisi- tion of the Cowan Street terminal facility from Cumber- land-Ohio, a 31,000-square-foot warehouse with a rail- road facility connecting onto a track on Cowan Street was added to the facility Also added were a new office building, a new crane, a new forklift, and new hopper fa- cilities for the unloading of bulk materials The Cowan Street terminal now includes warehouse facilities where barges can be unloaded and (inferentially) loaded, rail fa- cilities where railroad cars can be unloaded or loaded, and paved entrances and drives for trucks to be either unloaded or reloaded with commodities from the termi- nal warehouses Cumberland-Ohio did not in 1984 main- tain a warehouse facility, nor have any rail or connecting truck line facilities for making intermodal accommoda- tion Sweeney testified that "We are completely inter- modal" and that Cumberland-Ohio was not The David K and the Traci K were in operation for Cherokee by 14 January 1985 Since then, Cherokee's river transportation business has consisted solely of tramp towing along the routes and using the docking fa- cilities it had acquired in 1984 from Cumberland-Ohio 16 Cherokee obtains business by telephoning the barge owners' dispatchers as to when Cherokee's boat will be in a position to tow these barges and asking the dispatch- ers to give Cherokee such business The individuals who solicit such business on Cherokee's behalf are the same 15 This provision withholds jurisdiction from the ICC over transporta- tion by water carrier of certain commodities in bulk 16 Cherokee Equity Corporation, Inc did not on 7 December 1984 own any ICC operating authority whatever There is no evidence that it ever acquired any such authority other than that sold to it by Cumber- land-Ohio pursuant to the sales contract executed on 19 December 1984 CHEROKEE MARINE TERMINAL 1089 individuals who performed this work for Cumberland- Ohio, namely, Leon Jones (a dispatcher for Cumberland- Ohio who in January 1985 became the "secretary and treasurer" of Cherokee Marine Division) and Thomas Smith (Cumberland-Ohio's "port captain," who in Janu- ary 1985 became Cherokee's "port captain" and Chero- kee Marine Division's "vice president").17 Cherokee will transport any kind of cargo except for certain kinds of fuel Prior to the sale, Cumberland-Ohio had transported a number of different kinds of cargo; and there is no evi- dence that it had a policy of rejecting any kind of cargo "I After the sale, Cherokee transported much the same kind of cargo as Cumberland-Ohio had transported before the sale. 4 Customers Skinner testified that Cumberland-Ohio would solicit and accept any kind of customer "If they could pay us " Sweeney testified that Cherokee will accept any kind of customer. The sales contract contains an undertaking by Cumberland-Ohio to disclose to Cherokee Equity Corpo- ration, Inc , "all trade secrets, customer lists, and other confidential information relating to the operation of the Property as [Cherokee Equity] shall request." Cumber- land-Ohio President Skinner testified that, on request, Cumberland-Ohio would provide Cherokee with a list of Cumberland-Ohio's customers on the route to which it had transferred operating authority There is no evidence that any such request has ever been made. Skinner testi- fied that in response to inquiries in 1985 from former customers, he may have advised them that the service previously being performed by Cumberland-Ohio was now available from Cherokee In 1984, Cumberland-Ohio transported cargo for about 46 customers, including "Cherokee Marine Terminal "19 During the first 8 months of 1985, the period immediate- ly preceding the hearing, Cherokee served about 25 of these same customers 20 During the first 8 months of 1985, Cherokee transported cargo for about 43 custom- ers. Of these 43, about 16 had not been served by Cum- berland-Ohio during 1984 2 i The dollar volume of sales to these 16 new customers represented 9 percent (about $88,000) of Cherokee's total transportation sales (about $970,000) during the first 8 months of 1985 Neither Cumberland-Ohio in 1984, nor Cherokee in 1985, had any contract business The record contains little evidence about the year-to-year turnover in Cumberland-Ohio's customers while it was operating along the Cumberland River Physical inspection of Cumberland-Ohio's custom- er sales analysis documents for 1984 indicates that the customer list used for the first quarter was photocopied from a prior list I infer that this list was the final 1983 " In July 1985, Smith resigned his employment 's However, there is no evidence that Cumberland-Ohio was ever asked to, or did, transport fuel 19 It should be noted that as to Cumberland-Ohio, G C Exh 23 covers only the first 8 months of 1984 For this period, the total was about 38 20 During this 1985 period. Cherokee served about 25 of the approxi- mately 38 customers that Cumberland-Ohio served during the first 8 months of 1984 Cf supra, fn 19 Si This figure does not include two of Cherokee's 1985 customers (M Cohen and Serodmo, Inc) who used Cumberland-Ohio's services in 1984 after August of that year (cf supra, fn 19) list, and that the approximately six customers listed on the 1984 documents who did no 1984 business with Cum- berland-Ohio had been customers in 1983 One of these (Lykes) was a Cherokee customer ($285) in 1985. Also, physical inspection of these analysis documents indicates that the names of other customers were thereafter typed onto this customer list or a customer list for a later quar- ter, and that the customer list for each of the last three quarters initially consisted of-a photocopy of the list for the preceding quarter This inspection shows that about eight customers were added to the list in 1984 I infer that they had not been Cumberland-Ohio customers in 1983 Two of these (M Cohen and Serodino) were Cher- okee customers in 1985. Of Cumberland-Ohio's approximately 38 customers during the first 8 months of 1984, Cumberland-Ohio re- ceived during this period more than $20,000 from about 16 customers, and between $10,000 and $20,000 from about 3 customers. All but 3 of these 19 customers were served by Cherokee during the first 8 months of 1985. However, the lost customers included Cumberland- Ohio's second largest (Igert) and fourth largest (Ohio Barge Lines) during the first 8 months of 1984 Of Cherokee's approximately 43 transportation cus- tomers during the first 8 months of 1985, Cherokee re- ceived more than $20,000 from about 13 customers and between $10,000 and $20,000 from about 4 customers. Of the 13 customers who paid more than $20,000, 1 custom- er (Cargo Carriers) had not been a Cumberland-Ohio customer in 1984 Of the four customers who paid Cher- okee between $10,000 and $20,000, two (Robert Miller and Pillsbury) had not been Cumberland-Ohio customers in 1984 Cherokee's best customer during this period (Dundee Cement, about $224,000) had been Cumberland- Ohio's third best customer (about $184,000) during the first 8 months of 1984. Cherokee's second best customer during the first 8 months of 1985 (American Commercial Barge Lines, about $152,000) had been Cumberland- Ohio's best customer (about $436,000) during the first 8 months of 1984. Cumberland-Ohio's sales for the first 8 months of 1984 were about 80 percent higher than those of Cherokee for the first 8 months of 1985. Sweeney testimonially attrib- uted this differential partly to a generally depressed state in the riverboat traffic business, and partly to the fact that Cumberland-Ohio's additional towboat had made it more flexible than Cherokee. E. Alleged Unlawful Refusal to Bargain with OCA W and Recognition of Local 1 By letter dated 23 January 1985, and directed to "Mr. Tom Smith, Port Captain/Cherokee Marine Terminal/P.O Box 8128/Nashville, Tn. 37207," OCAW Representative Larry G. Abel alleged that the OCAW represented "a majority of your employees who formerly worked for Cumberland Ohio Corporation " The letter went on to demand "immediate recognition and bargain- ing," and stated that OCAW was "ready to meet with you at your earliest convenience " Sweeney testified that before answering this letter, he had a conversation with somebody at Cherokee Equity about the fact that Abel 1090 DECISIONS OF THE NATIONAL LABOR RELATIONS BOARD was demanding recognition Sweeney's response to Abel's letter is dated and postmarked 29 January 1985, and is writtten under the printed letterhead, "Cherokee/Marine Terminal/P.O. Box 8128, Nashville, Tennessee 37207." This reply reads as follows: Dear Mr. Abel: I have received your letter of January 23, 1985 addressed to Tom Smith, Port Captain. If my un- derstanding of your letter is correct, you are asking me to sit down and make some kind of deal with you covering all of the employees of Cherokee Towing. In the first place, we do not believe you in fact represent all or a majority of those employees. Sec- ondly, the law provides for an absolutely secret ballot election so that employees can say what they want done about their futures. You are asking me to work with you to take that right away from our employees. I simply will not do that. Your[s] very truly, James R. Sweeney, Jr. President In March 1985, a complaint was issued that named "Cherokee Marine, Inc." as the sole respondent, alleged that it had unlawfully refused to bargain with OCAW, but did not refer to Local 1. In July 1985, an NLRB field investigator asked James R. Craighead, Local l's president and business manager, whether he knew any- thing about "the boats" (inferentially, those being operat- ed by Cherokee) and whether Local 1 had a contract with "them." This was the first time that Craighead had received any knowledge of this operation. He replied that he did not have a contract, but was going to look into the matter. In the middle of or late July, Craighead went to Sweeney and said that he understood Sweeney had bought a boat. Sweeney said yes. Craighead asked whether Sweeney had a contract with anybody. Sweeney said no. Craighead asked where the boat was, and said that he wanted to see the people on it because he believed he represented "the people of Cherokee Marine." Sweeney said that Craighead could be right, and that Sweeney would have to check.22 During a subsequent discussion, Craighead and Local I's counsel decided that "if they own that boat, then them employees are mine" (that is, Craighead's) About 1 August, Craighead told Sweeney that the boat employ- ees "belong to us," and that Craighead had a right to go on the boat to visit them.23 Craighead gave Sweeney a 22 My findings as to this conversation are based on a composite of credible parts of the testimony of Craighead and Sweeney For demeanor reasons, I regard Craighead as the more honest of the two Accordingly, I do not credit Sweeney's testimony, inconsistent with Craighead's testi- mony, that during that conversation Craighead claimed that the riverboat employees came under Local 1's contract 22 The rules distributed to the riverboat crews immediately after the change in ownership provided, "No person other than on duty crew members shall be permitted aboard the vessel without special permission from the office " couple of pages from the first part of Local l's current bargaining agreement (the record fails to show which pages), and said that Craighead believed Local 1 repre- sented all the employees who worked under Sweeney. After a little bit, "Sweeney agreed that the boat employ- ees "belonged to" Local I and Craighead had a right to visit them. Craighead had since 1977 regularly gone on Cherokee Marine properties to contact new employees about joining Local 1. About 14 August, pursuant to arrangements made by Sweeney, Craighead went onto the David K. while it was docked, and obtained authorization cards from all the employees in the then crew About 5 September, when the other crew was on the David K and pursuant to ar- rangements made by Sweeney, Craighead visited it again. The record fails to show how many members of that crew signed authorization cards There is no evi- dence that Craighead made any effort to obtain authori- zation cards from the two Tract K. crews, which consist- ed of a total of two statutory employees. On 9 Septem- ber 1985, a bargaining agreement was executed by Local I (through Craighead) and "Cherokee Marine Terminal [by] James R. Sweeney, Jr., President." This agreement afforded wage increases to engineers, cooks, mates, and deckhands. In addition, the parties agreed to apply to these riverboat employees the provisions of Local l's 1983-1986 bargaining agreement with respect to vaca- tions, holidays, and seniority. In consequence, these riv- erboat employees received vacations for the first time '24 received more holiday benefits than previously,25 and specified more seniority-related benefits than those set forth in the "Towboat Employee Information" brochure The existence of these riverboat classifications had not been revealed to Local 1 during wage-reopener negotia- tions in the spring of 1985. During these negotiations, Local 1 asked management whether it now employed the new classifications of overhead and associate crane oper- ator. Management replied that these new classifications did exist. The wage agreement executed on 29 February (by Sweeney for "Cherokee Marine Terminal") specified these two new classifications and the classifications listed in the wage scale provisions of the original contract, but no others. Craighead did not receive a copy of the "Towboat Employee Information" brochure until 14 August 1985, when one of the towboat employees gave it to him Sweeney testified that the idea that the riverboat crews might be covered by the Local 1 bargaining agreement did not occur to him until after he wrote the 24 OCAW's agreement with Cumberland-Ohio had specifically stated that the employees would receive no vacation rights A similar provision is contained in the employee brochure, "Towboat Employee Information Effective January 7, 1985 " 25 The OCAW bargaining agreement had listed nine holidays (includ- ing Easter Sunday, Christmas Eve, and the employees' birthday) for which employees who worked on such days were entitled to an extra paid day The "Towboat Employee Information" brochure eliminated these three named holidays, and limited the extra pay to a half day for each holiday worked Local l's agreement added three holidays to the six specified in the brochure (namely, Christmas Eve, Thanksgiving Friday, and New Year's Eve), called for straight time if no work was performed on those days, and called for additional straight-time pay for each hour worked on such days CHEROKEE MARINE TERMINAL 1091 29 January 1985 letter rejecting OCAW's bargaining demand, and that he never mentioned this idea to Local 1 until Local 1 Representative Craighead raised it with him in July 1985 (see supra, fn 22) He further testified that until Craighead's inquiry, Sweeney had not applied any of the terms and conditions of Local l's contract to the riverboat employees, and that these employees did not receive vacations (which are called for by the 1983- 1986 contract with Local 1) until the September 1985 execution of the agreement which in terms covered riv- erboat employees Although Cherokee had never previ- ously employed personnel in any of the job classifica- tions hired to work on the riverboats, Sweeney hired such personnel in late December 1984 and early January 1985 without making any effort to follow the job-posting and bidding procedures set forth in the 1983-1986 collec- tive-bargaining agreement with Local 1 Nor did Sweeney make any effort, before September 1985, to ne- gotiate with Local 1 about such employees' wages, al- though Local I's contract requires such negotiations with respect to new jobs in the bargaining unit. Sweeney testified that it was the first week in September 1985 when he extended recognition to Local 1 with respect to the riverboat employees However, when hiring a "green" deckhand on 13 September 1985, he made no effort to fill this vacancy by using the procedure set forth in Local l's 1983-1986 contract.26 F. Duties and Conditions of Employment of Employees Represented by Local 1 and of Riverboat Employees After Cherokee acquired the river terminal business, and took over the river terminal employees, from Cum- berland-Ohio in 1983, the river terminal employees were assigned for payroll purposes to department 742. Chero- kee's 1983-1986 bargaining agreement with Local I was executed shortly after this transfer of the business. When executed in November 1983, that agreement covered un- skilled labor, barge labor, warehousemen, dump truck operators, front end loader operators, bob cat operators, conveyor system operators, crane operators, welders, and master mechanics. All these employees work at Cherokee's terminal, work a regularly scheduled 40-hour workweek Monday through Friday, receive overtime pay if they work more than 40 hours a week, punch a timeclock, and are paid every week. The basic job of such unit employees is to unload barges, railcars, and trucks, and to reload trucks and (occasionally) railcars, using cranes, tow motors, and lift trucks. Both before and after the riverboat purchase, the jobs of the employ- ees in this unit have remained the same. None of these employees has ever in any way been employed on the riverboats At all material times, their day-to-day super- visor has been Operations Manager Sam Albert, whose office is located at the Cowan Street address in Nash- ville. The David K and the Traci K. each have two crews Each crew on each boat remain on the boat around the clock for 14 consecutive days, and are then wholly off duty for 14 consecutive days while the other crew is on duty.27 Riverboat employees work 12 hours within each 24-hour period when such employees are on the boat, are paid by the day, do not receive overtime pay after work- ing for a given number of hours a week, do not punch a timeclock, and receive paychecks every 2 weeks 28 The approximately 12 employees on the David K. crews per- form no work on the dock The two employees on the Traci K crews may occasionally work on the dock The riverboat employees' immediate supervisors are the cap- tains and (when the captains are off duty) the pilots Dis- charges are decided on by the captains and Leon Jones, Cherokee Marine Division's "secretary and treasurer." Until July 1985, when Port Captain Thomas Smith re- signed, the captains reported to him At the time of the September 1985 hearing, they were reporting to Oper- ations Manager Albert. Smith may have supervised the warehouse for I week while Albert was on vacation. For payroll purposes, David K. crews (including supervisors) are assigned to department 783, and Traci K. crews (in- cluding supervisors) are assigned to department 784. Sal- aried riverboat Supervisors Smith (until his resignation) and Jones are assigned for payroll purposes to depart- ment 780 Sweeney testified that these department 780 records were so kept in order to keep the riverboat oper- ations separate for accounting purposes from the terminal and other operations I infer that this is also the reason why departments 783 and 784 records are kept separate from department 742 records. At all material times, 13 or 14 rank-and-file riverboat employees were on the payroll Craighead credibly testi- fied that, laying the riverboat employees to one side, at all relevant times Local l's bargaining agreement with Cherokee covered l I or 12 employees G Analysis and Conclusions 1 Alleged significance of Cherokee Marine Terminal's divisional status, the 10(b) defense 26 The agreement provides that in filling job vacancies or new jobs, "the Company will give due consideration to the ability, qualifications and the seniority of the employees, and where such ability and qualifica- tions are relatively equal, those employees having the greatest amount of seniority will receive the preference " Sweeney testified that when he was filling riverboat vacancies, none of the incumbent employees admit- tedly in Local l's unit had the necessary qualifications, and that these in- cumbent employees knew of these vacancies but expressed no interest in them However, although he testified that some of these incumbent em- ployees were probably qualified to become green deckhands, he did not follow the contractual procedures for filling such vacancies in hiring as deckhands two applicants who had never before worked for Cherokee, namely, Christopher Byrd, hired on 7 January 1985, and James Dicus, hired on 13 September 1985 a The contentions of the parties It is convenient to consider, as an initial matter, the materiality to the instant case of the circumstance that Cherokee Marine Terminal is a division of Cherokee Equity Corporation, Inc , and the partly related conten- tion that the instant complaint is barred by the 6-month limitations period imposed by Section 10(b) of the Act. It 27 Under Cumberland-Ohio, the period was 14 consecutive days for harbor boat crews, and 21 consecutive days for towboat crews 28 Under Cumberland-Ohio, the employees were paid by the month and received paychecks twice a month v 1092 DECISIONS OF THE NATIONAL LABOR RELATIONS BOARD is contended (1) that the charges that do not name Cher- okee Equity Corporation, Inc are wholly ineffective as to it, (2) that the first 8(a)(5) charge, which did name Cherokee Equity Corporation, Inc. was untimely, (3) that the 8(a)(2) allegations in the complaint are barred because, allegedly, they are not based on a timely 8(a)(2) charge, and (4) that in any event, Cherokee Equity Cor- poration, Inc is not answerable for any of the conduct attacked in the complaint, because all such conduct was allegedly engaged in by members of management of and directed toward employees in the Cherokee Marine Ter- minal Division, an allegedly autonomous division of Cherokee Equity Corporation, Inc. For the reasons stated below, I agree with the General Counsel that the complaint is in no respect time-barred, and that Chero- kee Equity Corporation, Inc. is answerable for any unfair labor practices found. b Alleged relevant facts (1) Relationship between Cherokee Equity Corporation, Inc., and Cherokee Marine Terminal Since 1968, Cherokee Equity Corporation, Inc. (Cher- okee Equity) has been a Tennessee corporation On 24 September 1985, the second day of the hearing, it was stipulated by all counsel (including Charles A. Powell III)29 that Cherokee Equity has at all material times been an employer engaged in commerce within the meaning of Section 2(2), (6), and (7) of the Act Until 1980, Cherokee Equity was primarily engaged in the cas- ualty insurance business Thereafter, and on divestiture of its insurance subsidiary in 1980, Cherokee Equity was primarily engaged in the business of acquiring, owning, and selling various business and investment properties, including stocks, bonds, real estate interests, and invest- ment in two local manufacturing firms Cherokee Equi- ty's 1983 financial report described Cherokee Equity's August 1983 purchase of waterfront facilities from Cum- berland-Ohio (see supra, part II,A) as the purchase of "Cherokee Marine Terminal " This report further de- scribed that facility as being in the business of loading and unloading barges using the Cumberland River in Nashville, Tennessee, and in storing consigned inventory for distribution It was stipulated that, as of the Septem- ber 1985 hearing, this continued to be the case. On 25 September 1985, the second day of the hearing, it was stipulated by all counsel (including Powell) that Cherokee Marine Terminal (Cherokee Marine) is an un- incorporated operating division of Cherokee Equity, has no separate corporate existence, and has no board of di- rectors The complaint in its final form alleges, and the answer thereto admits, that the president of Cherokee Marine is Sweeney. Between 1962 and 1980, Sweeney (a certified public accountant) had worked in various estab- lishments whose principal stockholders were David K. Wilson 30 and his son, William Wilson, who are Chero- kee Equity's principal stockholders, are its chairman and president, respectively; and are two of its five direc- tors 31 During this period, Sweeney acted as the manag- er of three funeral homes, the manager of a shopping center, and secretary-treasurer of an insurance company, which was then a Cherokee Equity subsidiary Sweeney was hired as Cherokee Marine's president in 1983, after separate interviews with David and William Wilson. As to the relationship between Cherokee Marine and Chero- kee Equity, Sweeney testified that they were "complete- ly autonomous," and "all management discussions are made autonomous from Cherokee Equity There are no consultations that are made of any kind whatsoever The only connection is that Cherokee Equity owns the assets of Cherokee Marine Terminal." Sweeney further testified that when he was hired, he and William Wilson made an oral working agreement that Sweeney would have con- trol over the moneys and would be fully responsible for how they were spent, and that this was "basically an agreement whereby we are completely autonomous from Cherokee Equity " Sweeney is responsible to Cherokee Equity's officers and directors to operate Cherokee Marine at a profit Sweeney's salary is determined by Cherokee Equity. According to Sweeney, he does not undergo an annual review of his performance, but if the Wilsons from Cherokee Equity were unhappy with Sweeney's work, "I'm sure . I would know about it very quickly " Cherokee Marine maintains two checking accounts in a bank (First American, Centennial Branch) which was selected by Cherokee Equity and is at the back door of the Cherokee Equity office. Sweeney has had at all ma- terial times the authority to sign checks on both ac- counts. Cherokee Marine performs the billing services for Cherokee Marine's business functions, sends out bills under Cherokee Marine's name, and receives payments in Cherokee Marine's name and at a post office address which differs from Cherokee Equity's address. All these payments, and all other moneys received by Cherokee Marine, are initially deposited in Cherokee Marine's gen- eral fund account. As a payroll period is completed, Cherokee Marine transfers from this account to Chero- kee Marine's payroll account the moneys necessary to meet Cherokee Marine's payroll Sweeney testified on 25 September 1985 that he did not know whose names were on the signature cards that were on file with the bank before early 1985. Cherokee Marine's secretary and treasurer, Leon Jones, came from Cumberland-Ohio the first of 1985 to work at Cherokee Marine's facilities Sweeney testified that for the purpose of enabling Jones to sign checks on these accounts, new signature cards were signed in early 1985 by Sweeney and Jones and then taken by Sweeney to Cherokee Equity, which was to forward them to the bank. Sweeney went on to testify 30 As previously noted, the name of the boat bought from Cumber- 29 At the outset of the hearing, Powell made an appearance on behalf land-Ohio by Cherokee Equity was thereafter changed to the David K of Respondents At that time, the complaint named Cherokee Equity a' The directors also include Blair K and Justin P Wilson The Corporation and Cherokee Marine Terminal, inc as Respondents Under record fails to show their kinship, if any, to David K and William the printed heading "Respondent," Powell signed the appearance sheet Wilson As of December 1984, Justin P Wilson was also a director of that day as the representative of Cherokee Marine and Cherokee Equity Cumberland-Ohio CHEROKEE MARINE TERMINAL that, on the morning of 25 September 1985, he learned for the first time that the signatures of Cherokee Equity President William Wilson and Cherokee Equity Control- ler John Powers were on these cards Sweeney further testified that it was a part of his "working agreement" with Cherokee Equity that Cherokee Equity would not withdraw funds from Cherokee Marine's accounts with- out Sweeney's knowledge and consent, and that so far as he knew, only he and Jones had ever signed checks on such accounts.32 Sweeney alone determined, without consulting Cherokee Equity's officials, the level of man- ning the boats, the types of personnel that would be hired, the wages that riverboat personnel would be paid, and the salary of Port Captain Smith As previously noted, the manning level and the types of personnel were the same as those used by Cumberland-Ohio As far as the record shows, Cherokee Equity has title to all the land, buildings, and capital equipment (includ- ing the riverboats) used in Cherokee Marine's business. As previously noted, the Cowan Street property used by Cherokee Marine was purchased by Cherokee Equity from Cumberland-Ohio in 1983, and various improve- ments thereto were later added Cherokee Equity has title to the land, for which it paid at least $1 8 million. Cherokee Marine pays no rentals to Cherokee Equity for the use of the land, buildings, or equipment, and is not repaying Cherokee Equity for the money it put up to purchase the original buildings The improvements added to this property after Cherokee Equity bought it from Cumberland-Ohio were financed by industrial develop- ment bonds, amounting to $2.6 million, as to which First American National Bank is the secured party and Chero- kee Equity is the named debtor Cherokee Marine paid the expenses of securing these bonds First American Na- tional bills Cherokee Marine on a monthly basis for the payments due on these bonds, and Cherokee Marine makes these payments, of $20,000 a month, directly to First American National out of Cherokee Marine's own accounts. Sweeney testified that he did not know who would control the Cowan Street equipment and building after the indebtedness was paid off. Also, Cherokee Marine makes the monthly $5000 payments due from Cherokee Equity to Cumberland-Ohio under the "con- sulting contract" executed in connection with the 1984 contract of sale between Cumberland-Ohio and Cherokee Equity Cherokee Equity was the only entity that made any commitment of funds (totaling about $763,000) when Cherokee Marine got into the river tow business Sweeney testified that Cherokee Marine was the debtor, and Cherokee Equity the creditor, on an oral "open note" (with fluctuating interest at the prime rate) to repay Cherokee Equity for the money it put up for the purchase of the David K. Sweeney testified that he did not know whether Cherokee Equity could ever sue Cherokee Marine for any unpaid balance, and that he had no assurance that the title to the David K would be transferred to Cherokee Marine after the "note" had 32 On 24 September, Sweeney testified that Cherokee Equity's officers and directors have no direct access to Cherokee Marine's accounts, and that only he and Jones had power to sign checks on these accounts 1093 been paid off As to how the size of the periodic pay- ments on this "note" was determined, Sweeney testified that the basis was "Whatever ready cash [Cherokee Marine is] able to not need at any given 30 days," and that "obviously [Cherokee Equity] would not want me to leave . . . uninvested funds lying around in a general account That wouldn't be good business " Sweeney tes- tified that at the time he made his most recent monthly report to Cherokee Equity, Cherokee Marine's general account amounted to about $20,000 Cherokee Marine does not file a separate financial statement of any sort. On request, Sweeney sends finan- cial statements to Cherokee Equity President William Wilson. Every month, Sweeney reports Cherokee Ma- rine's total revenues and expenses to Cherokee Equity Controller Powers. Also every month, Sweeney sends Powers a balance sheet, a profit-and-loss statement and change in financial position, a budget analysis, a cash flow analysis, and an analysis of any changes in the cap- ital surplus on the balance sheet From time to time, someone from Cherokee Equity, usually Powers, asks Sweeney to explain these reports, so that Cherokee Equity can properly consolidate them into its financial statement . The notes to Cherokee Equity's financial statement have entries after "Marine Terminal" with re- spect to property and equipment, revenues, operating profit, identifiable assets, depreciation, and capital ex- penditures; and describe "Marine Terminal" as a "busi- ness segment." Sweeney, who is a certified public ac- countant, testified that under accepted accounting princi- ples, there would not necessarily be any difference be- tween the way Cherokee Marine Terminal Division busi- ness would be reflected on Cherokee Equity's books if Cherokee Marine had been a wholly owned subsidiary corporation or a department of Cherokee Equity, rather than (as it is) a division (2) The procedural history of the instant proceeding As previously noted, when Cumberland-Ohio Presi- dent Skinner advised the crew of the then Robert D that it was being sold, he distributed to them on Cherokee Marine's behalf job application forms which bore the name "Cherokee Marine Terminal" and which instructed the applicants to mail them to P O. Box 8128 in Nash- ville. Among the employees who filled out such an appli- cation was Union President Miles Similar instructions were included in the help-wanted advertisement placed in the Waterways Journal Moreover, the name "Chero- kee Marine Terminal" and the foregoing post office box address appeared on the letterhead over the brochure "Towboat Employee Information" distributed to the riv- erboat employees after title to the Robert D had passed. OCAW's subsequent bargaining demand, dated 23 Janu- ary 1985, was directed and mailed to "Cherokee Marine Terminal" at the foregoing post office box address Cher- okee Marine's president Sweeney, who signed the letter which rejected the demand, testified that before sending this letter he had a conversation with somebody from Cherokee Equity about the fact that OCAW was making a demand for recognition. The letter, which rejected OCAW's demand, was mailed on 29 January 1986, was 1094 DECISIONS OF THE NATIONAL LABOR RELATIONS BOARD typed under the letterhead "Cherokee Marine Terminal" with the post office box address, was signed "James R Sweeney, Jr /President," and stated that OCAW was seeking "some kind of deal . . covering all of the em- ployees of Cherokee Towing " The initial charge with the instant docket number was filed by OCAW and served on 20 February 1985, named "Cherokee Marine Terminal" as the Employer; gave the post office box address as the Employer's address, al- leged that "the Company" had unlawfully refused to bar- gain with OCAW and had unlawfully discriminated against five named employees (including Miles), and was signed on OCAW's behalf by OCAW Representative Abel, to whom the letter had been addressed which re- jected the OCAW's bargaining demand Sweeney testi- fied that within a month after receiving the charge, he discussed it with Cherokee Equity President William Wilson The original complaint with the instant docket number, which was issued on 26 March 1985, named "Cherokee Marine, Inc " in the caption and as the sole respondent, and alleged (inter alia) that "Cherokee Marine, Inc is a corporation and is an employer within the meaning of the Act "33 These allegations were spe- cifically admitted in the answer filed about 2 April 1985, which states that the Respondent is "Cherokee Marine, Inc." and was signed by Powell as "Attorney for Chero- kee Marine, Inc " Although Powell's motion to the Re- gional Director for severance (filed about 1 July 1985) states that the Respondent is "Cherokee Marine Termi- nal," the unsuccessful appeal (with the motion attached) of the Regional Director's denial thereof is dated 17 July 1985, states that it is filed on behalf of "Cherokee Marine, Inc ," and includes a certificate of service signed by Attorney Barry V Frederick (associated with Powell in his law practice) as "Attorney for Respondent Chero- kee Marine, Inc." On 24 July 1985, Abel filed on the OCAW's behalf a second amended charge with the instant docket number. This charge named the employer as "Cherokee Marine, Inc, and Cherokee Equity Corporation," and gave only the Nashville post office box address as the employer's address That same day, the Regional Director mailed this charge to "Cherokee Marine, Inc." at the Nashville. post office address and to "Cherokee Equity Corpora- tion" at a Nashville address on Vanderbilt Place. On 30 July 1985, the Regional Director issued an amended complaint with the instant docket number The caption of this complaint named "Cherokee Equity Corporation" and "Cherokee Marine Terminal, Inc." The complaint referred to these entities as "Respondents", further al- leged that the complaint was based on the charges served on Cherokee Marine Terminal, Inc, on 20 Febru- ary and 27 March, and on the charges served on Re- spondents on 24 July 1985, went on to allege that Chero- kee Equity and Cherokee Marine were each corporations and were each employers engaged in commerce within the meaning of the Act, and further alleged that Re- a3 Cherokee Marine, Inc was also the employer named in the OCAW's first amended charge, which was filed and served on 27 March 1985, named four alleged discrimmatees (including Miles), and was other- wise identical to the initial charge in all respects material here spondents constitute a single-integrated business enter- prise and a single employer within the meaning of the Act because they are "affiliated business enterprises with common ownership and directors, have provided serv- ices for each other, have shared or utilized equipment owned by the other, and have formulated and adminis- tered a common labor policy affecting all employees " To this amended complaint, an answer filed by Powell on 9 August 1985 as "Attorney for Respondents" re- ferred to "Respondents, Cherokee Equity Corporation and Cherokee Marine Terminal, Inc ", admitted Chero- kee Equity's corporate status but denied the allegations of Marine's corporate status,34 and denied the com- plaint's single-employer allegations. The 9 August answer further denied that OCAW had ever asked Cher- okee Equity to bargain with it In addition, the 9 August answer admitted that the second amended charge (naming Cherokee Marine, Inc and Cherokee Equity Corporation) had been served on "Respondents" on 24 July, and went on to allege that "as to the Respondent Equity, the prosecution of this complaint is barred by the provisions of Section 10(b) of the Act in that no charge was filed against nor served upon the Respondent Equity within six months of the occurrence of the matters al- leged in the complaint " So far as material here, the com- plaint alleged an unlawful refusal to bargain "Since on or about" 29 January 1985, and the 9 August answer admit- ted that on 24 July 1985, the OCAW had filed and had served on "Respondents" the second amended charge, which, as previously noted, named "Cherokee Marine, Inc and Cherokee Equity Corporation," and alleged that "the Employer" had unlawfully refused to bargain with the OCAW since on or about 29 January 1985 The 9 August answer also alleged that Cherokee Marine "is, and at all times pertinent to this matter has been, a party to a collective bargaining agreement with a labor organization within the meaning of the Act which collective bargaining agreement is a bar to its recogniz- ing" the OCAW (see supra part II,A, E). On 28 August 1985, the OCAW filed a third amended charge which named Cherokee Marine Terminal, Inc and Cherokee Equity Corporation, and alleged, inter alia, that "Since on or about January 29, 1985 and thereafter, the Compa- ny [unlawfully] refused and is continuing to refuse to bargain with" the OCAW; and that "Since on or about January 23, 1985 . . the Employer has [unlawfully] rec- ognized" Local 1 The amendment (issued 5 September 1985) to the amended complaint bore the caption "Cher- okee Equity Corporation and Cherokee Marine Termi- nal, Inc," and added an allegation that "On or about August 1985, the exact date being unknown, Respond- ents" violated Section 8(a)(1) and (2) of the Act by rec- ognizing Local 1 as the representative of the riverboat employees notwithstanding "Respondents' obligations 34 As previously noted, the answer filed by Powell on 2 April had ad- mitted Cherokee Marine's corporate status Par 2 (b) of the amended complaint alleged , At all times material herein , Respondent Marine, a corporation with an office and place of business in Nashville , Tennessee has been engaged in marine terminal and towing operations " Par 2(b) of Powell's 9 August answer "admit[s] that Marine operates a marine terminal and towing operation and has an office and place of business in Nashville, Tennessee, but denies all other allegations of such paragraph " CHEROKEE MARINE TERMINAL 1095 since on or about January 23, 1985" to recognize the OCAW as such employees' representative. When taken together with Powell's contentions at the hearing and in his posthearing brief, Powell's answer (filed on 10 Sep- tember 1985) to the 5 September amendment asserted on behalf of the Respondents that (inter alia) the allegations set forth in the amendment are barred by Section 10(b) because the 28 August charge alleged these violations to have occurred since on or about 23 January, which 23 January date was more than 6 months before the 28 August charge was filed and which differed from the "on or about August" date that the complaint attached to these alleged violations ss On the second day of the hearing, all parties stipulated that the caption to this case, and all the complaints, be amended to name as Respondent "Cherokee Marine Ter- minal, Division of Cherokee Equity Corporation, Inc " c Discussion (1) The identity of the employer Cherokee Marine Terminal is not a legal entity, cannot sue or be sued in its own name, and, therefore, cannot, in a legal sense, be regarded as the sole "employer" of the employees here involved. Rather, Cherokee Equity Cor- poration, Inc., which is admittedly an employer within the meaning of the Act, is the only legal entity that has ever been named as a party Respondent in this proceed- ing. Accordingly, Cherokee Equity Corporation, Inc is answerable for any unfair labor practices found herein, irrespective of the degree of autonomy that that corpora- tion may have chosen to afford to the corporate division, which the corporation denotes as Cherokee Marine Ter- minal Royal Typewriter Co., 209 NLRB 1006, 1009, 1021-1022 (1974), enfd. 533 F 2d 1030 (8th Cir. 1976), Hearst Corp, 151 NLRB 834 fn 2 (1965). Although Cherokee Equity Corporation, Inc. had the legal option of setting up a wholly owned subsidiary corporation in order to conduct the marine terminal operation, Chero- kee Equity Corporation, Inc.'s decision not to do so dis- ables that corporation from now seeking to confine inde- pendent claimants (the General Counsel, the OCAW, and the employees) to any remedies that Cherokee Marine Division is capable of providing for any unfair labor practices herein. See Schenley Distillers Corp. v. U.S. 326 U S. 432, 436-437 (1946), Boggs v. Blue Dia- mond Coal Co., 590 F.2d 655, 662 (6th Cir. 1979), Mar- shall v. Coastal Growers Assn , 598 F 2d 521, 525 (9th Cir 1979); Crabtree Investments v Aztec Enterprises, 479 F Supp 448, 451-452 (M.D. La.); McDaniel v Johns Manville Sales Corp, 487 F Supp. 714 (N.D Ill. 1978), Johns-Manville, (asbestos cases), 509 F.Supp 1353 (E.D Tex., 1981); Love v. Ben Hicks Chevrolet, 655 S.W. 2d 574, 576 (Mo. Ct. App. W.D. 1983). " the corporate entity will sometimes be pierced when it is used to evade legal responsibility, but it will not be pierced to protect it as Powell's answer also alleged that the 8 (a)(2) allegations were time- barred because Cherokee Marine had recognized Local I prior to Janu- ary 1985 , "a fact known to or reasonably discoverable by [OCAW] and the Board " For the reasons discussed infra , part II,G,2 , this defense is related to the merits of the claim against its own wrongdoing." NLRB v. Miller Trucking Service, 445 F 2d 927, 930 (10th Cir. 1971). Limiting liability to Cherokee Marine Division would be particularly inappropriate in the instant case, where Cherokee Marine Division's income has been used to make payments on properties whose title is held by Cherokee Equity Corporation, and Cherokee Equity Corporation has received all of Cherokee Marine Divi- sion's revenues not used for such payments, for operating expenses, or to maintain enough cash on hand for 30 days See NLRB v. Deena Artware, 361 U S. 398, 403 (1960) (nominally separate corporation may be answer- able for debts of related corporation which is "only a shell, inadequately financed"); Perma Vinyl Corp, 164 NLRB 968, 969 (1967), enfd. 398 F 2d 544 (5th Cir. 1968) (successor held liable to remedy predecessor's unfair labor practices because, inter alia, the successor had become the beneficiary thereof). Indeed, even if Cherokee Equity Corporation, Inc. had elected to set up such a wholly owned subsidiary, Cherokee Equity would be answerable for the subsidiary's conduct if the subsidi- ary had in fact been operated as a division of Cherokee Equity Deena Artware, supra, 361 U S at 403 (1960). A fortiori, Cherokee Equity is answerable for unfair labor practices within what is one of its divisions in the literal sense. The secondary boycott cases cited in Cherokee's brief are inapposite to the issues here. As pointed out in Royal Typewriter, supra, 209 NLRB at 1022, this class of cases falls under Section 8(b)(4), whose purposes include con- fining labor disputes to the "person" immediately in- volved in such a dispute; whereas, "Here the issue is whether a parent of an unincorporated division having no separate identity as legal entity becomes a single em- ployer with its division for the purposes of the Act." Indeed, even as to Section 8(b)(4) there may be no mean- ingful distinction between Cherokee Marine Division and Cherokee Equity Corporation, Inc Thus, it is at least ar- guable that even assuming they are different "persons" within the meaning of that section, the corporation would not be a neutral employer with respect to the in- stant labor dispute in view of the corporation's participa- tion in the decision to refuse to recognize the OCAW as the representative of employees who worked in the divi- sion Cf Teamsters, Local 560 (Curtis Matheson), 248 NLRB 1212 (1980). Further, I am doubtful whether the corporation and the division constitute two different "persons." It is true that in preparing the 1983 annual report of Cherokee Equity Corporation, Inc it chose to describe the oper- ations of Cherokee Marine Terminal as one of Cherokee Equity's three "business segments" (the other two being "Real estate investments" and "General corporate") for purposes of describing revenues, operating profit, identi- fiable assets, and depreciation It is also true that Chero- kee Marine Terminal has separate bank accounts, a sepa- rate payroll, a separate "president" (Sweeney), and sepa- rate supervision under him Cherokee Equity Corpora- tion, Inc., however, compels Cherokee Marine Terminal to send to Cherokee Equity, directly or indirectly, all of Cherokee Marine's revenues in excess of operating ex- 1096 DECISIONS OF THE NATIONAL LABOR RELATIONS BOARD penses and needed ready cash. More specifically, Chero- kee Marine Terminal funds of $20,000 a month are sent to First American National as payments for bonds that name Cherokee Equity Corporation, Inc as the debtor, which were issued in order to enable Cherokee Equity to finance improvements whose title is held by Cherokee Equity, and which are secured by real estate whose title is also held by Cherokee Equity Furthermore, Cherokee Marine pays Cumberland-Ohio the amounts due it under its "consulting contract" with Cherokee Equity. More- over, because Cherokee Equity "would not want [Chero- kee Marine] to leave . . . uninvested funds lying around in a general account," Cherokee Marine regularly pays all of its remaining cash balance (except for ready cash needed for the next 30 days) to Cherokee Equity Par- ticularly because Sweeney admittedly has no assurance that Cherokee Marine will ever receive title to the David K., I regard as evidence of, at best, an accounting device the testimony that these payments are made to discharge an oral note for repayment of the David K.'s purchase price. Finally, in order to assure that these payments to First American National, Cherokee Equity, and Cumber- land-Ohio are made by Cherokee Marine, Cherokee Equity requires Sweeney to make monthly financial re- ports to it, has arranged (without Sweeney's knowledge) to enable two of its officers to sign checks on Cherokee Marine's accounts, and retains the power at will to dis- charge Sweeney or to change his salary. In short, any in- crease in Cherokee Marine's revenues from a refusal to recognize OCAW as the riverboat employees' represent- ative, and/or from a recognition of Local 1 as such rep- resentative, has caused and will cause a precisely equal and almost concurrent increase in Cherokee Equity's revenues. Similarly, any loss of Cherokee Marine's reve- nues due to a contract settlement favorable to the OCAW and/or withdrawal of recognition from Local 1, or any loss of revenues due to a primary strike among employees of Cherokee Marine, would cause either an equal and almost concurrent loss of what are admittedly Cherokee Equity's revenues, or an equal and almost con- current loss to Cherokee Equity consisting partly of loss of revenues and partly of payments from it to First American National and/or Cumberland-Ohio. Further, it was Cherokee Equity Corporation that decided to ac- quire the riverboat operation and executed the contract of sale, including a representation by Cumberland-Ohio that Cherokee Equity would not be obligated by any union contract or under ERISA, an undertaking by Cumberland-Ohio to pay certain insurance premiums for employees who became employees of Cherokee Equity, and a clause that required Cumberland-Ohio to terminate its riverboat employees "so that such employees shall have no claim against" Cherokee Equity Corporation. Moreover, Cherokee Equity Corporation, Inc owns all of the capital assets (including land, buildings, and river- boats) used in the operation of Cherokee Marine Termi- nal.36 38 I need not and do not determine Cherokee Equity's liability herein if Cherokee Marine Terminal Division were a subsidiary corporation Sweeney testified that he did not operate Cherokee Marine Terminal Di- vision any differently from an insurance company of which he had been secretary-treasurer while it was the wholly owned subsidiary of Dana For the foregoing reasons, I , find that Cherokee Marine Terminal is a segment or component of Cherokee Equity Corporation, Inc ; that Cherokee Equity Corpo- ration, and its division Cherokee Marine Terminal, con- stitute a single employer, and that the complaint in its final form properly names as the sole Respondent Chero- kee Marine Terminal, Division of Cherokee Equity Cor- poration, Inc. This entity will hereafter be referred to as Respondent. (2) The 10(b) defense It is undisputed that the 8(a)(5) charges were timely filed and served with respect to Cherokee Marine Termi- nal 37 My finding that Cherokee Marine Terminal is a segment or component of Cherokee Equity Corporation, Inc , which is the employer herein, establishes that such charges were timely as to the corporation as well G. W. Truck, 240 NLRB 333, 334-335 (1979); Sturdevant Sheet Metal Co., 238 NLRB 186, 187-188 (1978), enfd 636 F.2d 271 (10th Cir 1980); Photo-Sonics, Inc, 254 NLRB 567, 570 In. 2 (1981), enfd. 678 F 2d 121 (9th Cir. 1982); Penntech Papers, Inc., 263 NLRB 264, 284 (1982), enfd. 706 F 2d 18 (1st Cir. 1983), cert. denied 104 S.Ct. 237 (1983). Indeed, because Sweeney testified that he dis- cussed the 20 February 1985 charge with Cherokee Equity Corporation's president no later than 20 March 1985 (less than 2 months after the refusal to bargain), that charge would be timely with respect to the corpora- tion even if the corporation and the division had been two different employers Peterson Construction Co, 106 NLRB 850, 851 (1953); American Steamship Co., 222 NLRB 1226, 1230-1232 (1976); Sturdevant, supra, 238 NLRB at 188, 636 F.2d at 275, Botany 500, 251 NLRB 527, 530-531 (1980). In any event, the 8(a)(5) charge is timely as to Cherokee Equity Corporation, Inc., even disregarding the charges naming only Cherokee Marine Terminal The first 8(a)(5) charge, which named the cor- poration, alleged an unlawful refusal to bargain "Since on or about January 29, 1985, and thereafter," and was received by the corporation on 26 July 1985, within 6 months after the 29 January 1985 postmark on the letter in which Sweeney refused to recognize the OCAW 38 Corporation, a firm unrelated (so far as the record shows) to Cherokee Marine or Cherokee Equity He further testified that the relationship be- tween the insurance company and Dana in terms of operating and finan- cial transactions was no different from the relationship between Cherokee Marine and Cherokee Equity I attach little weight to his testimony in these respects, in view of the absence of specifics, including the absence of evidence that the insurance company was discharging debts as to which Dana was the named debts and had pledged its own property as security, or that the insurance company was paying Dana for property whose title Dana might not transfer to the insurance company when the property was paid for 31 The refusal to bargain took place in January 1985 An 8(a)(5) charge naming Cherokee Marine Terminal was filed and served in February 1985 38 The period between the critical dates was in fact somewhat shorter than indicated in the text For purposes of tolling the limitations period prescribed by Sec 10(b), the date of service is the date of mailing-here, 24 July 1985-rather than the date of receipt NLRB v Laborers Local 264 (D & G Construction), 529 F 2d 778, 782-785 (8th Cir 1976), Electri- cal Workers (Spartus Corp), 271 NLRB 607 (1984), Montgomery Hospital, 233 NLRB 752 fn 1 (1977) Moreover, the date of the refusal to bargain Continued CHEROKEE MARINE TERMINAL 1097 Likewise without merit is the contention that the 8(a)(2) complaint allegations are time barred because the first charge, which alleged an 8(a)(2) violation, was filed and served on 28 August 1985 and alleged an 8(a)(2) vio- lation "Since on or about January 23, 1985 " The fact that the charge named a date (23 January 1985) more than 6 months before the charge was filed does not pre- clude an 8(a)(2) finding based on the amendment to the amended complaint, because that amendment (issued on 5 September 1985) alleges an 8(a)(2) violation "on or about August 1985," much less than 6 months before the 8(a)(2) charge was filed and served. Wiley Bros. Transit Mix, 211 NLRB 382, 394 (1974); J. A. Croson Co, 274 NLRB 149 (1985) 39 In any event, the contention that the alleged August 1985 recognition of Local 1 constitut- ed an 8(a)(2) violation turns on the merits of the conten- tion that the January 1985 refusal to bargain with OCAW violated Section 8(a)(5) See infra part II,G,2 Accordingly, and because the 8(a)(5) charges filed in February, March, and July 1985 were timely with re- spect to the January 1985 refusal to bargain, these charges are sufficient to support the complaint allegation that Section 8(a)(2) was violated in August 1985 Kelly- Goodwin Hardwood Co., 269 NLRB 33, 36-37 (1984). (3) The General Counsel's motion to quash a subpoena for the investigatory file and to close the hearing Just before resting, counsel for the General Counsel offered into evidence a letter to the Regional Director from Attorney Powell, which is dated 11 March 1985 and had been inserted into the investigatory file. Counsel for the General Counsel offered this letter into evidence on the ground that a 10(b) defense was based on the fact that all the charges prior to 24 July 1984 named only Cherokee Marine Terminal, that "Cherokee Marine Ter- minal" on these charges was "simply a misnomer," and that Powell's letter of 11 March did not correct this mis- nomer but, instead, advanced or contributed to it Coun- sel for the General Counsel relied on the representations in the letter (captioned "Re Cherokee Marine Terminal" with the instant docket number) that the letter was being submitted as "the position statement of Cherokee Marine, Inc ('Cherokee')," and that "There is no common own- ership among T. L Herbert [see supra fn. 3] and Chero- kee. Cherokee is owned by Cherokee Equity Corpora- tion while T L Herbert, which owns C & 0 [see supra fn. 3], is owned primarily by the Skinner family." After this letter had been received over Powell's objection'40 would be the date on which OCAW received Sweeney's letter Swan Coal Co, 271 NLRB 962, 863 (1984), Montgomery Hospital, supra Be- cause there is no direct evidence as to this date, it presumptively fell on the day after the 29 January date of mailing-that is, 30 January 1985 Teamsters Local 610 (Browning-Ferris), 264 NLRB 886, 899-900 (1982) 30 The contention that the allegedly unlawful recognition of Local I occurred in January 1985 or earlier is really directed to and is discussed in connection with the merits of the case Local l's answer denied that it was recognized as these employees' representative on or about August 1985 As found infra, such recognition in fact occurred in September 1985 40 Powell relied on Rule 403 of the Federal Rules of Evidence, which Rule states in part, "Although relevant, evidence may be excluded if its probative value is substantially outweighed by the danger of unfair preJu- Powell procured the issuance of a subpoena duces tecum against counsel for the General Counsel (John F. Har- rington) seeking the production of the entire investiga- tory file. Powell stated on the record that he wanted this file in order to find out "what [the Board], in fact, knew or had the opportunity to learn" about "who Cherokee Equity was." Harrington thereupon orally requested me to quash the subpoena on the ground (1) that General Counsel Rosemary M Collyer had not granted permis- sion to produce the file, (2) that it is immaterial whether counsel for the General Counsel knew from other sources the real status of Cherokee Marine Terminal, and (3) that the subpoena was overly broad. I reserved ruling on that motion pending the disposition of a request to General Counsel Collyer to permit Harrington to comply with the subpoena By telegram sent that day (25 September 1985) or a day or two later, Powell, as attorney for Respondents, requested General Counsel Collyer to direct Harrington "to testify in this matter and to produce in connection with such testimony the investigative file underlying the complaint and the amendments thereto . . . Because of various amendments to the pleadings and the raising of Section 10(b) as a defense to certain charges, the issue of when the Board knew or should have known of the identities of proper Respondents is at issue Regional At- torney Harrington has made certain representations to the Administrative Law Judge and has introduced as General Counsel's Exhibit one letter from the investiga- tive file. In order to explore the scope and chronology of the Board's knowledge it is necessary to have access to the file and to examine Regional Attorney Harrington." Both Powell and counsel for Local 1 rested their case on 25 September 1985 without putting in any evidence, but subject to disposition of the subpoena By letter dated 22 October 1985, General Counsel Collyer refused to authorize Harrington to testify and to produce the in- vestigative file on the ground, inter alia, that "other sources of relevant evidence were available to respond- ent [sic] concerning its [sic] proffered Section 10(b) de- fense"; and that "in seeking the contents of the entire in- vestigative file, you appear to be seeking intra-agency memoranda which reflect the Agency's deliberative process and also attorney work products, which are priv- ileged from disclosure " On 24 October 1985, counsel for the General Counsel renewed his request that the pend- ing motion to quash be granted and also requested that the hearing be closed The due date for briefs was 12 November 1985. Local 1 did not file a brief, and Pow- ell's brief has not specifically addressed the issues raised by the Harrington subpoena. The General Counsel's motion to quash the subpoena and close the hearing is hereby granted My determina- tion that the charges naming only Cherokee Marine Ter- minal were effective as to Cherokee Equity Corporation, Inc is in no respect based on any finding that during rel- evant periods the Regional Office was justifiably un- aware of the status of Cherokee Marine Terminal, by dice " The letter refers to a number of matters in addition to the representations which caused counsel for the General Counsel to intro- duce the letter 1098 DECISIONS OF THE NATIONAL LABOR RELATIONS BOARD reason of being misled by Powell or for any other reason 41 Accordingly, the date on which the Regional Office knew or should have known about such status is irrelevant Moreover, in asking General Counsel Collyer to grant permission to Harrington to testify and to produce the investigative file, Powell sought the entire file, without limiting his request to those portions of the investigative file which shed light on this issue, nor to material which is not privileged. Because General Coun- sel Collyer (a Presidential appointee approved by the Senate) has access to the file in question and I do not, I give weight to her statement that the requested material includes privileged material. For these reasons, I find the subpoena to be overly broad.42 2 Whether Respondent is a successor to Cumberland-Ohio, whether the riverboat employees constituted a separate appropriate unit or an accretion to the unit represented by Local I A mere change in ownership of an employing industry does not itself absolve the new owner from the obliga- tion to recognize and bargain with the labor organization that represented the employees of the former owner. When there is a substantial continuity in the identity of the employing industry, the purchasing employer is bound to recognize and bargain with the incumbent union in the previously represented unit, if it remains ap- propriate NLRB v. Burns Security Services, 406 U.S. 272, 279 (1972); NLRB v. Downtown Bakery Corp., 330 F.2d 921, 925 (6th Cir 1964), cited with approval in Burns, supra; NLRB is. Interstate 65 Corp., 453 F.2d 269, 272 (6th Cir. 1971), Inland Container Corp, 275 NLRB 378 (1985), Matlack, Inc., 278 NLRB 246 (1986). In determin- ing whether the "employing industry" remains substan- tially the same, the Board has applied such criteria as whether (1) there has been a substantial continuity of the same business operations, (2) the new employer uses the same plant, (3) the same or substantially the same work force is employed; (4) the same jobs exist under the same working conditions; (5) the same supervisors are em- ployed; (6) the same machinery, equipment, and methods of production are used, and (7) the same product is used or the same service offered. Premium Foods, 260 NLRB 708, 714 (1982), enfd. 709 F.2d 623 (9th Cir. 1983); Trucking Water Air Corp., 276 NLRB 1401 (1985). On the basis of these standards, I agree with the General Counsel that Respondent is a successor to Cumberland- Ohio. Further, I agree with the General Counsel's relat- ed contention that the OCAW bargaining unit under 41 Because the 10(b) limitations period is directed at the charges and not the complaints, any claim of "misleading" would appear to be rele- vant to only the charging party (here, the OCAW) and not to the Re- gional Office, which issued the complaints but had no power to file charges on its own 42 In granting the motion to quash, however, I do not necessarily regard as conclusive General Counsel Collyer' s action in denying the re- quest to permit Harrington to testify and to produce the investigative file Thus, I am not aware of any evidence available to Powell, other than his own representations to the Regional Office, regarding when it "knew or should have known" about Cherokee Marine Terminal's status as a divi- sion of Cherokee Equity Corporation, Inc rather than a corporation Indeed, the record indicates that Powell himself may not have known this until after 17 July 1985 Cumberland-Ohio remains appropriate after the purchase by Respondent, and that the riverboat employees do not constitute an accretion to the unit of Respondent's em- ployees admittedly represented by Local I Thus, the ICC operating authority, which Respondent purchased from Cumberland-Ohio, covered almost all of the waterways which Cumberland-Ohio's riverboat em- ployees had traversed for the 3 years preceding the sale. After this purchase, Respondent's riverboat employees traversed these same waterways, and used a harbor port boat in the Nashville port, on vessels previously used for such purposes by Cumberland-Ohio's riverboat employ- ees. Respondent used the same size crews and the same riverboat job classifications (both supervisory and nonsu- pervisory), as had Cumberland-Ohio. Upon commencing riverboat operations in late January 1985, Respondent hired riverboat crews whose supervisory members (cap- tains and pilots) had all worked as such for Cumberland- Ohio, and a majority of whose nonsupervisory members had also worked as such for Cumberland-Ohio As of 23 September 1985, the first day of the hearing before me, all six of the supervisory crewmembers, and a majority of Respondent's nonsupervisory riverboat crews, still consisted of men who had worked for Cumberland- Ohio.43 Moreover, the captains' immediate superior before the sale, Port Captain Smith, continued to serve as such until July 1985, when he resigned; and discharges under Respondent are decided on by the captains and Jones, who was Cumberland-Ohio's dispatcher and who became Cherokee Marine Terminal's "secretary and treasurer" the first of 1985. After the sale, Respondent required the riverboat crews to comply with the same "Rules and Regulations" as those which had been im- posed by Cumberland-Ohio Moreover, after the sale, Respondent's riverboat operation engaged in the same kind of business-namely, tramp towing-as had Cum- berland-Ohio during the year preceding the sale Re- spondent solicited business through the same individuals (Smith until July 1985 and Jones) as had Cumberland- Ohio. Further, Respondent transported virtually the same kind of cargo. Also, the contract of sale precluded Cumberland-Ohio from competing with Respondent for 4 years (until 1989) along the Cumberland River, a route essential to river towing in the area served by Respond- ent; and gave Respondent access to Cumberland-Ohio's customer lists. In view of the foregoing, I find that Respondent is a successor with respect to Cumberland-Ohio notwith- standing the fact that Respondent's customers include some that were not, and do not include some that were, 4' As of that date, the riverboat crews consisted of 18 employees, of whom 10 had worked for Cumberland-Ohio These figures include the four former Cumberland-Ohio employees who were the subject of the partial settlement on 23 September 1985 (see text attached to in 14 supra) As of 23 September 1985, 14 riverboat employees were actively working for Respondent, of whom 6 had worked for Cumberland-Ohio Former Cumberland-Ohio employees continuously constituted more than half of Respondent's active riverboat employees until II June 1985 In any event, as Respondent does not appear to question , the post-demand turnover among the unit employees does not affect the OCAW's bargain- ing rights Hudson River 4ggregates, 246 NLRB 192 (1979), enfd 639 F 2d 865 (2d Cir 1981) CHEROKEE MARINE TERMINAL customers of Cumberland-Ohio's,44 and the unexplained circumstance that the towboat crews working for Re- spondent work a 2-week tour of duty, rather than the 3- week tour worked by Cumberland-Ohio's crews 45 Nor do I regard the nature of the employing industry as changed by Respondent's ownership of the then Martha Anne before the December 1984 sale, or by Cumberland- Ohio's retention of the John S The Martha Anne's crew were in the employ of Cumberland-Ohio before the sale and of Respondent afterward, and the cancellation of the Martha Anne charter from Respondent to Cumberland- Ohio was an aspect of the sale. As to the John S , that vessel was not manned by Cumberland-Ohio's employees after 10 January 1985 In any event, a change in the scale of an operation must be extreme before it will alter a finding of successorship Redok Enterprises, 277 NLRB 1010 (1985), see also Louis Pappas' Restaurant, 275 NLRB 1519 (1985) Nor do I attach much significance to the fact that Respondent, unlike Cumberland-Ohio, does not lease its operating authority or charter its vessels, such conduct by Cumberland-Ohio did not affect its cur- rent employees' tenure of employment or remove them from the coverage of the bargaining agreement 46 The General Counsel's able brief urges, and Respond- ent's posthearing brief concedes (p 11), the appropriate- ness of the unit represented by OCAW before the sale I agree Further, I agree with the General Counsel that this unit remained appropriate after the sale, and reject the contention of Respondent and Local 1 that the river- boat employees constituted an accretion to Local l's unit Thus, none of the employees admittedly in Local l's unit has ever performed any of the work performed by the riverboat 'employees. The 11 or 12 riverboat em- ployees iri the David K. crews have never performed any of the work performed by the employees admittedly in Local l's unit, although the 2 riverboat employees on the Tract K may occasionally work on the dock. The river- boat crews have always had separate immediate supervi- sion, and until July 1985 had separate intermediate super- vision No employees admittedly in Local l's unit have ever been transferred to the riverboat crews, and Re- 44 See Inland Container, supra Because Cumberland-Ohio (like Re- spondent) was in the tramp towage business, some turnover in the identi- ty of customers would have been likely even if the identity of the em- ployer had not been changed See Contract Carrier, 258 NLRB 353, 355 (1981) Indeed , this is suggested by the sales analysis documents (see supra, part Ii,D,4) Moreover, even if the identity of the employer had not been changed at the beginning of 1984, the generally depressed state in the 1985 riverboat traffic business would likely have caused lower rev- enues in 1985 as compared to 1984 45 Respondent's posthearing brief attributes the tour-of-duty change to "localized, rather than nationwide, trips" and to "shore jobs available in times of slack work " Under Cumberland-Ohio, however, the towboats made no nationwide trips and usually operated on the same routes as does Respondent Further, Respondent's towboat crews never work on shore, and Respondent's harbor boat crews almost never do so 46 More specifically, if a vessel was chartered "fully found," its crew remained in Cumberland-Ohio's employ and subject to the bargaining agreement If Cumberland-Ohio chartered a vessel to another firm "bare- boat," or if another firm operated its own vessel pursuant to a lease of Cumberland-Ohio's operating authority only, the lessee hired the crew without (so far as the record shows) making any effort to hire employees from Cumberland-Ohio, either temporarily or permanently So far as the record shows, until after the December 1984 sale, Cumberland-Ohio had chartered a vessel "bareboat" to another firm on only one occasion, for a 30-day period no later than 1980 1099 spondent admits that none of these admittedly Local 1- represented employees would be qualified to perform any jobs on the riverboat crews except as "green hands " Nor is there any evidence that any riverboat employees have ever been transferred to the unit admittedly repre- sented by Local 1 The employees admittedly represent- ed by Local 1 work at a fixed Nashville location on dry land, normally work 8 hours a day and 5 days a week, punch a timeclock, are paid by the hour, receive premi- um pay for overtime work, and are paid every week Riverboat employees work on riverboats which sail be- tween Nashville and Cairo, remain on their vessels for 14 consecutive days and are wholly off duty for 14 consecu- tive days, when on a vessel work 12 hours out of each 24, do not punch a timeclock, are paid by the day, do not receive premium pay for overtime, and are paid every 2 weeks Moreover, since at least 1977 the dry- land employees under Cumberland-Ohio and then under Respondent, and the riverboat employees under Cumber- land-Ohio, had been represented to two different units based on Board certifications, although during part of this period both units had been represented by OCAW While it is true that Respondent's acquisition of the riv- erboat operation has caused it to become part of an inter- modal transportation operation, there is no evidence that this change has had any significant effect on the river- boat employees' working conditions I conclude that because Respondent's riverboat em- ployees continue to share a community of interest that is not shared by Respondent's dry-land employees, and be- cause the riverboat employees have a history of separate representation based on Board certifications, the river- boat employees continue to constitute a separate appro- priate bargaining unit. Indianapolis Mack Sales, 272 NLRB 690 fn. 4 (1984) Accordingly, the riverboat em- ployees do not constitute an accretion to the unit repre- sented by Local 1. Paper Mfrs. Co, 274 NLRB 491 (1985). The proposed finding of an accretion is rendered particularly questionable by the fact that the alleged ac- cretion of riverboat employees is more numerous than the dry-land employees Renaissance Center Partnership, 239 NLRB 1247 (1979) My finding that the riverboat employees do not consti- tute an accretion to Local l's contract unit forecloses the contention that their alleged coverage by Local l's 1983- 1986 contract justified the January 1985 refusal to recog- nize OCAW as the riverboat employees' representative. Kroger Co, 219 NLRB 388, 389 fn 6 (1975), Anheuser- Busch, 170 NLRB 46 (1968), see also Safeway Stores, 276 NLRB 944 (1985) Accordingly, there is no relevance to Respondent's seeming claim that the supposed advan- tages that the contract allegedly conferred on the river- boat employees call for including them in the dry-land employees' unit. In any event, I find that neither Re- spondent nor Local 1 believed that their 1983-1986 con- tract covered the riverboat employees Thus, although Sweeney had executed this bargaining agreement, he tes- tified that not until after his 29 January 1985 rejection of OCAW's bargaining demand did it occur to him that they were covered by that contract, that he never men- tioned this idea to Local 1 until Local 1 Representative 1100 DECISIONS OF THE NATIONAL LABOR RELATIONS BOARD Craighead allegedly raised it with him in July 1985, and that until Craighead raised this inquiry, Sweeney had not applied any of the terms and conditions of the contract to the riverboat employees Further, Respondent never gave Craighead a copy of the 7 January 1985 towboat employees' brochure, which set forth employment condi- tions (including vacations and holidays) different from those prescribed in Local l's bargaining agreement Moreover, Craighead testified that in July 1985, he told a Board investigator that he had no contract with Re- spondent with respect to the riverboats, and that river- boat employee classifications were not covered by Local l's contract until 31 July 1985 Indeed, he testified that he and Sweeney agreed in September 1985 to apply to the riverboat employees the provisions of Local l's 1983-1986 bargaining agreement with respect to vaca- tions, holidays, and seniority-testimony hardly consist- ent with any understanding that the riverboat employees were already covered by the entire contract Further, al- though riverboat employees were always paid by the day, there is no evidence that Respondent and Local 1 agreed before September 1985 to any wages by the day or to a wage scale for any riverboat employee classifica- tion Indeed, although Respondent's brief seems to claim that even prior to September 1985 the riverboat employ- ees were covered by Local l's contractual seniority and layoff clauses , in hiring riverboat employees Sweeney failed to act consistently with these seniority provisions even after 9 September 1985, when Sweeney and OCAW agreed to apply to riverboat employees the seniority pro- visions of Local l's 1983-1986 bargaining agreement. In short, I accept Sweeney's testimony that Respond- ent's extension of recognition to Local I as the represent- ative of the riverboat employees occurred in September 1985. This evidence precludes any contention that Local l's contract defeated any right to recognition as to the riverboat employees that OCAW may have had when in late January 1985 Sweeney refused its bargaining demand." 3. Whether Respondent violated the Act by refusing to recognize OCAW, and by recognizing Local 1, with respect to the riverboat employees As previously found, Respondent occupied the status of successor to Cumberland-Ohio, which had for many years recognized the OCAW as the representative of the riverboat employees and, at the time of the sale, was a party to a collective-bargaining agreement with OCAW covering such employees Respondent has never denied that Sweeney knew, when he rejected OCAW's January 1985 bargaining demand, about OCAW's 1983-1986 bar- 44 The validity of the 8(a)(2) charge is not, of course, affected by this evidence that the filing of the charge preceded the recognition of Local 1 as to the riverboat employees NLRB v Fant Milling Co, 360 US 301 (1959), Pankratz, supra, 269 NLRB at 36-37 In any event, Respondent is in no position to impugn the 8(a)(2) charge on this ground About 9 August 1985 (19 days before the filing of the 8(a)(2) charge), Powell re- quested dismissal of the 8 (a)(5) allegations in the amended complaint be- cause "Marine is, and at all times pertinent to this matter has been, a party to a collective bargaining agreement with a labor organization within the meaning of the Act which collective bargaining agreement is a bar to its recognizing" the OCAW Cf ACF Industries v NLRB, 592 F 2d 422, 430-431 (8th Cir 1979) gaining agreement with Cumberland-Ohio, and I find that Sweeney in fact knew about it I rely on the fact that the 14 "Rules and Regulations covering Towboat Employees" effective 7 January 1985, which Respondent distributed to the riverboat employees, tracked almost verbatim the language of the 14 "Rules and Regulations" in OCAW's contract with Cumberland-Ohio, on the sim- ilarity between the language of the Rules and Regula- tions and the OCAW contract with respect to seniority and crew changes, on the inclusion in the contract of sale of assurances that there were no union contracts or ERISA obligations imposing an obligation on Cherokee Equity Corporation, on the fact that OCAW's bargaining demand was addressed to Port Captain Smith, a supervi- sor for Cumberland-Ohio before the sale and for Re- spondent afterward, and on the fact that the six supervi- sors whom Respondent hired in early January to work on the riverboats had all worked in similar capacities for Cumberland-Ohio 48 Under such circumstances, Re- spondent could not lawfully reject the OCAW's bargain- ing demand, unless Respondent has demonstrated either that on the date of its refusal, OCAW no longer enjoyed majority support, or that Respondent's refusal was moti- vated by a good-faith and reasonably grounded doubt of the OCAW's majority status Burns, supra, 406 U S at 279-281, Landmark International Trucks v. NLRB, 699 F 2d 815, 818-819 (6th Cir 1983), Makela Welding v NLRB, 387 F 2d 40, 45-46 (6th Cir 1967), Lockheed En- gineering Co, 271 NLRB 119 (1984), Sofco, Inc, 268 NLRB 159 (1983), JR.R. Realty Co, 273 NLRB 1523 (1985); Grico Corp., 265 NLRB 1344, 1346 (1982), enfd. 730 F 2d 767 (9th Cir 1984), Virginia Sportswear, 226 NLRB 1296, 1300 (1976) In the instant case, there is no evidence that when OCAW's demand letter was received in January 1985, OCAW no longer enjoyed majority support Moreover, although Sweeney's rejection letter stated that "We do not believe you in fact represent all or a majority" of the riverboat employees, the record does not show any rea- sonable basis whatever for this claim in late January 1985. Further, I find unmeritorious the contention that the OCAW's demand letter-addressed to "Mr Tom Smith, Port Captain/Cherokee Marine Terminal/P 0 Box 8128/Nashville"-was ineffective as to Cherokee Equity Corporation, Inc I note that Sweeney admittedly discussed this demand with somebody at Cherokee Equity before Sweeney answered OCAW's letter, that Respondent had caused the distribution to the laid-off Cumberland-Ohio employees (including the OCAW president) of employment application blanks that repre- sented that the new employer 's name and address were those on OCAW's demand letter, that Sweeney's reply was under a letterhead which gave the name and address specified in OCAW's demand, that Sweeney's reply said nothing about Cherokee Equity Corporation, Inc, and that attorney Powell has contended throughout this pro- ceeding that the towboat employees' only employer is 48 Cumberland-Ohio President Skinner, who signed the contract of sale on Cumberland-Ohio's behalf, testified that he assumed, but did not know "for sure," that when the assets were transferred Cherokee knew the Cumberland-Ohio employees had been represented by OCAW CHEROKEE MARINE TERMINAL 1101 Cherokee Marine See the cases cited supra, part II,G,l,d,(2), see also NLRB v. Clark, 468 F 2d 459, 463- 465 (5th Cir 1972), Honda of San Diego, 254 NLRB 1248, 1268 (1981) 49 Because OCAW's bargaining demand in late January 1985 imposed on Respondent the duty to bargain with OCAW with respect to the riverboat employees, and be- cause Respondent never discharged that duty, Respond- ent violated Section 8(a)(2) and (1) of the Act by recog- nizing Local 1 as that representative in September 1985 Paper Mfrs, supra, American Pacific Concrete Pipe Co, 262 NLRB 1223 (1982), enfd mem 709 F 2d 1514 (9th Cir 1983), Fairmont Foods Co, 245 NLRB 915, 923 (1979) Because Respondent never remedied its unlawful refusal to bargain with OCAW in January 1985, Re- spondent's subsequent recognition of and contract with Local 1 on 9 September 1985 were unlawful whether or not Local 1 Representative Craighead induced a majori- ty of the then riverboat employees to sign Local 1 au- thorization cards about 14 August and 5 September 1985 See Franks Bros. Co v NLRB, 321 US 702, 704-706 (1944), International Ladies' Garment Workers' (Bernhard- Altmann) v NLRB, 366 U S 731, 736 (1961), NLRB v. Pennsylvania Greyhound Lines, 303 U S 261, 267 (1938), Safeway Stores, supra Indeed, Cherokee's posthearing brief concedes (p 8, fin 4), "If it is found that Marine had a suc- cessor obligation to OCA W it is axiomatic that it could not recognize Local I with or without unlawful assistance " 4 Whether Respondent violated the Act by urging employees to sign membership and dues-checkoff cards for Local 1 Paragraph 17 of the complaint as amended on 5 Sep- tember 1985 alleges that Respondent violated Section 8(a)(2) and (1) of the Act, through Sweeney, by urging employees to sign membership and checkoff cards for Local 1 As the record contains no evidence to support this allegation, which is denied in the answers filed by Respondent and Local 1, that paragraph will be dis- missed. CONCLUSIONS OF LAW 1 Respondent Cherokee Marine Terminal, Division of Cherokee Equity Corporation, Inc is an employer en- gaged in commerce within the meaning of Section 2(2), (6), and (7) of the Act 2 OCAW and Local 1 are each labor organizations within the meaning of Section 2(5) of the Act 3 Respondent Cherokee Marine Terminal, Division of Cherokee Equity Corporation, Inc is a successor to T L Herbert & Sons, Inc (see supra fn. 3) 4 The following employees of Respondent Cherokee Marine Terminal, Division of Cherokee Equity Corpora- tion, Inc constitute a unit appropriate for collective-bar- gaining purposes within the meaning of Section 9(b) of the Act 49 The 22 December 1984 help-wanted advertisement also named "Cherokee Marine" at this same post office box address The record, however, fails to show whether OCAW knew about this advertisement at any material time All employees employed as regular crew mem- bers on tugboats , as regular crew members on harbor boats, excluding all office clerical employ- ees, salesmen , shipping and receiving clerks, watch- men, professional employees , assistant foremen, cap- tains, pilots, guards and supervisors as defined in the Act 5 At all material times, OCAW, by virtue of Section 9(a) of the Act, has been, and is, the exclusive represent- ative of the unit for the purposes of collective bargaining with respect to rates of pay, wages, hours of employ- ment, and other terms and conditions of employment 6 Since about 29 January 1985, Respondent Cherokee Marine Terminal, Division of Cherokee Equity Corpora- tion, Inc has violated Section 8(a)(5) and (1) of the Act by failing and refusing to bargain with OCAW as the ex- clusive collective bargaining representative of the unit 7 Since about 9 September 1985, Respondent Chero- kee Marine Terminal, Division of Cherokee Equity Cor- poration, Inc has violated Section 8(a)(1) and (2) of the Act by granting recognition to Local 1 as the exclusive bargaining representative of the unit 8 The unfair labor practices set forth in Conclusions of Law 6 and 7 affect commerce within the meaning of Section 2(6) and (7) of the Act 9 Respondent has not violated the Act by urging em- ployees to sign membership and dues-checkoff cards for Local 1. THE REMEDY Having found that Respondent Cherokee Marine Ter- minal, Division of Cherokee Equity Corporation, Inc. has violated the Act in certain respects, I shall recom- mend that such Respondent be required to cease and desist therefrom, and from like or related conduct, and to take certain affirmative action to 'effectuate the poli- cies of the Act Thus, Respondent will be required to bargain, on request, with OCAW as the exclusive repre- sentative of the riverboat employees In addition, Re- spondent will be required to withdraw and withhold rec- ognition from Local 1 with respect to that unit unless and until it is certified by the Board. Also, Respondent will be required to cease giving effect to any collective- bargaining agreements with Local 1 with respect to such employees Respondent's written 9 September 1985 agreement with Local 1 covering the riverboat employees does not refer to checkoff, but is styled as an "Amendment" to the 1983-1986 agreement, which requires Respondent to honor at least "voluntary" checkoff authorizations. Craighead testified on 24 September 1985 that he had ob- tained checkoff authorizations from an undisclosed number of riverboat employees, and had given copies to Respondent's bookkeeper, but that Respondent had not "yet" commenced deducting union dues The precise lan- guage of these authorizations is not shown by the record The General Counsel requests an order requiring Re- spondent to reimburse its riverboat employees for any Local I dues Respondent may have checked off since 24 1102 DECISIONS OF THE NATIONAL LABOR RELATIONS BOARD September 1985 50 The Supreme Court has held that the Board has no power to issue such an order where "no membership in the union was shown to be influenced or compelled by reason of any unfair labor practice " Car- penters Local 60 v NLRB, 365 U S 651, 655 (1961) Moreover, the Board issues such an order only upon an affirmative showing that employees were coerced into paying dues and joining a union Wintex Knitting Mills, 223 NLRB 1293 (1976), enf. denied 610 F 2d 430 (6th Cir 1979). The relevant collective-bargaining agreements in evidence contain no provisions which require employ- ees to become or remain union members in order to keep their jobs 51 Accordingly, the question presented in the instant case is whether such a showing of coercion is made out by the evidence that (1) before any of the em- ployees had signed these checkoff authorizations, Re- spondent had for 6 months or more been unlawfully re- fusing to bargain with the OCAW, and (2) some of the employees may have signed or may sign their checkoff authorizations after Respondent unlawfully recognized and contracted with Local I on 9 September 1985 In support of the request for a reimbursement order, counsel for the General Counsel cites Harbor Cartage, 269 NLRB 927 (1984), where a successor employer (1) unlawfully entered into a prehire contract with a union other than the one which had represented the predeces- sor's employees, and (2) thereafter unlawfully refused to recognize the latter union The Board ordered the reim- bursement of all dues checked off pursuant to the unlaw- ful contract, including dues checked off pursuant to au- thorizations signed before the employer's unlawful refus- al to bargain with the union which had represented the employees under the predecessor. On the other hand, the Board rejected a reimbursement remedy in Lowell Corru- gated Container Corp, 177 NLRB 169 (1969), enfd 431 F.2d 1196 (1st Cir. 1970), with respect to dues checked off for an independent union after the 7 March 1968 ex- piration of its union-shop agreement and the employer's lawful withdrawal of recognition from it, after the 3 April 1968 certification of another union, after the certi- fied union's bargaining demand on 24 April 1968, and after the employer's unlawful refusal to bargain with the certified union on I May 1968 The dues had been checked off pursuant to checkoff authorizations executed during the effective period, of the contract, and respec- tively renewed by their terms for 1 year upon each em- ployee's failure to request revocation during a specified 10-day escape period in March or April 1968 On the basis of the employees' failure to request revocation 50 Although no such order can be directed to Local I, which is not a Respondent herein, Respondent's 1983-1986 contract with Local l re- quires it "to save [Respondent] harmless from any action or actions growing out of these deductions and the validity of the checkoff cards or signatures thereon " Craighead testified that when he began to solicit the riverboat employees to sign authorization cards, he knew that a pending complaint "said that (Cherokee Marine] had bought out a company and they were obligated to the other union " Local I is named as a party to the instant proceeding, and was represented by counsel at the hearing before me Si As previously noted, the river boats sail between ports in Tennes- see, which forbids such agreements (Tenn Code Ann §§ 50-208 through 50-213), and Kentucky and Illinois, which do not Cf Chemical Workers v Mobil Oil Corp, 425 U S 407 (1976) during the escape period or at any time after the con- tract had expired, the Board found that "no element of coercion or restraint on the employees is discernible" (177 NLRB at 172-173) As to the riverboat employees who signed checkoff authorizations before Respondent recognized and con- tracted with Local 1 with respect to such employees, the instant case resembles Lowell Corrugated more closely than Harbor Cartage Although the Lowell "escape peri- ods" all ended before the employer unlawfully refused to bargain with the certified union, some of such escape pe- riods did not end until after the issuance of the certifica- tion, and in any event, the Board's opinion indicates that it would have ordered reimbursement to an employee who sought to revoke his authorization at any time after the contract had expired As to the riverboat employees who signed checkoff authorizations after Respondent had recognized and executed a contract with Local 1 on 9 September 1985 with respect to such employees, the in- stant case, however, resembles Harbor Cartage more closely than Lowell. It is true that in Harbor Cartage, unlike here, the employees were told during their hiring interviews that they were to become members of the union, party to the unlawful contract. This employer conduct was not in itself found to be an unfair labor practice, and the instant case is stronger than Harbor Cartage in that all of the checkoff authorizations for the unlawfully recognized union were signed after the em- ployer had unlawfully refused to bargain with the union entitled to recognition Accordingly, reimbursement will be required with respect to any moneys checked off after 24 September 1985 pursuant to checkoff authorizations signed for Local 1 on and after 9 September 1985. Such reimbursement shall include interest as prescribed in Florida Steel Corp, 231 NLRB 651 (1977); see generally Isis Plumbing Co, 138 NLRB 716 (1962) The record fails to show whether the checkoff authorizations for Local 1 by their terms are revocable at will, are auto- matically renewable, or terminate with the termination of Local l's bargaining agreement I need not and do not pass on the effect (if any) of an employee's attempt to revoke a checkoff authorization for Local 1 executed before 9 September 1985. In requiring reimbursement of moneys checked off pursuant to authorizations signed for Local 1 after Re- spondent had recognized and signed a contract with it, I note that permitting Respondent to continue honoring them would threaten unfair prejudice to the OCAW Re- spondent's unlawful September 1985 action to recogniz- ing Local 1, and in executing with it a contract which afforded the riverboat employees wage increases and other improvements, had the natural tendency to engen- der employee approval of and consequent checkoff au- thorizations for Local 1. The employees might well have developed similar receptivity to OCAW checkoff author- izations if Respondent had executed a contract with OCAW in consequence of complying with Respondent's statutory duty to recognize OCAW in late January The employees' willingness to authorize deductions for OCAW after Respondent has complied with the instant order to recognize and bargain with it would, however, CHEROKEE MARINE TERMINAL likely be diminished if they were already having Local 1 dues deducted from their wages. Accordingly, if such deductions continue, OCAW will be deprived of some of the benefits which it would receive under any contrac- tual checkoff clauses which it may procure in conse- quence of invoking Respondent's duty to bargain with OCAW about that subject. The brief of counsel for the General Counsel asks me to include in my recommended Order certain provisions which he describes, and which will be referred to herein, as a visitatorial clause The requested provision reads as follows: For the purpose of determining or securing compli- ance with this Order, the Board, or any of its duly authorized representatives, may obtain discovery from the Respondent, its officers, agents, successors or assigns, or any other person having knowledge concerning any compliance matter , in the manner provided by the Federal Rules of Civil Procedure Such discovery shall be conducted under the super- vision of the United States Court of Appeals enforc- ing this Order and may be had upon any matter rea- sonably related to compliance with this Order, as enforced by the Court.52 To the extent that the "visitorial" clause is directed to those persons identified in the Order (namely, the Re- spondent, its officers, agents, successors or assigns), the Board's power to include such a provision in its order seems clear . U. S. v Grinnell Corp., 384 U.S. 563, 579 (1966), "a relief commonly granted for the purpose of determining whether a defendant has complied with an antitrust decree . . [an] important and customary . . . provision"); U. S. v. Bausch & Lomb Co, 321 U.S. 707, 725-728 (1944); NLRB v. Steinerfilm, Inc., 702 F.2d 14, 15, 17 (1st Cir. 1983); Operating Engineers Local 138 (Nassau & Suffolk Contractors), 321 F.2d 130, 138 (2d Cir 1963), Turnbull Cone Baking Co., 271 NLRB 1320, 1360, (1984), enfd 121 LRRM 2025 (6th Cir. 1985); F. W. Woolworth Co., 90 NLRB 289, 294 (1950); Smyth Mfg. Co., 277 NLRB 680 (1985). Neither these cases, nor the others cited in the General Counsel's brief, address the Board's power to issue an order affording itself the right to obtain "discovery [from] any other person [not otherwise identified in the order or a party to the proceeding] having knowledge concerning any compliance matter." Rather, the General Counsel's brief relies on Rule 69 of the Federal Rules of Civil Procedure, which states, "In aid of the judgment or execution, the judgment creditor . may obtain discov- 52 On 23 September 1985, the first day of the hearing before me, Gen- eral Counsel Collyer issued, and released to the general public, a memo- randum instructing all Regional Directors to seek inclusion of this clause in all of the Board 's remedial orders Further , she directed that because such clauses had not been routinely sought in the past , the complaint should in all cases contain a separate prayer for the inclusion of such a clause in the Order The General Counsel's Memorandum 85-5 on Vist- torial Clauses, 120 LRR 137 So far as I am aware , not until briefs were simultaneously filed about 8 November 1985 did counsel for the General Counsel advise Respondent that such a clause was being sought Re- spondent, however , did not thereafter ask me to deny the request , either on the ground that Respondent did not have adequate advance notice thereof or for any other reason 1103 ery from any person, including the judgment debtor, in the manner provided in these rules . ." In interpret- ing this provision, the courts have held that the forego- ing language does afford a judgment creditor certain dis- covery rights against third parties, but that such rights are not unlimited. Thus, it has been held that a judgment creditor must make at least some showing of an alter ego relationship before Rule 69 empowers him to require re- sponses to interrogatories directed at alleged alter egos of the judgment debtor Strick Corp v. Thai Teak Prod- ucts Co., 493 F.Supp. 1210, 1217-1218 (E D Pa 1980) Rather similarly, when a third party was required to produce (pursuant to discovery proceedings) a settlement agreement with the judgment debtor, the judgment cred- itor had shown that the relationship between the third party and the judgment debtor (namely, their control by the same individual) raised reasonable doubts about whether the transfer of assets pursuant to the settlement agreement was bona fide or was intended to strip the judgment debtor of any assets which might satisfy the judgment Magnaleasing, Inc. v. Staten Island Mall, 76 F.R.D. 559, 561-562 (D C. N.Y 1977) See also Caisson Corp. v. County West Bldg. Corp., 62 F R D. 331, 334-335 (D.C Pa. 1974); Hartmann v. U.S., 79 F.R.D 705 (D C. Wis. 1978). However, substantially this kind of limitation is imposed by the language in the proposed visitatortal clause that such discovery "may be had upon any matter reasonably related to compliance with this Order." Ac- cordingly, I conclude that Rule 69 supports the Board's power to include in the visitatorial provision the forego- ing language with respect to third parties. See Regal Knitwear Co. v. NLRB, 324 U S. 9 (1944) In attempting to show that exercise of the Board's power to issue such an order would effectuate the poli- cies of the Act, counsel for the General Counsel alleges that in policing enforcement with court enforced Board orders, the Regional Offices are often unable to obtain sufficient cooperation from respondents to enable these offices to determine with certainty whether or not com- pliance is possible or has been achieved. By way of spe- cific example, the General Counsel asserts that respond- ents frequently fail to furnish documentation sufficient to enable the Regional Office to fully verify a claim that the respondents are unable to comply with orders requir- ing money payments; and that named respondents and nonparties to a Board proceeding often, by failing to co- operate with the Regional Office, prevent it from ascer- taining whether the nonparties are liable for noncompli- ance, in whole or in part, as alter egos, disguised con- tinuances, or successors (bona fide or otherwise). On the basis of these representations as to the agency's cumula- tive institutional experience, I find that the absence from previously issued Board orders of provisions which em- power the Regional Offices to compel the submission of certain kinds of information has with significant frequen- cy rendered the Regional Offices unable to make a fully informed judgment about whether Board orders have been complied with to the extent possible 53 53 Cf NLRB v Seven-Up Bottling Co, 344 US 344, 346-350 (1953), Isis Plumbing Co, 138 NLRB 716, 720 (1962), enf denied on other Continued 1104 DECISIONS OF THE NATIONAL LABOR RELATIONS BOARD As the General Counsel's brief rightly assumes (with- out quite saying so in terms), after the issuance of a Board order, effectuation of the statutory policy calls for initiating ancillary proceedings when, and only when, such proceedings are warranted by the facts The agen- cy's decision about whether to initiate such proceedings is, perhaps, most significant when the Board's order has been enforced by a court of appeals and the relief sought would be an adjudication in contempt on the basis of clear and convincing evidence; an erroneous decision not to proceed may permit a repetition of conduct that vio- lated both the Act and the court's judgment, whereas an erroneous decision to proceed not only will require all parties to lose time and expense in fruitless litigation, but also may cause the loss of tax money through payments made under statutes such as the Equal Access to Justice Act (28 U S.C 2412). As to such contempt or other an- cillary proceedings, the Regional Offices' ability to make an informed judgment about whether to initiate them would be substantially improved by the access specified in the proposed visitatorial clause. Further, I am per- suaded by the General Counsel's argument that a suffi- cient equivalent for the visitatorial clause is not provided by Section 11 of the National Labor Relations Act, which affords the Board power under certain circum- stances to issue subpoenas enforceable by the Federal District Courts. As the General Counsel points out, whether the Board's power under Section 11 routinely extends to a compliance stage inquiry about whether to institute contempt or other ancillary proceedings, it is more appropriate that any judicially supervised discov- ery be conducted under the aegis of the court of appeals, which has sole jurisdiction to conduct a proceeding to determine whether its own judgment has been complied with. Cf. NLRB v. Warren Co, 350 U S 107, 112 (1955). 54 Furthermore, and whether a Board order with- out a visitatorial clause would be regarded by the enforc- ing court of appeals as affording discovery powers to the grounds 322 F 2d 913 (9th Cir 1963), Philip Carey Mfg Co v NLRB, 331 F 2d 720, 729-731 (6th Cir 1964), cert denied 379 U S 888 (1964) The instant request for a visitatorial clause is not based on any special circum- stances in the instant case but, rather , is part of the General Counsel's effort to induce the Board to include such clauses in all remedial orders because of alleged recurring compliance problems in prior, unrelated cases and as a matter of uniform policy Where such is the basis for the requested relief, little significance attaches to the opinion of any individ- ual administrative law judge in any individual case about the frequency and seriousness of the problem allegedly addressed See Universal Camera C o r p v NLRB, 340 U S 474, 496-497 ( 1951) For procedural reasons, however, representations about agency experience must nonetheless be made to and disposed of by the administrative law judge in each case where such a clause is requested and before a definitive Board ruling about whether to include that clause as standard practice s4 As to a subpoena issued under Sec 11, whether that court of ap- peals played any role at all would depend on whether the District Court's judgment was appealed, and (even then) on whether the District Court's jurisdiction fell within the jurisdiction of the court of appeals that enforced the Board's order See Secs 10(e) and (f) and 11(2) of the Act, NLRB v General Electric Corp, 418 F 2d 736, 739 (2d Cir 1969), cert denied 397 U S 965 (1970), J P Stevens Co v NLRB, 388 F 2d 892 (4th Cir 1967), NLRB v B V D Co, 225 F 2d 923 (D C Cir 1955) More- over, as the General Counsel points out, the procedure called for by Sec 11, under which an appeal from the District Court's determination may be taken as a matter of right , may lead to a good deal of delay in obtain- ing information called for by a subpoena issued under that section Regional Office'55 the inclusion of such a clause would unequivocally afford such powers and subject them to the court of appeals' supervision Steinerfilm, supra, 702 F 2d at 15, 17 Finally, I agree with the General Counsel that the visi- tatorial clause does not work any undue hardship on either respondents or others who may be subjected to it Even as to those who are neither identified in the order (as respondent and his officers, agents, successors, and assigns) nor their alleged privies or abettors, the pro- posed visitatorial clause merely subjects them to the same discovery as does Rule 69, FRCP, after a District Court judgment has been entered Moreover, as to those who are so identified or are alleged to be their privies or abettors, the proposed visitatorial clause subjects them to the same discovery to which parties to civil litigation are subjected as a matter of course, and to which both the Board and a respondent are routinely exposed once con- tempt proceedings are initiated in the court of appeals. Because the very reason for the issuance of the order was to remedy the respondent's violation of the Act, it is fair to require him to provide through discovery any evi- dence he may have in support of a claim that compliance is impossible or has already been accomplished. Indeed, the proposed visitatorial clause may benefit a respondent, where evidence obtained by the agency under the dis- covery procedure was not in fact within the respondent's control and such evidence obviates further proceedings by persuading agency investigators that the respondent has complied with the order to the extent that he is able to do so For the foregoing reasons, I shall include in my rec- ommended Order a visitatorial provision substantially the same as that requested by the General Counsel, but with some minor changes to cover ancillary, noncontempt proceedings in the event that judicial enforcement of the Order is never sought Respondent will also be required to post appropriate notices. On these findings of fact and conclusions of law and on the entire record, I issue the following recommend- ed56 ORDER The Respondent, Cherokee Marine Terminal, Division of Cherokee Equity Corporation, Inc., Nashville, Ten- nessee, its officers, agents, successors, and assigns, shall 1 Cease and desist from (a) Failing and refusing to recognize and bargain col- lectively with Oil, Chemical and Atomic Workers Inter- national Union, Local 3-516, AFL-CIO, as the exclusive bargaining representative of the following unit: s6 Compare NLRB v Dixon, 189 F 2d 38, 39 (9th Cir 1951), with NLRB v Deena Artware, 251 F 2d 183 (6th Cir 1958) (then Circuit Judge Potter Stewart dissenting) 56 If no exceptions are filed as provided by Sec 102 46 of the Board's Rules and Regulations , the findings , conclusions, and recommended Order shall, as provided in Sec 102 48 of the Rules , be adopted by the Board and all objections to them shall be deemed waived for all pur- poses CHEROKEE MARINE TERMINAL 1105 All employees employed as regular crew mem- bers on tugboats , as regular crew members on harbor boats, excluding all office clerical employ- ees, salesmen , shipping and receiving clerks, watch- men, professional employees , assistant foremen, cap- tains, pilots, guards and supervisors as defined in the Act (b) Recognizing or contracting with Drivers, Ware- housemen, Maintenance and Allied Workers of America, Local Union No 1,- as the representative of any of Re- spondent's employees in the foregoing unit, unless and until Local 1 has been certified by the National Labor Relations Board as the exclusive bargaining representa- tive of such employees. (c) As to such employees, giving effect to Local l's collective-bargaining agreements executed in November 1983 and on 9 September 1985, or to any extension, re- newal, or modification of such agreements, provided, however, that nothing in this Order shall be construed as requiring Respondent to take any action unfavorable to any individual employee regarding wages, hours, and other substantive terms or conditions of employment, provided further that nothing in the first proviso shall limit the rights of OCAW with respect to actions taken unilaterally so far as OCAW is concerned. (d) In any like or related manner interfering with, re- straining, or coercing employees in the exercise of their rights under the Act 2 Take the following affirmative action necessary to effectuate the policies of the Act (a) On request, recognize and bargain collectively with OCAW as the exclusive representative of all employees in the aforesaid appropriate unit with respect to rates of pay, wages, hours, and other terms and conditions of em- ployment, and, if an understanding is reached, embody such understanding in a signed agreement. (b) Withdraw and withhold all recognition from Local 1 as the exclusive bargaining representative of its em- ployees in the aforesaid unit for the purpose of collective bargaining, unless and until Local 1 shall have been cer- tified by the Board as the exclusive representative of such employees (c) Reimburse its present and former employees in the bargaining unit described above for all moneys which may have been deducted from their pay on and after 24 September 1985, pursuant to checkoff authorizations for Local 1 executed on and after 9 September 1985, in the manner set forth in the the remedy section. (d) Preserve and, on request, make available to the Board or its agents for examination and copying, all pay- roll records, social security payment records, timecards, personnel records and reports, and all other records nec- essary to analyze the amount of backpay due under the terms of this Order (e) Post at its facilities in Nashville, Tennessee, copies of the attached notice marked "Appendix "57 Copies of 57 If this Order is enforced by a judgment of a United States court of appeals, the words in the notice reading "Posted by Order of the Nation- al Labor Relations Board" shall read "Posted Pursuant to a Judgment of the United States Court of Appeals Enforcing an Order of the National Labor Relations Board the notice, on forms provided by the Regional Director for Region 26, after being signed by the Respondent's authorized representative, shall be posted by the Re- spondent immediately upon receipt and maintained for 60 consecutive days in conspicuous places including . all places where notices to employees are customarily posted Reasonable steps shall be taken by the Respond- ent to ensure that the notices are not altered, defaced, or covered by any other material (f) Notify the Regional Director in writing within 20 days from the date of this Order, what steps have been taken to comply For the purpose of determining or se- curing compliance with this Order, the Board, or any of its authorized representatives, may obtain discovery from the Respondent, its officers, agents, successors or assigns, or any other person having knowledge concerning any compliance matter, in the manner provided by the Fed- eral Rules of Civil Procedure Such discovery may be had upon any matter reasonably related to compliance with this Order. If this Order is enforced in whole or in part by a United States court of appeals, the discovery called for by this Order shall be conducted under the su- pervision of that court Paragraph 17 of the complaint as amended on 5 Sep- tember 1985 is hereby dismissed APPENDIX NOTICE To EMPLOYEES POSTED BY ORDER OF THE NATIONAL LABOR RELATIONS BOARD An Agency of the United States Government The National Labor Relations Board has found that we violated the National Labor Relations Act and has or- dered us to post and abide by this notice WE WILL NOT refuse to recognize and bargain collec- tively with Oil, Chemical and Atomic Workers Interna- tional Union, Local 3-516, AFL-CIO, as the exclusive bargaining representative of the following unit- All'employees employed as regular crew mem- bers on tugboats, as regular crew members on harbor boats, excluding all office clerical employ- ees, salesmen , shipping and receiving clerks, watch- men, professional employees, assistant foremen, cap- tains, pilots, guards and supervisors as defined in the Act. WE WILL NOT recognize or contract with Drivers, Warehousemen, Maintenance and Allied Workers of America, Local Union No 1, as the representative of any of our employees in the foregoing unit, unless and until Local 1 has been certified by the National Labor Relations Board as the exclusive bargaining representa- tive of such employees As to such employees, WE WILL NOT give effect to Local l's collective-bargaining agreements executed in November 1983 and on 9 September 1985, or to any ex- tension, renewal or modification of such agreements We are not required to take any action unfavorable to any individual employee regarding wages, hours, and other 1106 DECISIONS OF THE NATIONAL LABOR RELATIONS BOARD substantive terms or conditions of employment, but the absence of such a requirement does not limit the rights of OCAW with respect to actions which we have taken unilaterally so far as OCAW is concerned. WE WILL NOT in any like or related manner interfere with, restrain, or coerce employees in the exercise of their rights under the Act WE WILL, on request, recognize and bargain collec- tively with OCAW as the exclusive representative of all employees in the foregoing unit with respect to rates of pay, wages, hours, and other terms and conditions of em- ployment, and, if an understanding is reached, embody such understanding in a signed agreement. WE WILL withdraw and withhold all recognition from Local 1 as the exclusive bargaining representative of our employees in the foregoing unit for the purposes of col- lective bargaining, unless and until Local I is certified by the Board as the exclusive representative of such em- ployees WE WILL reimburse, with interest, our present and former employees in the foregoing unit for all monies which may have been deducted from their pay on and after 24 September 1985, pursuant to checkoff authoriza- tions for Local 1 executed on and after 9 September 1985 CHEROKEE MARINE TERMINAL, DIVISION OF CHEROKEE EQUITY CORPORATION, INC