U-Haul Co. of Nevada, Inc. v. National Labor Relations Board

United States Court of Appeals

FOR THE DISTRICT OF COLUMBIA CIRCUIT

Argued December 4, 2006 Decided June 22, 2007

No. 05-1464

U-HAUL COMPANY OF NEVADA, INC.,

PETITIONER

v.

NATIONAL LABOR RELATIONS BOARD,

RESPONDENT

INTERNATIONAL ASSOCIATION OF MACHINISTS AND

AEROSPACE WORKERS, LOCAL LODGE 845,

INTERVENOR

Consolidated with

06-1195

On Petition for Review and

Cross-Application for Enforcement

of an Order of the National Labor Relations Board

George D. Adams argued the cause for petitioner. With him

on the briefs were Richard S. Cleary and William C. Vail, Jr.

David A. Fleischer, Senior Attorney, National Labor

Relations Board, argued the cause for respondent. With him on

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the brief were Ronald E. Meisburg, General Counsel, John H.

Ferguson, Associate General Counsel, Aileen A. Armstrong,

Deputy Associate General Counsel, and Meredith Jason,

Attorney.

David A. Rosenfeld was on the brief for intervenor

International Association of Machinists and Aerospace Workers,

Local Lodge 845.

Before: GINSBURG, Chief Judge, and HENDERSON and

GARLAND, Circuit Judges.

Opinion for the Court filed by Chief Judge GINSBURG.

GINSBURG, Chief Judge: U-Haul Company of Nevada, Inc.

petitions for review of a Decision and Order of the National

Labor Relations Board directing the Company to recognize and

bargain with the International Association of Machinists and

Aerospace Workers Local Lodge 845, AFL-CIO. U-Haul

claims (1) the General Counsel of the Board abused his

discretion in refusing to consolidate this case with another case

involving the same parties and, (2) because the Union upset the

“laboratory conditions” necessary for a valid representation

election, U-Haul’s refusal to bargain with the Union did not

violate the National Labor Relations Act. The Board has cross-

applied for enforcement of its Order and the Union has

intervened in support of the Board. We uphold the Board’s

Decision and Order in all respects.

I. Background

In March 2003 the Union petitioned for a representation

election at U-Haul’s repair facilities in Henderson and Las

Vegas, Nevada. When the election was held that May, 77

ballots were cast, 47 for the Union, 25 against the Union, and 5

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that were challenged.

U-Haul filed objections to the election, arguing that the

Union had:

• Promised to waive the initiation fees for employees

who joined the Union before the election;

• Misrepresented the extent of its support among

employees by forging signatures on a petition and

making “last minute representations” to employees in

the form of a document erroneously “guaranteeing” the

Company could not lawfully close or threaten to close

the shop if the Union won the election;

• Created the appearance that the Board favored the

Union when an active Union supporter greeted the

Board’s agent overseeing the election like a long-lost

friend; and

• Engaged in unlawful electioneering when the Union’s

election observer smiled at and made “thumbs-up”

gestures to voters in the polling place, and when Union

officials conversed with six or seven voters in a

parking lot near the polling place immediately before

they went in to vote.

The Company also objects that, even if no one of the foregoing

activities was sufficient to upset the laboratory conditions

necessary for a valid election, in the aggregate they surely were.

See Gen. Shoe Corp., 77 NLRB 124, 127 (1948) (holding

representation elections should be held in “laboratory ...

conditions as nearly ideal as possible, to determine the

uninhibited desires of the employees”), enf’d, 192 F.2d 504 (6th

Cir. 1951).

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A hearing officer, after taking testimony, recommended that

the Board overrule U-Haul’s objections and certify the Union as

the exclusive bargaining representative of the employees. U-

Haul filed exceptions with the Board, which rejected them,

adopted the findings and recommendations of the hearing

officer, and certified the Union.

When U-Haul thereafter refused to bargain, the Union filed

an unfair labor practice charge alleging the Company had

violated Sections 8(a)(1) and (5) of the Act, 29 U.S.C.

§ 158(a)(1), (5). The General Counsel filed a complaint, which

U-Haul answered with the argument that it had no obligation to

bargain because the election was invalid. The General Counsel

moved for summary judgment, which U-Haul opposed on the

grounds that the hearing officer was biased and this case should

have been consolidated with another proceeding involving the

Union, the Company, and its parent, U-Haul International, Inc.

The Board concluded the hearing officer was not biased and

the General Counsel had not abused his discretion because the

other proceeding against U-Haul involved separate and distinct

violations. Accordingly, the Board held the Company had

“engaged in unfair labor practices ... within the meaning of

Section[s] 8(a)(5) and (1)” and ordered U-Haul to cease and

desist from refusing to bargain and to bargain with the Union

upon request.

II. Analysis

In its petition for review, U-Haul renews its arguments that

(1) the General Counsel abused his discretion by failing to

consolidate this proceeding with the other unfair labor practice

case against the Company, (2) the Company did not unlawfully

refuse to bargain because the election was invalid for each of the

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reasons epitomized above, and (3) the hearing officer was biased

to the point of depriving U-Haul of due process.

We review the Board’s Decision and Order for abuse of

discretion. See Canadian Am. Oil Co. v. NLRB, 82 F.3d 469,

473 (D.C. Cir. 1996). “On questions regarding representation,

we accord the Board an especially wide degree of discretion.”

Id. (internal quotation marks and citation omitted). We review

the Board’s factual findings for substantial evidence. See

Allegheny Ludlum Corp. v. NLRB, 104 F.3d 1354, 1358 (D.C.

Cir. 1997). We will set aside a representation election only if

the petitioning party “demonstrate[s] that the conduct

complained of interfered with the employees’ exercise of free

choice to such an extent that it materially affected the election.”

C.J. Krehbiel Co. v. NLRB, 844 F.2d 880, 882 (D.C. Cir. 1988).

A. Consolidation

U-Haul argues in limine that the Board should have

dismissed the complaint with which the General Counsel

initiated this case because he abused his discretion by

“arbitrarily fail[ing] to consolidate contemporaneous charges”

against the Company. The Board rejected that argument on the

ground that under Service Employees, Local 87 (Cresleigh

Mgmt.), 324 NLRB 774 (1997), consolidation is required only

in “situations where the General Counsel is attempting to twice

litigate the same act or conduct as a violation of different

sections of the Act, or to relitigate the same charge in different

cases.” The charges at issue in the two cases against U-Haul are

distinct: The instant case involves U-Haul’s technical refusal to

bargain after the Union was certified as the bargaining

representative of the employees, which the Company claims was

justified by misconduct on the part of the Union. The other

proceeding, in contrast, involves various alleged pre-election

unfair labor practices on the part of U-Haul, for which the

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General Counsel is seeking a remedial bargaining order pursuant

to NLRB v. Gissel Packing Co., 395 U.S. 575 (1969), on the

ground that the Company irremediably destroyed the possibility

of holding a valid second election. In addition, the Board

pointed out that consolidation would unnecessarily delay

disposition of the post-election case, see Cresleigh Mgmt., 324

NLRB at 775, until the more complicated pre-election complaint

is resolved.

For the reasons given by the Board, we conclude the

General Counsel did not abuse his discretion in pursuing the

complaints against U-Haul in separate proceedings.

Accordingly, we turn to the merits of U-Haul’s arguments for

setting aside the election.

B. Waiver of the Union Initiation Fee

U-Haul’s burden is to show that Union misconduct

“interfered with the employees’ exercise of free choice to such

an extent that it materially affected the election,” C.J. Krehbiel

Co., 844 F.2d at 882. To that end, the Company argues first that

the Union’s promise to waive initiation fees for employees who

joined the Union prior to the election is “objectionable, as it

creates the false impression of employee support and a sense of

obligation to the Union,” see NLRB v. Savair Mfg. Co., 414 U.S.

270, 277-78 (1973).

This argument rests upon the faulty premise that the

Union’s offer was conditioned upon the employee joining the

Union prior to the election. The hearing officer specifically

found the Union offered, in writing and orally at meetings, to

waive the initiation fees for, as stated in a Union flyer, “all

employees who join ... in a newly organized shop,” not only for

those who joined before the election. This put the Union’s offer

squarely within the category deemed permissible in Savair, 414

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U.S. at 272 n.4; see Majestic Star Casino, LLC v. NLRB, 373

F.3d 1345, 1349 (D.C. Cir. 2004) (“Under judicial and Board

precedent, an offer to waive initiation fees in not impermissible

unless it is conditioned upon an employee’s demonstration of

support for the union”).

Substantial evidence supports the hearing officer’s finding

that the waiver of fees was not conditioned upon the employee’s

demonstrated support for the Union. Several employees

testified that one or another Union supporter told them the fee

waiver was conditioned upon support for the Union. The

hearing officer, however, found that none of the testimony

credibly supports that claim and, although there was testimony

suggesting that one employee, Don Collette, who was an

enthusiastic Union supporter, made such statements to two other

employees, the hearing officer found Collette’s denial more

credible than the conflicting testimony. The hearing officer

reasoned it was “inherently implausible” that Collette was

making statements to other employees that “contradicted the

plethora of documents that [the] Union was using during the

organizing campaign as well as what the Union officials stated

at meetings.”

A hearing officer’s “credibility determinations may not be

overturned [by the reviewing court] absent the most

extraordinary circumstances such as utter disregard for sworn

testimony or the acceptance of testimony which is on its fac[e]

incredible.” E.N. Bisso & Son, Inc. v. NLRB, 84 F.3d 1443,

1444-45 (D.C. Cir. 1996) (internal quotation marks and citation

omitted, alteration in original). No such showing has been made

here; the record supports the finding that the Union did not

condition waiver of the initiation fee upon an employee’s

supporting the Union before the election.

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C. Forged Signatures and Last Minute Representations

U-Haul next argues the Union’s distribution of a petition

supported by forged signatures and of a “‘Guarantee’ certificate

misrepresenting the Union’s powers, individual employees’

rights, and [U-Haul’s] management authority” were “calculated

to misinform the employees, and were cynically timed to ensure

that [U-Haul] would have no opportunity to respond.” The

“Guarantee” stated that, if the Union won the election, then “it

[would be] illegal for the company to close or threaten to close

the plant.”

The Board considered this objection pursuant to both its

longstanding precedent, Midland National Life Insurance Co.,

263 NLRB 127, 133 (1982), holding that misleading campaign

statements are cause to set aside an election only if a party has

used “forged documents which render the voters unable to

recognize the propaganda for what it is,” id. at 130 (internal

quotation mark and citation omitted), and the exception thereto

engrafted by the Sixth Circuit, which held that an election also

may be set aside “where no forgery can be proved, but where the

misrepresentation is so pervasive and the deception so artful that

employees will be unable to separate truth from untruth.” Van

Dorn Plastic Mach. Co. v. NLRB, 736 F.2d 343, 348 (1984).

The Board agreed with the hearing officer that the

misrepresentations alleged in this case did not meet either

standard and that the “Guarantee” — although “arguably ... an

erroneous reading of Board law” — would be seen and treated

by voters as “union propaganda.”

U-Haul challenges the Board’s decision upon the basis of

the Sixth Circuit’s five-factor test for whether

misrepresentations interfered with employees’ freedom of

choice, see NLRB v. St. Francis Healthcare Ctr., 212 F.3d 945,

963-64 (2000). The Board argues U-Haul may not raise this

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argument here because, although the Company did object on the

basis of Van Dorn, it did not argue the Board should apply the

five factors identified in St. Francis, see 29 U.S.C. § 160(e)

(“No objection that has not been urged before the Board ... shall

be considered by the court, unless the failure ... be excused

because of extraordinary circumstances”). U-Haul responds that

whereas § 160(e) bars a new “objection,” here the employer is

only adducing new support for an objection that it did make

before the Board.

We agree the argument is barred. St. Francis represents a

distinct alternative to the Board’s approach in Midland and adds

additional considerations to the Sixth Circuit’s own approach in

Van Dorn. See Majestic Star Casino, 373 F.3d at 1349

(Subsection 160(e) bars argument first raised in court that Board

should adopt factors explicated in St. Francis).

The Board concluded the alleged misrepresentations in the

form of the “Guarantee” and the forged signatures on the

Union’s petition did not change the employees’ understanding

of the petition or of the Guarantee as “union propaganda” to be

treated accordingly, and therefore they were not grounds for

setting aside the election. According to the Board, the few

allegedly forged signatures, which suggested more employees

supported the Union than may have been the case, would not

have prevented employees from recognizing that the Union was

circulating the petition to garner support for its cause. As for the

“Guarantee,” which “plainly emanated from the Union,” the

Board similarly concluded employees “would see the document

as union propaganda and treat it as such.”

The Board’s reasoning is consistent with the standard set in

Midland. We therefore hold the Board did not abuse its

discretion in concluding that the alleged Union

misrepresentations in this case did not compromise employees’

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freedom of choice.

D. Compromising Board Neutrality

U-Haul’s next argument is that when Don Collette, “a well

known Union advocate and organizer,” came into the polling

place to vote, his overfriendly greeting of the Board agent

supervising the election “suggested to the employees that the

Board was not neutral.” The Board responds: “The law is that

an election will be set aside,” as explained by this court, “if a

Board agent acts in a way to destroy confidence in the Board’s

election process, or [in a way that] could reasonably be

interpreted as impugning the election standards,” N. of Mkt.

Senior Servs., Inc. v. NLRB, 204 F.3d 1163, 1168 (D.C. Cir.

2000) (internal quotation marks and citation omitted, alteration

in original). In the cited case, the Board agent sent Union

officials into the employer’s facility to tell employees when to

vote, which “certainly may have given the impression that the

Board had ceded significant authority to the Union over the

conduct of the election.” Id. at 1169.

U-Haul does not adduce any precedent for the proposition

that a union adherent’s conduct can call the apparent neutrality

of the Board or its agent into doubt. Nor are the facts of this

case so compelling as to show the Board abused its discretion in

concluding that Collette’s glad-handing did not compromise the

Board’s appearance of neutrality.

E. Improper Electioneering

U-Haul argues that the Union’s election observer violated

the Board’s longstanding rule against “electioneering at or near

the polls,” Brinks, Inc., 331 NLRB 46 (2000), because he “made

a practice of smiling at voters and giving a ‘thumbs up’ as they

approached the table,” which some voters acknowledged “by

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pointing to their ‘Union Yes’ pins and smiling back.” In Brinks,

too, the union observer gave several voters a thumbs-up gesture

and the Board overturned the election.

Although we do not agree with the Board’s Decision insofar

as it said the Union observer’s gesture in this case “could not

reasonably be understood to convey any particular meaning” —

the gesture was obviously meant to encourage support for the

Union — the Board went on reasonably to distinguish Brinks on

the ground that in that case the union observer, who had been

instructed not to speak to employees, also “explicitly instructed”

several employees how to vote, see id. at 47. In this case there

is no suggestion the Union’s observer either told employees how

to vote or ignored any of the Board agent’s instructions. We

therefore conclude the Board did not abuse its discretion in

concluding the thumbs-up gestures by themselves were not a

ground upon which to overturn the election.

U-Haul next contends that conversations Union officials

had with six or seven voters in a nearby parking lot violated the

rule in Milchem, Inc., 170 NLRB 362 (1968), which prohibits

“prolonged conversations between representatives of any party

to the election and voters waiting to cast ballots,” id. at 362. U-

Haul also relies upon this court’s decision in Nathan Katz

Realty, LLC v. NLRB, 251 F.3d 981 (2001), in which we

summarized the law as follows: “[A] party engages in

objectionable conduct sufficient to set aside an election if one of

its agents is continually present in a place where employees have

to pass in order to vote.” Id. at 993.

Assuming the Union officials were, as U-Haul maintains

and the Board assumed for the sake of the argument, as little as

30 feet from the polling place, which was on the second floor of

U-Haul’s facility, nothing in the record suggests a Union agent

was “continually present in a place where employees ha[d] to

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pass in order to vote,” id. On the contrary, the Board noted in its

Decision that “[a]ll but a handful of eligible voters were already

inside the building when the voting period began and by the

time [the Union agent] arrived in the parking lot,” and the

subject “conversations did not take place in the polling area, the

waiting area, or near the line of voters.” The Board’s conclusion

that for these reasons the conversations “are not objectionable”

is consistent with Katz. Therefore, the Board did not abuse its

discretion in rejecting U-Haul’s objection to the Union’s electioneering.

F. Cumulative Impact

U-Haul’s last argument in this vein is that the Union

activities to which it objects, if insufficient individually to

invalidate the election, when aggregated are sufficient to do so.

The hearing officer, however, held that “even if ... taken

cumulatively, such conduct did not interfere with the laboratory

conditions of the election.” This is a defensible assessment. We

have explained before that where “most or all of the

[objectionable] incidents [are] in the least weighty categories,

the Board appropriately will decide not to overturn the election

results.” Amalgamated Clothing & Textile Workers Union v.

NLRB, 736 F.2d 1559, 1569 (D.C. Cir. 1984). In this case, none

of the claimed misconduct was weighty, and we can hardly say

it was an abuse of discretion for the Board to determine that a

few regrettable but insignificant incidents did not require

overturning an election the results of which were not close.

G. Hearing Officer Bias

Finally, U-Haul argues the hearing officer’s “bias toward

[U-Haul] at the objections hearing was palpable, and that bias

deprived [U-Haul] of due process.” As evidence of bias, U-Haul

points to the hearing officer’s: (1) refusal, over U-Haul’s

standing objection, to admit signature exemplars of witnesses

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who testified they had signed the Union petition; (2) statement

that allowing expert opinion regarding the inauthenticity of

disputed signatures was “against [her] better judgment”; (3)

discrediting two Union witnesses whose testimony arguably

supported U-Haul’s case; and (4) “questioning witnesses so as

to reshape their testimony” to U-Haul’s disadvantage.

This claim of bias has no merit. A meritorious claim may

be based either upon showing a bias or prejudice that “stem[s]

from an extrajudicial source and result[s] in an opinion on the

merits on some basis other than what the judge learned from his

participation in the case,” United States v. Grinnell Corp., 384

U.S. 563, 583 (1966), or, less commonly, upon showing a

“favorable or unfavorable predisposition ... so extreme as to

display clear inability to render fair judgment.” Liteky v. United

States, 510 U.S. 540, 551 (1994). U-Haul points to nothing of

the sort in the record of this case. On the contrary, U-Haul’s

specific complaints are but disagreements with some of the

hearing officer’s rulings. We therefore reject U-Haul’s claim

that it was denied due process.

III. Conclusion

We conclude the General Counsel did not abuse his

discretion by failing to consolidate this case with another case

then pending against U-Haul, and the hearing officer did not

deny U-Haul due process. On the merits, we reject each of U-

Haul’s arguments for setting aside the election. Therefore, U-

Haul’s petition for review of the Board’s Decision and Order is

denied, and the Board’s cross-application for enforcement is

granted.

So ordered.