# General Steel Products, Inc. And Crown Flex of North Carolina, Inc. v. National Labor Relations Board > Court of Appeals for the Fourth Circuit · July 14, 1971 · 445 F.2d 1350 URL: https://www.frixlaw.com/law-library/cases/9457139 ## Case - **Full name:** GENERAL STEEL PRODUCTS, INC. and Crown Flex of North Carolina, Inc., Petitioners, v. NATIONAL LABOR RELATIONS BOARD, Respondent - **Court:** Court of Appeals for the Fourth Circuit - **Decided:** July 14, 1971 - **Citations:** 445 F.2d 1350 - **Precedential status:** Published - **Opinion:** Dissent by Winter - **Judges:** Thomsen, Haynsworth, Winter, Thom-Sen - **Cited by:** 12 later opinions in the Frix Law Library ## Citator (automated) - No negative treatment found by the automated citator. That is not the same as a confirmation that the case is good law; read the citing cases. - Full citator and citing cases: https://www.frixlaw.com/law-library/cases/9457139 ## Opinion text WINTER, Circuit Judge (dissenting): The majority opinion requires the Board to reopen the record in this case and to receive additional evidence of events occurring both before and after the 1965 hearings and then to make new findings and reconsider its decision. I think the Board’s order should be enforced on the present record. The question of reopening arose in this way: When we remanded after Gissel, General Steel moved that a hearing to receive further evidence be held. The Board invited the parties (General Steel, the union and General Counsel) to file statements of position with respect to the issues on remand. General Steel responded, inter alia, by asserting (a) that the Board had not at the previous hearing received evidence pertinent to the issues created under Gissel, and (b) that, in any event, there had been a change of ownership of General Steel (precisely when it is not alleged), that the new owners were accustomed to dealing with organized labor and had no hostility to the union involved in the case, that there had been a turnover among supervisors so that certain supervisors who had previously committed unfair labor practices were no longer employed or had been demoted to nonsupervisory status, that the former president of General Steel, who was connected with most of the unfair labor practices, had sold his interest in General Steel and left its employ, that there had been such a turnover of employees that only 25 out of 207 of the original members of the bargaining unit were still employed, and that the new employees had not been exposed to unfair labor practices or had an opportunity to express their desires as to representation. It was alleged, as a conclusion therefrom, that there was nothing to prevent the conduct of a fair and proper re-run election. Since the majority requires General Steel’s motion to reopen to be granted in its entirety, and thus requires the consideration of additional evidence of events before the 1965 hearing, as well as after, a statement of my views requires that I consider each period of time separately. — I — With regard to evidence of events prior to the initial hearing, General Steel’s motion and statement of position was eloquently silent as to what evidence, available but not adduced at the hearing, had gained new relevance because of the decision in Gissel, or how the cross-examination of any particular witness would have been conducted differently if the rules established in Gissel had been in effect. The Board declined to reopen the record and to conduct a further hearing. In its supplemental decision, it recited, however, that General Steel had moved to reopen the proceedings, and it (the Board) had considered General Steel’s statement of position, together with the entire record, in concluding to order bargaining. I do not question that the Board has a duty to reopen the record and receive additional evidence on remand when an intervening decision of a court renders relevant that which was known before but not then adduced because not relevant under the then rules of law. But I would not fault the Board’s action in this case. The Board’s rules, 29 C.F.R. § 102.48 (d) (1), are specific that “[a] motion to reopen the record shall state briefly the additional evidence sought to be adduced, why it was not presented previously, and that, if adduced and credited, it would require a different result.” To me, this is a reasonable regulation. It regulates practice before the Board in substantially the same mariner *1359 that. Congress has regulated practice before us. Section 10 of the Act, 29 U.S. C.A. § 160(e), provides that an application to us for leave to adduce additional evidence “shall show to the satisfaction of the court that such additional evidence is material and that there were reasonable grounds for the failure to adduce such evidence in the hearing before the Board * * We would not entertain such a motion if the proffered evidence were not described with reasonable particularity, for the obvious reason that materiality could not be determined in a vacuum. No more, it seems to me, should the Board be required to reopen a record to receive the unknown. The Board’s burden of adjudication, like our own, is too great to require it to hold hearings which are not likely to be productive. In essence, the Board’s rules require a showing of materiality as a condition precedent to reopening. General Steel failed to carry that burden. It advanced an indisputable reason why the undisclosed evidence had not been previously offered, but it failed to describe the evidence with enough particularity to enable the Board to determine its relevance or probative value. It is no answer, as the majority argues, that the Board did not specifically rest this part of its refusal to reopen on this ground. The Board did not assign any different, inconsistent reason, and I do not think that we are restricted by the form in which the Board articulated (or, in this case, failed to articulate) its result from dealing with the merits of the motion. — II — Next is the issue of events occurring after the initial hearing. The general rule is well established that, in cases involving an employer’s failure to bargain in good faith, a bargaining order must be enforced even if by the time the Board issued its order the union had lost its majority. NLRB v. Katz, 369 U.S. 736 , 738 n. 16, 82 S.Ct. 1107 , 8 L.Ed.2d 230 (1962); NLRB v. Mexia Textile Mills, Inc., 339 U.S. 563 , 70 S.Ct. 826, 833 , 94 L.Ed. 1067 (1950); Franks Bros. Co. v. NLRB, 321 U.S. 702 , 64 S.Ct. 817 , 88 L.Ed. 1020 (1944); NLRB v. P. Lorillard Co., 314 U.S. 512 , 62 S.Ct. 397 , 86 L.Ed. 380 (1942) (per curiam). Under the general rule it would follow that events after a Board’s final decision and order (except voluntary full compliance with the order) would be immaterial to the validity of the order and to the correctness of its enforcement. Since such evidence would be immaterial, reopening would not be required. Gissel cited the authorities establishing the general rule and quoted the Franks Court’s statement that it wished to prevent employers from profiting from their own wrongful refusals to bargain. 395 U.S. at 610-611, 89 S.Ct. 1918 , 23 L.Ed.2d 547 . Even if Gissel is not considered to support the broad proposition that evidence of post-hearing events is immaterial to enforcement, it at least establishes the narrower proposition that evidence of post-hearing events, which were either under the employer’s control or which may have resulted from his wrongdoing, are not proper grounds for nonenforcement of a bargaining order. As to such events, Gissel would not require reopening. When I apply the rationale of these cases to the proffered evidence of changed circumstances, I conclude that we should not require reopening. These authorities and their reasoning persuasively rule out the evidence of employee turnover, and the resulting diminution of union strength. There remain only the turnover or demotion of supervisory personnel who committed the unfair labor practices and the sale of the company to owners having an attitude of greater realism in the field of labor relations. I would consider the dismissal or demotion of supervisory personnel immaterial, because it is always within the power of an employer to fire the supervisors who have done the dirty work. If this evidence must be considered, employers could hope to commit unfair labor prac *1360 tices and then frustrate the Board’s petition to enforce a bargaining order by a hasty housecleaning, to the detriment of both finality of proceedings and the deterrent effect of Gissel. A rule should not be established to provide this incentive; nor where, as here, the employer alleges “turnover,” should a rule be established which would require a separate determination with regard to each departed employee whether or not he left voluntarily or was discharged. A sale of the business presents like considerations and should receive like treatment. Nevertheless, the majority relies on NLRB v. American Cable Systems, Inc., 427 F.2d 446 (5 Cir. 1970), cert. den., 400 U.S. 957 , 91 S.Ct. 356 , 27 L.Ed.2d 266 (1971), in holding that in a Gissel case, i. e., one remanded or reconsidered by the Board after Gissel, a different rule is to be followed. Additional support for the majority’s view is found in NLRB v. General Stencils, Inc., 438 F.2d 894 (2 Cir. 1971); and G.P.D., Inc. v. NLRB, 430 F.2d 963 (6 Cir. 1970) (dissenting opinion, McCree, J.). There are, however, conflicting authorities. In NLRB v. L. B. Foster Company, 418 F.2d 1 (9 Cir. 1969), cert. den., 397 U.S. 990 , 90 S.Ct. 1124 , 25 L.Ed.2d 398 (1970), the court enforced a pre-Gissel bargaining order which it found to be supportable under the new Gissel standards without remand, stating: Emphasis is given to the rapid turnover in the employer’s personnel as a reason for not enforcing the order. But we think that this is a reason to enforce. Otherwise there will be an added inducement to the employer to indulge in unfair practices in order to defeat the union in an election. He will have as an ally, in addition to the attrition of union support inevitably springing from delay in accomplishing results, the fact that turnover itself will help him, so that the longer he can hold out the better his chances of victory will be. 418 F.2d at 5 . The court went on to point out that it is very difficult for a union to prevent attrition when it is not recognized and able to bargain, as is the case during litigation over the bargaining order. The same result was reached in G.P.D., Inc. v. NLRB, 430 F.2d 963 (6 Cir. 1970); NLRB v. Lou De Young’s Market Basket, Inc., 430 F.2d 912 (6 Cir. 1970); NLRB v. Kostel Corp., 440 F.2d 347 (7 Cir., 1971); and Gibson Products Company, No. 15-CA-3244 (NLRB, September 6, 1970). The majority and the authorities which support it proceed on the argument that since Gissel recognized the election route as the preferred means to determine majority employee sentiment, the Court is permitted to direct the Board to determine if laboratory conditions for a new election exist now, rather than as of the date the bargaining order would have been effective had the employer not pressed the litigation. I do not think that Gissel so holds. Of course, it is true that Gissel recognizes an election as the preferred device for determining representation in industrial democracy. But Gissel also recognizes that some employers by their wrongdoing destroy to varying degrees the effectiveness of an election as a means to reflect uninhibited employee desires, so that a bargaining order is justified before an election, or notwithstanding an election in which the union lost. The majority stresses Gissel’s first holding, but it ignores or slights the latter. The statements of the Court in Gissel, in arriving at these holdings, are perceptively analyzed by the Board in Gibson Products Company, supra, in which, to me convincingly, the Board concluded that “in determining whether the employer’s unfair labor practices are of such a nature as to preclude a fair election and thus necessitate a bargaining order based on a past card showing of majority status, the situation must be appraised as of the time of the commission of the unfair labor practices, and not currently. For, in virtually every case, by the time a Board decision is reached, there is likely to be sufficient employee turnover and other changes to make it arguable, where the employer *1361 has meanwhile refrained from committing new unfair labor practices, that an election held now would be free of the taint of the old unfair labor practices.” Succinctly stated, the Supreme Court’s indications in Gissel that that is the proper rule are its recognition and reaf-firmance (1) of the general rule that a bargaining order may issue when it is shown that a union once had a card majority, but had lost it by the time the bargaining order was entered ( 395 U.S. at 610 , 89 S.Ct. 1918 , 23 L.Ed.2d 547 ), (2) that an employer should not be permitted to profit from his own past misconduct or be given an opportunity to disrupt a future election so as to delay his bargaining obligation indefinitely ( 395 U.S. at 610-611 , 89 S.Ct. 1918 ), (3) that employees may petition for a new election if, after a bargaining order has redressed an employer’s past misconduct, they desire to disavow the union ( 395 U.S. at 613 , 89 S.Ct. 1918 ), and (4) that in Sinclair, one of the four cases considered in Gissel, the Court affirmed issuance of a bargaining order solely on the employer’s past § 8(a) (1) violations without requiring a reexamination of the current election climate, and in the other three suggested that the “requisite findings were implicit in the Board’s decisions below to issue bargaining orders,” remanding these cases for proper findings ( 395 U.S. at 615-616 , 89 S.Ct. at 1941 ). I cannot think that the Court would have suggested that the requisite findings were “implicit” in what the Board had already found if it had any notion that the Board was required to reopen the record. In the most recent expression on the subject, NLRB v. Kostel Corp., supra, the Seventh Circuit, cognizant of the conflict between the Fifth Circuit’s decision in American Cable and the Ninth Circuit’s decision in Foster, elected to follow Foster. It did so because the delay between unfair labor practices and remedial order in which subsequent events may occur is the “unfortunate but inevitable result of the procedure . . . prescribed in the Act;” and “[i]f any party should be penalized for the delay, it should be the employer, since his misconduct occasioned the proceeding. To hold otherwise would permit an employer to escape his duty to bargain with the employees’ representative by continuing his unlawful practices or by engaging in protracted litigation.” 440 F.2d at 353 . The Seventh Circuit also pointed out that, if the effect of its enforcement of a bargaining order would be to require the employer to bargain with a union no longer representing a majority of the employees, the present employees, after a reasonable period, might petition for a new election. Kostel, Foster, G.P.D., De Young’s and Gibson are the authorities which persuade me and which I would follow. — Ill — Under my view of how this case should be decided, I am brought to . the question of whether in the record made at the original hearing there was substantial evidence to support the Board’s findings that General Steel's “campaign to defeat the Union’s organizational efforts consisted of serious and extensive acts of interference, restraint, and coercion,” that these unfair labor practices “were so flagrant and coercive in nature as to require * * * a bargaining order to repair their effect,” and that “it is unlikely that the lingering effects of the * * * unlawful conduct would be neutralized by resort to conventional remedies which would have produced a fair rerun election.” From the findings the Board concluded that “employee sentiment * * * as expressed through the authorization cards is a more reliable measure of the employees’ desires * *• * and that the policies of the Act would be better effectuated by a bargaining order * * I think these findings are supported by this record and the conclusions justified. To me, there is no warrant for the majority to seize upon the “litany” characterization of Judge Goldberg in American Cable or to charge the Board with “apparent unwillingness * * * to *1362 consider seriously the new questions raised by Gissel * * Of course, if the Board were required to consider evidence of subsequent events, the Board’s order would be defective for failure so to do; but under my view of what is the proper record for the Board to consider, the Board’s previous findings of the nature and extent of the unfair labor practices fully support the Board’s conclusion that this is a Gissel “second category” case. I beg to remind the majority that our previous attempt to characterize the unfair labor practices as “not so pervasive that available remedies were not reasonably calculated to assure a free exercise of the employees’ choice by secret ballot rather than by resort to a count of questionable cards.” (398 F.2d at 340, n. 3), was said by the Supreme Court in Gissel to be “clearly inappropriate.” 395 U.S. at 616 , 89 S.Ct. 1918 . More importantly, the Supreme Court suggested that the findings required by Gissel to sustain a bargaining order “were implicit in the Board’s decisions * * * to issue bargaining orders * * * ” 395 U.S. at 616 , 89 S.Ct. at 1941 . As found in the earlier proceedings, there were 207 employees in the bargaining unit. Of these 122 had validly designated the union as their collective-bargaining representative. Beginning with the union’s initial efforts to organize and continuing through its rejection of the union’s request to bargain and up to the eve of election, General Steel embarked upon a course of action which resulted in numerous violations of § 8(a) (1). Employees were coercively interrogated about their union activity; racial discrimination was threatened if the union prevailed; discharge of employees was threatened if they voted for a union or joined in a strike; and employees were told that the employer would not bargain in good faith even if the union were certified. These unlawful acts were committed by General Steel’s top executive officer as well as supervisory personnel who specifically (and undoubtedly correctly) represented that they were carrying out General Steel’s policy. Notwithstanding these substantial interferences, in the election 83 ballots were cast for the union, 94 against, and 13 were challenged. When we heard the first appeal in this case, General Steel’s counsel conceded that the findings of violations of § 8(a) (1) were supported by substantial evidence although he argued that they were minimal in nature. It is perhaps significant that in this appeal, General Steel advances no alternative argument in its brief that, if the Board’s order was not invalid because the Board refused to reopen the record, the present record would not support a bargaining order under Gissel, assuming that the Board made findings with the specificity which General Steel contends is required. In any event, I do not decide the case on implied concessions. I am satisfied that the record as a whole contains substantial evidence to support the Board’s specific findings of fact and that the Board, employing its expertise, could properly conclude that a bargaining order, rather than a new election, was a proper order. I would enforce the Board’s order. --- Source: Frix Law Library, https://www.frixlaw.com/law-library/cases/9457139. Public record. Not legal advice.