# Opposition Brief — U. S. Marine Corp. v. National Labor Relations Board

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## Record

- **Collection:** Supreme Court brief
- **Document type:** Opposition Brief
- **Published:** January 1, 1992
- **Citation:** 503 U.S. 936

## Text

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No. 91-1006 _/ YAN 22

1992

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IN THE

Supreme Court of the United States

OCTOBER TERM, 1991

U. S. MARINE CORPORATION AND
BAYLINER MARINE CORPORATION,

. Petitioners,
NATIONAL LABOR RELATIONS BOARD AND
INTERNATIONAL UNION, ALLIED INDUSTRIAL WORKERS
OF AMERICA, AFL-CIO,

Respondents.

On Petition for a Writ of Certiorari to the
United States Court of Appeals
for the Seventh Circuit

RESPONDENT INTERNATIONAL UNION,
ALLIED INDUSTRIAL WORKERS OF AMERICA,
AFL-CIO, AND ITS AFFILIATED LOCAL LOCAL 879,
ALLIED INDUSTRIAL WORKERS OF AMERICA’S
BRIEF IN OPPOSITION

KENNETH R. LOEBEL
Counsel of Record

PREVIANT, GOLDBERG, UELMEN,
GRATZ, MILLER & BRUEGGEMAN, S.C.

1155 N. RiverCenter Dr.

Suite 202

P. O. Box 12993

Milwaukee, WI 53212

(414) 271-4500

Attorneys for Respondents
International Union, Allied
Industrial Workers of America,
AFL-CIO and its affiliated local,
Local 879, Allied Industrial Workers
of America

WILSON - Epes PRINTING Co.. Inc. - 789-0096 - WASHINGTON, D.C. 20001

® SS oo

LIST OF PARTIES

In addition to the International Union, Allied Indus-
trial Workers of America, AFL-CIO, which is listed in
the caption, Local 879, Allied Industrial Workers of
America, which is an affiliated local of the International
Union, Allied Industria] Workers of America, AFL-CIO,
was also a party to those proceedings had before the
Court of Appeals.

The International Union, Allied Industrial Workers of
America, AFL-C1O and its affiliated local, Local 879,
Allied Industrial Workers of America, will hereinafter
be referred to together as the “Union”.

TABLE OF CONTENTS

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TABLE OF AUTHORITIES ...0002002000....2cccceee eee ceeeeee ee

COUNTER STATEMENT OF THE CASE...................

REASONS FOR DENYING THE WRIT ......................

I.

Il.

AN EMPLOYER’S REFUSAL TO HIRE THE
EMPLOYEES EMPLOYED BY THE PREDE-
CESSOR AS PART OF A SCHEME TO
EVADE ACQUIRING A BARGAINING OB-
LIGATION UNDER BURNS IS UNLAWFUL
UNDER § 8(a) (3) OF THE ACT AND THE
COURT OF APPEALS DECISION HOLDING
THAT THERE WAS SUBSTANTIAL EVI-
DENCE ON THE RECORD TO SUPPORT
THE BOARD’S CONCLUSION WAS
dais acks cavivaasalicniiseicnsoiioesdetonscinpacer

THE BOARD’S RESTORATION OF THE
STATUS QUO ANTE REMEDY WAS NOT
INCONSISTENT WITH “BURNS”; WAS
NOT PUNITIVE; AND THE COURT OF
APPEALS’ DECISION ENFORCING THE
BOARD’S REMEDIAL ORDER APPLIED
THE PROPER STANDARD FOR REVIEW
AND WAS NOT IN CONFLICT WITH DECI-
SIONS OF OTHER CIRCUITS |...

Neen a rccusternerepnuwoensiovecetuseni

(iii)

Page

12

13

15

22

iv
TABLE OF AUTHORITIES

Cases Page
Ballou Birch Co. v. NLRB, 798 F.2d 339 (8th Cir.
BRED <eniesissseacsendinnsscestincadseadleaiaeipelaamiardnlaane nice iSite 15
Bigelow v. RKO Radio Pictures, 327 U. S. 261
2 | EE ne Renee TE Le ee Seema: ae 20
Birch Run Welding and Fabricating Inc. v. NLRB,
761 F.2d 1175 (8th Cir. 1985) —....202022220 ee. 15
Fall River Dying & Finishing Corp. v. NLRB, 482
SN I I cckicdeccarpssvadinntnscedieAccesndvcnnesiornnsiicens 16, 18

Fibreboard Corp. v. NLRB, 879 U.S. 203 (1964)... 17
Food Handlers v. Valmac, 528 F.2d 217 (8th Cir.

DARI Se oS ae ed ee 21
Franks Bros Co. v. NLRB, 482 U.S. 27 (1987)....... 16
Golden State Bottling Co. v. NLRB, 414 U.S. 168

BOAR A ANAS SONI ST i ia We ae eee 14
Halo-Krome Co. v. NLRB, —— F.2d ——, 138

sr 6 Eb. ) rel ocean eee eee 14
Howard Johnson Co. v. Hotei Empioyees, 417 U.S.

SRY IIE ict icine eccice-etocanindenobastibsnpetiaiatdbctntertaeanies 18, 17
Laborers Trust Fund v. Advanced Concrete, 484

Aa I dab ceaileet ni sabceniacabhoibeedesctibiss 13,17
Local 879 AIW, et al. v. Chrysler Marine Corp.,

et al., Civil Action 83-C-1983 _.....0002..00ooo ee... 3
Local 879, AIW v. Chrysler, 819 F.2d 786 (7th Cir.

| 5 RORGIRRCENC Eee SERN ae Pee Me Fes We ee ee 3
M.S.F. Industries Inc. v. NLRB, 568 F.2d 166

I Ce ig a 15
Majestic Molded Products Inc. v. NLRB, 330 F.2d

RN I Te UID aireccencinstidccicdecnictienietonsacecpetnnensuiens 15
NLRB v. Burns Int'l Security Services, 406 U.S.

Se VR a 13, 16, 17
NLRB v. C & C Plywood, 385 U.S. 421 (1967) .... 16
NLRB v. Katz, 36 U.S. 736 (1962) ..........0...0000000... 19
NLRB v. Transportation Management Corp., 462

es RG ERO RE Soe ey Ae Se 14

H. K. Porter Co. v. NLRB, 397 U.S. 99 (1970) .... 18
Riggs v. Palmer, 115 N.Y. 506, 511-512, 22 N.E.

I calls Fishes os cenaacacneaceciinmasamananentasaincs 20
Simon & Schuster, Inc. v. Members of New York

State Crime Victims Board, US. , 60

ie SS Fy Ls __ | cana enne omen 20

Vv

TABLE OF AUTHORITIES—Continued

Page
Spruce Up Corp., 209 NLRB 194 (1974), enfce’d,
529 F.2d 516 (4th Cir. 1975) -.....02002222 ee... 18
Story Parchment Co. v. Patterson Parchment.
Paper Co., 282 U.S. 555 (1981) -..........................- 20
Thorp Sales Corp. v. Gyuro Grading Co., 111
aE SI IIE so cseiicesonciccintteertnnsddccedtndiseniecnaninonteasss 20

Virginia Electric & P. Co. v. NLRB, 319 US. 533.. 18
Universal Camera Corp. v. NLRB, 340 U.S. 474

II os sicsibicihsitessiceditanniaceicandaacaasaaan cetera 14

Other Authorities
Section 8(a) (3) (5) and (1) 20.22.22... passim
I oi a aenuacaaiioniael passim
Paradigms Lost, John L. Casti..........0...0.............-------- 20

IN THE
Siyreme Court of the United States

OCTOBER TERM, 1991
No. 91-1006

U. S. MARINE CORPORATION AND
BAYLINER MARINE CORPORATION,

* Petitioners,
NATIONAL LABOR RELATIONS BOARD AND
INTERNATIONAL UNION, ALLIED INDUSTRIAL WORKERS
OF AMERICA, AFL-CIO,

Respondents.

On Petition for a Writ of Certiorari to the
United States Court of Appeals
for the Seventh Circuit

RESPONDENT INTERNATIONAL UNION,
ALLIED INDUSTRIAL WORKERS OF AMERICA,
AFL-CIO, AND ITS AFFILIATED LOCAL LOCAL 879,
ALLIED INDUSTRIAL WORKERS OF AMERICA’S
BRIEF IN OPPOSITION

The Respondent Union respectfully requests that this
Court deny the petition for a writ of certiorari filed on
behalf of U. S. Marine Corporation and Bayliner Marine
Corporation (hereinafter referred to together as “U. S.
Marine”)! to review the judgment of the Seventh Circuit

1U.§8. Marine in its Rule 29.1 Statement has pointed out that at
the present time Brunswick Corporation (“Brunswick’’) has ac-
quired all the shares of U. S. Marine and Bayliner Marine. It
should be noted that it was in the latter part of 1986 that Brunswick
had acquired all the shares of Bayliner and U. S. Marine from the
prior four common shareholders (App. 100a) and has exercised

2

reported at 944 F.2d 1305 (7th Cir. Sept. 25, 1991)
(en banc).

COUNTER STATEMENT OF THE CASE

The petition of U. S. Marine tends to overlook or omit
record evidence; how the National Labor Relations Board
(Board) had analyzed that evidence; and the standard
that was applied by the Court of Appeals in reviewing
the Board’s findings and conclusions relative to that rec-
ord evidence.

What the record discloses is that on October 19, 1983,
Orin Edson,’ the then Chairman of Bayliner, had written
Chrysler and asserted, “. .. Our entire goal is to purchase
an ongoing business ... Bayliner Marine Corporation or
its assignee, would agree to purchase all the assets of the
Chrysler Marine Corporation...” (GC 103).% (em-
phasis added)

On December 7, 1983, James W. Hoag, Bayliner’s Vice-
President for Administration and an attorney, reported
to Hartford, Wisconsin and on behalf of U. S. Marine
was responsible for the hiring of the employees to be
employed at the Hartford plant after the sales/purchase
agreement with Chrysler was consummated (ALJ at App.,
101la-102a).

On December 18, 1983 Hoag along with Chrysler rep-
resentatives, met with the Union’s representatives and

control over the plant located in Hartford, Wisconsin. In April
1991 it was announced by Brunswick that the decision to close the
Hartford, Wisconsin plant had been made and it is undisputed that
by no later than January 31, 1992 such plant will be totally closed
and the few employees left will also be let go.

2 Orin Edson was one of the only four shareholders who-owned
both Bayliner and U. S. Marine (App. 100a).

3 The Union will refer to references from U. S. Marine’s Petition

as (“Employer’s Pet. p. ———”); to the decision of the Administra-
tive Law Judge as (“ALJ at App. ——’’); to the decision of the
Board as (“Board at App. ——’’) ; to General Counsel's exhibits as

“GC ——”); and to employer exhibits as (Emp. Exh. ——’”’).

3

Hoag informed the Union’s representatives that Bayliner
did not intend to recognize the Union and that he was
not interested in having a union represent the employees,
and that he was too busy to deal with the Union at that
time (ALJ at App. 114a).

On December 28, 1983, Hoag provided Chrysler with
his sworn affidavit that Chrysler then presented to the
U. S. District Court for the Eastern District of Wisconsin
in the matter of Local 879 AIW, et al. v. Chrysler Marine
Corp., et al., Civil Action 83-C-1983 and wherein Hoag
swore “... That Bayliner... (d/b/a U. S. Marine) ...
expects to have a representative complement of employees
hired in early January of 1984... He [Hoag] further
believes that their [Chrysler employees] prior work expe-
rience will be advantageous in securing employment with
Bayliner as it should reflect the qualification it seeks .. .”
(GC Exh. 12).*

On January 13, 1984 Chrysler closed its doors (ALJ
at App. 100a). At the time Chrysler closed the Hartford
plant it had employed approximately 262 employees in the
bargaining unit represented by the Union (ALJ at App.
110a).

Hoag established the procedures that were to be fol-
lowed for the interviewing of those applicants who sought
to be employed by U. S. Marine at the Hartford plant
and it was Hoag that made the decisions as to who would
be hired and who would not be hired (ALJ at App. 112a).

On January 23, 1984 U. S. Marine commenced produc-
tion at the Hartford plant with 219 employees, all of

4The Union had obtained a “Boy’s Market” preliminary injunc-
tion pending the results of arbitration against Chrysler, but Chrys-
ler obtained a stay within days from the Court of Appeals (App.
5a). Also see Local 879, AIW v. Chrysler, 819 F.2d 786, 787 (7th
Cir. 1987). It wasn’t until after the Court of Appeals decision in
Chrysler in May 1987, over three years after U. S. Marine took
over, that the former Chrysler employees received the fruits from
the Union’s success in the arbitration against Chrysler.

4

whom had been former Chrysler employes. (ALJ at App.
112a-1138a).

On January 25, 1984 the Union requested U. S. Marine
to recognize it and to provide the Union with certain
information. When the Union received no response, it
filed the ULP charges in 30-CA-8206 on February 2,
1984. (ALJ at App. 114a-115a).

U. S. Marine continued to hire employees after the
Union filed the ULP charge but no further former Chrys-
ler employees were hired (ALJ at App. 113a). There
were 34 former Chrysler employees who had applied for
employment, all of whom had between 10 years and 31
years of service with Chrysler (Board at App. 68a n.4)
and who possessed the skills, abilities, and versatility and
other work related characteristics comparable to those 223
former Chrysler employees who had been hired. None of
the 34 former Chrysler employes not hired was ever given
any reason by Hoag or anyone else as to why he or she
had been rejected (ALJ at App. 127a and see Tr. 1298-
1300).

On February 8, 1984, U. S. Marine wrote to Region 30
of the NLRB in response to the Union’s ULP charge in
Case No. 30-CA-8206 and then claimed, “. . . that the
time to review the employment status to determine suc-
cessorship is when a representative complement has been
hired and not before .. .” (GC Exh. 66).°

On February 17, 1984 U. 8. Marine again wrote to
Region 30 of the NLRB and asserted, “. . . Based on
production forecasts prepared in January, Employer ex-
pects that 460 production and maintenance workers will
be employed in June 1984. This forecast was prepared
on the basis of information from Employer’s marketing
and manufacturing departments...

5In Hoag’s earlier sworn affidavit provided to the district court
in the Chrysler case Hoag had represented under oath “That Bay-
liner... (d/b/a U. S. Marine) ... expects to have a representative
complement of employees hired in early January of 1984...” (GC
Exh. 12).

5

“There are approximately 35 open applications from
former Chrysler employees. It is very unlikely when the
complement of 460 is reached a majority will have been
former Chrysler employees ... If the work force at the
appropriate time consists of a majority of former Chrys-
ler employees, then the question of successorship for rec-
ognition must be addressed .. .” (GC Exh. 43) (emphasis
added).

On February 28, 1984, the General Counsel of the
NLRB caused to be issued a complaint in 30-CA-8206
alleging that U. S. Marine was violating § 8(a) (5) and
(1) by failing to recognize the Union. On March 2, 1984,
U. S. Marine filed an answer denying that it had any
obligation to recognize the Union and to begin to bargain
collectively with the Union as the exclusive bargaining
representative of the employees.

On April 13, 1984, the Board petitioned the U. S. Dis-
trict Court for the Eastern District of Wisconsin for in-
terim relief as provided for under § 10(j) of the Act while
the proceedings were pending before the administrative
agency. Hoag in another affidavit dated April 27, 1984
(GC Exh. 43) and submitted to the district court in op-
position to the Board’s seeking interim relief under
$ 10(j), represented therein that U. S. Marine’s employ-
ment projections evidenced that there would be 460 em-
ployees employed in June 1984.

Hoag did not disclose to the Board or to the District
Court that U. S. Marine then had two employment pro-
jections in its possession prepared on February 15, 1984
and April 4, 1984 evidencing that the number of em-
ployees employed in June 1984 would not exceed 396 (GC
Exh. 35 and 38; also see App. 9a n.6).

The employment projection prepared by Hoag some-
time in January 1984 to show 460 was later found by the
ALJ to have been, “. . . false and designed to deceive the
Board and the Courts...” (ALJ at App. 133a) The
Board affirmed such finding (Board at App. 64a-65a).

6

On May 10, 1984 the district court granted the Board’s
petition under § 10(j) and caused to be issued an injunc-
tion enjoining U. S. Marine from refusing to recognize
the Union during the pendency of the administrative pro-
ceedings that were still to be had before the NLRB.

U. S. Marine did not take any appeal from the District
Court’s 10(j) injunction and pursuant to that injunction
U.S. Marine began to meet with the Union.*®

In response to the Union’s request to know what rea-
sons existed as to why U. S. Marine had not hired any of
the 34 former Chrysler employees while continuing to hire
other individuals Hoag informed the Union “that the hir-
ing was done by Bayliner managers and staff who were
totally unfamiliar with the history and personnel conflicts
of the former Chrysler organization.” (Emp. Exh. 24).’

Between January 23, 1984 and July 2, 1984, which is
the date the Union filed the unfair labor practice charge
alleging the 34 8(a)(8)’s, U. S. Marine had hired ap-
proximately 102 additional employees none of whom had
been formerly employed by Chrysler (GC Exh. 41g).

On October 1, 1984 the Union filed an additional unfair
labor practice charge wherein it alleged that U. S. Marine

® James Hoag was U. S. Marine’s principal representative in the
bargaining meetings that were had as a result of the issuance of
the § 10(j) injunction by the District Court. U. S. Marine did not
withdraw its answer to the General Counsel’s outstanding complaint
and it continued to deny that it was a successor to Chrysler.

In addition, U. S. Marine continued to hold Safety and Progress
Committee meetings whereby it continued to deal directly with the
employees and for which it was found in contempt (App. 10a).

7 Subsequently at the hearings had before the ALJ, Mr. Hoag
testified that in fact he had met with three former Chrysler execu-
tives and had each of these three individuals rate all the former
Chrysler employees on a scale of one to three. The ALJ found that
“Hoag then considered all this information and made the decisions
on those who would be hired, and those who would not, without
further consultation with the interviewers, the former Chrysler
officials, or anyone else .. .” (ALJ at App. 112a)

7

did not confer in good faith in an effort to reach any
agreement.

The NLRB’s General Counsel caused complaints to be
issued relative to each of the two additional unfair labor
practice charges the Union had filed in addition to the
complaint issued in the original charge. On September 16,
1985, the hearings before the ALJ were opened involving
all three complaints that had been issued and these hear-
ings consumed some nine (9) days and 1,887 pages of
transcript as well as over 150 total exhibits.

Notwithstanding that U. S. Marine’s principal repre-
sentative Mr. Hoag, an attorney, had earlier provided a
sworn affidavit to the District Court wherein he had iden-
tified that it was “... Bayliner... (d/b/a U. S. Marine)
[that] expects to have a representative complement of
employees hired...” (GC 12), U. S. Marine nonetheless
denied the allegation that Bayliner and U. S. Marine con-
stituted a single employer. U. S. Marine also persisted
in its denial that it had violated the Act by having failed
to recognize the Union when the Union had first requested
it to do so in January 1984 even though by September 16,
1985, U. S. Marine knew that the number of employees
employed by it at the Hartford plant had never reached
the 460 figure in June of 1984 that Hoag had falsely pro-
jected and that in fact the number of former Chrysler
employees employed by it had always constituted a ma-
jority of U. S. Marine’s work force (Board at App. 64a-
65a) .8

On August 22, 1986 the ALJ issued his decision and
found, amongst other things, “. . . that the manpower
figures computed by Hoag were false and designed to de-
ceive the Board and the Courts on a theory that full em-

SU. S. Marine also even denied that the bargaining unit was
appropriate and the ALJ later held, “. . . I find in these instances
that Respondents’ Answers are not based upon real issues of fact
or law, are frivolous and are designed to prolong and extend these
proceedings ...” (ALJ at App. 125a n.26).

8

ployment at the 460 level would not be attained until
June...” (ALJ at App. 133a); and that U. S. Marine
had violated § 8(a)(5) and (1) in numerous respects
(ALJ at App. 148a-151a).

The ALJ did not, however, conclude that U. S. Marine’s
failure to have hired the 34 former Chrysler employees
violated § 8(a)(3) or (1) of the Act. (ALJ at App.
133a)

U. S. Marine filed exceptions to the ALJ’s decision and
in those exceptions it persisted in claiming that U. S.
Marine and Bayliner were not a single employer, and it
also excepted “to any remedy in light of the fact that no
unfair labor practices were committed...”

Both the Union and General Counsel had taken excep-
tions to the ALJ’s decision and each had also filed answer-
ing briefs to the exceptions taken by U. S. Marine, U. S.
Marine, however, filed no answering brief to the excep-
tions taken by either the Union or General Counsel even
though both the Union and General Counsel were seeking
additional relief including a restoration of the status quo
ante remedy (Board at App. 61a).

On April 17, 1989, the Board issued its decision and
order and affirmed the ALJ’s findings that the manpower
figures concocted by Hoag had been false and designed to
deceive the Board and the courts (Board at App. 64a-
65a), and that U. S. Marine and Bayliner constituted a
single employer (Board at App. 62a) and that U. S.
Marine had violated § 8(a) (5) and (1) of the Act in the
various ways as determined by the ALJ (Board at App.
62a).

In addition, however, the Board, contrary to the ALJ,
concluded that U. S. Marine’s failure to have hired the
34 former Chrysler employees did violate § 8a) (3) and
(1) of the Act because as the Board explained, “. . Once
Hoag decided that 460 would be the false projection, it
became imperative that he hire fewer than 231 former

9

Chrysler employees, or the 460 figure became meaningless
as a defense to the Union’s recognition claim. Thus, the
sham inflation of the full-compliment projection and the
decision to stop rehiring former Chrysler employees once
their number had reached 223 are complementary aspects
of the same scheme sought to be carried out by U. S.
Marine... .” (App. 66a; Board at App. 66a; emphasis
added).

The Board’s order required U. S. Marine, amongst
other things, to offer employment to and make whole those
34 former Chrysler employees that had applied for em-
ployment, but had not been hired nor provided any reason
by U. S. Marine as to why any of them had not been
hired. (Board at App. 78a-79a)

In addition, the Board’s order® required that U. S.
Marine,

2. Take the following affirmative action necessary
to effectuate the policies of the Act... (c) On re-
quest of the Union, rescind any departures from
terms and conditions of employment that existed im-
mediately before the Respondent’s take over from
Chrysler Corporation of the Hartford, Wisconsin
operations, retroactively restoring preexisting terms
and conditions of employment, including wage rates
and benefit plans, and make the employees whole by
remitting all wages and benefits that would have
been paid absent such unilateral changes from Jan-
uary 23, 1984 until they regotiate in good faith with
the Union to agreement or to impasse...

(Board at App. 77a).

U. S. Marine then petitioned the Seventh Circuit to re-
view the Board’s order only insofar as the Board’s order

® One member dissented to the restoration of the status quo ante
remedy sua sponte on due process grounds namely that such remedy
had not been alleged in the complaint (Board App. 80a-85a). U. S.
Marine makes no claim that the Court of Appeals rejection of that
due process argument was improper (see App. 39a-42a).

10

had held that U. S. Marine had violated § 8(a) (3) and
(1) by failing to hire the 34 former Chrysler employees
and insofar as the Board’s remedial order required U. S.
Marine to restore the status quo ante that had existed
immediately prior to U. S. Marine’s take over.’°

U. S. Marine no longer challenged the ALJ’s conclu-
sions, as affirmed by the Board, that:

(1) U. S. Marine Crporation and Bayliner consti-
tuted a single employer,

(2) U. S. Marine was a successor employer to
Chrysler,

(3) U. S. Marine violated section 8(a) (5) and (1)
of the Act by

(a) refusing to recognize and furnish certain
information to the Union,

(b) failing to bargain in good faith with the
Union,

(c) unilaterally implementing changes in
terms and conditions of employment,"

(d) bargaining individually with employees,
and

(e) establishing and bargaining with an em-
ployer-dominated labor organization (the
Safety and Progress Committee).

(App. 17a-18a).

Judge Ripple writing for the majority of the Seventh
Circuit did observe, however, that in analyzing the Board’s

1 The Union also petitioned the Seventh Circuit to review the
Board’s order insofar as the Board had failed to provide additional
remedies requested by the Union. The Seventh Circuit denied the
Union’s petition (App. 43a-5la).

11 The Unilateral changes referred to were those that U. S. Marine
put into effect after it met with the Union but reached no bona fide
impasse (ALJ App. 148a-150a).

11

order that “We also note that these uncontested violations
‘do not disappear by not being mentioned in a brief. They
remain, lending their aroma to the context in which the
[remaining] issues are considered citation omitted] ...”
(App. 18a)

On September 25, 1991, the en bane Court of Appeals
issued its decision enforcing in full the Board’s order. The
decision was unanimous that there was substantial evi-
dence on the record as a whole to support the Board’s con-
clusion that U. S. Marine’s failure to have hired the 34
former Chrysler employees violated § 8(a) (3) and (1) of
the Act (App. 28a-29a; 51a-52a).

As to the Board’s remedial order that required U. S.
Marine to restore the status quo ante (App. 77a) the vote
was 6-5 to enforce the Board’s order. The majority opin-
ion by Judge Ripple held the Board’s remedy in the cir-
cumstances of this particular case was within the Board’s
statutory authority under $10(c) because

. . . The Board’s order is designed to prevent U. S.
Marine from taking advantage of its wrongdoing
to the detriment of the employees. The Board pre-
sumes tha‘, but for the unlawful practice, substan-
tially all of the employees would have been retained
and the employer would be obliged to consult with
the Union before setting new terms. Because of this
obligation to bargain with the Union, restoration of
the previously existing employment terms, the status
quo ante, is an appropriate remedy...

(App. 38a)

The dissenting opinion by Judge Easterbrook, was
grounded on the premise that even a new owner that seeks
by unlawful means, including unlawfully refusing to hire
employees of the predecessor for no reason other than to
evade acquiring the obligations of a “successor” under the
Act nonetheless still retains the absolute right to establish
whatever initial terms and conditions of employment that
it chooses and the Board’s order was not a remedy but was
a penalty and should not be enforced. (App. 5la-52a)

12

REASONS FOR DENYING THE WRIT

U. S. Marine’s petition for certiorari claims that the
Seventh Circuit’s judgment gives rise to two questions
that are both worthy of review by this Court.

The Union suggests that in regards to the alleged issue
of “Whether the Board and the Court of Appeals mis-
allocated the statutory burden of proof by ordering U. S.
Marine to hire the remaining 34 former Chrysler work-
ers...” (U.S. Marine Petition at i) that such “issue’’,
regardless of how artfully phrased, does not justify this
Court’s review of what at its core, simply involves a ques-
tion of weighing the evidence in the record to determine
whether or not there was substantial evidence in the
record as a whole to support the Board’s conclusion that
U.S. Marine’s failure to have hired the 34 former Chrysler
employees violated § 8(a) (3) and (1) of the Act.

The issue concerning whether the Board has the statu-
tory authority under Section 10(c) to order any successor
employer to ever restore the terms and conditions of the
predecessor employer is of more substance, particularly
in view of Judge Easterbrook’s dissenting opinion. The
Union nonetheless would in the circumstances of this par-
ticular case and in view of the current situation involving
the closing of the Hartford plant, respectfully submit that
U. S. Marine’s petition should be denied in toto. The
Seventh Circuit’s judgment enforcing the Board’s order,
given the specific facts and circumstances that were found
to exist does not create a conflict with the other circuits;
and a restoration of the status quo ante is not a penalty
but is a type of remedy that is available to the Board un-
der § 10(c) of the Act.

The Union would emphasize that the Board’s restora-
tion of the status quo ante remedy in the context of a
successorship case is inextricably interrelated with and
arises from its findiny that U. S. Marine had violated
both $ 8(a) (5) and (3). (App. 72a) The Court of Ap-

13

peals judgment enforcing the Board’s order was likewise
premised on the fact that U. S. Marine had violated
$ 8(a) (5) and (3). [“The remedy ordered in this case
is based on the established principles applicable to suc-
cessors who discriminate in order to avoid a bargaining
obligation ...”] (App. 40a)

I. AN EMPLOYER’S REFUSAL TO HIRE THE EM-
PLOYEES EMPLOYED BY THE PREDECESSOR
AS PART OF A SCHEME TO EVADE ACQUIRING
A BARGAINING OBLIGATION UNDER BURNS IS
UNLAWFUL UNDER § 8(a)(3) OF THE ACT AND
THE COURT OF APPEALS DECISION HOLDING
THAT THERE WAS SUBSTANTIAL EVIDENCE
ON THE RECORD TO SUPPORT THE BOARD'S
CONCLUSION WAS PROPER.

In Howard Johnson Co. v. Hotel Employees, 417 U.S.
249, 262 n.8 (1974) this Court made clear that “... [A]
new owner could not refuse to hire the employees of his
predecessor solely because they were union members or
to avoid having to recognize the union .... ” (emphasis
added) and citing NLRB v. Burns Int'l Security Services,
406 U.S. 272, 280-81, n.6.""

All eleven judges of the Seventh Circuit have agreed
that both the Board’s findings and conclusion relative to
U.S. Marine’s failure to hire the 34 former Chrysler em-

12 Howard Johnson involved a case arising under 301 LMRA
where the union representing the emplovees of the predecessor em-
ployer had sought to require the new owner to arbitrate the issue
of the new owner’s failure to have hired the predecessor's emplovees.

This Court noted “. . . There is no suggestion in this case that
Howard Johnson in any way discriminated in its hiring against the
former Grissom employees...” 417 U.S. at 262 n.8.

The question of whether a new owner has a legal duty to recog-
nize the union that represented the predecessor employees as the
successor to the predecessor employer appears to be one that should
be resolved, in the event there is a dispute, under the NILRA and
not under §301 LMRA. Cf. Laborers Trust Fund v. Advanced
Concrete, 484 U.S. 539, 544 n. 6 (1988).

14

ployees violated § 8(a) (3) and (1) was supported by sub-
stantial evidence on the record as a whole. (App. 19a-
29a).

This Court has long recognized that “Whether on the
record as a whole there is substantial evidence to support
agency findings is a question which Congress has placed
in the keeping of the Courts of Appeals. This Court will
intervene only in what ought to be the rare instance when
the standard appears to have been misapprehended or
grossly misapplied.” Universal Camera Corp. v. NLRB,
340 U.S. 474, 491 (1951). Also see Golden State Bottling
Co. v. NLRB, 414 U.S. 168, 172-173 (1973).

~. S. Marine doesn’t argue that the court of appeals
decision does not comport with the Universal Camera
standard, but instead argues that this Court’s decision in
NLRB v. Transportation Management Corp., 462 U.S.
393 (1983) has made Universal Camera irrelevant.

This Court in Transportation Management upheld the
Board’s position regarding a dual motive type case where
the Board had found that the employer had violated
§ 8(a) (8) and (1) by having discharged an individual
employee because he had engaged in protected union ac-
tivities. As the Court held, “... It is thus clear that the
Board’s finding that Santillo would not have been fired
if the employer had not had an anti-union animus was
‘supported by substantial evidence on the record consid-
ered as a whole’ .. .” 462 U.S. at 405."

Transportation Management did not involve the refusal
to hire a number of the predecessor’s employees by a new

13 UJ, S. Marine’s reliance on Halo-Krome Co. v. NLRB, —— F.2d
——, 188 LRRM 2661 (1991) (Emp. Pet. 28-29) is wholly mis-
placed. In Halo-Krome Co. the Second Circuit did apply the same
Universal Camera standard as did the Seventh Circuit. The Seventh
Circuit after review of all the evidence concluded that the Board’s
inference that the 34 former Chrysler employees were not hired in
ordr to evade a hargaining obligation was reasonable and supported
by the substantial evidence (App. 28a).

15

owner not because of any of their own individual union
activities but in order to ‘simply permit the new owner
to evade becoming a successor employer under the Act.

It was not necessary in the circumstances presented
here for the General Counsel to show that it was the par-
ticular union activities of each of the 34 that caused Hoag
to not hire each of them because it was U. S. Marine’s
seeking to evade a bargaining obligation as the successor
to Chrysler that caused it to not hire the 34, see Ballou
Birch Co. v. NLRB, 798 F.2d 339, 342 (8th Cir. 1986).
Also see Birch Run Welding and Fabricating Inc. v.
NLRB, 761 F.2d 1175, 1179-80 (8th Cir. 1985); M.S.F.
Industries Inc. v. NLRB, 568 F.2d 166, 176 (10th Cir.
1977) ; Majestic Molded Products Inc. v. NLRB, 330 F.2d
608, 606 (2nd Cir. 1964).

U. S. Marine has failed to demonstrate any legitimate
reason as to why this Court should grant its petition for
certiorari on the issue of whether there was substantial
evidence to support the Board’s conclusion that U. S.
Marine’s failure to hiré the 34 former Chrysler employ-
ees was to evade becoming a successor and the Union
would respectfully request that this Court deny any re-
view of that issue.

II. THE BOARD’S RESTORATION OF THE STATUS
QUO ANTE REMEDY WAS NOT INCONSISTENT
WITH “BURNS”; WAS NOT PUNITIVE; AND THE
COURT OF APPEALS’ DECISION ENFORCING
THE BOARD’S REMEDIAL ORDER APPLIED THE
PROPER STANDARD FOR REVIEW AND WAS
NOT IN CONFLICT WITH DECISIONS OF OTHER
CIRCUITS.

It has to be borne in mind that conduct of the kind
engaged in by Hoag on behalf of U. S. Marine doesn’t
simply exist in a vacuum or that U. S. Marine doesn’t
really intend to accrue benefits to itself by engaging in
such conduct. U. S. Marine knew when it had Hoag
embark on the scheme it did that “{I]n the labor field,

16

as in few others, time is crucially important in obtaining
relief...” NLRB v. C & C Plywood, 385 U.S. 421, 430
(1967). U.S. Marine was also aware that by unlawfully
withholding recognition this “disrupts the employees’
morale, deters their organization activities, and discour-
ages their membership in unions. . .” Franks Bros. Co.
v. NLRB, 482 U.S. 27, 49-50 (1987), cited approvingly
in Fall River Dying & Finishing Corp. v. NLRB, 482
U.S. 27, 49-50 (1987).

Fall River Dying is important in that it is a “succes-
sorship” case and therein this Court fleshed out what it
had earlier held in NLRB v. Burns Int’l Security Serv-
ices Inc., 406 U.S. 272 (1972).

The Board here has grounded its authority to provide
for a status quo ante remedy in a successorship situation
from this Court’s recognition in Burns that there may be
exceptional situations where a new owner could be obli-
gated to consult with the union over the initial terms and
conditions of employment. Burns, 406 U.S. at 294-295
(also see App. 70a-71la).

Fall River Dying adhered to the view, earlier expressed
in Burns, that there could exist “the exceptional situa-
tion . . . in which a successor should consult with the
union before setting these [initial] terms and conditions,
from the standard situation in which a successor could
set its own terms free of the union’s involvement .. .”
482 U.S. at 47 n.14."

Judge Easterbrook’s dissent, however, recognizes no
such “exceptional situation” that would ever justify the
Board’s status quo ante remedy. According to Judge

144In both Burns and Fall River Dying, the employer’s in those
cases did not unlawfully fail to hire the predecessor’s employees in
order to evade having to bargain with the union that had repre-
sented the predecessor’s work force. Indeed, in Fall River Dying
the employer there had continued to hire the predecessor’semployees
even after the union’s premature recognition demand and it thereby
acquired a bargaining obligation 482 U.S. at 52-54.

17

Easterbrook, the status quo ante remedy in a successor
case would always constitute a penalty and a new owner
must always have the absolute right to establish the
initial terms and conditions."

This Court has rejected arguments similar to those
raised by U. S. Marine and as advanced in the dissenting
opinion. No one doubts that employers have the right to
subcontract work. However, where the employees are
represented by a union if the employer unilaterally exer-
cises that right to subcontract without first having af-
forded the union an opportunity to discuss such a deci-
sion, the employer will be deemed in substance for purposes
of a remedy to have forfeited such right, Fibreboard
Corp. v. NLRB, 379 U.S. 203, 214-217 (1964).

This Court in Fibreboard rejected the argument that
because the employer could “effect cost savings ... by
contracting the work out ... [that] there is no need to
attempt to achieve similar economies through negotia-
tions ... or to provide them [employees] with an oppor-
tunity to negotiate a mutually acceptable alternative.”
Fibreboard Corp., 379 U.S. at 214. In rejecting such
argument this Court’s decision acknowledged, “. . . [A]]-
though it is not possible to say whether a satisfactory
solution could be reached, national labor policy is founded
upon the congressional determination that the chances are
good enough to warrant subjecting such issues to the
process of collective negotiations.” bid.

Because a new owner has the power in substance to
determine by its hiring policies whether or not it will
become a “successor” under the Burns/Howard Johnson/

Tf the new owner retains the predecessor work force and ini-
tially retains the predecessor's terms and conditions but subsequently
unilaterally changes those terms and conditions without having con-
sulted with the union, such conduct would violate § 8(a)(5) and the
Board’s remedy would require the restoration of the status quo ante,
see Advanced Concrete supra, 484 U.S. at 544 n.6. Therefore an
“exceptional situation” under Burns must include a situation other
than one that would already be covered by the Act.

18

Fall River Dying holdings, such a new owner when act-
ing lawfully in regards to the hiring of employees retains
the right to unilaterally establish the initial terms and
conditions of employment; see Spruce Up Corp., 209
NLRB 194 (1974), enfe’d, 529 F.2d 516 (4th Cir. 1975) .'®

Where the new owner is found to have implemented an
unlawful hiring policy in order to evade fulfilling the
legal duties of a successor then, according to the Board,
that in essence presents an “exceptional situation, not a
standard situation, where the new owner should consult
with the union before setting the initial terms and condi-
tions...” Fall River Dying, 482 U.S. at 47 n.14.

If a new owner is found to have brought itself by its
conduct into “the exceptional situation” but hadn’t con-
sulted with the union before setting the initial terms and
conditions then it is only through § 10(c) of the Act that
the Board can restore that “exceptional situation” to what
it should’ve been. Therefore an order such as provided by
the Board in this case is one, “. . . which deprives an em-
ployer of advantages accruing from a particular method
of subverting the Act, [and] is a permissible method of
effectuating the statutory policy...” Virginia Electric
& P. Co. v. NLRB, 319 U.S. 533, 540-541.

In H. K. Porter Co. v. NLRB, 397 U.S. 99 (1970) this
Court held that a particular remedy that had been pro-
vided by the Board, i.e., requiring the employer there to
agree to grant a check-off authorization, was not enforce-
able. However, that portion of the Board’s order was
deemed not enforceable, not because it was deemed to be

16This Court took note of the Board’s Spruce Up decision in
Fall River Dying, 482 U.S. at 46 n.12 but only in regards to the
fact that the Board had adopted the position that work force con-
tinuity for successorship cases was determined by whether a ma-
jority of the new owner’s employees were those of the predecessor.
Where a majority of the new owner’s employees had been employed
by the predecessor then the new owner according to the Board, is
the successor and obligated to recognize the union.

19

a “penalty”, but because this Court held that the Board’s
remedial authority under § 10(c) of the Act was limited
by the same considerations that led Congress to enact
§ 8(d). 397 U.S. at 107.

U. S. Marine does not contend nor does the dissenting
opinion argue that the considerations that led Congress
to enact § 8(d) deprive the Board of the remedial author-
ity in an “exceptional situation” arising in what might
be described as a quintessential successor case’ from
ordering a new owner/successor to restore the terms and
conditions of the predecessor where the new owner could
be deemed to have had the obligation to discuss with the
union the initial terms and conditions.

Judge Easterbrook asserted that “an obligation to ‘con-
sult’ does not imply an obligation to use the old terms un-
less the union agrees to different ones...” (App. 54a).
This court in NLRB v. Katz, 36 U.S. 736, 745 n.12
(1962), however, held that there is a substantial differ-
ence between the employer who engages in “consultation”
first with the union and then acts, and the employer who
unilaterally acts without consultation with the union. In
the case of the former, the employer is free to act after
consultation, but in the case of the latter, the employer
commits an unfair labor practice and will be required as
part of the remedy to restore the status quo ante, see
Fibreboard, supra. In other words, a new owner’s obliga-

17Tt is interesting to compare what occurred when the owners of
U. S. Marine acquired the ‘assets’ from Chrysler and how that
impacted on the employees working at the Hartford plant with what
occurred when the four owners of U. S. Marine’s shares sold all the
shares to Brunswick and how that impacted on the employees then
working at the Hartford plant. In the latter case work went on
just as before but in the former there was a one week shutdown and
then work proceeded just as before except the employees were not
permitted to be represented by the Union; 34 former Chrysler em-
ployees no longer were working and didn’t know why the new
owners had unilaterally established certain new terms and condi-
tions for the employees working at the Hartford plant.

20

tion to discuss the initial terms before unilaterally estab-
lishing new terms and conditions does not mean that after
having had discussed same with the union that it isn’t
thereafter free to unilaterally put into effect such changes
even though the union might not agree.

The dissenting opinion also appears to reject the “‘un-
certainty” principle (App. 59a). However, in law as in
physies,'* there is an “uncertainty” principle and that is
used by courts as a matter of public policy and provides
that “|T]he most elementary conception of justice and
public policy requires that the wrongdoer shall bear the
risk of uncertainty which his own wrongdoing has
created...” Bigelow v. RKO Radio Pictures, 327 U.S. 251,
264-265 (1946). Also see Story Parchment Co. v. Patter-
son Parchment Paper Co., 282 U.S. 555, 563 (1931) ;
Thorp Sales Corp. v. Gyuro Grading Co., 111 Wis.2d 432,
441 (1983).

To permit U. S. Marine to retain such advantages ac-
cruing to it from the particular methods it used to sub-
vert the Act would be to in essence permit the wrongdoer
to profit by its own fraud and wrongdoing and to encour-
age that which the Act forbids. It had been recognized
that “|N]o one shall be permitted to profit by his own
fraud, or to take advantage of his own wrongdoing, or to
found any claim upon his own inequity, .. .” Riggs v.
Palmer, 115 N.Y. 506, 511-512, 22 N.E. 188, 190 (1889)
cited approvingly in Simon & Schuster, Inc. v. Members
of New York State Crime Victims Board, US.
60 U.S.L.W. 4029, 4033 (1991).

When wrongdoer employers are permitted to retain the
profits from their own unlawful conduct to evade com-
pliance with the NLRA, the ones then who are “penalized”
are not only the employees of the employer, but also the
employers who chose to observe the rule of law even
though they may incur costs for them to do so.

18 See Paradigms Lost, John L. Casti pp. 459-453 for discussion
of Werner Heisenberg’s uncertainty principle as used in physics.

21

In Food Handlers v. Valmac, 528 F.2d 217-218 (8th
Cir. 1975), the Eighth Circuit observed how the employer

there “. . . fashioned this unbelievably strange situation
out of what Shakespeare would call ‘a quick sand of
deceit’. . .”’ and that, “... Any reduction [in the remedy

provided to the union by the arbitrator] would be in-
consistent with the policy of the National Labor Rela-
tions Act because it would encourage the very conduct
the Act sought to discourage—‘bad faith’ bargaining...”
It also observed “Oh, what a tangled web we weave
when first we practice to deceive [citing Scott, Marmion,
Conto VI, st. 17] .. .”

The Union submits, and with all due respect to Judge
Easterbrook, that if American industry and their rep-
resentatives in order to survive have to deliberately en-
gage in the unlawful conduct of the kind that Hoag
engaged in on behalf of U.S. Marine in order to survive
and compete against other employers that, then this
country is truly in very serious trouble.

Lastly the Union would note that this case is al-
ready eight years old and the plant will be closed as
of January 31, 1992. As far as any future bargaining
obligation that might have been required under the
Board’s order, that question is now for all practical
matters moot with the cessation of business at the Hart-
ford, Wisconsin plant effective January 31, 1992 and

with the few remaining employees all having been laid
off.

In such circumstances and because the Seventh Cir-
cuit’s decision is not at odds with the holdings of this
Court or really create a conflict with the other Circuits,
the Union believes that these practical reasons should
be weighed in the calculus of this Court as to whether
U.S. Marine’s petition should be granted.

22
CONCLUSION

For all the foregoing reasons, the Respondent Unions
respectfully submit that the Petition for a Writ of
Certiorari should be denied in its entirety.

Dated this — day of January, 1992.
Respectfully submitted,

KENNETH R. LOEBEL
Counsel of Record

PREVIANT, GOLDBERG, UELMEN,
GRATZ, MILLER & BRUEGGEMAN, S.C.

1155 N. RiverCenter Dr.

Suite 202

P. O. Box 12993

Milwaukee, WI 53212

(414) 271-4500

Attorneys for Respondents
International Union, Allied
Industrial Workers of America,
AFL-CIO and its affiliated local,
Local 879, Allied Industrial Workers
of America

---

Source: Frix Law Library, https://www.frixlaw.com/law-library/documents/brief%3Amicro_IA40385010_2215%3A2. Public record. Not legal advice.