United States Court of Appeals
FOR THE DISTRICT OF COLUMBIA CIRCUIT
Argued September 10, 1999 Decided October 22, 1999
No. 98-1433
Peter O'Dovero d/b/a Associated Constructors,
and O'Dovero Construction, Inc.,
Petitioners
v.
National Labor Relations Board,
Respondent
On Petition for Review and Cross-Application
for Enforcement of an Order of the
National Labor Relations Board
Charles W. Gorham argued the cause and was on the briefs
for petitioner.
Richard A. Cohen, Attorney, National Labor Relations
Board, argued the cause for respondent. With him on the
brief were Linda Sher, Associate General Counsel, and John
D. Burgoyne, Acting Deputy Associate General Counsel.
David S. Habenstreit, Attorney, entered an appearance.
Before: Sentelle, Randolph and Rogers, Circuit Judges.
Opinion for the Court filed by Circuit Judge Rogers.
Rogers, Circuit Judge: Petitioner Peter O'Dovero d/b/a
Associated Constructors and O'Dovero Construction, Inc. ap- peals the decision and order of the National Labor Relations
Board finding that it violated s 8(a)(1), (a)(3) and (a)(5) of the
National Labor Relations Act ("Act"), 29 U.S.C. ss 158 (a)(1),
(a)(3), and (a)(5), and directing that petitioner henceforth
cease and desist from "[d]iverting work from one group of
employees to another in order to discourage union activity,"
and "[r]esume bidding for jobs to be performed by unit
employees under bidding practices as they existed prior to
the unlawful diversion of union work." Peter O'Dovero d/b/a
Associated Constructors and O'Dovero Construction, Inc.,
325 N.L.R.B. No. 187, 1998 WL 380989, at *5 (1998). Before
the court, petitioner makes four claims of error: first, that
the Board was precluded from making a single employer
finding in light of a prior prosecutorial decision not to pursue
such a union complaint and the union was estopped from
bringing the instant case; second, the Board's finding that
O'Dovero has not ceased its operations is unsupported by
substantial evidence in view of the evidence that it was
performing no work nor bidding on contracts and that discus- sions about dissolving O'Dovero began two years earlier;
third, that the Board's finding that work was diverted from
O'Dovero to Associated elevates treatment of a union subcon- tractor and distorts the underlying contractual relationship;
and fourth, that the Board abused its discretion by imposing
an unduly burdensome remedy, effectively forcing resumption
of unprofitable operations. Only the latter contention re- quires some explication. Because the Board's findings are
supported by substantial evidence in the record, and because
the Board did not abuse its discretion in requiring resumption
of the status quo pro ante, we deny the petition and order
enforcement of the Board's order.1
I.
Associated Constructors ("Associated") and O'Dovero Con- struction, Inc. ("O'Dovero") are family owned and run con- struction companies. Associated, founded in the 1980s, is
owned entirely by Peter O'Dovero, while O'Dovero, estab- lished in the 1960s, is owned by Peter O'Dovero, his wife Lois,
and his son James, who is president of O'Dovero. Historical- ly, O'Dovero has performed work on Associated's projects,
specializing in laying underground pipe. That work is per- formed by unionized employees, who are hired on an as
needed basis during the construction season, which generally
runs from mid-April to the end of November. O'Dovero has
recognized the International Union of Operating Engineers,
Local 324 ("the Union") since its incorporation, although the
Union was not certified until 1993. Associated has never
recognized the Union, although the Union has made attempts
to organize its employees.
The instant case arises in connection with a project begun
in April 1995 to replace underground water pipes in Caspian,
Michigan. The heavy equipment work involved in laying
underground pipe was assigned to O'Dovero. On several
occasions before the job shut down in November, Craig
Dufresne, job superintendent of the O'Dovero equipment
operators, as well as supervisor of approximately ten Associ- ated laborers, told the heavy equipment operators that the
job was non-union, although the operators were then being
paid union wages and receiving union benefits, and were paid
as well for show-up as required under the collective bargain- __________
1 Petitioner does not challenge the Board's findings that peti- tioner violated s 8(a)(1) and (a)(5) by failing to bargain with the
Union for a new contract and with respect to the diversion of work
on the Caspian project, by making coercive statements regarding
employees' decisions to join or to stay in the Union, and by dealing
directly with Union represented employees. Accordingly, we affirm
those findings. See, e.g., Corson and Gruman Co. v. NLRB, 899
F.2d 47, 50 n.4 (D.C. Cir. 1990).
ing agreement between the Union and O'Dovero. Because
considerable pipe laying work remained to be done, Dufresne
told the operators that the project would start up again when
the weather broke.
In April 1996, shortly before O'Dovero's contract with the
Union was to expire, Bill Gray, the Union's bargaining repre- sentative, asked James O'Dovero about bargaining the terms
of a successor contract. Gray was informed that a new
contract might not be possible because Peter O'Dovero was
upset that the Union had tried to organize Associated's
employees. On June 20, 1996, Gray was told that O'Dovero
had decided to cease operations. Similar statements were
made regarding Peter O'Dovero's anger at the Union by
Dufresne, when he tried in the spring of 1996 to recruit
O'Dovero employees who had worked on the Caspian project
in 1995 on the basis that the project work would be non- union. Dufresne informed at least two O'Dovero employees
who had worked in 1995 that the project would be entirely
non-union because Peter O'Dovero was angry at the Union
and particularly at Union representative Gray. The Union
members refused to accept work on these terms, and the
Caspian project was completed by Associated employees on a
non-union basis.
In response to the Union's filing of charges alleging, among
other things, failure to bargain a successor contract and
illegal work diversion, an Administrative Law Judge ("ALJ")
found that O'Dovero and Associated were a single employer,
that O'Dovero had ceased operations, and that various of
petitioner's actions violated the Act, including unlawful diver- sion of Caspian project work for anti-union purposes from
O'Dovero to Associated in violation of s 8(a)(3) and (a)(1).
The National Labor Relations Board ("Board") adopted the
ALJ's decision except as to O'Dovero's operations. The
Board found no cessation of operations, but only the contin- ued diversion of work to non-union represented Associated
employees.
The court will set aside the Board's decision and order only
if the Board " 'acted arbitrarily or otherwise erred in applying
established law to the facts' at issue, International Union of
Elec., Elec., Salaried, Mach. and Furniture Workers, 41 F.3d
at 1536 (citations and internal quotation marks omitted), or if
its findings are not supported by 'substantial evidence'. 29
U.S.C. s 160(e), (f) (1988)." Plumbers and Pipe Fitters
Local Union No. 32 v. NLRB, 50 F.3d 29, 32 (D.C. Cir. 1995).
See also Elastic Stop Nut Div. of Harvard Ind., Inc. v.
NLRB, 921 F.2d 1275, 1279 (D.C. Cir. 1990). Moreover, the
court owes great deference to the Board's determination of an
appropriate remedy for violations of the Act, setting aside
that remedy only if the Board's remedy "is a patent attempt
to achieve ends other than those which can fairly be said to
effectuate the policies of the Act." Virginia Elec. & Power
Co. v. NLRB, 319 U.S. 533, 540 (1943). See also Teamsters
Local Union No. 171 v. NLRB, 863 F.2d 946, 957 (D.C. Cir.
1988).
II.
Petitioner's challenges to the Board's findings for lack of
substantial evidence do not merit extended discussion.
Notably, petitioner does not challenge the Board's finding
that Associated and O'Dovero are a single business enter- prise. Rather, petitioner maintains that the Board and the
Union were estopped from making a single employer argu- ment in view of the Board's rejection in 1995 of a similar
complaint by the Union, and in view of the Union's alleged
twenty years of "knowledge of the O'Dovero-Associated rela- tionship". Neither contention has merit. The 1995 decisions
by the Board's Acting Regional Director and General Counsel
not to pursue prosecution of the Union's 1995 charges were
based solely upon the limited evidence then provided by the
Union, and not upon independent investigation by the Board.
Prosecutorial decisions by the Regional Director and General
Counsel are not adjudications and have no preclusive effect
on future actions of the Board. NLRB v. United Food &
Commercial Workers Union, 484 U.S. 112, 125-26 (1987);
Bryant & Stratton Bus. Inst. Inc. v. NLRB, 140 F.3d 169, 185
(2d Cir. 1998); Ball Corp., 322 N.L.R.B. 948, 951 (1997). Peti- tioner's waiver or estoppel argument, that the Union has long
known of the single employer relationship between Associated
and O'Dovero, is no less flawed because, as the ALJ pointed
out, the existence of a single integrated enterprise does not
alone constitute an unfair labor practice; there must be other
evidence on which to base an unfair labor practice.
Petitioner's challenge to the Board's finding that Peter
O'Dovero unlawfully diverted pipe work on the Caspian pro- ject in violation of s 8(a)(3) and (a)(1), also is meritless. See
Laro Maintenance Corp. v NLRB, 56 F.3d 224, 228 (D.C. Cir.
1995). See also NLRB v. Transportation Mgmt. Corp., 462
U.S. 393, 395, 397-403 (1995); Wright Line, 251 N.L.R.B. 1083
(1980). First, there was substantial evidence to show anti- union motivation. Two witnesses, whom the ALJ credited,
recounted statements by O'Dovero's supervisor on the Caspi- an project that the project had "gone nonunion" because
Peter O'Dovero was angry with the Union. Petitioner con- cedes in the reply brief that there was substantial evidence
that the statements were made. A third witness, also credit- ed by the ALJ, recounted being told by James O'Dovero that
Peter O'Dovero was angry at the Union because it had
attempted to organize Associated's employees. In addition,
the ALJ found "that the very fact that Peter O'Dovero and
[the O'Dovero supervisor] gave differing reasons [for the
diversion of pipe laying work] itself undermines [petitioner's]
case on this issue." 2 See Southwest Merchandising Corp. v.
NLRB, 53 F.3d 1334, 1340 (D.C. Cir. 1995).
Substantial evidence thus supports the Board's conclusion
that anti-union animus was a "motivating factor" in the
Caspian work diversion. Indeed, petitioner's conflicting ex- __________
2 While Peter O'Dovero claimed that the change in crew was
due to the fact that "[t]he job was tapering down"--"[w]e went from
two crews to one crew and it was an Associated project to start with
so ... on Associated projects we do give preference to Associated
people," the supervisor claimed that the work was diverted because
"we had problems with O'Dovero Construction [in 1995]", although
the only problems he could identify involved Associated's employees
and he agreed as to every O'Dovero employee about whom he was
asked that the employee had performed well and was asked to
return, albeit as an Associated employee.
planations for the reassignment of work hardly constitute the
showing that it must make, namely that "the same action
would have taken place even in the absence of the protected
conduct". See Laro, 56 F.3d at 228, 229. That work was
assigned to O'Dovero employees after the Union attempted to
organize Associated, and after the Union had filed its 1995
unfair labor practices complaint, demonstrates only that there might have been
other, earlier opportunities for Peter O'Dovero to develop
anti-union animus and does not demonstrate that Peter
O'Dovero did not act on anti-union animus in diverting Caspi- an project work to Associated employees.
There also was substantial evidence that O'Dovero never
ceased operations. The Board noted in view of the evidence
of the single employer status of O'Dovero and Associated, see,
e.g., Radio & Television Broadcast Technicians Local Union
1264 v. Broadcast Services of Mobile, Inc., 380 U.S. 255, 256
(1965) (per curiam), which finding petitioner does not chal- lenge, that "it is not entirely clear what it means to say that
one of them, but not the other, has ceased operations." In
any event, Peter O'Dovero admitted that the corporate entity
is "still in existence", "did not file papers of dissolution," and
could resume a project "tomorrow" if it so chose. Other than
evidence that discussions about dissolution of O'Dovero oc- curred as early as 1994, petitioner can point to nothing that
would support its distinction between existence and cessation.
Petitioner's contention that the Board erred by failing to
undertake a partial closing analysis under Textile Workers v.
Darlington Mfg. Co., 380 U.S. 263 (1965), is unpersuasive
inasmuch as that case involved a corporate liquidation and
physical closing of a mill; nothing of the kind is shown here.
That O'Dovero was not bidding on work or performing work
misses the mark; O'Dovero's work was seasonal and per- formed upon assignment by Associated.
III.
Turning to petitioner's challenge to the Board's remedial
order, the Board directed that O'Dovero must resume opera-
tions inasmuch as there was no showing that it would be
unduly burdensome to resume the work that it historically
had done. The Board clarified, however, that nothing in its
Order "prohibit[s petitioner] from abandoning any operations,
or from declining to bid on projects, for legitimate business
reasons." Peter O'Dovero, 325 N.L.R.B. No. 187, 1998 WL
380989, at *5.
Under s 10(c), the Board "has wide discretion in ordering
affirmative action" to remedy the effects of unfair labor
practices, Virginia Electric, 319 U.S. at 539. Thus, the court
will decline to enforce the Board's remedial order only if the
order represents "a patent attempt to achieve ends other
than those which can fairly be said to effectuate the policies of
the Act." Virginia Electric, 319 U.S. at 540; Teamsters
Local Union No. 171, 863 F.2d at 957. A remedial order
directing the resumption of operations cannot stand, however,
where a company demonstrates that "compliance with the
order is unduly economically burdensome." Teamsters Local
Union No. 171, 863 F.2d at 957-58. See also Coronet Foods,
Inc. v. NLRB, 981 F.2d 1284, 1288 (D.C. Cir. 1993); Lear
Siegler, Inc., 295 N.L.R.B. 857, 861 (1989). While a determi- nation of undue burden necessarily is case specific, courts
have found an undue burden to exist where a plant was
ordered reopened "at an estimated operating loss of several
hundred thousand dollars to the company a year", Frito-Lay
v. NLRB, 585 F.2d 62, 68 (3d Cir. 1978), or where a "substan- tial capital outlay" would have been required of a small
company with a "minimal profit margin." NLRB v. R & H
Masonry Supply, Inc., 627 F.2d 1013, 1014 (9th Cir. 1980).
Similarly, the Board itself acknowledged in Lear Siegler that
requiring "an entity to reopen a demonstrably unprofitable
facility", even where it could "offset losses from the reopened
facility with profits from others ... might well be found to be
unduly burdensome." 295 N.L.R.B. at 861.
Petitioner contends that the Board abused its discretion in
ordering O'Dovero to resume operations. In support of its
contention, petitioner points to evidence that the compiled
financial statements of O'Dovero prepared by Anderson,
Tackman & Company, showed operating losses in 1993
through 1996 of $20,367, $4,630, $32,398, and $97,689, respec- tively. Consequently, petitioner claims, the decision was
made to cease operations at the annual shareholders meeting
in December 1995. From this evidence petitioner maintains
that the Board is requiring the cross subsidization that it
warned against in Lear Siegler, 295 N.L.R.B. at 861.
The difficulty with petitioner's contention is not its theory
but its deficiency of evidence to support its theory. As the
Board explained, the operating losses shown in O'Dovero's
financial statements have little meaning in view of the inter- mingled and integrated operations of O'Dovero and Associat- ed. The evidence of record does not isolate O'Dovero's losses
in a sufficient manner. Some of O'Dovero's major expenses
inure to the integrated company's benefit, such as rent being
paid to another Peter O'Dovero company, and his wife's and
son's salaries being paid by O'Dovero, yet much of the work
that O'Dovero had performed in recent years was bid by
Associated. Thus, it was impossible to tell whether on these
projects the company as a whole lost money on the work that
O'Dovero performed during the period in question, or wheth- er the losses shown were more than offset by profits realized
by Associated. Consequently, the financial statements do not
establish, and no witness claimed, that the Company did not
realize an overall profit on the work that O'Dovero per- formed. Indeed, the accountants' telling qualification stated
that their financial statements were prepared with "manage- ment[ ] elect[ing] to omit substantially all of the disclosures
and the statements of cash flows required by generally ac- cepted accounting principles," and that those omissions
"might influence the user's conclusions about [O'Dovero's]
financial position, results of operations and cash flows."
Moreover, the 1996 statement reflected losses when O'Dovero
performed virtually no unit work.
Even assuming the validity of petitioner's contention that
O'Dovero has sustained operating losses for several years,
petitioner still fails to show that the Board's order is unduly
burdensome. Given the highly intermingled infrastructure of
O'Dovero and Associated, which remained virtually un- changed, as demonstrated by Peter O'Dovero's testimony that
O'Dovero could resume operations "tomorrow", the Board
could properly find that its resumption directive imposes no
significant operational costs upon petitioner. Petitioner did
not claim that resumption of prior bidding practices would
entail any capital investment, or involve other financial com- mitments, such as moving costs. Furthermore, the limiting
language in the Board's order makes clear that O'Dovero may
decline to bid on a particular project if it has a legitimate
reason for doing so; what petitioner may not do is fail to bid
on work for anti-union reasons. Contrary to petitioner's
contention, the Board's order does not require it to resume an
operation that it has already determined to be intolerably
unprofitable. The Board simply found that petitioner had
failed to show that its actions were impelled by a determina- tion that it was incurring intolerable operating losses.
Put otherwise, the Board's order requires no more than a
return to the status quo ante with respect to "work assign- ment decisions". See, e.g., Emhart Indus. v. NLRB, 907 F.2d
372, 378 (2d Cir. 1990). Thus, if and when Associated enters
into a contract that involves in whole or in part ground pipe
work of the type that would have been performed by O'Dove- ro's unionized employees prior to the unlawful diversion of
work and O'Dovero's purported "cessation" of operations,
then that work must be continued to be assigned to the
unionized employees. The same would be true if O'Dovero
were to enter into a contract; work under that contract could
not be shifted to Associated's nonunion employees unless
prior to the purported "cessation" of O'Dovero's operations
such work would have been shifted for reasons unrelated to
anti-union animus.
Additionally, nothing in the Board's order would prevent
the owners of O'Dovero from taking steps to bring about the
dissolution of O'Dovero in a lawful manner. If the owners of
O'Dovero conclude that O'Dovero and its bargaining unit type
of work is an economic drain, and, therefore, formally dissolve
O'Dovero, nothing in the Board's order would prevent Associ- ated from performing non-O'Dovero type work under future
contracts with non-union employees. So understood, the
Board's order did not require petitioner "to engage in unprof-
itable operations. Petitioner having failed to show that the
remedial order was unduly burdensome," it necessarily fol- lows that the Board did not abuse its discretion in directing
resumption of O'Dovero's operations.
Accordingly, we deny the petition and order enforcement of
the Board's order.