National Labor Relations Board v. Food Store Employees Union, Local 347, Amalgamated Meat Cutters & Butcher Workmen of North America, AFL-CIO – Oral Argument – March 18, 1974

Media for National Labor Relations Board v. Food Store Employees Union, Local 347, Amalgamated Meat Cutters & Butcher Workmen of North America, AFL-CIO

Audio Transcription for Opinion Announcement – May 20, 1974 in National Labor Relations Board v. Food Store Employees Union, Local 347, Amalgamated Meat Cutters & Butcher Workmen of North America, AFL-CIO
Audio Transcription for Oral Argument – March 19, 1974 in National Labor Relations Board v. Food Store Employees Union, Local 347, Amalgamated Meat Cutters & Butcher Workmen of North America, AFL-CIO

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Warren E. Burger:

We’ll hear arguments next in 73-370, National Labor Relations Board against Food Store Employees.

Mr. Friedman.

Daniel M. Friedman:

Mr. Chief Justice and may it please to the Court.

In a large number of cases, this Court has recognized the limited role that Courts of Appeals have in reviewing the scope of remedial orders of administrative agencies.

The standard governing such review has been formulated in different ways, but there the Court had said it before the appellate court attempts to change the remedy, it must find that the remedy selected has no reasonable relation to the unlawful practices found that it constitute a patent abuse of discretion albeit the agency has not made an allowable choose of remedy.

Now this principle has also been applied to orders of the National Labor Relations Board, this Court having recently stated in Gissel case that those orders are entitled to special respect.

All of those cases have been ones in which the remedy provided by the agency has been challenge because it assertedly went too far.

The agency did something more either that was permitted to do under to the statute or that was claimed as necessary to deal with the problem before the agency.

In this case, the Court of Appeals for the District of Columbia Circuit held that the National Labor Relations Board had failed to go as far as it should have gone in providing appropriate remedies.

Specifically, because the Board failed to grant a Union request that in addition to a number of other remedies that the Board had provided, it did not require the employer to reimburse the Union for counsel fees expended and extraordinary organizational expenses it had.

In connection with an organizing drive result where the employer had committed serious unfair labor practices against it.

We have brought the case to this Court because we think that the standard governing the proper scope of judicial review of agency orders should be the same and must be the same whether the order is challenged as excessive or inadequate.

And indeed, as I understand the Union has no disagreement with us.

The Union said, “Yes, the standard is the same, but under standard the Board acted improperly.”

Now —

Potter Stewart:

Mr. Friedman, you don’t need to respond immediately to my question but there is a question in here about the status, if any, of the employer Heck’s in this case that you know there is a motion to strike their brief.

So they were not allowed to intervene and then after we denied certiorari, they were allowed to intervene in the Court of Appeals and so on.

I hope before this argument is finished, there will be some little straightening on this.

Daniel M. Friedman:

May I address that right now.

Potter Stewart:

You may but don’t feel —

Daniel M. Friedman:

No.

Let me — I think it will be a convenient point to address it right now.

Heck’s was a party of course before the Board and all of the proceedings.

On the cases before the Court of Appeals the first time, Heck’s intervened that it has a right as it had a right to do.

When the case came back to the Court of Appeals, the second time Heck’s did not intervene although it had a right to do so, and a case was presented to the Court of Appeals on the assumption by the both the Board and the Union that the Board had this authority.

Heck’s could have intervened but didn’t.

The Court of Appeals apparently assumed the Board had this authority but held that the Board have failed to exercise it.

It was only after the Court of Appeals had remanded the case to the Board to provide these remedies that Heck’s then sought to intervene before the Court of Appeals.

That was denied by the court presumably as untimely because under the rules and application for intervention it’s required to file within 30 days of filing a petition to review.

Heck’s then sought review in this Court on a petition for certiorari but denial of intervention.

Audio Transcription for Oral Argument – March 19, 1974 in National Labor Relations Board v. Food Store Employees Union, Local 347, Amalgamated Meat Cutters & Butcher Workmen of North America, AFL-CIO

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Potter Stewart:

Review of the denial of intervention?

Daniel M. Friedman:

Denial of intervention, that was denied, that was denied.

Following that, Heck’s was permitted to intervene by the Court of Appeals approximately six weeks after the petition for certiorari which was filed.

Now, we have filed a supplemental memorandum in this case.

It’s a Xerox document that we were unable to file unfortunately until last Friday in which we discussed this problem at considerable length.

We say, suggest to the Court is first of all, we think it is very dubious; whether after this Court has granted the petition for certiorari, the Court of Appeals can then grant intervention so as to permit someone to become a party in the proceeding to this Court.

We think when this Court has taken the case that at least ousts the Court of Appeals of authority to make then someone a party.

William J. Brennan, Jr.:

Did the Court of Appeals say why they did this?

Daniel M. Friedman:

No, they did not.

They did not Mr. Justice.

William J. Brennan, Jr.:

After initially denying —

Daniel M. Friedman:

After initially denying and I found that also that this Court, and they denied a petition for rehearing in the Court, but we don’t know why.

Now this issue was never been raised because this Court.

It’s not raise by the Board.

It is not raise by Union.

The Union concedes it and I’m not sure exactly what status the employer believes it has in this case.

On the one hand, it has now amended the caption to show itself as the respondent, on the other hand, at page 2 of its brief, it asked leave to intervene.

The Court of Appeals — this Court incidentally had denied a petition for rehearing of that in March I believe — early this month and it just seems to us this issue was not properly presented.

This is not the way in which this kind of a question should be (Inaudible).

The very question — the very question that the employer seeks to raise in this case is now pending before the Court of Appeals in the Tiidee case to which I shall refer, that case was argued in September —

Potter Stewart:

And that’s pending before some Court of Appeals, the Tiidee case.

Daniel M. Friedman:

That is pending before the Court of Appeals for the District of Columbia Circuit, the same court that decided this case in which there was a challenge to the Board’s authority to —

Potter Stewart:

Power.

Daniel M. Friedman:

Pardon?

Potter Stewart:

The Board’s power to do this?

Daniel M. Friedman:

The Board’s power to do.

Potter Stewart:

And here you concede the Board’s power, don’t you?

Daniel M. Friedman:

Yes, we think the Board has them.

Potter Stewart:

After all the Board did decide the Tiidee case and that’s why it had power?

Daniel M. Friedman:

That’s right.

Audio Transcription for Oral Argument – March 19, 1974 in National Labor Relations Board v. Food Store Employees Union, Local 347, Amalgamated Meat Cutters & Butcher Workmen of North America, AFL-CIO

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Daniel M. Friedman:

We think the Board has that power and the Union of course agrees with us.

William H. Rehnquist:

Well, then it’s entirely correct to call the concession on your part that the part has the power?

Daniel M. Friedman:

No, it’s not.

It’s not a —

William H. Rehnquist:

It’s a claim rather than —

Daniel M. Friedman:

I stand corrected Mr. Justice.

It is a claim.

Potter Stewart:

Well, but you both — It’s not at issue?

Daniel M. Friedman:

It’s not at issue as far as the parties are concerned.

Potter Stewart:

Right.

Daniel M. Friedman:

And the suggestion by the employer is that it’s somehow anomalous to decide the question of whether the Board in this case properly refused to award the fees if in fact as they claim, it has no authority at all.

We have cited signed it our supplemental memorandum, a decision of this Court, two decisions of this Court which we think are very close.

Some years ago, this Court held that a private plaintiff was entitled to recover for violation of Section 3 of the Robinson-Patman Act without deciding whether or not such as suit would lie.

About three to four years later, the question came up and this Court then held in the National Mill case that in fact Section 3 of the Robinson-Patman Act is not one of the antitrust laws for which a private action would lie.

So it seems to us this is a case in which this contention that the employer has made is not properly before the Court.

William J. Brennan, Jr.:

It’s certainly not subsumed under either the questions —

Daniel M. Friedman:

By no means —

William J. Brennan, Jr.:

— presented by your petition?

Daniel M. Friedman:

That is correct Mr. Justices.

I don’t see how our questions could possibly be viewed as raising any issue with respect to the Board’s power.

It’s a strange thing.

What the employer is doing is urging an alternative ground not for affirmance, but for reversal, a ground that the parties have not raised and that as far as we’re concerned is not — this is it seems to us is not the proper context and posture in which to litigate.

Potter Stewart:

Now the Respondent Union, I think has filed a motion to strike the brief, isn’t it?

Daniel M. Friedman:

One Union has —

Potter Stewart:

Have you joined that motion?

Daniel M. Friedman:

No.

We have not joined in the motion Mr. Justice, but what we have said, we spent two or three pages in this supplemental memorandum suggesting —

Potter Stewart:

I haven’t seen it.

I missed that somehow.

Daniel M. Friedman:

Yes.

Audio Transcription for Oral Argument – March 19, 1974 in National Labor Relations Board v. Food Store Employees Union, Local 347, Amalgamated Meat Cutters & Butcher Workmen of North America, AFL-CIO

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Daniel M. Friedman:

It’s — unfortunately it’s not printed at the moment, but we hope it will be printed by the end of the week.

It’s being printed now, but we filed it because of time.

Potter Stewart:

Right and so what have you done with respect to that motion?

Daniel M. Friedman:

We have done nothing with respect to that motion.

We have filed a memorandum or brief in answer to the Union’s brief because we don’t know how the Court is going to treat it, I’m sorry, the employer’s brief, we don’t know how the Court is going to treat it, but we give a number of reasons as to why we don’t think the Court should consider the argument and then very briefly just indicate our view as to why we I think the Board has that power in rather summary fashion because we got much —

William J. Brennan, Jr.:

Well, I would suppose Mr. Friedman, if we were going to consider it then we have to reset this case for oral argument?

Daniel M. Friedman:

I would —

William J. Brennan, Jr.:

It’s not represented here?

Daniel M. Friedman:

I would think so much Mr. Justice.

It would seem to me —

William J. Brennan, Jr.:

I don’t know how that can be, unless it’s subsumed in one of your questions?

Daniel M. Friedman:

No, it isn’t.

William J. Brennan, Jr.:

I don’t see how unless we granted some petition of Heck’s to present the question?

Daniel M. Friedman:

No, I don’t think that issue is probably before this Court.

Warren E. Burger:

Well, when we acted on the certiorari petition, they surely were not in the case here?

Daniel M. Friedman:

Well, they filed Mr. Justice.

They at the same time that the Court granted the Government’s petition for certiorari, it denied Heck’s petition for certiorari to review the denial of intervention.

Potter Stewart:

But then subsequently they were allowed to intervene?

Daniel M. Friedman:

By the Court of Appeals.

Potter Stewart:

Right, exactly.

Daniel M. Friedman:

By the Court of Appeals.

Warren E. Burger:

After the Court of Appeals had lost jurisdiction?

Daniel M. Friedman:

That’s our position.

William O. Douglas:

So we now have their brief, ex-brief?

Daniel M. Friedman:

That the Court Mr. Justice this morning denied leave to file.

The Court denied leave —

William O. Douglas:

And I have it?

Daniel M. Friedman:

You have it physically with you, but we believe that in the light of the Court’s action that is not —

William J. Brennan, Jr.:

I don’t suppose (Voice Overlap) wants now, the petition from the latest permission intervened, the order of intervention.

Daniel M. Friedman:

Not now, I don’t think so.

Audio Transcription for Oral Argument – March 19, 1974 in National Labor Relations Board v. Food Store Employees Union, Local 347, Amalgamated Meat Cutters & Butcher Workmen of North America, AFL-CIO

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Potter Stewart:

There was an order denying leave to file this, was there?

Daniel M. Friedman:

I’m sorry.

I apologize.

I’m sorry Mr. Justice.

It was denying the order the leave to the Chamber of Commerce to follow brief in support of that about the Heck’s brief is before the Court.

Potter Stewart:

And as a motion to strike.

Daniel M. Friedman:

There’s a motion to strike it made by —

Potter Stewart:

That has neither been granted nor denied.

Daniel M. Friedman:

That is correct.

That is before the Court, the motion.

The motion to strike or apart from the motion to strike whether the Court will consider the merits of that.

I mean, the Court could have of course keep the motion, the brief on file, but declined as we —

William J. Brennan, Jr.:

Now, the motion to strike is the Union’s motion.

Daniel M. Friedman:

It’s the Union’s motion.

William J. Brennan, Jr.:

And do you join it?

Daniel M. Friedman:

No, we’re not joining it as such.

Thurgood Marshall:

But if we do allow to stay in here and then reset this for rehearing and then the Court of Appeals changes its mind again and then what happens?

Daniel M. Friedman:

[Laughter]I don’t know Mr. Justice.

It seems to me your question indicates the reason for the rule that a party has to seek timely intervention before the Court of Appeals.

Heck’s could have protected itself completely in this case had it sort timely intervention before the Court of Appeals.

Now, let me if I may get to the basic issue in the case as I said there’s no dispute over the fact of the standard is the same, and therefore, the case comes down to as whether in the facts of this case the Board abused its discretion, did something that was patently irrational or illegal in declining the Union, the additional remedies which it had here sought.

William O. Douglas:

On that, you agree with Heck’s?

Daniel M. Friedman:

Oh, yes.

We agree the employer and the Board are in agreement that the Board properly declined these additional remedies.

We disagree with Heck’s.

We think we have the power to grant those remedies, Heck’s says we do not.

William H. Rehnquist:

Under Universal Camera, isn’t rather the question whether the Court of Appeals abused it’s reviewing discretion in deciding that the Board misused its authority.

I mean, we review the Court of Appeals rather than the Board, don’t we?

Daniel M. Friedman:

You review the Court of Appeals Mr. Justice, but in reviewing the Court of Appeals it seems to me it has to look at the limited role the Court of Appeals place in this thing that is whether in all of the circumstances, whether in all of the circumstances, it can be said that the Board patently abused its discretion.

That it’s conclusion here that these additional remedies were not necessary or no relation to its permissible views as to what the Act requires.

Audio Transcription for Oral Argument – March 19, 1974 in National Labor Relations Board v. Food Store Employees Union, Local 347, Amalgamated Meat Cutters & Butcher Workmen of North America, AFL-CIO

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Daniel M. Friedman:

Now, unfortunately it will need a somewhat detailed discussion of the facts because this Board decision here is involved with the Board subsequent decision in the Tiidee case and since the Court of Appeals held not that the Board had improperly exercised its discretion in this case in the sense that the Board’s rationale in this case was insufficient.

That was not the theory on which it held the Board was required to give these remedies.

The theory was that what the Board had done in the Tiidee case.

Somehow undermined its decision here.

So in my presentation, I will focus mainly on what the Board did in this case, what the Board did in the Tiidee case.

The case arose out of an attempt by the Union to organize a retail store operated by Heck’s in Clarksburg, West Virginia.

Heck’s as is customarily for it, strongly resisted the Union and engaged in a variety of unfair labor practices.

I use the word “customarily” because Heck’s is not stranger to the National Labor Relations Board.

In the past few years, it has been a respondent in 11 different proceedings.

And the Board found in this case that this was part of a general plan by Heck’s, conducted by its two principle officers, it’s president and vice president to resist unionization at every stage and it is said to deny its employees their rights under the National Labor Relations Act.

What the Heck’s did is to cause customarily ring to it.

They threatened and coerced employees who were active in the Union.

They conducted a non-secret poll of the employees as to who is interested in the Union.

They threatened that if the Union got in, they’d close the store and then they refused to bargain with the Union, even though as the Board found the Union enjoyed a representation status with respect to a majority of the employees.

The Union had obtained cards, authorization cards and that was basis on which it sought to bargain with the company.

Now, this is of some significance with respect to the kind of case we have here.

Heck’s asserted that it had a good faith doubt with respect to whether in fact the Union represented a majority of its employees and the examiner agreed with Heck’s on this.

The examiner said yes on all the facts we think Heck’s did have a good faith doubt, the Board however reject that.

As a remedy for these unfair labor practices, the Board adopted what is its conventional remedy.

It entered a cease and desist order.

It directed the employer depose to various notices in its plant and it also directed the employer on request to bargain with the Union finding that the employer’s unfair labor practices had made it impossible at that point to hold a fair election.

The Court of Appeals upheld the Board’s findings of violation and said that the Board’s order was fine as far as it went, but that it didn’t go far enough, and therefore, remanded the case to the Board to reconsider in the light of a Court of Appeals Tiidee’s opinion.

Now, on the remand, the Board granted some, but not all of the remedies that the Union had sought.

Specifically, it added these remedies.

It required the employer to mail this notice which had previously ordered posted in the plants to every employee at his or her home.

It directed the employer to give the Union access to company bulletin boards for a period of the year and it also directed the employer to make available to the Union the names and addresses of all the employees and to keep list current for a year to facilitate the Union’s communication with its employees.

The Board, however, refused to grant certain other requests that the Union had made.

It refused to grant an order for company wide bargaining.

It refused to order the employer to read the notices to the employees at an assemblage and it declined to award attorney’s fees and excess organizational expenditures.

The Board recognized there was a probability that as a result of the employer’s unfair labor practices, the Union probably spent more on attorney’s fees and organizational fees that it would have found had there not been the refusal to bargain.

Audio Transcription for Oral Argument – March 19, 1974 in National Labor Relations Board v. Food Store Employees Union, Local 347, Amalgamated Meat Cutters & Butcher Workmen of North America, AFL-CIO

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Daniel M. Friedman:

But, the Board concluded and this is on page 38 (a) of the petition, said it wouldn’t unbalance, effectuate the policies of the act to require reimbursement by the employer with respect to these items.

Now, when the Board spoke of effectuating the policies of the Act, it was referring to the statutory provision governing the Board’s authority over order.

Section 10 (c) of the Act which gives the Board power to take such affirmative action, including reinstatement of employees with or without backpay as will effectuate the purpose, the policies of the Act.

The basic rationale of the Board’s decision in this case was that the special role of a charging party before the Board, the group, the person who files the charges, that the role of the charging party was such that it was not necessary to carry out the policies of the Act as a general rule to provide for attorney’s fees and expert organizational expenses.

As the Board said, I’m reading now briefly from in page 39 (a), “It is the Board which has been given primary initial responsibility to determine and protect the public interest in the elimination of obstructions to commerce resulting from labor disputes.

Such protection of the public interest as may result from the charging parties participation in litigation must be regarded, we believe, as incidental to its efforts to protect its own private interest.

Given this statutory framework, we conclude that the public interest in allowing the charging party to recover, the cost of its participation in this litigation does not override the general and well-established principle that litigation expenses are ordinarily not recovered.

Well, now, the Union disagrees with us what the general principle is with respect to the recoverability of litigation expenses in this country.

We have filed a brief.

We argue it one way.

The Union on argues it the other.

Not infrequently lawyers disagree as to what the cases hold, but the critical thing, we think about this is this was just really an additional ground the Board relied on.

The clinical language we think is the language on page 38 that on balance because of the role of the charging party, it would not effectuate the policies of the Act to permit reimbursement.

Now, I just might mention parenthetically in passing since this is important.

Under the Board’s procedures, as this Court has recognized in the Schofield case, it’s the Board that has the laboring oar in conducting its proceedings.

The charging party has a party.

The charging party can may play a greater or lesser role, but it’s the Board that conducts the proceedings.

It’s the Board for example that makes the decision whether to seek enforcement of an order.

The charging party cannot do that.

It is the Board that has the sole authority to cite a respondent for contempt if he fails to comply with the order.

And therefore, it seems to us that this case is a very different case from the typical situation in which attorney’s fees have been awarded.

This is a not case in which attorney’s fees have to be awarded in order to encourage people to conduct litigation where that litigation is an important element of implementing the statutory programs and policies.

This is not a case in which as result of a litigant’s activities, benefit has been conferred upon a group and it’s deemed unfair that the members of that group should not compensate the man who brought the suit.

I mean, in the case in the Woods case, the case last year under the —

Hall v. Cole?

Daniel M. Friedman:

Yes, in the Cole case there what you had was the particular employee had brought a suit in order to vindicate his right to a free speech in opposition to the Union.

The Court held that attorney’s fees were properly paled by the Union in that case because in vindicating his right of free speech, he was also vindicating the rights of free speech of all the members of Union and therefore that all the members of the Union benefited from his endeavors.

Now here, obviously all the members of the Union benefited from the Union’s activities, but it’s the members of the Union who should pay for that.

Certainly, the employer in this case cannot be deemed the beneficiary of a litigation the Union conducted in this case.

The Union and the employer were at odds.

Audio Transcription for Oral Argument – March 19, 1974 in National Labor Relations Board v. Food Store Employees Union, Local 347, Amalgamated Meat Cutters & Butcher Workmen of North America, AFL-CIO

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Daniel M. Friedman:

Now, when the case came back to the Court of Appeals the second time, the Court of Appeals did not hold as I’ve indicated in any way that it disagreed with the Board’s general premise that ordinarily because of the nature of broad proceedings that counsel fees and organizational expenses should not be awarded.

What it said was it thought the Board’s rationale in this case had been undercut by it’s decision in Tiidee case and that the Board now in effect has conceded that as long as an employer, let me read the precise language the Court of Appeals used because I think it indicates the essence of it’s holding in this case.

The court said was —

Warren E. Burger:

Where are you reading now Mr. Friedman?

It appendix to the —

Daniel M. Friedman:

I am reading from page 10 (a) of the first appendix to the petition.

Unfortunately, in this case the various documents divided up in — among a number of different places.

What the Court said is a bottom of the — just before the paragraph number 2 on 10 (a).

It was said it would appear that Board is now recognized that employers will follow a pattern of resisting Union Organization and who to that end unduly burden the processes of the Board and the courts should be oblige at the very least to respond in terms of making good the legal expenses to which they have put the charging parties and the Board.

We hold that the case before us is an appropriate one for according such relief.

We think in this, in this holding the Board has completely misinterpreted the Board’s decision in Tiidee.

Tiidee was another case similar to this one; an employer who resisted Union organization demands, who refused to bargain the Board entered the conventional remedies.

The Court of Appeals remanded the case to the Board primarily to consider what was called a “make-whole” remedy.

That is the claim of the Union that relief should include not only cease and desist, etcetera, etcetera, but also to pay to the employees the amounts the Board thinks they would have gotten had there been a contract.

That was the main issue that was litigated in the Tiidee case.

William O. Douglas:

It was the different panel of the Court?

Daniel M. Friedman:

You could see them Mr. Justice.

Yes, the Tiidee panel where Judges Leventhal, Robinson and McGowan, this panel were Judges Leventhal, Bazelon, and McGowan and Judge McGowan wrote the opinion.

Now, in the Tiidee case after this lengthy discussion, the Court almost at the end its opinion added a footnote.

I’m sorry, the end of the discussion in the Tiidee opinion.

It said that the Board should reconsider on the remand, other lesser remedies beside the make-whole and one of the things it said to consider ultimate remedies such as an award to the Union for excess organization costs, caused by the company’s behavior, or for the cost of having to litigate a frivolous case, the Court’s words, frivolous case or for a combination of this.

And earlier in its opinion at page 1249 at 426 F.2nd, the Court said, “The present posture of the Board encourages frivolous litigation not only before the Board but before courts.”

That is the present posture of the Board in not doing anything more than the conventional remedies.

In its Tiidee opinion, the Board specifically granted attorney’s fees because this was frivolous litigation that was said.

To refer to page 35 and page 36 of the appendix, the brown volume, the Board said that it had previously, as recently noted, normally litigation expenses are not recoverable by the charging party in Board proceedings even though the public interest is served from the charging party protects its private interest before the Board, citing its decision in this very case.

And it went on to say, we agree with the Court, however, the frivolous litigation such as this is unwarranted.

But then it went on to say the statutory policy of ensuring rights of the employees is encouraged and if its not encouraged further when this frivolous litigation.

And it said, “In order discourage frivolous litigation, future frivolous litigation, page 36 of the appendix and to serve the policies of the Act we decided to award it.

Three times in its discussion at pages 35-36 of the appendix in its Tiidee opinion, it refers to frivolous litigation.

When it came to access organizational expenses, what the Board said was we’re not going to award them because as we view this case, there were no access organizational expenses.

Audio Transcription for Oral Argument – March 19, 1974 in National Labor Relations Board v. Food Store Employees Union, Local 347, Amalgamated Meat Cutters & Butcher Workmen of North America, AFL-CIO

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Daniel M. Friedman:

The Union in two months won in election 19 to 6 and it didn’t incur any excess organizational expenditures.

The Court of Appeals interpreted that ruling as somehow indicating that the Board had abandoned its rationale in Heck’s.

Somehow because the Board had not said in the Heck’s case, I’m sorry, because the Board had not said in Tiidee case while we have — while we generally don’t award these things, we don’t have reach the case to see whether it’s an exception here, whether it’s frivolous litigation because in this situation there was no excess expenditures obtained.

Now, it seems to us, there are two basic points I’d like to make about what the Board did in this case.

First, we think the Board was preeminently reasonable in light of the statutory scheme in concluding that as a general rule, attorney’s fees and litigation expenses should not be accorded as a part of the remedy for unfair labor practices.

That we think is the general rule if properly promulgated.

We also think it acted reasonably in creating the exception it did in Tiidee for frivolous litigation.

Frivolous litigation stands on a very different footing from litigation in which although there are substantial questions to be litigated, nevertheless ultimately it’s held that the defendant has not prevailed.

In this case, in this case although the Board found that the employer had no good faith doubt about the Union’s — the employer had no good faith doubt about the Union’s majority status, the employer — the Union — the employee’s contention had sufficient substance that the trial examiner went the other way.

We think this is one of those cases where what the Court of Appeals has really done is it has attempted to determine what in fact would be appropriate in this kind of a situation, what would be appropriate relief to effectuate the policies of the Act.

That is a decision with all due respect to the Court of Appeals that Congress has committed to the expert opinion of the Board and not to the courts and we think the Court of Appeals in this case went beyond the proper scope of its relief.

Thank you.

Warren E. Burger:

Thank you Mr. Friedman.

Mr. Ratner.

Mozart G. Ratner:

Mr. Chief Justice and may it please the Court.

This case presents in our view, two rather separate questions.

One is to validity of the court’s holding that the Board acted arbitrarily in not awarding organizational expenses in this case and the second is that the Board acted arbitrarily in refusing to award legal fees in this case.

There is no question here contrary to my friend Mr. Friedman’s setting of the question about what the Board should hold as a general rule with respect to legal fees.

At least if as a general rule is meant to cover cases where you do not have a persistent aggravated offender, one whose unfair labor practices are brazen and who is in fact a multiple recidivist.

The law has ways of taking care of treating litigants of that violators of that kind.

It is the same way as it turns out to the fields with litigants who present frivolous defenses.

Warren E. Burger:

Mr. Ratner, isn’t it inherent in the doctrine that Mr. Friedman discussed at the close of his argument that this is one of the very delicate matters that the Board deals with and the only to avoid 11 different rules on it is to let the Board have virtually final authority on determining such remedies?

Mozart G. Ratner:

I submit, Mr. Chief Justice that that principle has no application in this case where what the Court of Appeals in effect did was to hold that the Board had acted arbitrarily, unreasonably, and drawn a distinction where there is no material difference in results, in relevant results between what they said about the benefits of organizational expenses to effectuation of the policies of the act in Tiidee and what they said as the Board as their reasons for organization expenses in Tiidee none of which Board remotely on the organizational expenses related solely to the counsel fees.

I mean, that it Heck’s, the reasons given in Heck’s for the denial of counsel fees were the same as the reason given for the denial of organizational expenses.

They’re relevant on the question of counsel fees.

They are irrelevant to the question of organizational expenses and the Court of Appeals so held and whether the Board was being arbitrarily, when it distinguished aggravated and persistent violators from those who present frivolous defenses even others may not be even as brazen violations as the law of the persistent recidivist.

Now, we think that unless the scope of judicial review afforded by the Administer Procedure Act is to be narrowed beyond toleration that the Court of Appeals must be allowed at least to set aside administrative inaction or action when it correctly finds that the action or in action is arbitrary in the sense that I have used that term, which means irrational, not materially related and supported by the reasoning given and distinctions without relevant differences.

This is, I submit Your Honor what the test should be in this case.

Did the Court of Appeals — was the Court of Appeals correct in holding that the Board in effect was arbitrary here.

Now there are two respects in which this case is unique.

Audio Transcription for Oral Argument – March 19, 1974 in National Labor Relations Board v. Food Store Employees Union, Local 347, Amalgamated Meat Cutters & Butcher Workmen of North America, AFL-CIO

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Mozart G. Ratner:

One, it is a case of a multiple recidivist whose brazen violations in the Board’s own words are company wide aggravated and pervasive.

The Board found that Heck’s had a policy, a labor policy which was opposed to policies of the Act, and as a result of that policy, within a relatively short time, between 1965 and 1970, Heck’s was involved in unfair practice litigation 11 times.

During that period as it happened, the Court of Appeals for Fourth Circuit was holding that the Board couldn’t get a bargain order on authorization cards.

And it was only when that was — it was in that light of that holding that the Board and the trial examiner treated one or two of these Heck’s violation cases.

One or two other cases actually came to this Court in Gissel as a companion case and of course the judgment below was reversed.

Now, Heck’s strategy was –- oh, I just wanted to add that the reason the Board reversed the trial examiner’s determination that there was no refusal to bargain in bad faith was not because it differed with him on the facts, but on it — because its view that Heck’s was totally unconcerned with whether the Union had a majority or not.

It wouldn’t have bargained no matter what the situation was because of its background and history of persistent unfair labor practices, it would have refused to bargain in any event.

It’s simply demanded an election to gain additional time to undermine the Union and when it had done that of course it fought with it, litigation.

Now, the strategy that Heck’s used was to transfer, discharge or close its door or threaten to do those things if the Union got in to engage in excessive interrogation, coercive interviews and illegal polls.

When the Union requested recognition, Heck’s would step up its campaign.

It routinely refused to look at authorization cards that Union tendered in support of its request.

It demanded an election to gain time within which to undermine the Union further and thereby forced the Union and the general counsel to litigate, to establish that Union had an un-coerced majority when it have requested recognition.

Now, the Board treats frivolous litigation as if somehow the litigation had been initiated by the employer.

That’s not true.

Of course, the employers have responded in this case.

The real way to see that, the only way to see that is to see that the employer is willing to submit to litigation even though he has gotten a plausible defense or no matter how brazen his violations are in the hope like Mr. McCoben that something will turn up.

And if he is able to attack the Union’s card showing, well, that’s let him free of the hook because if he has — Union hasn’t got a valid majority of un-coerced cards, it doesn’t have a right, but that isn’t why he acted illegally.

All of his illegal action was devoted to destroying the support for the Union whether or not they have a majority.

So what really is happening here is that employer is using, he is provoking the litigation.

He is provoking the Union and compelling it to resort to litigation, it and the Board to resort to litigation and then he goes along, hopes he wins, he doesn’t care how long it takes in effect for long as long possible to ward off the evil bad.

And then when the evil day arrives probably finds the Union totally impotent to engage in bargain.

The Board has recognized all that.

In its decision in Tiidee, its supplemental opinion in Tiidee following the remand from the Court of Appeals, the Board had this to say, and oh yes before I get to that I should mention that when Mr. Friedman says that the Board’s decision — the Court’s decision in Tiidee related only to frivolous litigation.

He omits the fact that the remand in the Heck’s itself was predicated not on the frivolity of the defense, but on the persistent and aggravated bad faith conduct which the Board itself had found.

So there can be no justification whatever for claiming that the Board was — could properly have believed that all the Court of Appeals meant was it should award counsel fees in cases of frivolous litigation and not where they’re aggravated and persistent violations as where in Heck’s.

That distinction just simply blown out on the basis of the Heck’s remand itself.

Now, the Court of Appeals, the Board accepts the remand in the Heck’s case.

As we understand it that means that they were content to attempt to follow what the Board — what the Court had told them to do and one of the things that the Court had told them it had to do was to consider at least some of the alternative remedies, including organization expense — excess organizational expenses and counsel fees that had been requested by other parties including the Union in the Heck’s case as alternative to the so called make-all remedy.

On page 33 of the appendix is the Board’s explanation in its supplemental opinion in Tiidee of what it thought the remand meant.

The Board believes, they consider why we find it would be counterproductive to grant the Union’s request for a remand to the trial examiner, the Board believes that the alternative remedies provided here and after will undo some of the baneful affects pointed out by the court as having resulted from respondent’s clear and flagrant violation of the law.

Audio Transcription for Oral Argument – March 19, 1974 in National Labor Relations Board v. Food Store Employees Union, Local 347, Amalgamated Meat Cutters & Butcher Workmen of North America, AFL-CIO

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Mozart G. Ratner:

No, that has nothing to do with the frivolity of the defense or the frivolity of the litigation.

These are the effects that flow from respondent’s clear and flagrant violation of the law. Indeed, that’s how a Union basically loses it support among the employees.

The exception always proves the rule.

It won the case to the election in Tiidee, but it lost in Heck’s and that is most common experience that Unions have, where you have clear and flagrant aggravated violations of a law such as the respondent engaged in this case, you’re going to inevitably have as a result, the loss of support for the Union by the employees whether it lost their support either from complete support to majority or from majority to a minority.

Now, to continue with the Board’s statement, these remedies will for; one aid the Union in rebuilding strength so that it may bargain effectively with the respondent and also by requiring respondent that the pay some Board in the litigation cost occasioned by this misconduct similar brazen refusals will be discarded.

Warren E. Burger:

We’ll resume at that point in the morning at 10 o’clock.