Ernst Home Center, Inc. v. United Food & Commercial Workers International Union

888 P.2d 1196, 77 Wash. App. 33
Court of Appeals of Washington·Decided January 9, 1995·No. No. 33420-4-I·Published·Cited by 26 cases

Opinion

Coleman, J.

Ernst Home Center, Inc., appeals the trial court’s order of summary judgment, dismissing its defamation and Consumer Protection Act (CPA) claims against the United Food and Commercial Workers International Union, AFL-CIO, Local 1001 (Union), and the law firm representing the Union, Webster, Mrak and Blumberg (Webster Defendants). Ernst’s complaints arise out of a mailer distributed by the Union and its attorneys to Ernst employees. Ernst contends that the mailer contained false statements that were damaging to its reputation and that the Webster Defendants violated the CPA by soliciting potential clients through the mailer. We affirm.

I

Facts

Since 1986 the Union has been the collective bargaining representative for a substantial number of Ernst employees. The most recent union contract with Ernst expired October 31, 1992. In October 1992, the Union began negotiating with Ernst over the terms of a new collective bargaining agreement. During the Union’s preparation for negotiations, a number of Ernst employees claimed that "off-the-clock work” was occurring.1 According to Joe Peterson, president of the [36] Union, some managers were telling employees to record the hours for which they were scheduled to work, but not to record additional hours spent on work-related activities like continuing education.2 As a result of these reports, the Union proposed new contract language in the form of penalties against Ernst for permitting off-the-clock work. Ernst rejected this proposal at the bargaining table, insisting that company policy had always been to prohibit off-the-clock work.3

During an October 8, 1992, bargaining session, Kathryn Norris, Ernst’s manager of employee/labor relations, spoke with employee representatives regarding off-the-clock work. She told them that it was Ernst’s policy to pay employees for all time worked and that employees who had worked additional hours for which they had not been paid needed to make a claim.4 The Union responded by distributing a mailer, on or around October 16, 1992, to Ernst employees.5 The front cover of the mailer stated the following:

Why has Ernst finally agreed to stop "off-the-clock” work?
Because the Union demanded it at the bargaining table!

[37] Inside, the mailer advised employees that they were entitled to back pay for off-the-clock work and that they could obtain a back pay calculation form either by sending a request to the Ernst Back Pay Task Force or by calling one of two telephone numbers. Peters on stated, by way of affidavit, that the mailer was intended to identify Ernst employees who had worked off the clock and to help those employees calculate how much money Ernst owed them.

On October 29, 1992, Ernst sent a letter to the Union and its attorneys, alleging that the mailer was defamatory and violated the CPA. After learning that neither the Union nor its attorneys would agree to a retraction, Ernst filed a complaint on November 3, 1992, for defamation and a CPA violation. The Union, in turn, filed an unfair labor practices charge with the National Labor Relations Board (NLRB) against Ernst and its attorneys. The NLRB issued a complaint against Ernst and filed a petition with the United States District Court, seeking to enjoin Ernst from litigating its claims.

By letter dated November 17, 1992, Norris responded to a Union request for information. Regarding off-the-clock work, Norris stated:

At various points throughout negotiations we have stated that a member of the Human Resource Services staff, Matt Boswell, interviewed a number of bargaining unit staff members [on] October 15, 1992, in store 217 regarding possible "off-the-clock” work. . . . Discussion with the staff member included informing him or her of their responsibility to properly account for all time worked on their paycard, including CEU [continuing education units] training that may have taken place away from the workplace, and the necessity of each staff member to take all required rest and lunch breaks on a daily basis. No written record was kept of the conversations, nor were any staff member(s) threatened with discipline for failing to previously report such claims.[6]

Norris also discussed the issue of CEU hours and stated:

[38] Through discussion with store managers we found that a few staff members [13] had not received compensation for all time worked during Holiday decorating parties, store clean-up and CEUs done during personal time. We are in the process of compensating the . . . staff members for all known work time[.]

On April 12, 1993, Ernst served its interrogatories, requesting: (1) the identity of the persons who made the "demand” and "agreement” set forth in the mailer; (2) the identity of the authors and printers of the mailer; (3) the identity of all Ernst employees known by the Union to have worked off the clock; and (4) all documents related to the creation of the mailer. Ernst also noted several depositions that were set to take place shortly after the interrogatories were due.

In May 1993 the parties agreed to stay discovery pending the outcome of the NLRB’s petition before the federal district court. Following the NLRB’s withdrawal of the petition, Ernst mailed a letter to the Union’s attorney on June 17, 1993, setting a response deadline of July 2, 1993. By letter dated July 2, 1993, the Union objected to Ernst’s discovery request and refused to provide any discovery. The parties subsequently held a King County Local Rule 37(e) conference. The Union refused to participate in discovery until after a decision had been reached on its motion for summary judgment.

On July 6, 1993, the Union filed a motion for summary judgment, arguing that the court should dismiss Ernst’s defamation claim because the statements in the mailer were substantially true. In support of the motion, the Union offered a declaration by Peterson. Regarding the Union’s proposed penalties for permitting off-the-clock work, Peterson stated:

Ernst rejected this proposal, insisting that company policy has always been to pay for all time worked. Ernst’s representatives then asked us to identify all employees who had an off-the-clock claim so that they could be compensated. I considered Ernst’s statements during the negotiations that employees would be paid for off-the-clock work a commitment by Ernst to stop the off-the-clock work in the sense that the employees would receive compensation for such work.

[39] Peterson also discussed a November 19, 1992, negotiating session in which Ernst was asked whether it paid for all time worked. He stated:

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Ernst Home Center, Inc. v. United Food & Commercial Workers International Union, 888 P.2d 1196, 77 Wash. App. 33 (Wash. Ct. App. 1995).

888 P.2d 1196 (Ernst Home Center, Inc. v. United Food & Commercial Workers International Union) — published by Counsel Stack Legal Research, free access to 12M+ legal documents.

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