Manhattan Center Studios, Inc. v. National Labor Relations Board

452 F.3d 813, 371 U.S. App. D.C. 437, 179 L.R.R.M. (BNA) 3105, 2006 U.S. App. LEXIS 15759
CourtCourt of Appeals for the D.C. Circuit
DecidedJune 23, 2006
DocketNos. 04-1400, 04-1417
StatusPublished
Cited by20 cases

This text of 452 F.3d 813 (Manhattan Center Studios, Inc. v. National Labor Relations Board) is published on Counsel Stack Legal Research, covering Court of Appeals for the D.C. Circuit primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Manhattan Center Studios, Inc. v. National Labor Relations Board, 452 F.3d 813, 371 U.S. App. D.C. 437, 179 L.R.R.M. (BNA) 3105, 2006 U.S. App. LEXIS 15759 (D.C. Cir. 2006).

Opinions

PER CURIAM.

Petitioner Manhattan Center Studios (MCS) seeks review of an order of the National Relations Board (NLRB or Board) finding that it committed an unfair labor practice (ULP) in refusing, inter alia, to bargain with a union certified by employee vote. After the certification election, MCS learned that one of its supervisory employees had, before the election, improperly distributed union authorization forms and solicited the unit employees to sign them. MCS refused to bargain on that basis, contending the election was not valid. It claimed that its supervisory employee’s subsequently discovered misconduct constituted an affirmative defense to the ULP charge. The Board disagreed. Before us, MCS argues that, in denying it the opportunity to contest the validity of the election, the Board misapplied its precedent regarding newly discovered evidence. The Board cross-petitions for enforcement of its order. Because we find that the Board erred in applying its “due diligence” standard — used to permit an untimely election challenge based on newly discovered evidence — to the facts of this case, we remand for further proceedings.

I.

MCS is a corporation based in New York City that offers its facility for rent for theatrical and musical productions.1 On February 19, 2003, stagehands and production staff (production employees) employed by MCS voted by a 5-1 margin to certify Theatrical Stage Employees Local No. One (Union or Local One) as the collective bargaining representative for their seven-employee bargaining unit. See Tally of Ballots, NLRB Case No. 2-RC-22677 (Feb. 19, 2003), reprinted at Joint Appendix (JA) 10. MCS did not file an objection to the election within seven days after the election as required by 29 C.F.R. § 102.69(a).2 Eight days later, on February 27, the Board certified the Union as the representative of the production employees’ bargaining unit and, on March 7, the Union wrote to MCS’s CEO Russell Arnold requesting both available dates to begin bargaining and information on terms and conditions of employment needed to formulate its bargaining proposals.

On March 20, MCS responded to the Union’s request, refusing to bargain or to turn over any employee information. Its letter stated that “it has recently come to our attention that an MCS supervisor was [439]*439improperly involved in organizational activities on behalf of Local One. As a result, it appears that Local One is not validly and lawfully certified as the bargaining representative of an uncoerced majority of MCS’s stagehands and production employees.” Letter from Russell Arnold, CEO, MCS, to James J. Claffey, Jr., Legitimate Theater Business Manager, JA 13. The Union then filed two ULP charges against MCS and on May 30 the Board issued a complaint charging MCS with a violation of sections 8(a)(1) and (5) of the National Labor Relations Act (Act), 29 U.S.C. § 158(a)(1), (5), in refusing the Union’s requests to bargain and to provide information following a valid certification.3 JA 18. In its answer to the complaint MCS admitted it had refused to bargain but offered an affirmative defense to the ULP charges — namely, that the “Union’s election petition was tainted by unfair labor practices, including improper supervisory involvement in the organizing campaign.” JA 48. MCS maintained that after the Union was certified on February 27- — and, significantly, after the period to object had expired, see 29 C.F.R. § 102.69(a) — it learned that one of its supervisory employees, Technical Coordinator Gustavo Garces, had distributed the Union’s authorization cards before the election and solicited employees to sign them, thereby tainting the unit employees’ exercise of their “right to bargain collectively through representatives of their own choosing” in violation of section 8(b)(1) of the Act. See 29 U.S.C. § 158(b)(1);4 JA 63. MCS learned of Garces’s organizing activities from Michael Spony, a non-unit employee, sometime in March. JA 52. According to the affidavits of Spony and CEO Arnold, Spony told Arnold that Garces had boasted to Spony of Garces’s “spearheading] the Union’s campaign to organize [MCS’s] production employees” during a conversation the two had had in November 2002. JA 53, JA 15. Because the information regarding Garces’s misconduct “was not previously available” to MCS, MCS argued that, notwithstanding the representation proceeding had closed when the unit employees voted to certify the Union as their representative and the period for filing objections had expired, it could nonetheless properly raise the issues of his misconduct and its effect on the election in the then-pending ULP proceeding in order to challenge the validity of the Union’s certification and thus undergird its refusal to bargain. MCS Mem. of Law in Opp’n to Mot. for Summ. J. at 12, JA 67. Because it was unaware of Garces’s misconduct until March, it could not have timely objected to the election on that basis. Nonetheless, MCS argued, it remained free to challenge the election because, in its words, “a party is entitled to litigate representation issues concerning coercive pre-election conduct if the party has obtained newly discovered evidence or did not otherwise have an opportunity to litigate the issues in the prior representation proceeding.” JA 64 (citing San Antonio Portland Cement Co., 240 N.L.R.B. 1168 (1979)). Its evidence was new, MCS claimed, because it did not learn [440]*440of the supervisory taint until after the seven-day period. Id.

On September 24, 2004, the Board issued its Decision and Order granting summary judgment to the General Counsel. Manhattan Ctr. Studios, Inc., 342 NLRB No. 131, 2004 WL 2203011 (2004) (MCS), JA 79. It began by noting “the Respondent did not file any objections to the conduct of the election” within seven days thereafter; the representation proceeding had therefore closed and could be “reopened to litigate [election impropriety] issues only if [MCS] could establish that it has newly discovered evidence.” Id., slip, op. at 2. It found that MCS had not met that burden. The Board described newly discovered evidence as evidence of facts that existed at the time of the representation proceeding “which could not be discovered by reasonable diligence.” Id. (citing APL Logistics, Inc., 341 N.L.R.B. No. 132, slip op. at 1, 2004 WL 1174586 (2004)). It then concluded:

[T]he Respondent has failed to present any information indicating that prior to the expiration of time in which to file objections to the election, it engaged in an attempt to uncover any potential improprieties in that proceeding. Thus, the Respondent has failed to establish that the evidence at issue could not have been discovered earlier through the exercise of reasonable diligence.

Id. at 2, JA 80 (emphasis added). Because MCS had no affirmative defense to its refusal to bargain with the Union, no genuine issue of material fact existed as to MCS’s refusal to bargain and, accordingly, the General Counsel was entitled to summary judgment. MCS timely petitioned for review.

il.

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Bluebook (online)
452 F.3d 813, 371 U.S. App. D.C. 437, 179 L.R.R.M. (BNA) 3105, 2006 U.S. App. LEXIS 15759, Counsel Stack Legal Research, https://law.counselstack.com/opinion/manhattan-center-studios-inc-v-national-labor-relations-board-cadc-2006.