NOTICE: This
opinion is subject to formal revision before publication in the bound volumes
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Air Climate Systems, Inc. and All Climate Systems, Inc. and Sheet Metal Workers Local 18. Case 30–CA–17695
May 30, 2008
DECISION AND ORDER
By Chairman Schaumber and Member Liebman
The General Counsel seeks a default judgment on the ground that the Respondents failed to file a timely answer to the complaint. Upon a charge filed by the Union on March 12, 2007, the General Counsel issued a complaint on August 31, 2007 against Air Climate Systems, Inc. and All Climate Systems, Inc., the Respondents, alleging that they were alter egos and that they violated Section 8(a)(5) and (1) of the Act. On September 27, 2007, the Respondents filed a late answer.
On October 4, 2007, the General Counsel filed a Motion for Default Judgment with the Board. On October 11, 2007, the Board issued an order transferring the proceeding to the Board and a Notice to Show Cause why the motion should not be granted. On October 15, 2007, the Respondents filed a response to the default judgment motion, and on October 25, 2007, the General Counsel filed a statement in support of the default judgment motion.
On February 8, 2008, the Board issued an Order giving the Respondents an opportunity to file a response explaining the late filing of the answer. On February 27, 2008, the Respondents filed a late response to the Order. On March 7, 2008, the General Counsel filed a reply to the Respondents’ response.
Ruling on the Respondents’ Response to the Board’s February 8, 2008 Order[1]
The Respondents’ response to the Board’s February 8, 2008 Order was due on February 22, 2008. The Respondents’ response was filed by mail, was postmarked on February 22, 2008, and was received by the Board on February 27, 2008. Section 102.111(b) of the Board’s Rules and Regulations provides that a document must be received by the Board on or before the due date and that documents filed by mail must be postmarked on or before the day before the due date. The Respondents’ response was not received by the Board until 5 days after the due date and was postmarked on the due date. Accordingly, the Respondents’ response was filed late.
Section 102.111(c) provides that a document may be filed late only upon good cause shown based on excusable neglect. It also requires that a party seeking permission to file a document late must file a motion with the late document setting forth the grounds relied on for the late filing. The Respondents offer no explanation for the late filing of the response and did not file the required motion seeking permission to file the response late.
We therefore reject the Respondents’ late-filed response.[2]
Ruling on the Motion for Default Judgment
Section 102.20 provides that the allegations in a complaint shall be deemed admitted if an answer is not filed within 14 days from service of the complaint unless good cause is shown to the contrary. The complaint here was served on August 31, 2007. The Respondents’ answer was therefore due on September 14, 2007. In addition, the complaint stated that the answer had to be received by the Regional Office by September 14, 2007, or postmarked by September 13, 2007, and that, if no answer were filed, the Board could find the complaint allegations to be true pursuant to a default judgment motion. When the Respondents did not file an answer by the September 14, 2007 due date, the Region, by letter dated September 19, 2007, notified the Respondents that they had failed to file an answer within the prescribed time and that, unless an answer was received by September 26, 2007, a motion for default judgment would be filed.
The Respondents did not file an answer by September 26, 2007, but instead faxed an answer to the Regional Office after close of business on September 26, 2007, and mailed the answer on September 26, 2007. The answer was postmarked on September 26, 2007, and received in the Regional Office on the next day, September 27, 2007.
In their response to the default judgment motion, the Respondents concede that they filed the answer 1 day late and offer no explanation for the late filing. Absent a showing that the late filing of an answer is attributable to excusable neglect, the Board will reject the late answer, will find the complaint allegations to be admitted, and will grant default judgment on that basis. See Proper Steel Erectors, Inc., 345 NLRB 906, 907 (2005), and cases cited therein.
As noted above, we have rejected as late filed the Respondents’ February 22, 2008 response. However, even if the response had been timely filed, the Respondents’ explanation for the late filing of the answer does not demonstrate good cause based on excusable neglect.
In their response, the Respondents explain the late filing of the answer by stating that their
counsel attended a hearing on the day the answer was due, that the hearing ran
later than expected, that this delayed counsel’s return to his office, and that
this delay prevented counsel from hand-filing the answer in the Regional Office
that afternoon.[3]
We find the
Respondents’ explanation unavailing.
Counsel knew the answer had to be filed in the Regional Office by close
of business that day. He nevertheless
attended a hearing that he anticipated would run through 2:30 p.m. at a
location 45 miles from his office.
Counsel should have known that unexpected delays—e.g., the hearing
running late or traffic congestion—might prevent him from returning to his
office in time to hand-file the answer before the Regional Office closed at
4:30 p.m. The Respondents have not
explained why, in these circumstances, their counsel did not take alternative
steps to ensure a timely filing, such as completing and mailing the answer
prior to the due date or arranging in advance for a colleague to complete and
hand-file the answer on September 26, 2007.[4]
Further, the
Respondents do not explain why their counsel took no steps to have the answer
filed when he realized he would return to the office later than anticipated. The hearing ended at about 3:30 p.m.[5] At that point, counsel had only 1 hour to
drive the 45 miles to his office and hand-file the answer before the Regional
Office closed. The Respondents state
that the answer was “physically completed” by 3:00 p.m., but they do not
explain why counsel could not have telephoned his office when the hearing ended
at 3:30 p.m. and arranged for a colleague to sign, copy, and hand-file the
answer before 4:30 p.m.
The Board has
consistently rejected counsel inattention as an excuse for the late filing of
an answer. See, e.g.,
We also note
additional facts suggesting a disregard by the Respondents for the Board’s
rules and procedures. The Respondents’
counsel knew he was filing the answer late, but did not file a motion for leave
to file a late answer as required by Section 102.111(c). Although the Board’s February 8, 2008 Order
directed the Respondents to explain why the Respondents did not file such a
motion, the Respondents’ response to the Order failed to address this
issue. Finally, as noted, the Respondents’
response to the Board’s February 8, 2008 Order was itself filed 1 day late and
that too was not accompanied by the required motion for leave to file late.
The Respondents contend that the Board, in ruling upon the default judgment motion, should consider additional factors—that is, whether the late filing resulted in prejudice and whether the answer, if credited, would constitute a meritorious defense to the complaint allegations. In support of this contention, the Respondents rely on court decisions giving weight to these additional factors in determining whether to grant default judgment in late-answer cases arising under the Federal Rules of Civil Procedure.[6] However, the Board has previously considered and rejected this contention. See Patrician Assisted Living Facility, 339 NLRB 1153, 1154–1155 (2003) (“there are important differences between federal civil litigation and Board administrative process”); Country Lane Construction, 339 NLRB 1321, 1322 (2003), enfd. mem. 95 Fed. Appx. 817 (6th Cir. 2004); Ferndale Foods, Inc., 339 NLRB 1194, 1195 (2003).[7]
For these reasons, in the absence of good cause being shown for the Respondents’ late filing of the answer, we grant the General Counsel’s Motion for Default Judgment.
On the entire record, the Board makes the following
Findings of Fact
i. jurisdiction
At all material times, Respondent Air Climate Systems,
Inc. and Respondent All Climate Systems, Inc., corporations with offices and
places of business in
During the 12-month period ending May 31, 2006, Respondent Air Climate, in conducting its business operations, provided services valued in excess of $50,000 for enterprises within the State of Wisconsin that are directly engaged in interstate commerce. During the 12-month period ending June 1, 2007, Respondent All Climate, in conducting its business operations, provided services valued in excess of $50,000 for enterprises within the State of Wisconsin that are directly engaged in interstate commerce. Additionally, during the 12-month period ending June 1, 2007, Respondent All Climate, in conducting its business operations, purchased and received goods valued in excess of $50,000 directly from points outside the State of Wisconsin and from other enterprises, located within the State of Wisconsin, each of which other enterprises had received the goods directly from points outside the State of Wisconsin.
At all material times, the Respondents have been employers
engaged in commerce within the meaning of Section 2(2), (6), and (7) of the
Act, and Sheet Metal Workers Local 18 (the
ii. alleged unfair labor practices
On or about May 5, 2006, the Respondents established All Climate as a disguised continuation of Air Climate. At all material times, Air Climate and All Climate have been affiliated business enterprises with common officers, ownership, shareholders, directors, management, and supervision; have formulated and administered a common labor policy; have shared common premises and facilities, law firm, accounting firm, phone number, fax number, insignia, customers, vendors, insurance policies, and personnel, and have provided services for each other. Based on these facts, Air Climate and All Climate are, and have been at all material times, alter egos and a single employer within the meaning of the Act.
The following employees of the Respondents constitute a unit appropriate for the purposes of collective bargaining within the meaning of Section 9(b) of the Act:
All employees engaged in, but not limited to, (a) the manufacture, fabrication, assembling, handling, erection, installation, dismantling, conditioning, adjustment, alteration, repairing and servicing of all ferrous or nonferrous metal work and all other materials used including the setting of all equipment and all reinforcements in connection therewith, (b) all lagging over insulation and all duct lining, (c) testing and balancing of all air-handling equipment and duct work and serving of all equipment installed by sheet metal workers, (d) the preparation of all shop and field sketches used in fabrication and erection, including those taken from original architectural and engineering drawings or sketches, and (e) all other work included in the jurisdictional claims of Sheet Metal Workers’ International Association.
Since on or about December 1, 1998, the
At all material times, the Janesville Signatory Contractors (the Association) has been an informal organization composed of construction industry employers that, inter alia, represents its employer members in negotiating and administering collective-bargaining agreements.
On or about June 1, 2004, the
During summer 2006, the
On or about June 1, 2006, the Respondents withdrew
recognition of the
On or about January 4, 2007, the Union requested, by
letter, that the Respondents furnish the Union with information regarding the Respondents’
alter ego status that is necessary for and relevant to the
Conclusion of Law
By withdrawing recognition from the Union, by failing to sign the 2006 Agreement, by repudiating and failing to apply the 2004 and 2006 Agreements since on or about June 1, 2006, and by failing to provide information requested by the Union, the Respondents have failed and refused to bargain collectively and in good faith with the exclusive representative of their employees in violation of Section 8(a)(5) and (1) of the Act. The Respondents’ unfair labor practices affect commerce within the meaning of Section 2(6) and (7) of the Act.
Remedy
Having found that the Respondents have engaged in certain
unfair labor practices, we shall order them to cease and desist from those
practices and to take certain affirmative action designed to effectuate the policies
of the Act. We shall order the
Respondents to recognize the Union as the exclusive bargaining representative
of the unit employees and, on request, to bargain in good faith with the
ORDER
The National Labor Relations Board orders that the
Respondents, Air Climate, Inc. and All-Climate, Inc., alter egos and a single
employer,
(a) Refusing to recognize
and bargain with the Sheet Metal Workers Local 18 as the exclusive bargaining
representative of employees in the following unit:
All employees engaged in, but not limited to, (a) the manufacture, fabrication, assembling, handling, erection, installation, dismantling, conditioning, adjustment, alteration, repairing and servicing of all ferrous or nonferrous metal work and all other materials used including the setting of all equipment and all reinforcements in connection therewith, (b) all lagging over insulation and all duct lining, (c) testing and balancing of all air-handling equipment and duct work and serving of all equipment installed by sheet metal workers, (d) the preparation of all shop and field sketches used in fabrication and erection, including those taken from original architectural and engineering drawings or sketches, and (e) all other work included in the jurisdictional claims of Sheet Metal Workers’ International Association.
(b) Failing and refusing
to apply the terms and conditions of the June 2006 to May 2009
collective-bargaining agreement with the
(c) Refusing to provide
the Union with information that is necessary and relevant to the performance of
the
(d) In any like or
related manner interfering with, restraining, or coercing employees in the
exercise of the rights guaranteed them by Section 7 of the Act.
2. Take the following affirmative action necessary
to effectuate the policies of the Act
(a) Recognize and, on request, bargain with the
(b) Abide by the terms and
conditions of the June 2006 to May 2009 collective-bargaining agreement with
the
(c) Make whole the unit
employees and benefit funds for any losses they may have suffered as a result
of the Respondents’ failure to abide by the terms of the June 2004 to May 2006
and June 2006 to May 2009 collective-bargaining agreements with the
(d) Within 14 days from the date
of this Order, provide the
(e) Preserve and, within 14 days
of a request, or such additional time as the Regional Director may allow for
good cause shown, provide at a reasonable place designated by the Board or its
agents, all payroll records, social security payment records, timecards,
personnel records and reports, and all other records, including an electronic
copy of the records stored in electronic form, necessary to analyze the amount
of backpay due under the terms of this Order.
(f) Within 14 days
after service by the Region, post at their facilities in
(g) Within 21 days after service by the
Region, file with the Regional Director a sworn certification of a responsible
official on a form provided by the Region attesting to the steps that the
Respondents have taken to comply.
Dated,
Peter C. Schaumber, Chairman
Wilma B. Liebman, Member
(seal) National
Labor Relations Board
APPENDIX
Notice To Employees
Posted by Order
of the
National Labor Relations
Board
An Agency of the United States Government
The National Labor Relations Board has found that we violated Federal labor law and has ordered us to post and obey this notice.
federal law gives you the right to
Form, join, or assist a union
Choose representatives to bargain with us on your behalf
Act together with other employees for your benefit and protection
Choose not to engage in any of these protected activities.
We will not refuse to recognize and bargain with the Sheet Metal Workers Local 18 as the exclusive bargaining representative of employees in the following unit:
All employees engaged in, but not limited to, (a) the
manufacture, fabrication, assembling, handling, erection, installation,
dismantling, conditioning, adjustment, alteration, repairing and servicing of
all ferrous or nonferrous metal work and all other materials used including the
setting of all equipment and all reinforcements in connection therewith, (b)
all lagging over insulation and all duct lining, (c) testing and balancing of
all air-handling equipment and duct work and serving of all equipment installed
by sheet metal workers, (d) the preparation of all shop and field sketches used
in fabrication and erection, including those taken from original architectural
and engineering drawings or sketches, and (e) all other work included in the
jurisdictional claims of Sheet Metal Workers’ International Association.
We
will not fail and refuse to apply the terms
and conditions of the June 2006 to May 2009 collective-bargaining agreement
with the
We
will not refuse to provide the Union with information
that is necessary and relevant to the performance of the
We will not in any like or related manner interfere with, restrain, or coerce you in the exercise of the rights guaranteed you by Section 7 of the Act.
We will recognize
and, on request, bargain with the
We will abide by the terms and conditions of the June 2006 to May
2009 collective-bargaining agreement with the
We will make whole the unit employees and benefit funds for any
losses they may have suffered as a result of our failure since on or about June
1, 2006 to abide by the terms of the June 2004 to May 2006 and May 2006 to June
2009 collective-bargaining agreements with the Union, with interest.
We will provide the Union with the information relating to the
relationship between Air Climate Systems, Inc. and All Climate Systems, Inc. as
requested by the
Air Climate Systems, Inc. and All Climate Systems,
Inc.