Erica, Inc. v. National Labor Relations Board

United States Court of Appeals
Fifth Circuit
F I L E D
IN THE UNITED STATES COURT OF APPEALS September 19, 2006
FOR THE FIFTH CIRCUIT
Charles R. Fulbruge III
Clerk
No. 05-60706
ERICA, INC., GENERAL PARTNER,
d/b/a FOOD BASKET PARTNERS LP,
Petitioner-Cross-Respondent,
versus
NATIONAL LABOR RELATIONS BOARD,
Respondent-Cross-Petitioner.
Appeals from the National Labor Relations Board
(Docket No. 28-CA-17521)
_________________________________________________________
Before JONES, Chief Judge, and REAVLEY and PRADO, Circuit Judges.
PER CURIAM:*
Erica, Inc. (“Food Basket”) petitions to set aside a Decision and Order of the
National Labor Relations Board (“NLRB”) adopting the administrative law judge’s
*
Pursuant to 5TH CIR. R. 47.5, the Court has determined that this opinion should
not be published and is not precedent except under the limited circumstances set forth in
5TH CIR. R. 47.5.4.
decision that Petitioner violated the National Labor Relations Act, 29 U.S.C.A. §
151 et seq. (West 1998) (“NLRA”), by refusing to bargain with the union
representing the employees of petitioner’s predecessor. The NLRB has cross-
petitioned to enforce the order. We review the NLRB’s findings for substantial
evidence, and its conclusions of law de novo, to determine if those conclusions are
reasonably defensible. Brown & Root, Inc. v. NLRB, 333 F.3d 628, 633 (5th Cir.
2003). We deny the petition and enforce the order of the NLRB for the following
reasons:
1. Former employees of Furr’s, Food Basket’s predecessor, made up a
majority of Food Basket’s workforce, which created an obligation for
Food Basket to bargain with the union. See Fall River Dyeing &
Finishing Corp. v. NLRB, 482 U.S. 27, 40–41, 107 S.Ct. 2225, 2234
(1987). Food Basket argues that one employee, Ruben Lucero, was a
supervisor, and did not count as an employee for collective bargaining
purposes. See 29 U.S.C.A. §§ 152(3), 164(a) (West 1998). Thus,
Food Basket claims that former Furr’s employees were a minority of
Food Basket’s new workforce. However, other than conclusory
testimony by one store manager, Food Basket provided no evidence of
Lucero’s status as a supervisor, and no evidence that Lucero exercised
2
supervisory powers. The Board is not required to defer to conclusory
testimony about the position of an employee. Central Freight Lines v.
NLRB, 653 F.2d 1023, 1025 (5th Cir. Unit A Aug. 1981). See also
Beverly Enterprise-Mass., Inc., v. NLRB, 165 F.3d 960, 962–63 (D.C.
Cir. 1999). The NLRB produced a witness who testified that Lucero
performed work similar to that of a produce clerk. Therefore, the
NLRB’s finding that Lucero was not a supervisor was supported by
substantial evidence, and the former employees of Furr’s made up a
majority of Food Basket’s employees, triggering the duty to bargain.2
2. The union made a valid demand for recognition on September 12,
2001. Food Basket argues that because the union’s demand letter did
not define the bargaining units sought, the letter was insufficient as a
demand. However, “a valid request to bargain need not be made in
any particular form, or in haec verba, so long as the request clearly
indicates a desire to negotiate and bargain on behalf of the employees.”
Peters v. NLRB, 153 F.3d 289, 299 (6th Cir. 1998) (citations omitted).
2
Because the Court holds that Lucero was not a supervisor for purposes of
the NLRA, it is unnecessary to decide the status of Brandi Yniquez in order to
determine whether former Furr’s employees make up a majority of Food Basket’s
employees.
3
See also NLRB v. Williams Enters., Inc., 50 F.3d 1280, 1286 (4th Cir.
1995); Joy Silk Mills, Inc. v. NLRB, 185 F.2d 732, 741 (D.C. Cir.
1950); Case Concrete Co., 220 NLRB 1306, 1309 (1975). The
union’s letter was unmistakably a request to be recognized as the
employee’s bargaining representative, and should have shifted the
burden to Food Basket to contact the union and seek clarification of the
demand. See Hydrolines, Inc., 305 NLRB 416, 420 (1991). Food
Basket argues that Hydrolines requires that a valid demand letter
include descriptions of the bargaining units sought. However,
Hydrolines merely declared a union’s letter with unit descriptions
attached to be a valid demand. Id. In this case, although the union’s
letter did not include unit descriptions, the letter was sufficiently clear
to notify Food Basket that the union wished to bargain on behalf of the
employees.3
3. Finally, Food Basket argues that a bankruptcy court order, which
3
Moreover, because testimony demonstrated that the stores in question were
up and running by the time the demand letter arrived on September 12, 2001, the
NLRB’s finding that Food Basket employed a substantial and representative
complement of employees at that time was supported by substantial evidence. See
Penn. Transformer Tech., Inc. v. NLRB, 254 F.3d 217, 225 (D.C. Cir. 2001).
4
limited the liability of third party purchasers of Food Basket’s
predecessor, shielded Food Basket from liability under the NLRA. We
disagree.
Food Basket had a duty to bargain with the union under the
NLRA because of its conduct after the purchase of Furr’s
Supermarkets. A new employer is not necessarily bound by a
predecessor’s collective bargaining agreement; however, “[i]f the new
employer makes a conscious decision to maintain generally the same
business and to hire a majority of its employees from the predecessor,”
then the new employer must bargain with the union that represented the
predecessor’s employees. Fall River Dyeing & Finishing Corp. v.
NLRB, 482 U.S. 27, 41, 107 S.Ct. 2225, 2234 (1987). Bankruptcy
courts lack jurisdiction to determine successorship obligations under
federal labor law. See NLRB v. Laborer’s Int’l Union of N. Am., AFL-
CIO, 882 F.2d 949, 955 (5th Cir. 1989). A Bankruptcy Court order
might discharge duties that arose before the bankruptcy petition, but a
successor’s post-sale conduct can create a new duty to bargain. See In
re Carib-Inn of San Juan Corp., 905 F.2d 561, 563–64 (1st Cir.
1990); In re Goodman, 873 F.2d 598, 602 (2d Cir. 1989). As a result,
5
the Bankruptcy Court’s order here does not shield Food-Basket from
the NLRA’s requirements. Because Food Basket’s post-sale conduct
meets the test for successor liability, Food Basket acquired the
obligation to bargain with the union of its predecessor.
PETITION DENIED, ORDER ENFORCED.
6