Opinion ID: 3030030
Heading Depth: 2
Heading Rank: 3

Heading: NLRB Decision

Text: In a July 22, 2005 decision by the NLRB Board (a panel comprised of Chairman Battista and Members Liebman and Schaumber), the Board affirmed the ALJ ruling. The panel stated that in “agreeing with the [ALJ] that Trafford is an alter ego, Chairman Battista, and Member Schaumber find it unnecessary to pass on the judge’s finding that Trafford and Liberty Source had substantially identical business purposes and operations.” App. 16 n.1. Similarly, the panel stated that in affirming the ALJ’s finding as to the purpose behind the creation of Trafford, it was not relying on the adverse inference the ALJ drew from the failure by Trafford to call the Wortleys to testify. The decision by the panel noted that one of the panel members, Chairman Battista, “adheres to his position that the General Counsel must show, inter alia, an intent to avoid legal obligations under the Act in order to prove alter ego status. However, recognizing that under extant Board law, unlawful motivation is not a necessary element of alter ego finding . . . Chairman Battista concurs with his colleagues in the finding of alter ego.” App. 16. After affirming that finding and the ALJ’s finding that Trafford and Liberty engaged in unfair labor practices, the 15 Board imposed an order designed to remedy the harm caused. This included an obligation to pay terminated employees back pay, reinstate certain employees, and comply with the terms of the collective bargaining agreements. PETITION FOR REVIEW Trafford timely appealed the Board’s decision. Trafford’s challenge to the Board’s decision is confined to the alter ego issue. Specifically, Trafford claims that the alter ego finding lacked substantial evidence, and that the Board committed legal error by failing to consider whether Trafford and Liberty had substantially identical business purposes. Trafford does not attack the findings regarding violations of sections 8(a)(1) and 8(a)(5). In challenging the alter ego finding, Trafford argues that the companies are not owned by the same individual; that the composition of the Trafford management, though it overlaps with the Liberty management, performs different jobs; that there was no purpose to evade labor law obligations; and that “[m]ost importantly, the character and nature of the two businesses is substantially and materially different.” Petr.’s Br. 15. Trafford also argues that the Board failed to apply the proper legal standard when it refused to consider 16 whether Trafford and Liberty had substantially identical business purposes and operations.5