Court Opinion

ID: 9465786
Source: CourtListenerOpinion
Date Created: 2023-08-05 00:55:44.738028+00
Date Added: 2024-06-11T17:39:22.302965
License: Public Domain

VANCE, Circuit Judge, with whom ALVIN B. RUBIN, Circuit Judge,
joins, dissenting:
Initial consideration of the majority’s opinion invites the conclusion that a desirable result has been reached. The union 1 agreed to a private settlement with the employer,2 and under the majority’s view of the facts the union is simply held to the bargain. A great deal more, however, is involved. To reach its result the majority does violence to well-established law, and its holding has an unnecessarily disruptive effect on the regulatory apparatus. The price is too high, and I must respectfully dissent.
I.
At issue is whether the National Labor Relations Board can be foreclosed from the discharge of its statutory responsibility by a private agreement which it does not approve and to which it is not a party.
The majority acknowledges that the Board acts in the public interest to enforce *907public, not private rights 3 and that by contractual agreement parties cannot affect the Board’s power to prevent unfair labor practices.4 In my view, however, the effect of its decision is exactly the contrary.
At the outset the majority misconceives the nature of the disposition of the union’s original charge. As an outgrowth of this initial error, an incorrect standard is applied, and an incorrect result ultimately ensues. The correct characterization of the-disposition is important not only because it is outcome determinative in this case but also because, as precedent, the majority’s holding will influence disposition of tens of thousands of cases. Over half of the disputes handled by the Board are disposed of voluntarily, but voluntary disposition can occur in several ways with different consequences.
The majority likens the November 7, 1975, settlement stipulation between the union and Gulf States to an informal agreement contemplated by 29 C.F.R. § 101.7. It then compares that type of agreement with the formal agreement provided for in 29 C.F.R. § 101.9, concluding that the same principles govern consideration of preagreement violations in either case. The stipulation, however, was neither type of agreement. It was a private stipulation resulting in the withdrawal of charges on complainant’s own initiative as authorized by 29 C.F.R. § 101.5.5
The § 101.9 formal agreement ordinarily 6 requires approval of the Board in Washington. The § 101.7 informal agreement requires approval of the Board’s Regional Director. Such an informal agreement was proposed in the instant case by the Board’s Field Examiner, but it was rejected by Gulf States.
Neither the Board nor its Regional Director was a party to the stipulation entered into by Gulf States and the union, and neither approved it. The Regional Director approved only the withdrawal of charges under 29 C.F.R. § 101.5.7
In cases in which approval is required, the Board or its Regional Director examines the *908merits of the dispute and the appropriateness of the proposed resolution. If the agreement is formal, the Board approves the terms of the agreement itself; even if it is informal, the Regional Director approves its terms. Subject to the exceptions sanctioned by the Supreme Court in Wallace Corp. v. NLRB, 323 U.S. 248, 65 S.Ct. 238, 89 L.Ed. 216 (1944), the Board’s policy is ordinarily not to go behind such a settlement. By contrast the Regional Director’s consent for withdrawal of charges does not imply Board participation or approval of the settlement. Under well-established Board procedure withdrawal constitutes a disposition of the issues without prejudice,8 although the parties may have made a contrary private agreement. The majority employs the rule applicable to informal agreements in a situation involving only a withdrawal of charges. The impact of this holding was described in brief by the Board as follows:
Almost a third of the more than 30,000 charges now filed with the Board annually are disposed of by withdrawals before complaint issues. Forty-Second Annual Report of the NLRB, pp. 4-5 (G.P.O., 1977) (S.A. 2-3). If the Board’s approval of such withdrawals is to be taken as a determination on the merits or an approval of any private adjustment the parties may have made, the Board’s case-handling procedures would be drastically affected and withdrawals discouraged or delayed.
Concluding that there is no distinction between the effect of a withdrawal of charges and the effect of an NLRB approved settlement agreement is incorrect. The four cases cited by the majority9 do not so hold. In each of those cases the agreement in question was one that had been approved by the Board’s Regional Director.
The present situation — a stipulation of the parties with approval of the Regional Director given not to its terms but only to the withdrawal of charges — was presented in NLRB v. Zimnox Coal Co., 336 F.2d 516 (6th Cir. 1964). Under those facts the court held that “it was within the broad discretion of the Regional Director to permit the refiling of these charges.” Id. at 517. The same result was reached by the Seventh Circuit in NLRB v. My Store, Inc., 345 F.2d 494, 497 (7th Cir.), cert. denied, 382 U.S. 927, 86 S.Ct. 315, 15 L.Ed.2d 340 (1965), as follows:
Respondent contends that the Board • could not base findings of 8(a)(1) and (3) violations on evidence of respondent’s conduct prior to February 26, 1963, or use such conduct as evidence of respondent’s bad faith in bargaining because of the union’s “agreement to drop” the original pending unfair labor practice charges and the dismissal of the complaint by the Board’s Regional Director. . . . But even assuming, though not deciding, that there was an agreement by the union to drop the charges, the Board could not be precluded from hearing the complaint filed on May 8, 1963. A hearing before the Board is in furtherance of a public policy, not to vindicate a private right, . and the “judicial concept of estoppel” may not be invoked to frustrate the purposes of the Act.
See also NLRB v. Rose, 347 F.2d 498 (7th Cir. 1965).
The majority emphasizes that the Regional Director “knew that the parties had agreed that each of their withdrawals of charges was with prejudice.” It then con*909tends that, to implement the policies of the Act, the Regional Director’s approval and the parties’ settlement agreement should not be set aside “merely because one of the parties has brought new charges.” No authority is cited for the suggestion that the terms of the unapproved stipulation of the parties control the power of the Board to go behind the agreement. This conclusion is comparable to a contention that a settlement agreement between private litigants restricts the power of a prosecutor to prosecute.10 It is manifestly in conflict with § 10(a) of the Act11 and cannot be reconciled with this court’s prior, correct statement in Boire v. International Brotherhood of Teamsters, 479 F.2d 778, 803 (5th Cir. 1973), that “parties cannot by contractual agreement divest the Board’s function to operate in the public interest.”
II.
The majority then incorrectly applies the rule that would have been applicable had the settlement agreement been one made with approval. Neither the language nor the meaning of Wallace is as obscure as is suggested:
To meet such situations the Board has established as a working rule the principle that it ordinarily will respect the terms of a settlement agreement approved by it. It has consistently gone behind such agreements, however, where subsequent events have demonstrated that efforts at adjustment have failed to accomplish their purpose, or where there has been a subsequent unfair labor practice. We think this rule adopted by the Board is appropriate to accomplish the Act’s purpose with fairness to all concerned. Consequently, since the Board correctly found that there was a subsequent unfair labor practice, it was justified in considering evidence as to petitioner’s conduct, both before and after the settlement and certification.
Wallace Corp. v. NLRB, 323 U.S. at 254-255, 65 S.Ct. at 241 (footnotes omitted). The cases cited to support this holding, thus given approval by the Supreme Court,12 provide clear demonstration of the Board’s enforcement policy — the same policy to which it continues to adhere.
The majority discounts record evidence with respect to what it designates the first prong of Wallace, and proceeds to blunt the second prong beyond recognition. In cases cited in the majority opinion, no such treatment of Wallace is found. Thus in NLRB v. Arrow Specialties, Inc., 437 F.2d 522 (8th Cir. 1971), the court said of the pertinent part of Wallace,
This language has been interpreted to mean that a settlement agreement can be set aside and presettlement violations found if there has been a breach of an agreement or a subsequent independent violation of the Act by a party to the agreement.
Id. at 526 (emphasis added). Almost identical language was used by our own court in NLRB v. Southeastern Stages, Inc., 423 F.2d 878 (5th Cir. 1970) in stating what it correctly characterized as the general rule. See Lincoln Bearing Co. v. NLRB, 311 F.2d 48 (6th Cir. 1962); International Brother*910hood of Teamsters v. NLRB, 104 U.S.App. D.C. 359, 262 F.2d 456 (1958). The Board’s precedents were correctly summarized in General Electric Co. v. Johnston, 235 F.Supp. 898 (W.D.N.C.1964):
Under the Board’s own decisional rules, the unfair labor practice following the settlement must be substantial'io justify vacating the settlement, and, in determining whether independent unfair labor practices have occurred after a settlement, the Board will not appraise a respondent’s subsequent conduct in the light of the conduct prior to the settlement.
Id. at 900 (emphasis added).
The majority rejects the general rule as thus stated but does not disclose what is to be substituted in its place. It holds that the “mere occurrence of some” post settlement unfair labor practice is not enough to go behind the settlement, but it fails to say what is enough. The notion that emerges is that the subsequent unfair labor practice must more or less constitute a violation of the settlement agreement. Broad settlement language customarily employed in Board approved settlements may well require the alleged culprit to go and sin no more. In this event, subsequent, otherwise unrelated, unfair labor practices probably violate both the Act and the settlement agreement. Frequent occurrence of this factual coincidence, however, does not supply support for the treatment of the disjunctive conditions stated in Wallace and its progeny as a single condition.
III.
Under the Board’s findings both of the disjunctive Wallace tests are met. When the union claimed that Gulf States had failed to bargain in good faith, Gulf States was charged both with committing subsequent unfair labor practices and with violating the heart of the stipulation.13 The Board found that from the outset Gulf States violated the settlement stipulation provision that “good faith negotiations shall commence.” It also found Gulf States guilty of numerous and repeated unfair labor practices, some of which violated the stipulation, and some of which were independent. These findings support the Board’s action in going behind the stipula-tion even under the majority’s interpretation of Wallace. Viewing the record as we must under Universal Camera Corp. v. NLRB, 340 U.S. 474, 71 S.Ct. 456, 95 L.Ed. 456 (1951), there is clearly substantial evidence that supports the Board’s order.
I do not find in the Board’s briefs a contention that it has unreviewable, unbridled discretion. It correctly makes its usual arguments (1) that Congress entrusted the Board with considerable discretion in carrying forward this nation’s quest for labor peace and (2) that it has the responsibility of making credibility judgments and of finding facts. In neither instance does it quarrel with well-established standards of judicial review. In holding that the Board misused its discretion on the basis of the record before us, it seems to me that the majority merely substitutes its own discretion for that of the Board.

Conclusion

Mistreatment of facts affects these parties only. The unwarranted imposition of a new set of rules governing the withdrawal of charges and post-settlement consideration of presettlement charges, however, works a mischief that goes far beyond this case. The Board points out that because it has not considered itself bound by such action, it has freely consented to the withdrawal of charges. If the rule is to be different, the Board will be obligated to make inquiry into the terms of all private settlements before consenting to the withdrawal of charges. Disposition of the ten thousand plus cases per year that fall into this category will obviously be complicated to an enormous degree.
*911The majority’s new rule does not have a discernible philosophic tilt. It is a two-edged innovation that can cut either way. Its primary effect is the unwarranted disruption of an already complicated but fairly understandable administrative process.
Before today’s decision the line between settlement agreements, both formal and informal, bearing the Board’s imprimatur and private, unapproved settlements resulting in withdrawal of charges was sharp and clear. Differences in processing and effect were apparent to parties and practitioners. Applicable regulations, manuals and cases treated them with specificity. The majority’s opinion supplants clarity with needless confusion. The end and purpose of this change are not apparent. If the objective is to advance the state of the law, I respectfully submit that it fails. If it is simply to achieve a desired result in this case, it is largely unnecessary. Adopting the panel’s mistreatment of the facts insured the result without alteration of controlling law.
I would hold (1) that the private settlement of the parties, pursuant to which the parties withdrew earlier charges, was not binding on the Board; (2) that under Board procedures withdrawal of such charges was without prejudice; and (3) that the Board did not abuse its discretion in entertaining new and timely charges concerning the same conduct. It is doubtful that the factual issue is of en banc importance. Rather than remanding to the panel, however, it is my view that having reached these conclusions we should also acknowledge that substantial evidence supports the Board’s findings and enforce its order.

. The International Brotherhood of Boilermak- • ers, Iron Ship Builders, Blacksmiths, Forgers and Helpers, AFL CIO.

. Petitioner, cross-respondent, Gulf States Manufacturers, Inc. (Gulf States).

. Citing National Licorice Co. v. NLRB, 309 U.S. 350, 60 S.Ct. 569, 84 L.Ed. 799 (1940); Amalgamated Utility Workers v. Consolidated Edison Co., 309 U.S. 261, 60 S.Ct. 561, 84 L.Ed. 738 (1940); Agwilines, Inc. v. NLRB, 87 F.2d 146 (5th Cir. 1936).

. Citing Boire v. International Brotherhood of Teamsters, 479 F.2d 778, 803 (5th Cir. 1973).

. Board authority controlling this particular procedure is found in John F. Cuneo Co., 152 N.L.R.B. 929, 931 n. 4 (1965) as follows:
In its amended answer to the complaint, as amended, Respondent defended, specially, that any allegations that it committed violations of Section 8(a)(1) prior to September 1963 were barred by a “settlement agreement” which resulted in the withdrawal of Section 8(a)(1) charges against it in Case No. 13 -CA-5808 which were filed with the Board by the Union. The Respondent claimed that the withdrawal of these charges by the Union was the quid pro quo for its consent to the Union’s request for an immediate Board-conducted election. The Trial Examiner granted the General Counsel’s motion to strike these provisions of Respondent’s answer and Respondent excepts to this ruling. This ruling is affirmed. No settlement agreement was signed or approved by the Regional Director in Case No. 13-CA-5808. In the absence of such approval, any agreement which the Respondent and the Union may have entered into and which resulted in the withdrawal of these prior charges was a private arrangement which does not estop the Board to proceed on any new charges alleging the same conduct as the withdrawn charges. See Zimnox Coal Company, 140 NLRB 1229, 1230, 1237, enfd. 336 F.2d 516 (C.A. 6); Fetzer Television, Inc., 129 NLRB 660, 661, 669.

. In some cases, the Regional Director may determine that an informal, 29 C.F.R. § 101.7 settlement agreement is preferable to a formal one. An agreement reached under these circumstances although provided for by 29 C.F.R. § 101.9(b)(2) need not be approved by the Board and does not require a Board order.

. Under the language of 29 C.F.R.. § 101.5, no approval at all is required for withdrawal of charges. This appears to conflict with 29 C.F.R. § 102.9 which provides, “Any such charge may be withdrawn, prior to the hearing, only with the consent of the regional director with whom such charge was filed; . . ” In this instance the parties incorporated into their private settlement stipulation a specific request for the withdrawal of charges. The Regional Director responded in a letter as follows: “This is to advise that 1 have approved with Withdrawal Request submitted in the above matter.”

. Section 10120.5 of the National Labor Relations Board’s Case Handling Manual, Part 1, April 1975, which is designed only to provide procedural and operational guidance for the agency staff, provides,
10120.5 Refiling of Same Allegation: A closing of a C case pursuant to a withdrawal request constitutes a disposition of the issues without prejudice. However, the 10(b) period will apply with respect to any refiling of the same allegations. The matter, if reopened, should be considered and handled as a new charge.

. NLRB v. Southeastern Stages, Inc., 423 F.2d 878, 880 (5th Cir. 1970); NLRB v. Arrow Specialties, Inc., 437 F.2d 522, 526 (8th Cir. 1971); NLRB v. Bangor Plastics Inc., 392 F.2d 772, 775-76 (6th Cir. 1967); Lincoln Bearing Co. v. NLRB, 311 F.2d 48, 50 (6th Cir. 1962).

. The analogy is valid to the extent stated. It cannot be carried further because of obvious differences in the role and procedures used by the Board and a prosecutor.

. 29 U.S.C. § 160(a).

. Matter of Locomotive Finished Material Company, supra, 52 N.L.R.B. [922,] 926-928; Matter of Chicago Casket Company, 21 N.L.R.B. 235, 252-256; Matter of Harry A. Halff, 16 N.L.R.B. 667, 679-682; cf. Matter of Wickwire Brothers, supra [16 N.L.R.B. 316, 325, 326]. The courts have approved the Board’s practice in this respect. National Labor Relations Board v. T. W. Phillips Gas & Oil Co., 3 Cir., 141 F.2d 304, 305, 306; National Labor Relations Board v. Hawk & Buck Co., 5 Cir., 120 F.2d 903, 904, 905; National Labor Relations Board v. Thompson Products, Inc., 6 Cir., 130 F.2d 363, 366, 367; Canyon Corp. v. N.L.R.B., 8 Cir., 128 F.2d 953, 955, 956; Sperry Gyroscope Co. v. N.L.R.B., 2 Cir., 129 F.2d 922, 931. See Warehousemen’s Union v. N.L.R.B., 74 App.D.C. 28, 121 F.2d 84, 92-94, certiorari denied 314 U.S. 674, 62 S.Ct. 138, 86 L.Ed. 539.
Wallace Corp. v. NLRB, 323 U.S. 248, 254 n. 10, 65 S.Ct. 238, 241, 89 L.Ed. 216 (1944).

. The majority’s opinion does not clearly indicate the proper procedure to be used by the Board in evaluating these allegations.