Court Opinion

ID: 9455524
Source: CourtListenerOpinion
Date Created: 2023-08-04 19:25:10.78344+00
Date Added: 2024-06-11T17:34:38.014501
License: Public Domain

HASTINGS, Senior Circuit Judge
(dissenting).
With deference to my distinguished colleagues in the majority, I dissent from their conclusions on the antitrust issue raised by the employer-dealers throughout this proceeding. The majority adequately sets out the contents of the challenged price-fixing proposal and it need not be repeated here. The general propositions of law relied upon by the majority may be accepted without *1341much dispute. However, I have been unable to accept their application to the facts of the case before us.
I agree with the majority that the employer-dealers’ antitrust challenge to the elections is properly before us. This challenge was vigorously pressed at every step leading to the elections and was consistently brushed aside by the Board. Raising the same contention once more as a post-election objection would have been a futile gesture.
I further agree with the majority’s implicit recognition that the Board is competent, under proper circumstances, to consider questions of antitrust law as they relate to its responsibilities under the Labor Act. The Board, in its brief in a companion case, Borek Motor Sales. Inc. v. N. L. R. B., 425 F.2d 677 (1970), concedes, “It is, of course, true that the Board in administering the Labor Act cannot completely close its eyes to violations of other statutes which may come to its attention or which are enmeshed in the factual situations on which the Board must pass. * * [T]he Board has not been commissioned to effectuate the policies of the Labor Relations Act so single-mindedly that it may wholly ignore other and equally important Congressional objectives.’ Southern S. S. Co. v. N. L. R. B., 316 U.S. 31, 47, 62 S.Ct. 886, 86 L.Ed. 246 (1942).” In H. L. Washum, 172 NLRB No. 40 (1968), the Board considered the merits of a charge that a contract it was ordering reinstated violated the antitrust laws. Thus it appears that the central question before us is whether the alleged antitrust violation was prematurely presented to the Board.
The majority suggests two reasons for not denying enforcement. First, it is said that the Board properly refused to consider the employers’ antitrust contention before the election because Board intervention to correct improper campaign tactics is warranted only in exceptional eases and that in all others, the proper remedy for an aggrieved party is “counter-propaganda.”
The short answer is that this is an exceptional case warranting Board action. The cases cited by the majority for the usual rule are simply different from that before us. In some, the alleged misrepresentation was trivial or of only doubtful impropriety. In others, it was highly speculative whether the alleged misrepresentation had any effect on the election outcome. In each case, a single union and one employer were involved and access' to employees for counter-propaganda presented no problem for either . party. And finally, all of those cases dealt with challenges made only after the election was held so that the only remedy the Board could have granted for the alleged wrong would have been to set aside the election.
The instant case is significantly different in each respect. Here the misrepresentation was neither trivial nor of doubtful impropriety. The Union proposed a panacea for problems that had long troubled employers and employees alike. It said it would secure benefits for the employees and would not harm the business of the employers in the process. It contended that it would in fact do a great service to the dealers by making it possible for them to eliminate the severe competition that had been holding their profits to a minimum. This was a proposal of clear appeal.
However, it was also one that the Union certainly could not implement because of the antitrust laws. The Union’s pricing scheme, if implemented, would be a clear per se violation of the Sherman Act. The crux of the proposal is that the Union would, through its collective bargaining agreement, participate in fixing a minimum price, below list, at which all automobiles in the Chicago area would have to be sold. The purpose of such price-fixing would be to guarantee the employer-dealers a minimum profit of three percent on each car sold.
“Congress feared the concentrated power of business organizations to dominate markets and prices. It intended [by the Sherman Act] to outlaw busi*1342ness monopolies. A business monopoly is no less such because a union participates, and such participation is a violation of the Act.” Allen Bradley Co. v. International Brotherhood of Electrical Workers, 325 U.S. 797, 811, 65 S.Ct. 1533, 1541, 89 L.Ed. 1939 (1945). The dealers who were to be involved in this price-fixing scheme were clearly a “non-labor group.” Cf. American Federation of Musicians v. Carroll, 391 U.S. 99, 88 S.Ct. 1562, 20 L.Ed.2d 460 (1968). But assuming arguendo that they were not, a violation still exists because the proposed scheme was not intended to compensate the dealers for their labor services in competition with salesmen but was calculated to give them an “entrepreneurial profit.” See Musicians v. Carroll, supra, 391 U.S. at 110 n. 10, 888 S.Ct. 1562.
Also present in the instant case is evidence that this clearly improper proposal had a substantial effect, not only on the outcome of the election, but on the very ability of the Union to get the required showing of interest to hold the election. The record before us and before the Board shows that the Union had been trying to organize automobile salesmen in the Chicago area since 1961, apparently without much success. The campaign that led to the present cases began early in November, 1967, and had the support of the Communications Workers of America, AFL-CIO. It also seems to have faltered for in January, 1968, the AFL-CIO withdrew its support. It was at this point, on January 28, 1968, that the succeeding Union group first proposed its pricing scheme which it touted as a method to secure greater financial benefits for salesmen while at the same time saving employers from the harsh competition in the Chicago area. The prospects for the Union immediately brightened. Numerous representation petitions were filed. The number finally rose to between 80 and 90, covering dealerships widely scattered in Illinois and Indiana.
This then suggests another reason for considering the instant case exceptional. Here 80 or 90 widely scattered employers were faced with the organized campaign of a single Union. They might reasonably have concluded that the usual weapon of counter-propaganda would be ineffective in this situation, or at least that such propaganda could not be adequately prepared and dispersed in the time remaining before the elections.
However, and finally, the employers did not then simply sit back idly to await the outcome of the elections before raising any objection. Instead, they immediately went to the Board with two alternative proposals. They asked that either the Union be required to obtain another showing of interest after disavowing the alleged price-fixing scheme, or that the elections be delayed until the Union submitted proof that it had informed all those who signed authorization cards that it had abandoned its pricing proposal. In my judgment, this procedure was not unreasonable in the • circumstances and neither we nor the Board should insist that counter-propaganda was the only acceptable pre-election method for dealing with the problem faced by the dealers. The point is that the employers acted before the election when it was possible to remedy the problem without setting aside an election on the basis of hindsight.
In sum, in light of the obvious illegality of the Union proposal, the early and reasonable request of the employers for assistance, the ease with which the Board could have remedied the clear abuse, the possible inefficacy of counter-propaganda and the evidence of the effect of the proposal on the organizational campaign, it seems that it was a clear abuse of discretion for the Board to permit the elections to proceed without taking any steps to insure that the free choice of the employees was not distorted by the proposed illegal pricing scheme.
The second reason advanced by the majority for not denying enforcement is that until the Union actually presses its illegal proposal in collective bargaining no harm can result from the election *1343having been held. As I read the record before us this approach ignores the realities of the situation. I am convinced that the Union, unable to secure adequate employee support in any other way, won the election on the strength of its illegal proposal. It should not thereafter be given the opportunity to purge itself by the simple expedient of renig-ging on its major campaign promise. The net result of this would be to enable the Union to get its foot in the door and thereafter to assume recognized bargaining status, for at least one year. The taint that has pervaded the entire representation process thereby would be brushed aside. To such an anomalous result I am unwilling to subscribe.
All parties seem to suggest that this particular problem is presently without judicial precedent. It would not be enough for me to say now that future collective bargaining in this case shall not encompass illegal price-fixing. Rather, I would hold that elections already held, under the circumstances found present here, should be set aside. No other adequate remedy is presently available.
In my considered judgment the petition to review and set aside the order of the Board should be granted and the cross-application for enforcement denied.