Court Opinion

ID: 194844
Source: CourtListenerOpinion
Date Created: 2011-02-07 02:26:18+00
Date Added: 2024-06-11T09:42:40.708097
License: Public Domain

July 27, 1993

                  UNITED STATES COURT OF APPEALS
                      FOR THE FIRST CIRCUIT

No. 92-1993

          TRUCK DRIVERS & HELPERS UNION, LOCAL NO. 170,
                           Petitioner,

                                v.

                 NATIONAL LABOR RELATIONS BOARD,
                           Respondent.

                                           

                   GIRARDI DISTRIBUTORS, INC.,
                           Intervenor.

                                           

                           ERRATA SHEET

     The opinion of this Court issued on May 26, 1993, is amended
as follows:

     Page 5, line 21, capitalize "u" in "union".

     Page 5, line 23, capitalize "u" in "union".

     Page 12, line 8, substitute "183679" for "18679".

     Page 19, footnote 12, line 5, substitute "111 S.Ct. 671" for
"xx U.S. xx".

                  UNITED STATES COURT OF APPEALS
                      FOR THE FIRST CIRCUIT
                                           

No. 92-1993

          TRUCK DRIVERS & HELPERS UNION, LOCAL NO. 170,

                           Petitioner,

                                v.

                 NATIONAL LABOR RELATIONS BOARD,

                           Respondent.

                                           

                   GIRARDI DISTRIBUTORS, INC.,

                           Intervenor.

                                           

              ON PETITION FOR REVIEW OF AN ORDER OF

                THE NATIONAL LABOR RELATIONS BOARD

                                           

                              Before

                    Torruella, Cyr and Stahl, 
                         Circuit Judges.
                                       

                                           

     Randall E. Nash, with whom Grady and Dwyer, was on brief for
                                               
petitioner.
     Robert J.  Englehart, Attorney,  with whom Jerry  M. Hunter,
                                                                
General Counsel, Yvonne T.  Dixon, Acting Deputy General Counsel,
                                 
Nicholas E. Karatinos,  Acting Associate General  Counsel, Aileen
                                                                 
A.  Armstrong,  Deputy  Associate  General   Counsel,  and  Linda
                                                                 
Dreeben,  Supervisory Attorney,  National Labor  Relations Board,
       
were on brief for respondent.
     Henry  F. Telfeian,  with whom  Keck, Mahin  & Cate,  was on
                                                        
brief for intervenor.

                                           

                           May 26, 1993
                                           

          TORRUELLA,  Circuit Judge.   In this  case we  review a
                                   

decision and  order of  the National  Labor Relations  Board (the

"Board").  The  General Counsel  of the Board  brought an  unfair

labor  practice  complaint against  an  employer  based on  three

charges that it had previously  dismissed.  The facts  underlying

these charges occurred more  than six months prior to  the filing

of  the formal  complaint  by the  General  Counsel.   The  Board

dismissed the  complaint as  barred by the  six-month statute  of

limitations  prescribed by  section 10(b)  of the  National Labor

Relations Act ("NLRA"),  29 U.S.C.    160(b).   In addition,  the

Board  rejected  the  General  Counsel's  alternative  effort  to

resuscitate  these  dismissed  charges,  finding  amendment  to a

timely  charge  improper  since  the charges  were  not  "closely

related."    We affirm  the first  decision,  but reverse  on the

latter.

                                I
                                 

                            BACKGROUND
                                      

          The  Union  represents  certain  employees  of  Girardi

Distributors, Inc.,  (the "Company"), a  liquor distributor  that

operates   several   distribution   facilities  in   northwestern

Massachusetts.   Over the years,  the employees  and the  Company

entered into collective bargaining agreements, the most recent of

which covered from 1986 to May  19, 1989.  In April of 1989,  the

Union and the Company began negotiations for a new agreement.  

          The negotiations did  not progress  well.   On May  19,

1989,  the Union  filed its  first  unfair labor  practice charge

                               -2-

(case 1-CA-26394),  alleging violation of    8(a)(1),  (3), & (5)

of  the NLRA, 29  U.S.C.   158(a)(1),  (3), & (5).1   The General

Counsel of the Board  dismissed the charge through the  Office of

the  Regional Director  on July  19, 1989.   Addressing  the main

thrust  of the charge, the  Regional Director refused  to bring a

complaint because,  in its view, the investigation did not reveal

sufficient  evidence  of  bad  faith  bargaining.    Negotiations

between the Company  and the Union continued during  the Regional

Director's investigation.  As a  result of the investigation, the

charges  were  dismissed  and  the  Union  did  not  appeal   the

dismissal.

          The Union  remained dissatisfied with  the negotiations

and  felt certain that the Company sought  to bust the Union.  In

June, the Company made  its "last, best, and final  offer," which

significantly  undercut the  wages and  benefits received  by the

members of the bargaining unit under the 1986-89 labor agreement.

Despite  the final offer the parties continued to hold bargaining

sessions.  The Union filed its second charge (case 1-CA-26561) on

                    

1   Section  8(a)(1) makes  it an  unfair labor  practice for  an
employer  to "interfere,  restrain  or coerce  employees" in  the
exercise  of  their  section 7  rights  to  engage in  "concerted
activities  for the  purpose  of collective  bargaining or  other
mutual aid or protection."  29 U.S.C.    157, 158(a)(1).

    Section  8(a)(3) makes  it an  unfair labor  practice for  an
employer  "to encourage  or  discourage membership  in any  labor
organization" by  "discrimination in  regard to hire  or tenure."
Id.   158(a)(3).
   

    Section   8(a)(5)  requires   that   an   employer   "bargain
collectively with the representatives of his employees" and to do
so  in  good faith.   See  id.    158(a)(5);   NLRB  v. Insurance
                                                                 
Agents' Int'l Union, 361 U.S. 477, 498 (1960).
                   

                               -3-

August  4,  1989,  alleging  the same  statutory  violations  but

providing  more  factual support  for  the  bad faith  bargaining

claim.  The Regional Director again dismissed the charges and the

General Counsel's National Office of Appeal upheld the dismissal.

          On September 8, 1989, the Union filed  its third charge

(case 1-CA-26660,  which was amended  several times) on  the same

general grounds with further factual support.  Certain statements

made by  management, which  were held improper  under    8(a)(1),

were the subject of an  informal settlement agreement,2 while the

other charges were dismissed.   The Union unsuccessfully appealed

the dismissal of the other charges.

          By  the  end  of  1989,  despite  numerous  negotiation

sessions, the Union and the Company had not reached an agreement.

After the  Union lost its appeal on the third set of charges, the

Company withdrew its final offer.  On April 14, 1990, the Company

purportedly subcontracted  the bargaining  unit work  to Suburban

Contract  Carriers,  Inc.  ("Suburban"),  terminated   its  union

employees,  and withdrew  its  recognition of  the  Union as  the

exclusive  collective bargaining representative of the bargaining

unit.

                    

2    The  Regional  Director  approved  the  unilateral  informal
settlement on February 22,  1990.  The Company complied  with the
settlement's posting  requirement.  The case,  however, was never
closed because of the pendency  of a fourth set of  charges (case
1-CA-27243)  filed  in  April of  1990.    The  Regional Director
vacated and set aside the settlement agreement when it issued the
Consolidated Complaint that sought to reinstate the three charges
dismissed in 1989.   The  Union's second basis  for avoiding  the
statute of limitations pertains  to this settlement agreement and
is discussed infra.
                  

                               -4-

          On  April 16,  1990, the  Union filed  a fourth  set of

charges  (case  1-CA-27243),  alleging  the  Company  violated   

8(a)(1) & (5) by refusing to supply the name of the subcontractor

to the  Union, and by unilaterally  subcontracting the bargaining

unit  work.  Finally, the  General Counsel filed  a complaint and

set the hearing date for November 19, 1990.

          On  the morning  of  the hearing,  the General  Counsel

received  new testimony  from the  principals of  Suburban, David

Murphy and Peter DeVito.  The proceedings were adjourned with the

consent of  the parties.   Based on  the testimony of  Murphy and

DeVito,  the Regional Director  further investigated  the Union's

charges and procured testimony  from Kenneth White, the Company's

former  operations manager,  and Daniel Maroni,  another employee

close to management, which was damaging to the Company.

          In  March  of  1991,  the Regional  Director  issued  a

Consolidated Complaint, which revived the three charges dismissed

in  1989  (cases  1-CA-26394,  1-CA-26561,  1-CA-26660),  and  an

Amended  Complaint,   which   amended  case   1-CA-27243.     The

Consolidated Complaint  alleged that  the Company had  engaged in

bad faith bargaining from April through September of 1989 and had

unlawfully implemented  its final  offer.  The  Amended Complaint

charged that failure to provide the name of the subcontractor and

withdrawal of recognition of  the Union violated sections 8(a)(1)

&  (5), and that subcontracting  the bargaining unit's  work to a

subcontractor  that  was  the  alter  ego   of  the  Company  and

discharging the Union employees violated sections 8(a)(1) & (3).

                               -5-

          With    respect   to   the   Amended   Complaint,   the

Administrative  Law  Judge ("ALJ")  found  that  the Company  had

violated the NLRA  and ordered  the Company to  cease and  desist

from subcontracting  the bargaining unit work  anew, to recognize

the Union, and to restore the  status quo in existence before the

false   subcontractor  was   engaged.     With  respect   to  the

Consolidated Complaint,  the ALJ  found that the  General Counsel

had stated a  prima facie case that the Company  had bargained in

bad  faith,  that   impasse  had  not  been   reached,  and  that

implementation of  the final  offer was unlawful.   Nevertheless,

the  ALJ dismissed  the  Consolidated Complaint  because under   

10(b)  the charges dismissed in 1989 could not be reinstated more

than  six  months after  the  acts underlying  those  charges had

occurred.  The ALJ found that the General Counsel did not satisfy

the   fraudulent  concealment   exception  to   the  statute   of

limitations because it failed to demonstrate  that facts had been

fraudulently  concealed, and  because the  Union and  the General

Counsel did not exercise due diligence in discovering the factual

basis  for the  charges.   The  Board  affirmed and  adopted  the

decision and order of the ALJ.

          The  Union appeals  the dismissal  of  the Consolidated

Complaint.     The   dismissed  charges   warrant  reinstatement,

according  to   the  Union,  because  the   Company  fraudulently

concealed  the  operative facts  supporting  the  charges through

affirmative  acts  of  concealment  and  by  a  "self-concealing"

scheme, and because  the Union and the General  Counsel exercised

                               -6-

due diligence to uncover the evidence.  Alternatively, the  Union

asserts that  the dismissed    8(a)(3)  and (5)  allegations were

"closely  related"  to  the    8(a)(1) charges  in  the  informal

settlement  agreement  reached  in   case  1-CA-26660.    As  the

agreement was later  set aside  by the Regional  Director, the   

8(a)(3) and  8(a)(5) charges in the Consolidated Complaint may be

reinstated by amendment to the now timely   8(a)(1) charge.

                                II
                                  

          Section  10(b)  of  the  NLRA  prescribes  a  six-month

statute of limitations  for the filing  of unfair labor  practice

charges.3   In Ducane  Heating Corp.,  273 N.L.R.B.  1389 (1985),
                                    

enforced without opinion, 785 F.2d 304 (4th Cir. 1986), the Board
                        

extended  the breadth of   10(b) to prohibit the reinstatement of

dismissed charges outside the six-month  period.  The Board  also

held  that the  limitations period  is tolled when  "a respondent

fraudulently conceals the operative  facts underlying the alleged

violation."   Ducane Heating, 273  N.L.R.B. at 1390.   The period
                            

will begin to run anew  when "the charging party knows  or should

have known  of the concealed facts."   Id.  In  effect, the Board
                                          

borrowed the federal doctrine of fraudulent concealment, which is

an  "equitable  doctrine  read  into  every  federal  statute  of

limitations."   Holmberg v. Armbrecht,  327 U.S. 392, 397 (1946);
                                     

O'Neill, Ltd., 288 N.L.R.B. 1354, 1988 WL 214303 at * 57.
             

                    

3   "[N]o  complaint  shall issue  based  upon any  unfair  labor
practice  occurring more than six  months prior to  the filing of
the charge with the Board and  the service of a copy thereof upon
the person against whom such charge is made . . . ."  29 U.S.C.  
160(b).

                               -7-

          While the language  of    10(b) does not  apply on  its

face to the reinstatement of dismissed charges, the Board is free

to  fill a  "gap" left  in  the statute  by applying    10(b)  to

dismissed charges and  by fashioning its  own rule of  fraudulent

concealment  to toll the  statute of  limitations.   Chevron USA,
                                                                 

Inc., v. Natural Resources  Defense Council, Inc., 467 U.S.  837,
                                                 

843-44  (1984).    Traditionally  the  Board  has  been  accorded

"deference  with regard to its interpretation of the NLRA as long

as  its  interpretation  is  rational  and  consistent  with  the

statute."   NLRB v. United Food & Commercial Workers Union, Local
                                                                 

23,  484 U.S.  112, 123  (1987).   The Court  of Appeals  for the
  

District  of  Columbia  found  the  application  of     10(b)  to

dismissed  charges  to  be  reasonable and  consistent  with  the

underlying policy  of  the statute  in District  Lodge 64,  Int'l
                                                                 

Ass'n  of Machinists and Aerospace Workers v. NLRB, 949 F.2d 441,
                                                  

445 (D.C. Cir. 1991).  We agree with that determination.   In the

absence  of a clear statement from Congress on the application of

the  fraudulent  concealment  tolling  doctrine in  the     10(b)

context, we must defer  to the Board's reasonable interpretation.

Chevron,  467 U.S.  at  843-44.    We turn  now  to  the  Board's
       

formulation  of   its  interpretation   and  to  whether   it  is

permissible.

          The Board's reluctance to  delimit the precise contours

of  the fraudulent concealment doctrine as applied to   10(b) has

been  a matter of  some frustration for the  federal courts.  See
                                                                 

NLRB  v. O'Neill, 965 F.2d  1522, 1527 (9th  Cir. 1992); District
                                                                 

                               -8-

Lodge 64, 949 F.2d at 449 (remanding fraudulent concealment issue
        

because court was  "unable to  make enough sense  of the  Board's

opinion to  justify  affirmance").    In this  case,  the  Board,

adopting the  ALJ's reasoning and conclusions,  purported to rely

on  the  general  federal  fraudulent  concealment  doctrine   as

explained  by  an  earlier  Board decision,  O'Neill,  Ltd.,  288
                                                           

N.L.R.B.  1354  (1988),  and by  the  Court  of  Appeals for  the

District of Columbia in Hobson v. Wilson, 737 F.2d 1, 33-36 (D.C.
                                        

Cir. 1984), cert. denied  sub. nom., Brennan v. Hobson,  470 U.S.
                                                      

1084 (1985).  Nevertheless,  the Board appears to have  adopted a

rule that is different from the one upon which it claims to rely.

          In Hobson,  the Court of  Appeals for  the District  of
                   

Columbia recognized two means by which fraudulent concealment can

occur  -- by  affirmative  acts of  concealment  or by  a  "self-

concealing"  wrong or  scheme.   The  Hobson  court held  that  a
                                            

plaintiff may establish a  self-concealing wrong by demonstrating

that the  defendant "engage[d]  in some misleading,  deceptive or

otherwise contrived action or scheme, in the course of committing
                                                                 

the  wrong, that is designed to mask  the existence of a cause of
          

action."  Hobson, 737 F.2d at 34-35.  The court announced a broad
                

and  inclusive understanding  of self-concealing  wrongs, stating

that  "[t]he deception  may be as  simple as  a single  lie or as

complex as [a  scheme], so  long as the  defendants conceal  'not

only  their involvement, but the  very conduct itself.'"   Id. at
                                                              

34-35 (citation omitted).

          Based  on  Hobson and  its  belief  that O'Neill,  Ltd.
                                                                 

                               -9-

adopted  Hobson's  reasoning,  the  Union contends  that  it  has
               

demonstrated  fraudulent  concealment  and that  the  statute  of

limitations was tolled.  The Union's argument proceeds roughly as

follows:   Normally, in the course of negotiation each party at a

bargaining  session attempts to  force the  other side  to accept

concessions.  The NLRA requires that the parties meet and bargain

in  good faith, but does  not require that  they reach agreement.

See NLRB v. Insurance  Agents' Int'l Union, 361 U.S.  477, 490-01
                                          

(1960);  Soule  Glass & Glazing Co. v. NLRB,  652 F.2d 1055, 1103
                                           

(1st Cir. 1981) ("Adamant insistence on a bargaining position . .

.  is  not  in itself  a  refusal  to  bargain  in good  faith.")

(citation  omitted).     Therefore,  in   the  average  "surface"

bargaining  case  (bargaining  without  the intent  to  reach  an

agreement) the central issue  is motive.  As the  Union perceives

the   issue,  the   deception  committed   by  the   Company  was

misrepresenting  bad faith  or surface  bargaining as  good faith

bargaining.   The self-concealing  wrongs were the  statements to

the  Board  that the  Company  honestly  put forward  negotiating

positions  with a good faith  bargaining intent.   In the Union's

view, the Company prevented the  Union from discovering the cause

of  action, despite  the Union's  due diligence,  by fraudulently

concealing the operative fact  -- its bad faith.  In  effect, the

Union  argues that tolling  continues as long  as the concealment

has so  impaired its  case that  it is unable  to furnish  to the

General  Counsel with,  or the  General Counsel  cannot discover,

sufficient evidence to file a formal complaint before the Board.

                               -10-

          We   fully  understand  the  rationale  supporting  the

Union's stance.   In this  case, the Union  filed three  separate

charges  alleging  essentially the  same  grievance  -- that  the

Company was surface bargaining and its true intent was to destroy

the  Union.    These  charges were  dismissed  on  three separate

occasions and twice on appeal.  The General Counsel explained, in

its memorandum in support of exceptions to the ALJ decision, that

at  the time the charges were dismissed, the Company's bargaining

table  conduct,  the  first  and generally  exclusive  source  of

evidence, revealed  no indications  of  bad faith.   Indeed,  the

evidence showed  that the parties  were meeting and  that various

proposals were being discussed.  Despite the Union's  claims that

the  Company intended to destroy the Union, there was no concrete

evidence  of  that  intention.   The  General  Counsel  asserted,

therefore, that it would  not have brought the complaint  because

the extensive paper trail compiled by  the Company indicated that

it was  bargaining in good faith while at the table.  The General

Counsel denied that it knew all the facts subsequently considered

by the ALJ  to support a prima facie case  of surface bargaining.

Nonetheless, the General Counsel stated that even if it had known

the  facts, it  would  not have  brought  a complaint  given  the

Company's conduct during discussions at the bargaining table.

          Consequently, from the Union's perspective, the conduct

at  the table  and  the  position  statements  submitted  to  the

Regional  Director  defending  against  the  charges, which  were

designed to  deceive  the Union  and  the General  Counsel,  were

                               -11-

sufficient  to conceal the cause of action and therefore toll the

statue  of limitations  under the  self-concealing wrong  theory.

The cause  of action was  concealed because  the General  Counsel

would not bring  the complaint without direct evidence of illegal

intent  if the  bargaining table  conduct at  least superficially

appeared to be in  good faith.  Furthermore, because  the General

Counsel's dismissal  of the  charges is unappealable,4  whether a

cause of action  is concealed  must be decided  according to  its

criteria.

          While it quoted from Hobson, the ALJ's decision did not
                                     

rely on Hobson's statement of the "self-concealing wrong" theory.
              

The  ALJ  stated  that  the  Board  had  never  found  fraudulent

concealment  without some affirmative act,  even if it was simply

affirmative  verbal  misrepresentation.    Girardi  Distributors,
                                                                 

Inc., 307  N.L.R.B. No. 236,  1992 WL 18679  at *38 n.24  (citing
    

Brown & Sharpe Mfg., 299 N.L.R.B. No. 89 (1990); Kanakis Co., 293
                                                            

N.L.R.B.  No. 50 (1989); Strawsine Mfg., 280 N.L.R.B. 553 (1986);
                                       

Garrett  Railroad  Car  &  Equipment,  Inc.,  275  N.L.R.B.  1032
                                           

(1985)).  The ALJ specifically noted that the Board's decision in

O'Neill, Ltd., which also quoted extensively from Hobson, did not
                                                        

                    

4   Procedurally, the charging  party files a  complaint with the
Regional Director and if the Regional Director decides to dismiss
the  charge  its decision  may be  appealed  only to  the General
Counsel,  not  to the  Board or  the  courts.   Consequently, the
General  Counsel's decision to dismiss is final.  See United Food
                                                                 
& Commercial  Workers Union, 484 U.S. at 118-19  & nn.8 & 10.  We
                           
note the  force of the Union's  analogy to the rule  that a party
who commits a "fraud on the court" should not expect the benefits
of  repose bestowed  by the  statute of  limitations.   See Hazel
                                                                 
Atlas Glass Co. v. Hartford Empire Co., 322 U.S. 238 (1944).
                                      

                               -12-

turn  on  Hobson's expansive  definition  of what  sort  of self-
                

concealing  wrong  could  be  considered  fraudulent  concealment

sufficient  to toll  the statute  of limitations.   The  ALJ read

O'Neill,  Ltd. to require a  showing that "there were affirmative
              

misrepresentations  made  (exculpatory  statements   aside)  with

respect to the  dismissed charges,"  and that there  was a  self-
                                        

concealing scheme in place (as opposed to a single lie).  Girardi
                                                                 

Distrib., 1992  WL  18679  at  *29  (citing  O'Neill,  Ltd.,  288
                                                           

N.L.R.B.  at 1355).   Under  this formulation,  there must  be an

affirmative  misrepresentation other  than  telling  the  General

Counsel and the charging party that the accused is not engaged in

surface  bargaining  and  supplying  rational  excuses  for   the

accused's  conduct at  the  bargaining table.    See id.  at  *38
                                                        

n.23.5    The  ALJ's  conception of  the  scheme  necessary seems

rather  great indeed; he appeared  to require a  showing of "some

master plan of contingencies that would be triggered by unfolding

events."  Id. at *29.  
             

          We agree with the ALJ that, to the extent O'Neill, Ltd.
                                                                 

discusses  the more  relaxed  standard of  self-concealing wrongs

explained in Hobson,  those statements are only  dicta.  O'Neill,
                                                                 

                    

5   The ALJ relied on the Board's statement in O'Neill, Ltd. that
                                                            
"the  mere fact  that a  party makes  exculpatory representations
does not,  by itself, constitute fraudulent  concealment or serve
to toll  the    10(b) period."   288 N.L.R.B.  1353, n.10  (1988)
(citing Al Bryant, Inc., 260 N.L.R.B. 128, 133-35 (1982)). 
                       

   We note that we find this  rule rather peculiar because we can
think of no reason to distinguish "exculpatory" statements to the
Board designed to  avoid a  formal complaint from  any other  lie
that  a party  may proffer  to avoid  sanctions for  unfair labor
practices.

                               -13-

Ltd.  did not announce  the rule upon  which the Union  now urges
    

that  we rely.6  It is impossible  to say what deceptive actions,

short  of proof of a complicated  scheme replete with contingency

plans to get rid  of the Union, would  satisfy the Board.   It is

clear, however, that the deception that the Board now requires is

significantly more than the  "single lie" which the Hobson  court
                                                          

rule would accept.

          Irrespective of  the extent  of the effort  to conceal,

the  fraudulent concealment  doctrine  will not  save a  charging

party  who fails to exercise  due diligence, and  is thus charged

with notice of a potential claim.   Girardi Distrib., at * 28-29;
                                                    

Hobson,  737 F.2d at  35.7  Normally,  when the party  seeking to
      

toll  the statute  by fraudulent concealment  alleges affirmative

acts of concealment, the burden of showing due diligence falls on

that party.   Morales  v. Rosa-Viera,  815  F.2d 2,  5 (1st  Cir.
                                    

1987).  The  opposite rule  applies, however,  when the  charging

party alleges  that the  statute is tolled  by a  self-concealing

                    

6  We note parenthetically that  the Board would probably be able
to develop a new rule, or narrow a present one, without offending
decisions  limiting an  agency's  authority to  apply such  rules
retroactively.  See Chevron Oil Co. v. Huson, 404 U.S. 97 (1971);
                                            
District Lodge  64, 949 F.2d at  446-48.  The absence  of a clear
                  
rule  would negate  any claim  of  reasonable reliance,  which is
necessary  for a finding that  application of the  new rule would
cause "substantial inequitable results."   See District Lodge 64,
                                                                
949 F.2d at 448.

7   The  party seeking  the shelter  of the     10(b) affirmative
defense bears the burden of proving "clear and unequivocal notice
-- either actual or  constructive -- of the acts  that constitute
the  alleged unfair  labor practice."   John  Morrell &  Co., 304
                                                            
N.L.R.B. No.  116,  1991 WL  181868  at *5;  Pennsylvania  Energy
                                                                 
Corp., 274 N.L.R.B. 1153, 1155 (1985).
     

                               -14-

wrong, in which case the defendant bears the burden.  Hobson, 737
                                                            

F.2d  at  35.   Thus,    "[w]hen  tolling is  proper  because the

defendants  have concealed the  very cause of action,  . . . they

have the burden of coming forward with any facts showing that the

plaintiff could have discovered .  . . the cause of action  if he

had exercised  due diligence."  Id. (quoting Richards v. Mileski,
                                                                

662  F.2d 65,  71  (D.C. Cir.  1981)).   In  another  significant

departure from  the Hobson  decision, the Board  here placed  the
                          

burden of  proving the exercise  of due diligence  in discovering

the  fraud  on  the   party  seeking  to  toll  the   statute  of

limitations.  The significance of which party bears the burden of

proof on due diligence is palpable in this case because, in large

measure,  the Board's  decision turned  on the  utter  absence of

evidence of due diligence  by the Union and the  General Counsel.

Nevertheless, because  courts apportion this  burden differently,

compare Hobson, 737 F.2d  at 35 (placing burden on  party seeking
              

shelter of statute of  limitations in self-concealing wrong case)

with  NLRB  v.  O'Neill, 965  F.2d  1522,  1527  (9th Cir.  1992)
                       

(placing burden  on party seeking to toll  statute of limitations

in self-concealing scheme  case), we cannot say  that the Board's

decision  is  unreasonable  and   therefore  must  defer  to  it.

Chevron, 467 U.S. at 843-44.  
       

          Having  established  the  legal  tests   governing  the

Board's decision, we turn  to the Board's findings  of fact.   We

must accept the Board's factual findings if they are supported by

substantial  evidence on the  record when considered  as a whole.

                               -15-

29 U.S.C.   160(f); Universal Camera Corp. v. NLRB, 340 U.S. 474,
                                                  

488  (1951).  In this case, the  Board adopted the ALJ's findings

and  conclusions.   The  ALJ  found  that  the  Company  did  not

fraudulently  conceal by affirmative  actions the operative facts

underlying the dismissed charges.   The ALJ exhaustively reviewed

the evidence and found that the General Counsel had  made a prima

facie  case of  bad  faith or  surface  bargaining based  on  (1)

evidence  of the Company's generalized intent to bust the Union;8

(2) the discrepancy between wage  proposals for union workers and

the wages  paid to nonunion workers at  other Company facilities;

(3)  the  solicitation  of   replacement  workers  early  in  the

bargaining process;  (4) the expressed belief  that the proposals

would  provoke a  strike; and  (5) the  statements  of operations

manager,  Ken White,  indicating that  better wages  and benefits

would  be provided if the employees renounced the Union.  The ALJ

therefore concluded that the operative facts  could not have been

fraudulently concealed because the  Union and the General Counsel

knew  the facts supporting the prima face case when the dismissed

charges were originally  filed by  the Union.   Finally, the  ALJ

determined  that the  dismissed charges  could not  be reinstated

because the Union and the General Counsel had offered no evidence

that  they had  exercised due  diligence to  uncover  the alleged

                    

8     The  record  evidence  showed  that  the  Union  membership
understood that the Company wanted to get rid of the Union.  This
general  animus  began  after   George  Girardi,  Jr.  took  over
management of  the Company from his father.   As the Union notes,
everyone was aware of  this animus after 1985, and,  despite this
antipathy, the parties were able to reach an accord in 1986.

                               -16-

fraud.

          Given the  narrow scope  of the  fraudulent concealment

doctrine  in the    10(b)  context, we  cannot conclude  that the

Board's  findings  of fact  and  conclusions  are unsupported  by

substantial  evidence in  the  record.   Consequently, they  must

stand.  The strength  of the Union's argument proceeded  from the

evidence  of  intent  garnered  from statements  made  by  former

insiders not available to the General Counsel or the Union at the

time  the charges  originally  were filed.    The Board  was  not

swayed;  it explicitly held that  the new evidence  did not alter

its calculus. 

          Clearly there is an  incongruity between what the Board

and  the  General Counsel  find sufficient  to  state a  claim of

surface  bargaining.  The Board's prima facie case, and hence its

finding  of notice,  rests  on facts  which  it holds  constitute

constructive,  as  opposed to  actual, evidence  of bad  faith or

intent.  The ALJ asserted that a surface bargaining  case must be

made on  the basis  of the  "totality of  respondent's observable

conduct."  Girardi  Distrib. at  *29.  In  contrast, the  General
                            

Counsel contended in this case that it normally would not bring a

formal  unfair labor  practice  complaint,  irrespective  of  the

surrounding circumstances, in cases in which the bargaining table

conduct  appeared  to be  in good  faith.   The  ALJ specifically

rejected the  General Counsel's  suggestion to follow  the Hobson
                                                                 

court's statement  of  fraudulent concealment,  stating, "[i]f  I

agreed  with the position of the General Counsel, virtually every

                               -17-

surface  bargaining case  would  be potentially  exempt from  the

strictures of  section 10(b), needing only  some newly discovered

evidence of intent to surface."  Id.  
                                    

          This  incongruity  places  the  charging  party   in  a

difficult position.    A charging  party cannot  get the  General

Counsel  to   file  a  timely  complaint  if  it  only  possesses

circumstantial evidence supporting  a finding of  bad faith.   On

the other  hand,  its timely  charges  that the  General  Counsel

unappealably  dismissed will  not  be reinstated  if the  General

Counsel  later finds  direct evidence of  bad motive  because the

Board  construes evidence  of  constructive intent  based on  the

totality of the circumstances  as notice of  the claim.  That  is

what happened in this case.  

          While we believe the Court of Appeals  for the District

of    Columbia's  construction   of  the  fraudulent  concealment

doctrine  urged by  the General  Counsel and  the Union  to be  a

better and  more  equitable  rule  for  the  victims  of  surface

bargaining, the  Board ultimately controls  the terms of    10(b)

unless its  interpretation is unreasonable.  We  may not supplant

the Board's  judgment since the  Board reasonably adopted  a less

expansive fraudulent concealment doctrine  that it viewed as more

faithful to industrial relations  policy favoring finality in the

resolution of labor disputes.   We note, however, that  under the

present formulation, the General Counsel  will rarely demonstrate

fraudulent  concealment in surface  bargaining cases.  Therefore,

instead of  waiting  for the  smoking  gun, the  General  Counsel

                               -18-

should search diligently for  circumstantial evidence of unlawful

intent as understood by  the Board to prevent sound  unfair labor

practice  charges from  being barred  by the    10(b)  statute of

limitations.   Investigation  should include  interviewing senior

bargaining representatives or company presidents concerning their

intention to bargain  in good  faith and their  union animus,  if

only to later assert misrepresentation that  tolls the statute of

limitations.9 

                               III
                                  

          We turn now to the Union's second argument to avoid the

statute of limitations bar.   The third set of  charges dismissed

in 1989 (case 1-CA-26660) involved several charges.   It alleged,

inter  alia, violations of   8(a)(5) for bad faith bargaining and
           

  8(a)(1) based  on statements  made by the  Company's operations

manager promising  improved wages  and working conditions  if the

workers  renounced  the  Union.10   All  the  charges except  the

  8(a)(1) charge, were dismissed.   The   8(a)(1) charge  was the

subject of a unilateral informal settlement agreement approved by

the Regional  Director.11   Because settlement agreements  may be

set aside  if the  provisions are  breached or  subsequent unfair

labor practices are committed, see Universal Blanchers, Inc., 275
                                                            

                    

9   The  General  Counsel  stated  before  the  Board  that  such
interviews would be fruitless because individuals do not admit to
unfair labor practice violations.

10  See supra note 1.
             

11  The Company  agreed to post the appropriate  notice to remedy
the infraction.

                               -19-

N.L.R.B. 1544,  1545 (1985), the Regional Director  did not close

case 1-CA-26660.  The  Regional Director rescinded the settlement

agreement  and  asserted  that  the  Consolidated  Complaint  was

"closely related"  to the then-resurrected    8(a)(1) charge, and

therefore  not  time-barred.12    The Union  proffers  this  same

argument on appeal.

          In  Nickles Bakery  of Indiana  Inc., 296  N.L.R.B. 927
                                              

(1989), the Board summarized the closely related test established

in Redd I, Inc., 290 N.L.R.B. 1115 (1988):   
               

            First,  the  Board will  look  at whether
            otherwise  untimely  allegations  involve
            the same legal theory as  the allegations
            in  the pending  timely charge.   Second,
            the  Board  will   look  at  whether  the
            otherwise untimely allegations arise from
            the   same   factual   circumstances   or
            sequence of events  as the pending timely
            charge.   Finally, the Board will look at
            whether a respondent would  raise similar
            defenses to both allegations.

Nickles  Bakery,   296  N.L.R.B.  at  928   (footnotes  omitted).
               

Applying this  standard, the  ALJ rejected the  "closely related"

argument.   In addition, while  the ALJ agreed  that the informal

settlement  agreement could  be  set  aside  due to  the  charges

pending in the Amended  Complaint, he ultimately recommended that

                    

12   The six-month limitations period applies only "to the filing
and service of  the charge, not to  the issuance or amendment  of
the complaint."  NLRB v. Overnite Transp. Co., 938  F.2d 815, 820
                                             
(7th  Cir. 1991); accord Sonicraft,  Inc. v. NLRB,  905 F.2d 146,
                                                 
148  (7th Cir.  1990), cert.  denied, 111  S.Ct.  671 (1991).   A
                                    
complaint  based on  a  timely filed  charge  may be  amended  to
include other  allegations if they  are "closely related"  to the
underlying timely charge  and occurred within  six months of  the
charge.  See Eastern Maine Medical  Center v. NLRB, 658 F.2d 1, 6
                                                  
(1st  Cir. 1981); see also NLRB v. Complas Indus., Inc., 714 F.2d
                                                       
729, 734 (7th Cir. 1983).

                               -20-

it  be  reinstated.     The  ALJ  favored  reinstatement  because

rescinding  the agreement served no purpose in light of its other

holding that the   8(a)(1) allegations were not "closely related"

to  the   8(a)(5) charges.   Girardi Distrib.  at *31-*33 & n.30.
                                             

The Board adopted the ALJ's recommendations and conclusions.

          Appellee  Company urges  that we  may not  consider the

"closely  related" theory  supporting reinstatement  of dismissed

charges.  It reasons that because neither the General Counsel nor

the Union raised objections to the reinstatement of the set aside

settlement agreement, the  Union has  waived its right  to do  so

now.  See  29 U.S.C.    160(e);13 Woelke  & Romero Framing,  Inc.
                                                                 

v. NLRB, 456 U.S.  645, 665 (1982);  Detroit Edison Co. v.  NLRB,
                                                                

440 U.S.  301, 311 & n.10  (1979).  It follows,  then, that since

the settlement agreement disposing of  the   8(a)(1) charges  has

been reinstated, no timely  charge exists to which the  dismissed

charges of the Consolidated Complaint can be "closely related."

          It  is true  that the  General  Counsel did  not object

specifically  to the  reinstatement of  the set  aside settlement

agreement  before  the Board.14    The  General Counsel  objected

strenuously, however,  to the ALJ's  decision that the    8(a)(5)

charges were not  "closely related" to the   8(a)(1) charges.  We

                    

13  Judicial  review is barred by    10(e) of the Act,  29 U.S.C.
  160(e), which  provides that "[n]o objection that  has not been
urged before  the Board . .  . shall be considered  by the court,
unless the failure  or neglect  to urge such  objection shall  be
excused because of extraordinary circumstances."

14  Nor did the  Union, although it could have intervened  in the
appeal to the Board.  See 29 U.S.C.   10(f).
                         

                               -21-

think that  the exception  taken  on this  ground challenged  the

recommendation  to   reinstate  the  set  aside   agreement  with

sufficient particularity  to survive the rule  waiving issues not

timely raised.  By  attacking the ALJ's decision on  the "closely

related" issue, the General  Counsel attacked the ALJ's rationale

for reinstatement.  Thus, the General Counsel implicitly objected

to reinstatement of the set aside agreement.

          We  therefore  consider  whether  the  charges  in  the

Consolidated  Complaint were  closely  related to  the    8(a)(1)

charge.  While  the ALJ found  that none of  the elements of  the

test had been met, his  explanations were less than satisfactory.

We examine each in turn.

          The ALJ  combined the "same legal  theory" and "similar

defense"  components  of  the  test,  asserting  that  the  legal

theories  behind  each  charge  were "far  different,"  but  only

illustrating the  differences between the defenses  that would be

raised to each charge.   The ALJ stated that the only  defense to

the   8(a)(1) charge was  that the statements had not  been made.

In  contrast, a  defense to  the    8(a)(5) charge  would involve

detailed  explanations   of  each  step  taken   by  the  Company

throughout the  negotiations and  disintegration of the  parties'

relationship.  The only connection that the ALJ could see between

the two  sets  of charges  was  "their bearing  on  the issue  of

intent."  Girardi Distrib. at *33.  
                          

          With respect  to  the "same  factual  circumstances  or

sequence  of  events" element  of the  test,  the ALJ  imposed an

                               -22-

extremely  high burden  regarding  the required  nexus.   Without

proof  that  the  Company specifically  directed  the  operations

manager, Ken White, to make the   8(a)(1) statements as part of a

"scheme"  to get rid of the Union, the ALJ rejected the assertion

that  the statements were part  of the same  factual situation or

sequence  of  events.   He  concluded  that  the  statements were

"simply isolated  statements reflecting  the common knowledge  of

all  [the Company's] employees that Mr. Girardi would like to get

rid of the Union."  Id. at *32.
                       

          We  think that  the ALJ's  factual conclusions  are not

supported  by substantial evidence in the record and that the ALJ

misapplied  the  closely  related  test.    With  respect to  the

similarity between the legal  theories underlying each charge, it

is  clear that  the  allegations  need  not  be  under  the  same

statutory  section.  See Redd I, Inc., 290 N.L.R.B. 1115; NLRB v.
                                                              

Overnite Transp. Co., 938 F.2d 815, 821 n.8 (7th Cir.  1991).  It
                    

is sufficient  that both charges  are part of the  same effort or

crusade  against the union.  See, e.g., Overnite Transp. Co., 938
                                                            

F.2d at 821; Texas World Service Co. v. NLRB, 928 F.2d 1426, 1437
                                            

(5th  Cir. 1991).   In  this case,  the ALJ  conceded that  the  

8(a)(1) statements  were probative  of the Company's  intent when

dealing with the Union,  which was the central issue for  the bad

faith bargaining charges  under    8(a)(5).  It  would seem  then

that  the  charges  involved   the  same  legal  theory,  broadly

speaking.

          We  do  not  understand  the  ALJ's  finding  that  the

                               -23-

statements  by White  were  just  isolated statements  confirming

facts already  known to  the Union.   As  we stated earlier,  the

evidence  did  not  support  finding  a  detailed  "scheme"  with

contingency plans.   The factual nexus required under the closely

related  test,  however, does  not  demand  that General  Counsel

establish  that  sort of  a conspiracy.    Charges will  be found

closely related factually if  they arise from the  same "sequence

of events."  Earlier in his opinion, the ALJ found that after the

bargaining  unit members  complained  about  the wage  difference

between  the  Company's  union  and  nonunion  employees,  White,

"acting  on information given him by Mr. Girardi, advised the men

they  could have the benefits afforded  the nonunion personnel if

they decertified."  Girardi  Distrib. at *26.  Thus,  despite the
                                     

inconsistency in  the ALJ's  characterization of the  impetus for

the  statements, it is clear  that the Company  directed White to

make the antiunion statements in violation of   8(a)(1).  The ALJ

also relied upon White's statements in determining that the prima

facie case on surface bargaining  existed.  Finally, the evidence

indicated  that White played an important role in the campaign to

bust the Union,  even if the  evidence did not support  a finding

that a  detailed conspiracy existed  by which the  Union's ouster

would  be  accomplished.     Consequently,  we  think  the  facts

underlying the two charges are factually "closely related."

          The  fact that  the defenses  to the    8(a)(5) charges

would be much more detailed and lengthy in their presentation, as

the  ALJ found, is  not fatal to  a finding that  the charges are

                               -24-

closely  related.   Taken as  a whole,  the closely  related test

seeks to ensure that  the General Counsel does not amend a charge

to  include unrelated infractions of the NLRA.  Each component of

the test adds  specificity to  the inquiry.   The "same  defense"

prong of  the test is  but another  way to ferret  out amendments

which involve  extraneous material.   In defending against  the  

8(a)(5) charge the  Company would  attempt to  show that  White's

statements were not part of its effort to decertify the Union and

that  its efforts  to  bust the  Union  did not  include  surface

bargaining.   The  overlap  between  the  subject matter  of  the

defenses  is readily apparent.  The Union, therefore, has met the

"closely  related"  test and  the merits  of  the charges  in the

Consolidated Complaint warrant consideration.

                                IV
                                  

          We  affirm the  Board's holding  with respect to  the  
                    

10(b)  bar.    We reverse  the  reinstatement  of  the set  aside
                         

settlement agreement and remand for a hearing on the Consolidated
                               

Complaint  having  found those  charges  closely  related to  the

timely   8(a)(1) charges underlying the set aside agreement.

                               -25-