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National Labor Relations Board v. Beech-Nut Life Savers Inc.

decided: December 3, 1968.

NATIONAL LABOR RELATIONS BOARD, PETITIONER-APPELLEE,
v.
BEECH-NUT LIFE SAVERS, INC., RESPONDENT-APPELLANT



Lumbard, Chief Judge, Waterman and Kaufman, Circuit Judges.

Author: Waterman

Appellant seeks reversal of an order, United States District Court for the Southern District of New York, Bonsal, J., enforcing a National Labor Relations Board subpoena duces tecum directed to appellant by which appellant is required to produce the information necessary to comply with the Board's so-called Excelsior rule, laid down in Excelsior Underwear, Inc., 156 NLRB 1236 (1966).

The subpoena was issued in connection with the prefatory stages of a rerun representation election. Appellant had not timely complied with the rule when the original election had been held, and, that election having been set aside and the rerun election ordered, refused to comply with the rule in connection with the rerun election, and, its subpoena being ignored, the Board sought district court enforcement thereof.

The disposition below, 274 F. Supp. 432, is affirmed.

WATERMAN, Circuit Judge.

This case is here on appeal from a final judgment order of the United States District Court for the Southern District of New York granting the National Labor Relations Board's application for enforcement of a subpoena duces tecum directed to appellant Beech-Nut Life Savers, Inc. pursuant to Section 11(2) of the National Labor Relations Act, as amended (61 Stat. 136, 73 Stat. 519, 29 U.S.C. § 151 et seq.). The district court's opinion is reported at 274 F. Supp. 432. The jurisdiction of this court is invoked under 28 U.S.C. §§ 1291 and 1294.

On February 18, 1966, Office & Professional Employees International Union, Salesmen's Division, Local 153, AFL-CIO (Local 153), petitioned the Board for a representation election to be held among certain of the appellant's salesmen. Two other unions, District 65, Retail, Wholesale and Department Store Union, AFL-CIO, and Joint Organizing Committee of Locals 342, 400, 467, 474, and 489, Amalgamated Meat Cutters & Food Employees Union, AFL-CIO, intervened in the proceeding. The Regional Director for Region 2, New York City, on April 14, 1966, ordered that an election by secret ballot be conducted among the affected salesmen of appellant. In his Direction of Election the Regional Director ordered appellant, among other things, to comply with the rule announced by the Board in Excelsior Underwear, Inc., 156 NLRB 1236 (1966).

The Board's Excelsior rule requires an employer to file with the Board's Regional Director a list of the names and addresses of all employees eligible to vote in a representation election within 7 days after the Director's direction of an election or after the close of a payroll period determinative for eligibility purposes, whichever is later. This list is made available to all parties participating in the representation proceeding in order to facilitate the communication of election issues to the employees and the prompt resolution of questions relating to the voting eligibility of particular employees. The Excelsior rule also provides that an employer's failure to file the required list is ground for setting the election aside whenever proper objections to the election are filed.

Appellant failed to file the Excelsior list. On July 20, 1966, one day before the scheduled election, the company submitted a list of names of the voters but without addresses.

On July 21, 1966, an election was conducted in which 88 votes were cast for Local 153, 3 votes for one of the intervening unions, no votes for the other intervening union, and 135 votes against representation by any union. Local 153 filed objections to the election because appellant had not complied with the Excelsior rule.

The Regional Director sustained the Local's objections, set aside the election, and ordered a second election. Appellant maintained that the July 21 election was a valid one, and attacked the validity of the Excelsior rule and the impropriety of the Board's insistence upon compliance with the Rule in this representation proceeding. In the meantime the two intervening unions were permitted to withdraw from participation in the second election.

On November 29, 1966, the Regional Director issued a Notice of Rerun Election and notified the Company by letter that it had until December 7, 1966 to submit an Excelsior list. In a letter dated December 5, 1966 appellant refused to supply the Excelsior list. Because of appellant's continued refusal to furnish an Excelsior list, the second election was indefinitely postponed by the Regional Director.

On December 13, 1966, the Regional Director caused a subpoena duces tecum to be issued, pursuant to Section 11(2) of the Act, directing the appellant to produce and make available to the Board's Regional Office the appellant's personnel payroll records or, in lieu thereof, a list containing the names and addresses of all employees eligible to vote in the election. The appellant refused to comply with the subpoena or otherwise furnish the list and petitioned to have the subpoena revoked. The Board denied appellant's petition and applied in the district court for enforcement of the subpoena, or alternatively, for a mandatory injunction directing the appellant to comply with the Excelsior rule. Jurisdiction was based on Sections 11(2) and 9(c) of the National Labor Relations Act, and on 28 U.S.C. § 1337. The district court upheld the Excelsior rule, refused to review the validity of the first election and entered judgment on November 1, 1967. It granted enforcement of the Board's subpoena. It also ordered that the appellant should, within seven days of the receipt of a notice from the Regional Director that a second election was to be held, forward the subpoenaed information to the Director. The court found it unnecessary to issue the alternatively requested mandatory injunction. This appeal followed.

Appellant's main contention is that the Board's Excelsior rule, regardless of whether the rule is a desirable or an undesirable one, is invalid and unenforceable because it was not promulgated in the manner required by the applicable provisions of the Administrative Procedure Act, 5 U.S.C. §§ 551-553. This contention is supported by two separate arguments. Appellant's first argument is that rules of general applicability and future effect, 5 U.S.C. § 551(4), such as the Excelsior rule, can only be promulgated after quasi-legislative agency proceedings which conform with the Administrative Procedure Act's provisions dealing with quasi-legislative agency rule-making, 5 U.S.C. §§ 551-553; and, that only "orders," 5 U.S.C. § 551(6), which are applied to the particular case before the agency can be formulated in quasi-judicial agency proceedings. 5 U.S.C. § 551(7). Appellant's second argument is that, even if rules of general applicability and future effect can be formulated in the course of a quasi-judicial agency proceeding, the agency ...


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