Armor Research Foundation of Illinois Institute of Technology

National Labor Relations Board - Board Decisions

Feb 3, 1954

107 N.L.R.B. 1052 (N.L.R.B. 1954)

1052 DECISIONS OF NATIONAL LABOR RELATIONS BOARD
ARMOUR RESEARCH FOUNDATION OF ILLINOIS INSTITUTE
OF TECHNOLOGY and OIL WORKERS INTERNATIONAL
UNION, CIO , Petitioner . Case No. 13-RC - 3630 . February 3,
1954
DECISION AND ORDER
Upon a petition duly filed under Section 9 (c) of the National
Labor Relations Act, a hearing was held before Allen P. Haas,
hearing officer . The hearing officer's rulings made at the hear-
ing are free from prejudicial error and are hereby affirmed.
Upon the entire record in this case , the Board finds:
Armour Research Foundation is a privately endowed non-
profit corporation engaged in technological research , operated
in conjunction with the Illinois Institute of Technology , a private-
ly endowed nonprofit educational institution providing under-
graduate and graduate courses in science and engineering. The
research activities of the Foundation fall into four categories:
(a) unsponsored , pure scientific research underwritten by the
Institute "in furtherance of its obligation as an institution of
higher learning to contribute to the general store of human
knowledge "; ( b) public service research undertaken at the re-
quest of various governmental or public agencies , without com -
pensation and solely in the public interest ; ( c) research spon-
sored by industry ; and (d ) research sponsored by various
governmental agencies , mostly Federal.
During the present fiscal year , the income of the Institute
was approximately $ 14,000 , 000, $ 3 , 000,000 from tuition and
fees, $ 8,000,000 from various research project grants, $2,
500,000 from commercial research sponsors , andthe remainder
from gifts and the proceeds from cafeteria and bookstores.
The Board has found many of the commercial sponsors to be in
interstate commerce. The Foundation has patents on magnetic-
recording equipment and has granted licenses to 52 licensees,
13 of whom are foreign; the proceeds from these licenses
are valued at about $46 , 000 a year . During the present fiscal
year , the Foundation has purchased approximately $ 2,800,000
worth of materials , approximately 15 percent, or $420,000
from out of State.
The Employer expressed its willingness to concede that its
activities affected interstate commerce, within the meaning of
the Act , but argues that the assumption of jurisdiction by the
Board would not effectuate the purposes of the Act . In its brief,
the Employer states that the Board asserted jurisdiction in
Illinois Institute of Technology including Armour Research
Foundation and Institute of Gas Technology , 81 NLRB 201, on
the basis of a record which did not fully develop the true nature
of the Foundation , only 27 percent of whose research is
commercially sponsored , and upon "an incorrect concept of the
proper extent of the Board ' s jurisdiction which later decisions
have rejected ." In support of that position, the Employer's
107 NLRB No. 228.
ARMOUR RESEARCH FOUNDATION 1053
brief cites Trustees of Columbia University , 97 NLRB 424;
Philadelphia Orchestra Association , 97NLRB 548, and the
dissent of Chairman Herzog an erhber Peterson in Califor-
nia Institute of Technology, 102 NLRB 1402. The Petitioner
filed no brief.
In the California Institute of Technology decision , the ma-
jority, reconciling earlier Board precedents stated the follow-
ing rule:
[The Board ] has refused to exempt such nonprofit organi-
zations from the operation of the Act when the particular
activities involved were commercial in nature . [Citing
cases.] Conversely , where the activities involved arenon-
commercial in nature and intimately connected with the
educational activities of the institution , the Board has re-
fused to assert its jurisdiction . [Citing Columbia Uni-
versity.]
The dissenters disagreed only as to the characterization of
the particular project --a Cooperative Wind Tunnel which was
located off the campus and was financed entirely by commer-
cial sponsors --as being sufficiently commercial to warrant
the assertion of jurisdiction.
Here , the Foundation is physically located on the campus of
the institute ; some students are employed by the Foundation in
aid of the alternating study-work Institute program and others
are given fellowships to the Ins itute by the Foundation. Only
27 percent of the Foundation ' s wokk is commercially sponsored.
Under these circumstances , we are of the opinion that the ac-
tivities involved are intimately connected with the educational
activities of the Institute and noncommercial in nature and that
it would not effectuate the policies of the Act to assert jurisdic-
tion here.
['The Board dismissed the petition.]
Member Murdock , dissenting:
I dissent from the refusal to assert jurisdiction here which
is contrary to the Board ' s prior determination involving the
Foundation in Illinois Institute of Technology , 81 NLRB 201.
In view of the majority ' s admission that 27 percent of the
work of the Foundation , which is separately incorporated, is
commercially sponsored, I cannot comprehend the ultimate
conclusion that the Foundation ' s activities are "noncommercial
in nature ." Surely 27 percent , amounting to $2.5 million a
year , cannot be deemed de minimis or an incidental aspect of
the Foundation ' s work . The following conclusion , stated in the
Board ' s earlier decision , remains true:
Whatever its general purposes may be , there can be little
doubt that the research features of the Employer ' s activi-
337593 0 - 55 - 68
1054 DECISIONS OF NATIONAL LABOR RELATIONS BOARD
ties as carried out by the Foundation and Gas Technology
are operated on a commercial or business basis. These
two divisions of the Employer furnish research services
to industrial concerns and the Federal Government which
have as their purpose the improvement of manufacturing
processes . Moreover , their sponsors reimburse them for
all cost engendered in connection with these services. In
return for research services rendered during the past year,
the Foundation is expected to receive from its sponsors
approximately $2,900,000. This organization in addition
receives a substantial income from manufacturing con-
cerns for use of its patents. At least with respect to the
Foundation ' s operations , education appears to be of second-
ary significance . The facts herein establish that the Em-
ployer's sponsored research projects are of a business
nature. We are of the opinion and find that the Employer
is engaged in commerce within the meaning of the Act.
This finding is unaffected by the fact that the Employer
does not operate for profit or that its activities in inter-
state * commerce involve the communication of informa-
tion rather than the transmission of specific products.
I regard the activities here involved as distinguishable from
the university library which was involved in the Trustees of
Columbia University case, and a symphony orchestra whichwas
involved in the Philadelphia Orchestra Association case. It
clearly falls within the California Institute of Technology case
which was decided subsequent to them.
DICK BROTHERS, INC. and STEEL WORKERS FEDERATION,
Petitioner . Case No. 4-RC-2055. February 3, 1954
DECISION AND ORDER
Upon a petition duly filed under Section 9 ( c) of the National
Labor Relations Act, a hearing was hold before Julius Topol,
hearing officer . The hearing officer's rulings made at the hear-
ing are free from prejudicial error and are hereby affirmed.
Upon the entire record in this case , the Board finds:
1. The Employer is engaged in commerce within the mean-
ing of the Act.
2. The labor organizations involved claim to represent em -
ployees of the Employer.'
'United Steelworkers of America, CIO, hereinafter referred to as Steelworkers , and its
Local 1626 intervened at the hearing on the basis of a current contractual interest . Petitioner
objected to the intervention of Local 1626 and contended that it is not a labor organization
within the meaning of the Act, because it is defunct . In view of our finding in paragraph
numbered 3, below, Petitioner ' s objection and contention are without merit.
107 NLRB No. 219.