Avne Systems, Inc.

National Labor Relations Board - Board Decisions

Aug 25, 2000

331 N.L.R.B. 1352 (N.L.R.B. 2000)

DECISIONS OF THE NATIONAL LABOR RELATIONS BOARD 1352
Avne Systems, Inc. and Local 445, Laborers’ Interna-
tional Union of North America, AFL–CIO

Local 445, League of International Federated Em-
ployees (Avne Systems, Inc.) and Local 445, La-
borers’ International Union of North America,
AFL–CIO. Cases 2–CA–30949 and 2–CB–16899
August 25, 2000
DECISION AND ORDER
BY CHAIRMAN TRUESDALE AND MEMBERS
HURTGEN AND BRAME
On December 28, 1998, Administrative Law Judge
Raymond P. Green issued the attached decision. Respon-
dents Avne Systems, Inc. and Local 445, League of Inter-
national Federated Employees (LIFE), each filed excep-
tions and a supporting brief. The Charging Party, Local
445, Laborers’ International Union of North America,
AFL–CIO, filed an answering brief, cross-exceptions, and
a supporting brief. The General Counsel filed an answer-
ing brief and a cross-exception.
The National Labor Relations Board has delegated its
authority in this proceeding to a three-member panel.
The Board has considered the decision and the record
in light of the exceptions and briefs and has decided to
affirm the judges rulings, findings,1 and conclusions as
modified below and to adopt the recommended Order.
As an initial matter, we note that there are no excep-
tions to the judges finding that, but for the statute of limi-
tations defense asserted by the Respondents, the evidence
showed that the Respondents unlawfully entered into a
collective-bargaining agreement at a time when the
Charging Party was the Section 9 representative and Re-
spondent Avne’s collective-bargaining agreement with
the Charging Party had not yet expired. Nor are there
any exceptions to the judges finding that, but for the stat-
ute of limitations defense, Respondent Avne unlawfully
withdrew recognition from the Charging Party during the
term of an existing collective-bargaining agreement. In
the absence of exceptions, we adopt these findings and
proceed to consider the statute of limitations issue.
It is undisputed that the conduct alleged as unlawful in
the instant case occurred more than 6 months before the
charges were filed. Notwithstanding this fact, the judge
found that the statute of limitations should be tolled be-
cause the Respondents fraudulently concealed from
Avne’s employees a scheme to substitute a new union,
Local 445, League of International Federated Employees
(LIFE), for Local 445, Laborers’ International Union of
North America (Local 445, LIUNA), their bargaining
representative. The judge found that, by misleading the
employees as to the nature of the transactions involved,
Respondent LIFE, with the acquiescence of Respondent
Avne, fraudulently concealed the true facts from the af-
fected employees and that, as a consequence, the 10(b)
statute of limitations should be tolled. We find merit in
the Respondents’ exceptions to this finding.

1 The Respondents have excepted to some of the judges credibility
findings. The Boards established policy is not to overrule an adminis-
trative law judges credibility resolutions unless the clear preponderance
of all the relevant evidence convinces us that they are incorrect. Stan-
dard Dry Wall Products, 91 NLRB 544 (1950), enfd. 188 F.2d 362 (3d
Cir. 1951). We have carefully examined the record and find no basis
for reversing the findings.
First, we find that the Avne employees knew that offi-
cers of Local 445, LIUNA were proposing that they
separate from the International Union and form a new
local. Indeed, it appears that at least some of the impetus
for this plan came from Respondent Avne’s employees
own dissatisfaction with an increase in the amount of per
capita tax charged by the Laborers International Union.
And, in furtherance of this plan, the Avne employees
signed cards authorizing LIFE to represent them and di-
rected Avne to deduct fees and dues from their wages as
a condition of acquiring or maintaining membership in
LIFE. Under these circumstances, it cannot be said that
the employees were unaware of the facts giving rise to
the instant unfair labor practices.
Despite their knowledge and involvement, however,
the judge concluded that the employees were materially
misled as to the true nature of the transaction. Even
though they knew that LIFE would be a new union dis-
tinct from Local 445, LIUNA, the judge found Avne
employees agreed to the change based on the representa-
tion that they would continue to have the same represen-
tation by the same people and that the change would only
be temporary until the new union could affiliate with the
International. The judge found that the employees were
not informed that there might be an impediment to reaf-
filiation. Instead, the judge determined that, to the extent
that employees were told there would be a change, they
were told that it would not be a substantive one.
Contrary to the judge, we do not find that the forego-
ing representations to employees rise to the level of af-
firmative misstatements about material facts, a required
element in the test for fraudulent concealment. Thus,
apart from the affiliation aspect, it is apparent—as accu-
rately represented by the Local 445 officials—that very
little of substance did change for Respondent Avnes em-
ployees following their switch to LIFE; certainly not
enough to premise a conclusion of fraudulent conceal-
ment. Thus, the employees continued to have the same
shop steward, the same representatives in their dealings
with Respondent Avne, and—substantively—their same
contract. And, as to the representation that LIFE would
eventually reaffiliate with the International, the employ-
ees could not reasonably have been surprised when the
International (whose per capita tax receipts the scheme
was designed to reduce) did not cooperate, and the
planned reaffiliation of LIFE with the International did
not occur. Accordingly, on these facts, we do not find
that the statute of limitations should be tolled based on
331 NLRB No. 180
AVNE SYSTEMS, INC. 1353
fraudulent concealment vis-à-vis Respondent Avne’s
employees.
We do, however, agree with the judge’s ultimate con-
clusion that the statute should be tolled. We do so, be-
cause, in our view, the International was the victim of
fraudulent concealment. As an initial point, we find that
the Respondent LIFE affirmatively concealed material
facts from the International about the status of Local 445.
Thus, we note that John Mongello Jr., the Local 445 offi-
cial who was instrumental in the establishment of LIFE,
admitted that LIFE was created specifically to avoid the
Internationals per capita tax. Mongello further conceded
that he and other Local 445 officials made a conscious
effort to conceal their plan from the International. In-
deed, the judge found that, after LIFE was created, Mon-
gello, despite his purported resignation, continued to
hold himself out, with the consent of the Unions other
officers, as being in charge of Local 445, LIUNA. Fur-
ther, Mongello and the other officers of Local 445,
LIUNA, and LIFE concealed the existence of LIFE from
the International as well as the fact that they had, in ef-
fect, transferred many contracts and members from Local
445 to LIFE.
Next, there is no record evidence that, had it exercised
due diligence, the International would have learned,
within the 10(b) period, of the scheme by Mongello and
others to remove Avne employees from Local 445,
LIUNA. As found by the judge, the deception was suc-
cessful based on Mongellos misrepresentations as well as
by the fact that the International was not a party to any of
the contracts that Local 445, LIUNA had maintained
with employers, and had neither a list of employers con-
tracting with Local 445 LIUNA nor a list of the names
and addresses of its members. Significantly, once the
deception was uncovered, the International quickly
placed Local 445, LIUNA in trusteeship and filed a Fed-
eral lawsuit. Moreover, the trustee designated to operate
Local 445, LIUNA promptly filed the instant unfair labor
practice charges.
Although the judge found that the International had
been deceived, he found that the statute of limitations
should not toll based on this deception because the Inter-
national lacked standing. Specifically, the judge noted
that the International was not the Charging Party and had
no contractual or other standing vis-a-vis Avne or the
employees represented by the Charging party, Local 445,
LIUNA. For this reason, although the judge acknowl-
edged the authority of the International, in certain cir-
cumstances, to impose a trusteeship on Local 445,
LIUNA, he concluded that the International was not an
“affected party” for 10(b) purposes. We disagree.
First, we emphasize that, in a very practical sense, the
International was the obvious victim of the scheme by
Mongello and others to supplant Local 445, LIUNA with
LIFE as the representative of Avne employees. As a
result of the deception, membership declined in the In-
ternationals local and its per capita tax base declined.
Further, in order to protect its interests and those of its
affiliate locals, the International placed Local 445,
LIUNA into trusteeship. Significantly, it was the trustee
appointed to operate Local 445, LIUNA for the Interna-
tional who filed the instant charges. In these circum-
stances, we find a sufficient nexus between the Charging
Party trustee and International Union to treat the latter as
an affected party for 10(b) purposes.
In sum, we find that the International was the victim of
deliberate concealment of material facts, and was igno-
rant of these facts without any fault or want of due dili-
gence on its part. Accordingly, we find that the tolling of
the 10(b) period was warranted.2
Finally, although the judge did not make a separate
finding on the point, we also agree with his tolling of the
statute as to both Respondents. In doing so, we need not
endorse the judges finding that Respondent Avne acqui-
esced in the deception practiced by Mongello and his
associates. Even assuming arguendo that there was no
such acquiescence, we find it appropriate to toll the stat-
ute as to both Respondents.
Briefly, had the International/trustee known the true
situation in time, it presumably would have filed unfair
labor practice charges during the 6-month window. In
that case, even had Avne played no role in concealing the
underlying actions at issue, it still would have been li-
able, if charged, on the underlying actions themselves.
Indeed, as noted above, the judge found (and no one dis-
putes) that, but for the 10(b) defense, Respondent Avne
acted unlawfully in withdrawing recognition from Local
445, LIUNA, signing a contract with LIFE, and checking
off and remitting dues and fees to it.
A party filing unfair labor practice charges may name
more than one respondent. If a potential charging party,
because of fraudulent concealment practiced solely by
potential respondent A, fails to discover in time the un-
fair labor practices committed by potential respondents A
and B, we see no reason, if the statute of limitations is to
be tolled, why potential respondent B must remain be-
yond the laws grasp. As between the parties violating
the Act and the victim of their unlawful conduct (from
whom material facts have been concealed) we find that
equities favor the latter.3
Our dissenting colleague argues that Respondent Avne
has a valid 10(b) defense. The misconduct in this case
occurred in March 1997, when Respondent Avne and
Respondent LIFE entered into a collective-bargaining
agreement. The charge was not filed until November 14,
1997, more than 6 months after the misconduct. How-
ever, the dissent concedes that the International Union

2 Although the International was not the Sec. 9 representative, Sec.
10(b) provides that “any person” can file a charge.
3 As noted above, Respondent Employer does not except on the mer-
its, i.e., it does not argue that its actions were lawful. It argues only the
10(b) point.
DECISIONS OF THE NATIONAL LABOR RELATIONS BOARD 1354
was the victim of fraudulent concealment. Thus, Section
10(b) was tolled, and the charge was timely. The dissent
contends that the charge was timely as to Respondent
LIFE, but not as to Respondent Avne. The reasoning for
this proposition is that LIFE was the fraudulent party, not
Avne.
The reasoning of the dissent is flawed. The doctrine of
fraudulent concealment is not intended to punish a re-
spondent for its fraud; it is intended to protect the injured
party from the fraud, i.e., it is intended to excuse the in-
jured party from what would otherwise be a l0(b) bar
against it. And, once protected against Section 10(b), the
injured party can proceed against the unfair labor prac-
tice. (Although Avne did not commit a fraud, it did
commit an unfair labor practice). Thus, Local 445 as the
Charging Party can proceed against Avne and secure an
order to take away recognition from LIFE and restore
recognition to Local 445.4
Moreover, the dissent’s argument on behalf of Avne is
not one that is made by Avne itself. Avne argues that
LIFE did not mislead employees. Our colleague rejects
this Avne argument, but then makes a very different one
for Avne, i.e., that Avne was not guilty of any fraud.
Thus, in addition to the nonmerit of this argument, (see
above) we note that the argument is not procedurally
before us.5
In sum, although we disagree with the judges finding
that the employees of Respondent Avne were victims of
fraudulent concealment for 10(b) purposes, we agree
with his ultimate conclusion that the statute of limitations
should be tolled.
ORDER
The National Labor Relations Board adopts the rec-
ommended Order of the administrative law judge and
orders that the Respondents, Avne Systems, Inc., Bronx,
New York, its officers, agents, successors, and assigns,
and Local 445, League of International Federated Em-
ployees (Avne Systems, Inc.), its officers, agents, and
representatives, shall take the action set forth in the Or-
der.

4 We note that the 10(b) period does not begin to run until the party
adversely affected had actual or constructive knowledge of the miscon-
duct. Adair Standish Corp., 295 NLRB 985, 986 (1989); Carpenters
Wisconsin River Valley Council, 211 NLRB 222, 227 (1974). The
record indicates the trustee appointed by the International Union filed
charges within 6 months of learning of the misconduct. We recognize
that Adair Standish and Wisconsin River involve the principle that Sec.
10(b) is tolled for periods when the charging party had no actual or
constructive knowledge of the unfair labor practice. However, we see
no valid reason for applying a different principle simply because, as
here, the reason for the lack of knowledge is fraudulent concealment by
the other party.
5 We recognize that Respondent Avne raised a 10(b) defense. Our
point is simply that Respondent Avne did not make the dissents argu-
ment in support of that defense.
MEMBER BRAME, dissenting in part.
I agree with my colleagues and, in the absence of ex-
ceptions, adopt the judges findings that, but for the stat-
ute of limitations defense, the Respondents unlawfully
entered into a collective-bargaining agreement at a time
when Local 445, Laborers’ International Union (Local
445, LIUNA) was the Section 9 representative of the
employees at issue and its collective-bargaining agree-
ment with Respondent Avne was in effect, and, further,
Respondent Avne unlawfully withdrew recognition from
Local 445, LIUNA during the term of that agreement. I
further agree that the statute of limitations should be
tolled with respect to Respondent LIFE based on Re-
spondent LIFE’s fraudulent concealment of material
facts about the status of Local 445, LIUNA, and note that
the International Union was ignorant of these facts with-
out any failure of due diligence on its part. Thus, as de-
tailed below, despite the fact that the unfair labor prac-
tices alleged occurred more than 6 months before the
charges were filed and thus outside the 10(b) period, I
agree with my colleagues finding that Respondent LIFE
violated Section 8(b)(1)(A) and (2) by accepting recogni-
tion from Avne, entering into and enforcing a collective-
bargaining agreement with Avne, and accepting dues and
fees pursuant to that agreement. However, contrary to my
colleagues, I would not toll the statute of limitations as to
Respondent Avne. Thus, I would not find that Avne vio-
lated the Act in the manner set forth in the conclusions of
law and would provide no remedial order with respect to
that Respondent.1
As detailed in the judge’s decision, Local 445, LIUNA
had a longstanding Sec. 9 relationship with Respondent
Avne. At the time the events at issue occurred, Local
445, LIUNA and Avne were parties to a contract cover-
ing various Avne employees, which was effective from
October 1, 1994, to October 1, 1997. Local 445, LIUNA
was affiliated with the Laborers International Union.
John Mongello Jr. (Mongello) was the business manager
and chief officer of Local 445, LIUNA. The president of
Avne at the time of the events at issue, Jack Steinmetz,
testified that he had dealt with Mongello as the union
representative to the Company for approximately 16 or
17 years.
1 My colleagues note that Respondent Avne makes a different argu-
ment in support of its exceptions involving Sec. 10(b) than the one I
rely on here. The majority essentially claims that, because “the argu-
ment is not procedurally before us,” I am precluded from using this
analysis to find no liability on Avne’s part. I disagree. The Board has
consistently held that Sec. 10(b) is not jurisdictional but is an affirma-
tive defense which must be timely raised by a respondent in its answer
to the complaint or at hearing or is considered waived. See, e.g., Lei-
sure Knoll Assn., 327 NLRB 470 fn. 3 (1999), and Prestige Ford, 320
NLRB 1172 fn. 3 (1996). Respondent Avne has raised the 10(b) statute
of limitations defense at hearing. Thus, Sec. 10(b) is timely raised and
must be considered. In my view, this is sufficient to put before us pro-
cedurally the issue of the application of Sec. 10(b) to the facts in this
case, and we should not, after the fact, place a higher burden on a party
raising a 10(b) defense.
AVNE SYSTEMS, INC. 1355
In late 1996, a dispute arose between Local 445,
LIUNA and the International concerning the amount of
per capita tax the local affiliate was obligated to pay the
International. When no resolution was reached, Mongello
devised a plan whereby the local would disaffiliate from
the International, form a new and independent labor or-
ganization, and reaffiliate at a later time in a manner
which Mongello believed would result in a lower tax
payment. In early 1997,2 Mongello and the other officers
of Local 445, LIUNA created a new local, Local 445,
League of International Federated Employees (LIFE). At
the same time, these individuals held a series of meetings
with Avne employees and presented their plan. At these
meetings, the employees signed LIFE authorization
cards. The record is unclear regarding what the employ-
ees were told before they signed these cards.
In January or February, Mongello came to Steinmetz’
office and presented him with a group of cards signed by
Avne employees. According to Steinmetz, Mongello told
him that “we are now representing a new union. The em-
ployees decided to vote us. Here is [sic] the . . . signature
cards.” After some discussion, Steinmetz and Mongello
agreed to and executed a new contract which was virtu-
ally identical to the former contract between Avne and
Local 445, LIUNA, which, as noted above, was not to
expire until October 1. The new agreement was un-
signed but was effective from March 1, 1997, to Febru-
ary 28, 2000.
Local 445, LIUNA was not disbanded at the time LIFE
came into being. Instead, it continued to maintain a sepa-
rate existence through new officers appointed by Mon-
gello and continued to represent employees of some
other employers. Both Unions apparently occupied the
same offices. During the time both Unions operated, the
International became concerned with the drop in mem-
bership (and resulting reduction in per capita taxes) in
Local 445, LIUNA and sought to investigate the matter.
In May, an investigator from the International visited the
Local 445, LIUNA offices and in June an International
representative accompanied by an auditor visited the
offices. During these visits, Mongello met and discussed
the matter with these individuals without disclosing ei-
ther that he had resigned from Local 445, LIUNA or that
a new union had been created. As found by the judge,
Mongello, with the consent of the other officers of both
Unions, continued to hold himself out as being in charge
of Local 445, LIUNA and explicitly engaged in efforts to
conceal the truth from the International.
Finally, in an August meeting with the Internationals
investigator, Mongello admitted that he had chartered a
new union and had transferred members of Local 445,
LIUNA to Respondent LIFE, and that he was no longer
associated with Local 445, LIUNA. In October, the In-
ternational placed Local 445, LIUNA into trusteeship

2 All dates are in 1997 unless otherwise indicated.
and filed a Federal lawsuit. Thereafter, the Local 445,
LIUNA trustee filed the charges that resulted in the com-
plaint here.
Section 10(b) of the Act states, in pertinent part, that
“no complaint shall issue based upon any unfair labor
practice occurring more than six months prior to the fil-
ing of the charge with the Board.” As the Board stated in
Koppers Co., 163 NLRB 517 (1967), the “[p]ractical
effect of the proviso of Section 10(b) is that, absent the
existence of a properly served charge on file, a party is
assured that on any given day his liability under the act is
extinguished for any activities occurring more than 6
months prior thereto.”3
It is well established that there are some exceptions to
this statute of limitations. Pertinently, where a wrongdoer
fraudulently conceals evidence of his unlawful conduct,
the concealment tolls the running of the 10(b) period, and
the wrongdoer is effectively estopped from raising a
10(b) defense. Thus, under this equitable doctrine, the
party engaging in the fraud, i.e., the wrongdoer, is not
entitled to benefit from his actions by operation of the
statute of limitations.4
The Board has articulated a three-pronged test estab-
lished by the D.C. Circuit in describing the equitable
fraudulent concealment doctrine. Under that test, fraudu-
lent concealment tolls the 10(b) statute of limitations
when, (1) there has been deliberate concealment of, (2)
material facts relating to the alleged wrongdoing, and (3)
the wronged party does not know of these facts and could
not have discovered them through reasonable diligence.5
The Board has stressed that “the three critical elements”
all must be present to warrant the tolling of the 10(b)
period.6
There is no doubt here that Respondent LIFE’s actions
were sufficient to warrant tolling of the 10(b) period. My
colleagues so find and, as stated above, I agree. How-
ever, without passing on whether Respondent Avne has
itself engaged in fraudulent concealment, and assuming
for purposes of the decision that Avne played no role in
Respondent LIFE’s deception, the majority concludes
that the statute of limitations must be tolled with respect
to Avne as well. The majority’s theory is that the equities
favor tolling with respect to both Respondents when the
3 See also Machinists District Lodge 64 v. NLRB, 949 F.2d 441, 445
(D.C. Cir. 1991), and cases cited therein.
4 NLRB v. Don Burgess Construction Corp., 596 F. 2d 378, 382–383
(9th Cir. 1979), enfg. 227 NLRB 765, 766 (1977), cert. denied 444 U.S.
940 (1979), quoting Holmberg v. Armbrecht, 327 U.S. 392, 397 (1946),
in which it was noted that the equitable doctrine of tolling for fraudu-
lent concealment is read into every statute of limitation, including Sec.
10(b).
5 Brown & Sharpe Mfg. Co., 321 NLRB 924 (1996), enfd. sub nom.
Machinists District Lodge 64 v. NLRB, 130 F.3d 1083, 1087 (1997),
relying on Fitzgerald v. Seamans, 553 F.2d 220, 228 (1977).
6 Id.
DECISIONS OF THE NATIONAL LABOR RELATIONS BOARD 1356
acts of one foreclose the victim of the wrongful conduct
from timely filing a charge. I disagree.7
It is clear that, absent the tolling of the statute of limi-
tations, Respondent Avne would be assured that its
liability under the Act would be extinguished after the
passing of the 6-month period for the filing of the charge.
It is equally clear that under Board and related court
precedent, there must be deliberate and affirmative con-
cealment of the wrongful acts for the tolling of the statu-
tory time period for the filing of the charge. Thus, a po-
tential respondent who has committed unfair labor prac-
tices, although a wrongdoer to that extent, is able to avail
itself of the operation of the statutory time limits despite
having committed the unfair labor practices, absent any
further wrongful acts.
The majority’s analysis fails to recognize this. The ma-
jority concludes that the equities favor tolling the statu-
tory time limits against Avne, which did not except on
the merits to the unfair labor practices found, rather than
having the victim of the unfair labor practices without
recourse against it. Thus, the majority in effect finds that
Respondent Avne is not entitled to avail itself of the
statutory time limits even in the absence of any fraudu-
lent concealment of its acts. In my view, this is a mis-
reading of the equitable doctrine of tolling statutory time
limits. The majority’s analysis incorrectly shifts the in-
quiry from the wrongdoers fraudulent concealment to an
application of general equitable principles focusing on
the plight of the charging party.8
Even accepting the improper shift, I would find that
the equities lie differently. I would find that there is no
showing of complicity by Respondent Avne, i.e., it has
not engaged in or condoned any fraudulent concealment
of facts associated with Respondent LIFE’s scheme to
conceal its unlawful conduct from the International.
Thus, an essential one of the three elements of the equi-
table doctrine warranting the tolling of Section 10(b) is

7 The majority has not cited any precedent directly on point. I note
that in Demars v. General Dynamics, 779 F.2d 95, 97 (1st Cir. 1985),
involving a combined Sec. 301 and duty of fair representation lawsuit,
the circuit court indicated that, in the absence of a finding that Sec.
10(b) should be tolled based on the fraudulent concealment of the re-
spondent union, it did not reach the issue of whether the fraudulent acts
of the respondent union could toll the statute as to the respondent em-
ployer. I further note that in Newton v. Chicago & North Western
Transportation Co., 119 LRRM 3399 (1985), the District Court found,
in the context of the Railway Labor Act, that even if Sec. 10(b) could
be tolled as to a plaintiffs claims against the respondent union, the
plaintiffs failed to demonstrate concealment warranting tolling as to the
claims against the respondent employer.
8 See, e.g., Winer Motors, Inc., 265 NLRB 1457 (1982), where the
Board majority reversed precedent, finding that the Board had previ-
ously exceeded its authority and circumvented Sec. 10(b) when it al-
lowed the General Counsel to ignore the statutory limitations and rein-
state a withdrawn charge for equitable reasons outside the 10(b) limita-
tion period absent fraudulent concealment by a respondent. (Winer was
extended in Ducane Heating Corp., 273 NLRB 1389, 1391(1985),
enfd. mem. 785 F.2d 304 (4th Cir. 1986), to include dismissed charges
as well.)
missing. Absent proof of such conduct, Respondent
Avne is entitled to rely on the 10(b) statutory limitation
on its liability.9

Geoffrey E. Dunham, Esq., for the General Counsel.
Joel E. Cohen, Esq., for the Respondent, and Stephen Goldblatt
Esq., for Local 445, LIFE
Barbara S. Mehlsack, Esq., for the Charging Party.
DECISION
STATEMENT OF THE CASE
RAYMOND P. GREEN, Administrative Law Judge. This
case was tried in New York, New York, on July 28 and 29 and
November 4, 1998. The charges in Cases 2–CA–30949 and 2–
CB–16899 were filed on November 14, 1997. The consolidated
complaint was issued on April 2, 1998, and alleges:
1. That both Unions, are labor organizations within the
meaning of Section 2(5) of the Act.
2. That Avne has been party to successive collective-
bargaining agreements with Local 445, Laborers’ International
Union of North America, AFL–CIO (Laborers’ Local 445),
covering its full-time and regular part-time production employ-
ees, the most recent of which was effective from October 1,
1994, to October 1, 1997. (At times, the parties also referred to
Laborers’ Local 445 as Local 445, LIUNA.)
3. That on or about March 1, 1997 (and during the life of the
aforesaid agreement), Avne withdrew recognition from Labor-
ers’ Local and granted recognition to Local 445, League of
International Federated Employees Union (Local 445 LIFE).
4. That on March 1, 1997, Avne and Local 445 LIFE exe-
cuted a collective-bargaining agreement covering the aforesaid
employees and did so (a) notwithstanding that no question con-
cerning representation could be raised during the mid-term of
the collective-bargaining agreement between the employer and
Laborers’ Local 445 and (b) notwithstanding that Local 445
LIFE did not, at the time of recognition, represent an uncoerced
majority of the bargaining unit employees.
5. That the collective-bargaining agreement between Local
445 LIFE and Avne contains provisions requiring employees to
become and remain members of Local 445 LIFE and permitting
the employer to remit dues on behalf of those employees who
sign dues-checkoff authorizations. It is alleged that pursuant to
such provisions, the employer has deducted moneys from the
pay of employees and has remitted them to Local 445 LIFE.
Both the Employer and Local 445 LIFE contend, among
other things, that the charges were filed more than 6 months
after the occurrence of the transactions alleged to be violations
of the Act and therefore that the complaint is barred by Section
10(b) of the Act.
9 My colleagues cite Adair Standish Corp., 295 NLRB 985 (1989),
and Carpenters Wisconsin River Valley Council, 211 NLRB 222
(1974), to support a finding that Sec. 10(b) should not be tolled as to
either Respondent. Those cases do not involve the issue of fraudulent
concealment. Where fraudulent concealment is at issue, applicable
precedent clearly requires the three elements discussed above in order
to toll the statutory limitations period. See Demars v. General Dynam-
ics Corp., supra at 97, where the court distinguishes between the earli-
est the charging party knew or should have known about the miscon-
duct absent concealment and the tolling of the statute of limitations
under the fraudulent concealment doctrine.
AVNE SYSTEMS, INC. 1357
FINDINGS OF FACT
I. JURISDICTION
The parties agree and I find that the company is an employer
engaged in commerce within the meaning of Section 2(2), (6),
and (7) of the Act and that the unions are labor organizations
within the meaning of Section 2(5) of the Act.
II ALLEGED UNFAIR LABOR PRACTICES
Laborers’ Local 445 has had a longstanding relationship with
a number of companies in the New York area, one of which is a
company called Avne Systems Inc. (The current ownership of
Avne is different from what existed at the time of these events.)
A contract covering about 200 plus Avne employees ran from
October 1, 1994, to October 1, 1997. It should be noted that the
Laborers’ International Union has never been a party to any
contract between Laborers’ Local 445 and Avne and has no
contractual standing with respect to that employer.
At the time that the above-described contract was made,
John Mongello Jr. was the business manager and chief officer
of Laborers’ Local 445. The other officers listed on the LM-2
form filed with the Department of Labor for the period ending
December 31, 1996, were Rafael Griffin, president, John Mon-
gello Sr., secretary-treasurer, Michael Aronne, vice president,
and trustees Theodore Paphzis, William Aronne, Vincent Ger-
aldi, and Ella Dupree. In relation to Avne, it was Mongello who
was the union representative who dealt with that company in
terms of negotiations or any other business.
It appears from this record, which includes depositions from
John Mongello Jr. and Rafael Griffin taken in another lawsuit,
that in or about December 1996 a dispute arose between Labor-
ers’ Local 445 and its International Union regarding the amount
of per capita tax that it was obligated to pay; the local urging
that its tax be reduced. When this was not acceded to, Mon-
gello Jr., apparently in December 1996, came up with the idea
of disaffiliating from the Laborers’ International Union, form-
ing a new and separate labor organization, and then at a future
time reaffiliating with the Laborers’ International through a
division which he believed would allow for a lower per capita
tax. In his deposition Mongello stated inter alia:

Our idea was, with the membership, to create an inde-
pendent, go independent, create an independent union and
have the members go in the independent union from La-
borers’ Local 445; have the independent union, at that
time, affiliate with LIFE . . . and we would go back into
the Laborers’ and be an affiliate member of the Laborers’;
we would still be Laborers’, and we would be able to pay a
$3 per capita tax and still keep our programs.
. . . .
The truth is, to me, LIFE and LIUNA are the same un-
ion. We want it to be the same union. We want it to be in
the same International. That’s want we want. Our ulti-
mate goal was to go this way and going that way. We told
the membership there’s going to be a point in time where
we will have independent status. That’s where we are right
now. In other words, we are not in LIUNA. In order to
accomplish the goal to go into LIUNA, we come up to this
point and then . . . .
. . . .
The membership is aware that by coming into LIFE,
there would be a period of time before we would get our
accepted charter from the NFIU, [a division of LIUNA],
that we would be independent and we wouldn’t have an
affiliation. That’s where it is right not. We applied for a
charter at the NFIU level . . . .1

Similarly, Rafael Griffin, who was the president of Laborers’
Local 445 and who thereafter became the president of Local
445 LIFE, testified in his deposition:

Q. In terms of the Laborers’ Local 445 people . . . were
they told the same thing you just told me, that its a tempo-
rary thing and they would still be members of the Labor-
ers’?
A. That’s correct.
Q. Is that what they were told?
A. That’s correct.
Q. Would it be fair to say they were told that in any
type of written documents, or just verbally by you and
other officers of Laborers’ Local—
A. The petitions that are signed, they say it clear.
. . . .
MR. GOLDBLATT: He is asking you if there’s any-
thing other than that petition which was written down.
A. We have a meeting, a couple of meetings, where
it’s explained.
Q. Who explained it?
A. Mr. Mongello Jr.
Q. Was it explained that they were simply moving
from one LIUNA union to another LIUNA union?
A. That’s correct.
. . . .
A. LIFE is not going to be that different than Labor-
ers’. We are going to go into LIUNA no matter—we are
planning to go into LIUNA through Philadelphia. So,
member, we say, listen, we are going to keep the program
going, and we are going to be affiliated with AFL–CIO.

Sometime in January 1997, the officers of Local 445,
LIUNA, with Mongello at the lead, created Local 445 LIFE. (It
is not entirely clear exactly when Mongello said let there be
LIFE.) In any event, in the LM-2 form filed with the Depart-
ment of Labor for the period ending December 31, 1997, the
officers of Local 445 LIFE are listed as follows: Rafael Griffin,
president, John Mongello Jr., secretary-treasurer, and Vice
Presidents John Mongello Sr., Herman Reich, and Michael
Aronne. The address listed on the form is 325-73rd Street,
Brooklyn, New York, which is the same address listed on the
previously noted LM-2 filed by Local 445, LUINA.
While creating this new labor organization, the old union
was kept intact and it has, through new officers appointed by
Mongello, continued to maintain its separate existence. It has
also continued to administer some collective-bargaining agree-
ments that did not, like the one with AVNE, wind up being
“assigned” or turned over to Local 445 LIFE. At the time of
the hearing, about 20 percent of Laborers’ Local 445 former
membership remained in that Union and continued to be cov-
ered by contracts between their employers and that labor or-
ganization.
Orlando Hernandez, Laborers’ Local 445’s shop steward,
testified that in the autumn of 1996 he attended some meetings
of the local union where the subject of per capita taxes was

1 He states in his deposition that such an application was made in
September or October 1997.
DECISIONS OF THE NATIONAL LABOR RELATIONS BOARD 1358
discussed and where he learned that the International Union
was proposing to raise this tax.
According to Hernandez, sometime in January or February
1997, he along with John Mongello Jr. and a few other union
officials, held a series of meetings with the employees of Avne
(one per shift), where they presented the idea of separating
from the Laborers’ International Union and forming a new
union which wouldn’t have to pay the per capita tax. The em-
ployees at these meetings signed cards for LIFE, League of
International Federated Employees. These cards state inter alia;

I, the undersigned hereby apply for membership in the
above Union and I authorize it to represent me for the pur-
pose of collective bargaining and I authorize and irrevoca-
bly direct my Employer to deduct from my wages initia-
tion fees and dues uniformly required by said Union as a
condition of acquiring or maintaining membership . . . .

As the cards obtained at this meeting are undated and as
Hernandez could not be specific regarding the date, it is not
entirely clear when this set of meetings was held. It appears,
however, that these cards were signed sometime before Mon-
gello went to Jack Steinmetz to ask for recognition on behalf of
Local 445 LIFE. Whether these cards were solicited before or
after Mongello resigned from Laborers’ Local 445 is not clear,
but this is probably not relevant, as he continued, with the ap-
proval of the other officials of Laborers’ Local 445, to hold
himself out as the person in charge of that union for a period of
time after his resignation. (Rafael Griffin remained as the
president of Laborers’ Local 445 until he tendered a resignation
in September 1997.)
During the trial, I suggested that it might be a good idea if
someone could talk to and bring to the trial a sampling of the
employees of Avne who could testify as to what, if anything,
they were told, either verbally or in writing, as to the plan by
Laborer Local 445’s officers to leave the Laborers’ Interna-
tional Union and to create their own labor organization. For
better or worse no such witnesses were presented by any party
other than Hernandez who was presented by the Respondent
Union. I therefore do not know exactly what the employees of
Avne were told before they signed the cards for Local 445
LIFE. However, based on the depositions of John Mongello Jr.
and Rafael Griffin, it seems reasonable to conclude that these
employees, like employees at other shops, were told that the
intention was to temporarily disaffiliate from the Laborers’
International Union, to create, for a limited duration, a separate
independent union, and to then reaffiliate as soon as possible
with the International in such a manner that they could pay a
reduced per capita tax. Thus, based on this conclusion, it seems
probable to me that the employees of Avne were led or misled
into believing that the proposed change was to be temporary
and completely cosmetic and that this “change” would amount
to no change at all inasmuch as the new union would simply
reaffiliate with the Laborers’ International Union in the near
future. There is no evidence, however, that the em-
ployee/members were told that the International Union might
not accept or approve of this plan.
Jack Steinmetz, then the president of the Company, testified
that in January or February 1997, John Mongello Jr. came to his
office and after presenting to him a group of cards signed by
Avne’s employees, asked that the Company withdraw recogni-
tion from Laborers’ Local 445 and enter into a contract with
Local 445, LIUNA. When Mongello agreed that the new con-
tract with Local 445, LIUNA would contain no changes from
the terms and conditions in the Laborers’ Local 445 contract,
Steinmetz agreed. According to Steinmetz he and Mongello
executed a contract between Avne and Local 445 LIFE some-
time during the last week of February 1997 which runs for a
term from March 1, 1997, to February 28, 2000. The contract
itself is undated and once again, no one could give me a precise
date when this document was executed. (For example, was it
executed before or after Mongello sent his resignation to La-
borer’s Local 445?)
In any event, the new contract between Avne and Local 445
LIFE is virtually identical in both its terms and language as the
contract between Avne and Laborers’ Local 445, which by its
terms, was not set to expire until October 1, 1997. The new
contract contains a union-security clause requiring membership
as a condition of continued employment and also requires the
employer to remit union dues on behalf of employees who au-
thorize such payments. (It was stipulated that pursuant to the
contract, Avne did in fact deduct and remit dues to Local 445
LIFE.) The only difference between the two contracts is that the
second, the agreement, at schedule A, provides that effective on
December 1, 1997, the Employer and the Union agree to reopen
the contract with respect to wages, health plan, and pension
issues. (But even this is not a real difference since the old con-
tract would have expired on October 1, 1997, and these and
other terms would have been subject to negotiation at that
time.) If Avne’s employees were told of the existence of this
new contract (and I assume that they were), the fact that it is
virtually identical to the one it replaced, reinforces my opinion
that they were led into believing that the change was not sub-
stantive and, in fact, represented no change at all.
In the meantime, the International became concerned about a
drop in membership in Laborers’ Local 445. (Reflected in a
drop in its receipt of per capita tax.) In January 1997, Thomas
Vinton was hired by the International Union to make an inves-
tigation of a number of local unions including Laborers’ Local
445. Vinton went to the offices of the Union in April and May
1997 where he met with John Mongello Jr. who held himself
out as its business manager. Indeed, when Richard Ello, an
International representative, visited the offices of Laborers’
Local 445 with an auditor, in June 1997, he met with John
Mongello Jr. who discussed the issues raised but neither dis-
closed that he resigned from the Union nor that a new union
had been created. As far as Ello was concerned, he thought,
with no reason to believe to the contrary, that he was dealing
with the person responsible for the operations of Laborers’
Local 445.
The record shows that during the period after Local 445
LIFE was created, Mongello Jr., despite his purported resigna-
tion, continued to hold himself out, with the consent of the
union’s other officers, as being in charge of Laborers’ Local
445 and that he and the other officers of Laborers’ Local 445
and Local 445 LIFE made a successful effort to conceal from
the Laborers’ International Union, the existence of Local 445
LIFE or that they had, in effect, transferred many of the con-
tracts and members to the latter union. This was made possible
by the fact that the International Union was not a party to any
of the contracts that Laborers’ Local 445 had maintained with
employers and had no existing list of the employers contracting
with Laborers’ Local 445. (Nor did it a have a list of the names
and addresses of the local union’s membership.) That there
was an explicit effort to conceal these goings on from the Inter-
AVNE SYSTEMS, INC. 1359
national Union is admitted by John Mongello Jr. in his deposi-
tion.
At a meeting between Mongello Jr. and Vinton, held in Au-
gust 1997, Mongello finally admitted that he had chartered a
new union, and had transferred members of Laborers’ Local
445 into the new union. Mongello told Vinton for the first time
that he had resigned as business manager of Laborers’ Local
445 and that a person named Peter Hasho had taken his place.
In October 1997, the Laborers’ International Union placed
Laborers’ Local 445 into trusteeship. They also filed a Federal
lawsuit and on November 14, 1997, the trustee, on behalf of
Laborers’ Local 445 filed the instant charges.
III. ANALYSIS
A. The Merits
The evidence shows that Local 445 LIFE was formed in De-
cember 1996 or early January 1997 by the officers and trustees
of Laborers’ Local 445 and for better or worse it was stipulated
that both were labor organizations within the meaning of the
Act. The head of both Unions was John Mongello Jr. and in
January and February 1997, he went around to various compa-
nies having contracts with Laborers’ Local 445 and asked em-
ployers, including Avne to withdraw recognition from Labor-
ers’ Local 455 and execute contracts with Local 445 LIFE.
This was done in Avne’s case sometime in late February 1997
and a contract identical to the existing agreement with Labor-
ers’ Local 445 was made with Local 445 LIFE. The second
contact contained a reopener provision to negotiate wages and
benefits and it appears that such negotiations were undertaken
in November or December 1997.
Employees of Avne signed authorization cards designating
Local 445 LIFE to represent them and it appears that these
cards, although undated, may have been executed at a series of
meetings held before Avne executed the new contract with
Local 445 LIFE.
Notwithstanding the creation of Local 445 LIFE, Laborers’
Local 445 continued to exist under the presidency of Rafael
Griffin and thereafter under an International trustee. Notwith-
standing the creation of Local 445 LIFE, the existence of La-
borers’ Local 445 was maintained to administer those collec-
tive-bargaining agreements with employers that refused to
agree to the substitution of Local 445 LIFE. Insofar as relevant
to the present case, it is noted that Laborers’ Local 445 contin-
ued to exist as a labor organization, continued to act as a repre-
sentative of some employees and was subsequently put under
International trusteeship when the International first became
fully cognizant of what was going on in New York.
When I was listening to this case, I thought that it presented
an odd and sui generis set of facts. Nevertheless, the General
Counsel has cited a case which, apart from the 10(b) issue, is
almost identical and deals with all of the issues raised by all
parties. Dominick’s Finer Foods, 308 NLRB 935 (1992). In
that case, Local 703 IBT, with a membership of about 2500,
had a collective-bargaining agreement with Dominick’s and
other employers. When that union and its leadership was put
under pressure by virtue of a Federal RICO lawsuit and by
internal union dissension, its officers and trustees sought to
form a separate union called Local 707 NPWU. They solicited
and obtained signatures on petitions from approximately 628
out of 835 employees in four bargaining units. These petitions
purported to authorize joint representation between Local 703
IBT and Local 707 NPWU and individual representation if
either union should disclaim interest. Subsequently, these offi-
cers, who at the time held positions in both unions, tendered
disclaimers of interest on behalf of Local 703 IBT and per-
suaded the employers of the four units to withdraw recognition
from the incumbent union and to grant recognition to the newly
formed Local 707 NPWU. After these events, a rival slate took
control of Local 703 IBT which continued to be a viable labor
organization and continued to represent employees of other
employers under existing collective-bargaining agreements.
The administrative law judge (Walter H. Maloney), in an opin-
ion adopted by the Board found that the employer violated
Section 8(a)(1), (2), (3), and (5), and that Local 707 NPWU
violated Section 8(b)(1)(A) and (2) of the Act. He stated inter
alia:

Tested by normal contract-bar standards, the Respondent
Employers in this case were required, when presented by
either a memorandum of agreement, a supporting petition,
or a disclaimer of interest to have ignored them and to
have adhered to their outstanding contracts which, in each
instance, obligated them to accord exclusive, not joint or
several, recognition to that Union. Had they done so, great
mischief would have been avoided. If, in the face of their
purported dilemma, they had wished to invoke the proc-
esses of the Board, any of these Respondent employers
could have filed a representation petition in late September
1990 and would have been told quickly and inexpensively
in the context of a Section 9 proceeding what their rights
and responsibilities were. . . . The ease and celerity with
which these employers acceded to extraordinary requests
to substitute one bargaining agent for another during a
contract term gives rise to an inference that these employ-
ers were not dealing with the former leadership of Local
703 IBT at arm’s length.
To the General Counsel’s allegation that the Respon-
dent Employers were duty bound under the Board’s con-
tract-bar rules to continue to recognize Local 703 IBT ex-
clusively in late September and early October under the
terms of existing contracts, the Respondents have advanced
several defenses. First of all, they claim that the decision
of Local 703 IBT members to leave the Teamsters and to
join the NPWU was an internal union matter into which
their employers should not intrude. Local 703 IBT was,
and remains, a charted local of the International Brother-
hood of Teamsters, an AFL–CIO affiliate. Each Respon-
dent Employer was faced with a situation in which the
members of its bargaining unit were proposing, through a
two-step process, to leave Local 703 IBT and become
members of another union affiliated with another inde-
pendent national union. By asking each employer to cease
recognizing Local 703 IBT either partially or entirely and
to recognize another bargaining agent for their employees,
former Local 703 IBT officials were raising a question
concerning representation which necessarily brought into
play the contract-bar rules discussed above.
In particular, Certified argues that what was proposed
by Joseph and what actually occurred was merely a deci-
sion by a union local to disaffiliate from one parent union
and affiliate with another. It cites May Department Stores
v. NLRB, 897 F.2d 221(7th Cir. 1990) and other cases for
the proposition that a decision by a union to affiliate or
disaffiliate is a private union matter. . . . However, in this
case, Local 703 IBT as an entity has never disaffiliated
DECISIONS OF THE NATIONAL LABOR RELATIONS BOARD 1360
form the Teamsters International or attempted to affiliate
with any other parent organization. About 20 percent of
its membership, located in many small bargaining units
throughout the Chicago area, never attempted to seek joint
representation status with Truck Drivers Local 707 NPWU
nor to disclaim the bargaining rights of Local 703 IBT
with the respective employers. Throughout this dispute
they have continued to be represented by Local 703 IBT, a
union which itself still maintains a charter with the Team-
sters International and is, indeed, now more closely identi-
fied than ever with its International through the imposition
of a trusteeship. What the Senese faction attempted to do
here was to strip Local 703 IBT of most of its membership
and all of its assets and deliver both, in bulk, to a rival un-
ion as the property of that union, leaving behind a collec-
tive shell with a name and a charter and a small, bankrupt
membership. This action was not an affiliation or a reaf-
filation but something akin to larceny and does not in any
way minimize or remove the existence of a question con-
cerning representation or the rules which such a question
calls into play.
B. The 10(b) Issue
It is alleged that on or about March 1, 1997, Avne withdrew
recognition from Laborers’ Local 445 and that on that same
date, Avne illegally recognized and entered into a contract with
Local 445 LIFE. The single transaction giving rise to these
allegations is the execution of the collective-bargaining agree-
ment between Avne and the newly created union. The other
allegations of the complaint stem from the fact that this contract
contains a union-security clause, that dues were deducted and
remitted to Local 445 LIFE and that the Employer concomi-
tantly, abrogated the existing contract with Laborers’ Local
445.
The charges in these cases were filed on November 14, 1997,
by Laborers’ Local 455, via a trustee appointed by the Labor-
ers’ International Union. As these charges were filed and
served more than 6 months after the March 1, 1997 transaction
(the contract’s execution), the unfair labor practice first oc-
curred outside the 10(b) statute of limitations period. To this
extent, therefore, the Respondents have met their initial burden
of proof regarding the 10(b) issue.
But for the statute of limitations defense, the evidence shows
that the employer and Local 445 LIFE each violated the Act by
entering into a collective-bargaining agreement at a time when
the Employer’s collective-bargaining agreement with Laborers’
Local 445 had not yet expired. Similarly, the evidence demon-
strates that the Employer unlawfully withdrew recognition from
Laborers’ Local 445 during the life of the existing collective-
bargaining agreement. That is, in the absence of a showing, not
made here, that Laborers’ Local 445 was defunct, the evidence
establishes the unfair labor practices alleged by the General
Counsel.2

2 I reject the contention that Laborers’ Local 445 effectively dis-
claimed interest. For one thing there is no evidence that this Union
proffered any disclaimer of interest. Moreover, even if one construed
Mongello’s requests of Avne to substitute Local 445 LIFE as being the
equivalent of a disclaimer of interest, such a disclaimer to be effective,
must be unequivocal and made in good faith. Thus, if the assertion by a
union is that it has abandoned its claim to represent employees is shown
to be inconsistent with its conduct, the disclaimer will be rejected.
Retail Associates, Inc., 120 NLRB 388, 391 (1958); Hartz Mountain
Section 10(b) is a statute of limitations which must be raised
as an affirmative defense by the Respondents. As it was raised
by the Respondent union in its answer and by both at the hear-
ing, the issue is properly before the Board.
As a general matter, the 10(b) period starts to run from the
date that the unfair labor practice unequivocally occurs. Indus-
trial Power, 321 NLRB 816 (1996). (Although the Company
said on January 11, 1994, that it would terminate contract and
relationship with a Union on June 1, 1994, the 10(b) period was
not triggered until the actual repudiation and withdrawal oc-
curred, i.e., on June 1, when the “affected party” either has
actual or constructive notice of the transaction. As stated by
the Board in Leach Corp., 312 NLRB 990 (1993);

[A] statement of intent or threat to commit an unfair labor
practice does not start the statutory six months running.
The running of the limitations period can begin only when
the unfair labor practice occurs. NLRB v. Al Bryant, Inc.,
711 F.2d 543, 547 (3rd Cir 1983). It is also firmly estab-
lished that the 10(b) period commences only when a party
that has clear and unequivocal notice of a violation of the
Act. E.g., Desks, Inc., 295 NLRB 1, 11 (1989). “Further,
the burden of showing such clear and unequivocal notice
on the party raising the affirmative defense of Section
10(b).” Chinese American Planning Council, 307 NLRB
41 (1992).

The Charging Party in this case is Laborers’ Local 445 and
not the International Union. Indeed, the International Union,
not being a party to the contract with Avne had no contractual
or other standing vis-à-vis the employer or the employees rep-
resented by the local union. Therefore, although it had the right
under certain circumstances to impose a trusteeship on Labor-
ers’ Local 445, which it did in September 1997, I would not
construe the International as being an “affected party” as that
term is used by the Board in analyzing 10(b) issues.
To illustrate the point one might look at the Supreme Court’s
decision in Machinists Local 1424 (Bryan Mfg. Co.) v. NLRB,
362 U.S. 411 (1960). In that case a charge was filed alleging
that 10 months previous, the employer had recognized and
executed a collective-bargaining agreement with a union not-
withstanding the union’s lack of majority status at the time that
the agreement was executed. The Court held that the charges,
filed by an individual employee were barred. And in subse-
quent cases, the Board has held that where recognition has been
granted to a labor union, an employer cannot subsequently
challenge that recognition if no 8(a)(2) charge has been filed
within 6 months of the grant of recognition. See Gibbs & Cox,
Inc., 280 NLRB 953, 967 fn. 21 (1986); Laborers (Roman
Stone Construction), 153 NLRB 659 (1965).
Under the rationale of Bryan Mfg. Co., supra, who can doubt
the outcome of a case where an employer entered into a sweet-
heart contract with union A (which did not represent a major-
ity) and then union B came along 7 months later to organize the
employees. If union B filed a petition it would be dismissed by

Corp., 260 NLRB 323 (1982). In the present case, the evidence shows
that the representatives of Laborers’ Local 445 told employees that the
new union would be, in effect, the same as the old union and that its
creation was merely a means to reaffilate with the Laborers’ Interna-
tional Union without having to pay the existing per capita tax. This is,
in my opinion, exactly the opposite of an effective disclaimer of inter-
est as the entire plan was to have continued representation by what was
intended to be a functionally identical labor organization.
AVNE SYSTEMS, INC. 1361
the Board under its contract bar rules and if it then filed an
8(a)(2) charge against the employer and an 8(b)(1)(A) and (2)
charge against union A, those charges would be dismissed if
Section 10(b) was raised as defense. The fact that union B, the
affected party, may not have known or been given notice of the
contract between the employer and union A, would make no
difference to the outcome and to hold otherwise would mean
that in such circumstances, a company and a union entering into
a first contract would, in order to avoid, a 10(b) defense, have
to notify every other labor organization in the United States.
Of course, even in the situation described above, the 10(b)
limitations period would be tolled if the transactions were con-
cealed in such a manner that no one other than the contracting
parties was on notice that a potentially illegal contract was
made. To take the most obvious example, if an employer and a
Union entered into a contract which they thereupon put it into a
drawer and only notified the affected employees of its existence
6 months and 1 day after its execution, the 10(b) period would
start to run from the date of its disclosure. Such a situation
would present a case of fraudulent concealment and this is a
legitimate exception to a 10(b) defense. Waymouth Farms, 324
NLRB 960 (1997). (Bargaining order at new location is appro-
priate remedy for Respondent’s fraudulent concealment from
the Union of its plans to relocate.) See generally Browne &
Sharpe Mfg. Co., 321 NLRB 924 (1996), for the Board’s stan-
dards in cases where the General Counsel asserts fraudulent
concealment.3
In the present case, the evidence shows that the officers of
Laborers’ Local 445/Local 445 LIFE deliberately concealed
their actions from the International Union. But as the Interna-
tional Union is neither the charging party in this case, nor an
“affected” party as that term is used in 10(b) cases, the fact that
it became aware of the events more than 6 months after they
occurred does not in my opinion, make any difference.
The Charging Party, Laborers’ Local 445 was on notice of
the illegal events as its officers were the people who engaged in
the illegal acts. Those officers were aware of the events and if
one or more of them changed their minds, he or she could have
filed a charge within the 10(b) period. (Highly unlikely as a
practical matter.)
The only other group of affected individuals were the em-
ployees of Avne. And these people were on notice that some-
thing was going on because they were asked, in January or
February 1997, to sign cards authorizing Local 445 to represent
them.
But with appropriate camouflage it is possible to hide some-
thing which is in plain sight. The testimony by John Mongello
Jr. and Rafael Griffin in their depositions persuades me that
employee/members of Laborers’ Local 445 were told that even
though Local 445 LIFE was going to be created as a new and
separate union from Laborers’ Local 445, they were advised
that they would continue to have the same representation by the
same people and that this was only going to be a temporary
arrangement until the new union could reaffiliate with the La-
borers’ International Union. In the case of Avne, Local 445

3 The Board stated that in order for the 10(b) period to be tolled
based on a claim of fraudulent concealment, the General Counsel must
show that “(1) deliberate concealment has occurred; (2) material facts
were the object of the concealment; and (3) the injured party was igno-
rant of those facts, without any fault or want of due diligence on its
part. All three elements must be present to warrant the tolling of the
10(b) period.
LIFE was substituted for Laborers’ Local 445, but the employ-
ees continued to have the same shop steward, the same person
represent them in their dealings with the Employer, and the
exact same contract. If they were told that there was some sort
of change, it is obvious that they were also led to believe that
no real change of substance had or was occurring.
In my opinion, the facts in this case show that by misleading
employees as to the nature of the transactions involved, Local
445 LIFE (with the Employers’ acquiescence), fraudulently
concealed the true facts from the affected employees and that as
a consequence, the 10(b) statute of limitations should be tolled.
CONCLUSIONS OF LAW
1. By withdrawing recognition from and refusing to bargain
with Local 445, Laborers’ International Union of North Amer-
ica, AFL–CIO, the Respondent, Avne Systems, Inc., has vio-
lated Section 8(a)(1) and (5) of the Act.
2. By abrogating its collective bargaining agreement with
Local 445, Laborers’ International Union of North America,
AFL–CIO, the Employer has violated Section 8(a)(1) and (5) of
the Act.
3. By recognizing Local 445, League of International Feder-
ated Employees, on or about March 1, 1997, as the collective-
bargaining agent of its production and maintenance employees,
Avne has violated Section 8(a)(1) and (2) of the Act.
4. By entering into a collective-bargaining agreement with
Local 445, League of International Federated Employees, and
executing a contract requiring employees to become members
of that union as a condition of employment, Avne has violated
Section 8(a)(1), (2), and (3) of the Act.
5. By deducting dues and fees from the wages of its employ-
ees and remitting them to Local 445, League of International
Federated Employees, Avne has violated Section 8(a)(1), (2),
and (3) of the Act.
6. By accepting recognition from Avne and entering into a
collective-bargaining agreement with said employer, Local 445,
League of International Federated Employees has violated Sec-
tion 8(b)(1)(A) of the Act.
7. By entering into a contract with Avne which inter alia,
requires union membership as a condition of employment, and
pursuant to which Local 445, League of International Federated
Employees has received dues and fees, said Union has violated
Section 8(b)(1)(A) and (2) of the Act.
8. The aforesaid violations affect commerce within the
meaning of Section 2(2), (6), and (7) of the Act.
REMEDY
Having found that the Respondents have engaged in certain
unfair labor practices, I find that they must be ordered to cease
and desist and to take certain affirmative action designed to
effectuate the policies of the Act.
Inasmuch as Avne has illegally withdrawn recognition from
Laborers’ Local 445, and illegally abrogated its contract with
that labor organization, I will recommend that it recognize and
bargain with said union and that it restore, if requested, the
terms and conditions of employment as they existed under the
aforesaid collective-bargaining agreement. In this regard, I
shall recommend that the employer and Local 445 LIFE be
jointly and severally liable for payments required pursuant to
Article 22 to the designated Health and Welfare Insurance
Fund. Such payments shall be for the period encompassed by
the contract between Avne and Laborers’ Local 445 and for the
period after that contract’s expiration date until such time as
DECISIONS OF THE NATIONAL LABOR RELATIONS BOARD 1362
Avne has bargained in good faith with that labor organization
and has either reached a new agreement, or a valid impasse, or
is otherwise legally discharged from its obligation to bargain
with Laborers’ Local 445. As to such moneys, interest shall be
paid and computed in accordance with the practice set forth in
Merryweather Optical Co., 240 NLRB 1213, 1216 fn. 7
(l979).4
I shall also recommend that Avne cease and desist from rec-
ognizing Local 445 LIFE and cease and desist from giving
affect to any of the terms contained any contract with that labor
organization. Further, it is recommended that Avne and Local
445 be jointly and severally responsible for remitting to Avne’s
employees any and all dues and other fees that were deducted
from their pay and/or remitted to Local 445 LIFE. Interest on
these moneys are to be paid in accordance with New Horizons
for the Retarded, 283 NLRB 1173 (1987).
Finally, I shall recommend that Local 445 LIFE cease and
desist from accepting recognition from Avne as the bargaining
agent for any of its employees or from enforcing or giving ef-
fect to any of the terms of its contract with Avne.
On these findings of fact and conclusions of law and on the
entire record, I issue the following recommended5
ORDER
A. The Respondent, Avne Systems, Inc., Bronx, New York,
its officers, agents, successors, and assigns, shall
1. Cease and desist from
(a) Refusing to recognize and bargain collectively in good
faith with Local 445, Laborers’ International Union of North
America, AFL–CIO as the exclusive collective-bargaining rep-
resentative in a unit consisting of all of its full-time and regular
part-time production and maintenance employees, excluding all
office clericals and guards, professional employees, and super-
visors as defined in the Act.
(b) Refusing to give full force and effect to the terms and
conditions of the collective-bargaining agreement with Local

4 Although the complaint does not specifically allege that the em-
ployer unilaterally changed terms and conditions of employment, it
does allege that it withdrew recognition from Laborers’ Local 445 and
the facts show that it abrogated the existing and unexpired contract. As
such, the matter is fully litigated and I see no reason not to include this
as a remedy for the violations found herein. Katz’s Deli, 316 NLRB
318, 334–335 (1995), enfd. in part and remanded in part 80 F.3d 755
(2d Cir. 1996). By the same token, as the failure to make payments to
the Welfare Fund was a direct consequence of the execution of the
contract with Local 445 LIFE and as I have found that such agreement
violated Sec. 8(b)(1)(A) and (2) of the Act, it seems to me that Local
445 LIFE is at least as culpable as the employer in failing to make
payments to Laborers’ Local 445’s Welfare Fund. Moreover, to the
extent that a similar welfare fund operated by Local 445 LIFE has
received payments from the Employer, such payments were the result
of an illegal contract under Sec. 8(b)(1)(A) and (2) and Sec. 303 which,
although permitting payments to pension and welfare funds, precludes
such payments in the absence of a valid collective-bargaining agree-
ment. As such, I conclude that both the employer and Local 445 LIFE
should be jointly and severally liable for the failure to make payments
to Laborers’ Local 445 Welfare Fund, not only during the life of the
agreement, but also after its expiration.
5 If no exceptions are filed as provided by Sec. 102.46 of the Board’s
Rules and Regulations, the findings, conclusions, and recommended
Order shall, as provided in Sec. 102.48 of the Rules, be adopted by the
Board and all objections to them shall be deemed waived for all pur-
poses.
445, Laborers’ International Union of North America, AFL–
CIO.
(c) Granting recognition to any labor organization other than
Local 445, Laborers’ International Union of North America,
AFL–CIO unless and until the other labor organization be-
comes certified as the exclusive collective-bargaining represen-
tative of an appropriate unit of employees as the result of a
Board-conducted election.
(d) Maintaining in force and effect any collective-bargaining
agreement with Local 445 League of International Federated
Employees and/or to any contract provision requiring employ-
ees to become or remain members of said labor organization.
(e) Checking off from the pay of its employees and remitting
to Local 445 League of International Federated Employees, any
money for union dues or fees.
(f) In any like or related manner interfering with, restraining,
or coercing employees in the exercise of the rights guaranteed
them by Section 7 of the Act.
2. Take the following affirmative action necessary to effec-
tuate the policies of the Act.
(a) Recognize and, on request, bargain with Local 445, La-
borers’ International Union of North America, AFL–CIO as the
exclusive bargaining representative of its full-time and regular
part-time production and maintenance employees, with respect
to rates of pay, wages, and other terms and conditions of em-
ployment, and if an understanding is reached, embody the un-
derstanding in a signed agreement.
(b) Give full force and effect to any collective-bargaining
agreement between Avne and Laborers’ International Union of
North America, AFL–CIO.
(c) Jointly and severally with Local 445 League of Interna-
tional Federated Employees, make whole employees by remit-
ting to them any moneys deducted from their wages and paid to
that Union as dues and fees.
(d) Jointly and severally with Local 445 League of Interna-
tional Federated Employees, make whole employees by paying
into the Health and Welfare Insurance fund all moneys owed in
accordance with the contract between Avne and Local 445,
Laborers’ International Union of North America, AFL–CIO.
(e) Preserve and, within 14 days of a request, make available
to the Board or its agents for examination and copying, all pay-
roll records, social security payment records, timecards, per-
sonnel records and reports, and all other records necessary to
analyze the amounts due under the terms of this Order.
(f) Within 14 days after service by the Region, post at its fa-
cility in Bronx, New York, copies of the attached notice
marked “Appendix A.”6 Copies of the notice, on forms pro-
vided by the Regional Director for Region 2 after being signed
by the Respondent's authorized representative, shall be posted
by the Respondent immediately upon receipt and maintained
for 60 consecutive days in conspicuous places including all
places where notices to employees are customarily posted. Rea-
sonable steps shall be taken by the Respondent to ensure that
the notices are not altered, defaced, or covered by any other
material. In the event that, during the pendency of these pro-
ceedings, the Respondent has gone out of business or closed the
facility involved in these proceedings, the Respondent shall
6 If this Order is enforced by a judgment of a United States court of
appeals, the words in the notice reading “Posted by Order of the Na-
tional Labor Relations Board” shall read “Posted Pursuant to a Judg-
ment of the United States Court of Appeals Enforcing an Order of the
National Labor Relations Board.”
AVNE SYSTEMS, INC. 1363
duplicate and mail, at its own expense, a copy of the notice to
all current employees and former employees employed by the
Respondent at any time since March 1, 1997.
(g) Within 21 days after service by the Region, file with the
Regional Director a sworn certification of a responsible official
on a form provided by the Region attesting to the steps that the
Respondent has taken to comply.
B. The Respondent, Local 445 League of International Fed-
erated Employees, its officers, agents, and representatives shall
1. Cease and desist from
(a) Entering into or enforcing any collective-bargaining
agreement with Avne Systems, Inc., covering its production
and maintenance employees or enforcing union-security provi-
sions in said agreements requiring membership in that union as
a condition of employment.
(b) Obtaining recognition and bargaining collectively with
Avne Systems, Inc., where its employees were lawfully repre-
sented by another labor organization.
(c) Receiving dues and fees from Avne’s employees pursu-
ant to the aforesaid collective-bargaining agreement or any
extension or renewal thereof.
(d) In any like or related manner restraining or coercing em-
ployees in the exercise of the rights guaranteed them by Section
7 of the Act.
2. Take the following affirmative action necessary to effec-
tuate the policies of the Act.
(a) Jointly and severally with Avne Systems Inc., make
whole employees by remitting to them any moneys deducted
from their wages and paid to Local 445 League of International
Federated Employees as dues and fees.
(b) Jointly and severally with Avne Systems Inc., make
whole employees, in the manner set forth in the remedy section
of this decision, by reimbursing Laborers’ Local 445’s Health
and Welfare Insurance fund for all moneys owed in accordance
with the terms and conditions of the contract between Avne and
Local 445, Laborers’ International Union of North America,
AFL–CIO.
(c) Preserve and, within 14 days of a request, make available
to the Board or its agents for examination and copying, all re-
cords and reports, necessary to analyze the amounts due under
the terms of this Order.
(d) Within 14 days after service by the Region, post at its of-
fice copies of the attached notice marked “Appendix B.”7 Cop-
ies of the notice, on forms provided by the Regional Director
for Region 2 after being signed by the Respondent's authorized
representative, shall be posted by the Respondent immediately
upon receipt and maintained for 60 consecutive days in con-
spicuous places including all places where notices to employees
are customarily posted. Reasonable steps shall be taken by the
Respondent to ensure that the notices are not altered, defaced,
or covered by any other material. Signed copies of the notice
shall b e returned to the Regional Director for forwarding to the
Respondent employer for posting on its premises.
(e) Within 21 days after service by the Region, file with the
Regional Director a sworn certification of a responsible official
on a form provided by the Region attesting to the steps that the
Respondent has taken to comply.
APPENDIX A
NOTICE TO EMPLOYEES

7 See fn. 6, above.
POSTED BY ORDER OF THE
NATIONAL LABOR RELATIONS BOARD
An Agency of the United States Government

The National Labor Relations Board has found that we violated
the National Labor Relations Act and has ordered us to post and
abide by this notice.

Section 7 of the Act gives employees these rights.
To organize
To form, join, or assist any union
To bargain collectively through representatives of their
own choice
To act together for other mutual aid or protection
To choose not to engage in any of these protected con-
certed activities.

WE WILL NOT refuse to recognize and bargain collectively
in good faith with Local 445, Laborers’ International Union of
North America, AFL–CIO as the exclusive collective-
bargaining representative in a unit consisting of all of our full-
time and regular part-time production and maintenance em-
ployees, excluding all office clericals and guards, professional
employees, and supervisors as defined in the Act.
WE WILL NOT refuse to give full force and effect to the
terms and conditions of our collective-bargaining agreement
with Local 445, Laborers’ International Union of North Amer-
ica, AFL–CIO.
WE WILL NOT grant recognition to any labor organization
other than Local 445, Laborers’ International Union of North
America, AFL–CIO unless and until said other labor organiza-
tion becomes certified as the exclusive collective-bargaining
representative of an appropriate unit of employees as the result
of a Board-conducted election.
WE WILL NOT maintain in force and effect any collective-
bargaining agreement with Local 445 League of International
Federated Employees and/or any contract provision requiring
our employees to become or remain members of said labor
organization.
WE WILL NOT check off from the pay of our employees
and remit to Local 445 League of International Federated Em-
ployees any money for union dues or fees.
WE WILL NOT in any like or related manner interfere with,
restrain, or coerce employees in the exercise of the rights guar-
anteed them by Section 7 of the Act.
WE WILL recognize and on request, bargain with Local 445,
Laborers’ International Union of North America, AFL–CIO as
the exclusive bargaining representative of our full-time and
regular part-time production and maintenance employees, with
respect to rates of pay, wages, and other terms and conditions
of employment, and if an understanding is reached, embody the
understanding in a signed agreement.
WE WILL give full force and effect to terms and conditions
of any collective-bargaining agreement between Avne and Lo-
cal 445, Laborers’ International Union of North America,
AFL–CIO.
WE WILL jointly and severally with Local 445 League of
International Federated Employees, make whole our employees
by remitting to them any moneys deducted from their wages
and paid to that Union as dues and fees.
WE WILL jointly and severally with Local 445 League of
International Federated Employees, make whole our employees
by paying into the Health and Welfare Insurance Fund of Local
445, Laborers’ International Union of North America, AFL–
DECISIONS OF THE NATIONAL LABOR RELATIONS BOARD 1364
CIO all moneys owed in accordance with the terms and condi-
tions set forth in our contract with that Union.
AVNE SYSTEMS, INC.
APPENDIX B
NOTICE TO EMPLOYEES AND MEMBERS
POSTED BY ORDER OF THE
NATIONAL LABOR RELATIONS BOARD
An Agency of the United States Government

The National Labor Relations Board has found that we violated
the National Labor Relations Act and has ordered us to post and
abide by this notice.

Section 7 of the Act gives employees these rights.
To organize
To form, join, or assist any union
To bargain collectively through representatives of their
own choice
To act together for other mutual aid or protection
To choose not to engage in any of these protected con-
certed activities.
WE WILL NOT enter into or enforce any collective-
bargaining agreement with Avne Systems, Inc., covering its
production and maintenance employees or enforce any union-
security provisions in said agreements requiring membership in
our union as a condition of employment.
WE WILL NOT obtain recognition and bargain collectively
with Avne Systems, Inc., where its employees are lawfully
represented by another labor organization.
WE WILL NOT receive dues or fees from Avne’s employ-
ees pursuant to the aforesaid collective-bargaining agreement or
any extension or renewal thereof.
WE WILL NOT in any like or related manner restrain or co-
erce employees in the exercise of the rights guaranteed them by
Section 7 of the Act.
WE WILL jointly and severally with Avne Systems Inc.,
make whole employees by remitting to them any moneys de-
ducted from their wages and paid to us as dues and fees.
WE WILL jointly and severally with Avne Systems Inc.,
make whole employees, by reimbursing Laborers’ Local 445’s
Health and Welfare Insurance fund for all moneys owed in
accordance with the terms and conditions of the contract be-
tween Avne and that Union.
LOCAL 445, LEAGUE OF INTERNATIONAL FEDERATED
EMPLOYEES