Best Bread Co., Inc.

National Labor Relations Board - Board Decisions

Sep 30, 1985

276 N.L.R.B. 1298 (N.L.R.B. 1985)

1298 DECISIONS OF NATIONAL LABOR RELATIONS BOARD
Best Bread Company, Inc. and Eliseo Galarza, Jr.
and Miscellaneous Warehousemen , Drivers and
Helpers, Local 986 , ' International Brotherhood
of Teamsters , Chauffeurs, . Warehousemen and
Helpers of America . Cases 21-CA-22612(E),.
21-CA-22624(E), and 21-CA-22984(E)
30 September 1985
SUPPLEMENTAL DECISION AND
ORDER
By CHAIRMAN DOTSON AND MEMBERS
DENNIS AND BABSON
On 17 April •1985 Administrative Law Judge
William A. Gershuny issued the attached supple-
mental decision. -The Applicant filed exceptions
and a supporting brief, and the General Counsel
filed an answering brief in support of the judge's
supplemental decision.
The National Labor Relations Board has delegat-
ed its authority in this proceeding to a three-
member panel.
The Board has considered the supplemental deci-
sion and the record in light of the exceptions and
briefs and has decided to affirm the judge's rulings,
findings,' and conclusions2 and to adopt the rec-
ommended Order.
i In par 8 of the judge's decision , he inadvertently refers to "[Section]
8(a)(1) and (b) violations " We correct the reference by changing it to
"8(a)(l) and (3) violations"
Also in par 8 of his decision the judge finds that "Board law is now
well established that the General Counsel proceeds with substantial justi-
fication within the meaning of Section 102 44(a) of its Rules and Regula-
tions where the evidence (or, as here , the prospective evidence) would, if
believed, constitute a prima facie case of unlawful conduct SME Cement,
Inc, 267 NLRB 763 (1983)" We do not rely on this view of the judge as
to what establishes substantial justification sufficient for the General
Counsel to proceed See DeBolt Transfer, 271 NLRB 299 fn 7 of the
judge's decision (1984) In the circumstances of this case , we do not
adopt the judge 's view, expressed in par 9 of his decision, that "in any
event , had they recanted in February , the General Counsel still would
have been left with one principal witness whose testimony , if believed,
would have established the essential puma facie case SME Cement teach-
es that the General Counsel may still proceed with justification even
where there is a fundamental conflict in the testimony of the witnesses "
Nonetheless , we believe that the General Counsel met her burden of
proving substantial justification in this case Thus, on the basis of wit-
nesses' sworn statements , a complaint was issued and the General Coun-
sel prepared for trial When the witnesses recanted , the General Counsel
acted with due diligence to withdraw'the complaint Under these circum-
stances, we find that the General Counsel's actions were substantially jus-
tified throughout the underlying proceedings
Contrary to the judge's finding, as stated in par 4 of his decision, that
neither the Applicant nor the General Counsel has requested an eviden-
tiary hearing , the record shows that , in its reply to the General Counsel's
answer to application for an award of fees and expenses under the Equal
Access to Justice Act, the Applicant stated "If the issues raised by par-
ties cannot be resolved based upon the pleadings submitted by the parties,
the Respondent (Applicant) requests that a hearing be held to resolve all
issues of credibility and/or facts "
2 We believe that Congress , in revising the Equal Access to Justice
Act, 5 U S .C § 504 ( 1982), as amended by Pub L 99-80, 99 Stat 183
(Aug 5 , 1985), did not alter , but merely clarified , the definition of "sub-
stantially justified " "Substantially justified" means more than "mere rea-
sonableness " H R Conf Rep. No 99-120, p 9
ORDER
The National Labor Relations Board adopts the
recommended Order of the administrative law
judge and orders that the application of the Appli-
cant, Best Bread Company, Inc., Vernon, - Califor-
nia, for an award under the Equal Access to. Jus-
tice Act be dismissed. .
Joel B. Martinez, Esq., for the General Counsel.
Coleman J. Walsh, Jr., Esq. (Richards, Watson, Dreyfuss &
Gershon), of Los Angeles, California, for the Appli-
cant.
SUPPLEMENTAL DECISION AND ORDER
(Equal Access to Justice Act)
WILLIAM A. GERSHUNY, Administrative Law Judge.
Applicant, Best Bread Company, Inc, seeks to recover
fees and expenses pursuant to the Equal Access to Jus-
tice Act, 5 U.S.C. § 504, following a decision to with-
draw the consolidated complaint immediately prior to
commencement of the scheduled hearing.
By order dated 18 January 1985, the General Coun-
sel's motion to dismiss the application- was granted as to
claimed investigative expenses incurred prior to the issu-
ance of the complaint and was denied in all other re-
spects.
Thereafter the General Counsel filed an answer dated
12 February 1985, admitting that Applicant is an eligible
corporation under the Act, but asserting, principally, that
the General Counsel's position was "substantially justi-
fied" within the meaning of the Act at all relevant times.
Affixed to the answer were 3 charges, 12 affidavits taken
from 4 witnesses by the Region during the course of its
investigation, certain business records, and the 2 consoli-
dated complaints. .
• On 15 March 1985 Applicant filed its reply 'to the
answer, contending that the General Counsel failed to es-
tablish substantial justification.' No affidavits or other
evidentiary material were attached to the reply. Neither
Applicant nor the General Counsel has requested an evi-
dentiary hearing and, based on my review of the plead-
ings herein, I see no reason for scheduling such a hear-
ing. Accordingly, the record in this EAJA case will con-
sist solely of the pleadings herein and the exhibits there-
to.
The facts relevant to this proceeding are simple and
uncontroverted.
Between 23 September 1983 and 13 February 1984
three charges were filed against Applicant herein, alleg-
ing a number of violations of Section 8(a)(1) and (3) of
the -Act, arising out of an organizational drive by Team-
sters Local 986. As evidenced by the record in this case,
counsel for the General Counsel conducted the Region's
investigation, taking eight affidavits from three employ-
ees (including the principal union adherent) and one
i Although the reply was untimely , the General Counsel has agreed to
an appropriate extension of time Accordingly, the request for extension
is granted
276 NLRB No. 145
BEST BREAD CO. 1299
from Respondent 's president . Thereafter, the Regional
Director declined to proceed to complaint on a number
of the charges , but did proceed on others, issuing a con-
solidated complaint initially on 28 December 1983 and an
amended consolidated complaint on 30 March 1984. An
evidentiary hearing was scheduled for 9 a.m., Tuesday,
26 June 1984.
On Friday, 22 June, counsel for the General Counsel,
during the course of trial preparation , was told by one of
his three principal witnesses that she had made false
statements in an earlier 1983 November affidavit and did
not wish to participate in the case . She and the two
other affiants were instructed to appear at the Regional
Office on Monday , 25 June, the day prior to the sched-
uled hearing . At that time, new affidavits were taken
from each of the three and two admitted having made
earlier false statements . The Acting Regional Director
immediately was informed and decided to withdraw the
consolidated complaint and dismiss the charges. Due to
the lateness of the day, counsel for the General Counsel
was unable to reach Respondent 's counsel by telephone
and, accordingly , the latter was not informed until the
morning of the hearing , 26 June. The Acting Regional
Director 's order was signed thereafter on 28 June.
The original , sworn employee affidavits gave an ac-
count of activities on 22-23 September 1983, which, if
believed , would clearly have established a prima facie
case of 8(a)(1) and (b) violations , i.e., the discharge of
employees because of their desire for union representa-
tion . To be sure, the affidavit of Respondent's president
presented an entirely different picture , one of striking
employees being replaced by new employees and subse-
quently being returned to work as needed . But, impor-
tantly , there is no suggestion in the Region 's investiga-
tion that the prospective testimony of the three employ-
ees was inherently - unbelievable , V. B. Fabricators, 271
NLRB 1032 (1984), and, indeed , counsel for Applicant
apparently is unable to point out otherwise. Board law is
now well established that the General Counsel proceeds
with substantial justification within the meaning of Sec-
tion 102 .44(a) of its Rules and Regulations where the evi-
dence (or, as here , the prospective evidence) would, if
believed , constitute a prima facie case of unlawful con-
duct. SME Cement, Inc., 267 NLRB 763 (1983).
Applicant, apparently recognizing this standard, con-
tends nevertheless that the General Counsel was dilatory,
in that trial preparation - was not begun until the Friday
prior to the Tuesday hearing , suggesting that had trial
preparation commenced "in February, his witnesses' lack
of credibility would have been discovered." (Reply, p.
6.) This contention , apart from being unrealistic, is en-
tirely speculative . No experienced and busy trial counsel,
having already completed an investigation of the facts,
would commence trial preparation and meet with pro-
spective witnesses 4 months prior to the hearing, particu-
larly where , as here, the case is not complex and the
probability of pretrial settlement is great. Moreover, had
the General Counsel done so, there is nothing to suggest
that the two prospective witnesses were prepared to
recant before they were actually faced with the prospect
of testifying under oath. And, in any event, had they re-
canted in February, the General Counsel still would
have been left with one principal witness whose testimo-
ny, if believed, would have established the essential
prima facie case . SME Cement teaches that the General
Counsel may still proceed with justification even where
there is a fundamental conflict in the testimony of the
witnesses.
Applicant also suggest that the Region 's investigation
was inadequate , in that a broader investigation would
have revealed other coemployees who would have refut-
ed the prospective testimony of the General Counsel's
two recanting witnesses . But that would have left the
General Counsel with the unimpeached testimony of the
main union adherent and still would have allowed the
General Counsel to make the delicate, yet justifiable,
prosecutorial decision to proceed on the basis of the tes-
timony of one witness . SME Cement, supra.
Lastly, there is the matter of the timeliness of the
Acting Regional Director 's decision to dismiss the
charges. The Region first received notice of the recanta-
tion of one of its witnesses on the Friday before the
Tuesday morning hearing , while counsel was preparing
the witness at a location away from the Regional Office.
That witness and another witness as well did not commit
their changed testimony to writing until Monday, the
day before the hearing , when they were at the Regional
Office. The record does not indicate the time of day.
Nevertheless , notice is taken that the authority to dismiss
charges rests exclusively at the Region with the Regional
Director (or Acting). There is simply nothing in this
record to indicate any unreasonable period of delay be-
tween the time of discovery and the time of decision to
dismiss. Significantly , counsel for Applicant does not
suggests otherwise.
On this record, I am compelled to find and conclude
that, at all relevant times, the General Counsel proceed-
ed with substantial justification.
IT IS THEREFORE ORDERED that the application for fees
and expenses is dismissed.