Darlington Manufacturing Co.

National Labor Relations Board - Board Decisions

Oct 18, 1962

139 N.L.R.B. 241 (N.L.R.B. 1962)

DARLINGTON MANUFACTURING COMPANY, ETC. 241
force or require Gordon Fields to enter into an agreement prohibited by Sec-
tion 8(e).
BUILDING AND CONSTRUCTION TRADES COUNCIL
OF SAN BERNARDINO AND RIVERSIDE COUNTIES,
Labor Organization.
Dated------------------- By-------------------------------------------
(Representative ) ( Title)
PLASTERERS LOCAL #73,
Labor Organization.
Dated------------------- By-------------------------------------------
(Representative ) ( Title)
This notice must remain posted for 60 consecutive days from the date of posting,
and must not be altered , defaced, or covered by any other material.
Employees may communicate directly with the Board 's Regional Office 849 South
Broadway , Los Angeles 14, California, Telephone Number, Richmond 9-4711,
Extension 1031 , if they have any question concerning this notice or compliance
with its provisions.
Darlington Manufacturing Company; Roger Milliken ; Deering,
Milliken & Co., Inc. and Textile Workers Union of America,
AFL-CIO. Case No. 11-C.4-1071. October 18, 1962
DECISION AND ORDER
On April 30, 1957, Trial Examiner Lloyd Buchanan issued his
Intermediate Report in the above-entitled proceeding, finding that
Respondent Darlington Manufacturing Company, herein referred to
as Darlington, had engaged in and was engaging in certain unfair
labor practices and recommending that it cease and desist therefrom
and take certain affirmative action, as set forth in the attached Inter-
mediate Report. Thereafter the General Counsel, Darlington, and
the Charging Union filed exceptions to the Intermediate Report and
supporting briefs. Darlington and the Charging Union also filed
reply briefs, and Darlington requested oral argument. On Septem-
ber 16, 1957, the Board heard oral argument in which the General
Counsel, Darlington, and the Charging Union participated.
On December 16, 1957, the Board issued an order remanding the
case to the Trial Examiner for the purpose of taking "evidence with
respect to the single employer status of Respondent and related cor-
porations." Pursuant to this order and after issuance of a complaint
against the affiliated corporations, and Roger Milliken as an individ-
ual, a further hearing was held before Trial Examiner Buchanan.
On December 31, 1959, the Trial Examiner issued his Supplemental
Intermediate Report, attached hereto, finding that Darlington and the
related corporations, herein referred to as Deering-Milliken, did not
occupy the status of a single employer. Thereafter the General Coun-
sel and the Charging Union filed exceptions to the Supplemental In-
termediate Report and supporting briefs. Darlington and Deering-
139 NLRB No. 23.
242 DECISIONS OF NATIONAL LABOR RELATIONS BOARD
Milliken filed a brief in support of the Supplemental Intermediate
Report.'
During the hearing on remand the Trial Examiner had dismissed
the complaint as to Roger Milliken. On October 22, 1958, the Board
affirmed the dismissal "upon the sole ground that the amendment of
the complaint to the extent that it included Roger Milliken as an
individual Respondent went beyond the permissible scope of the
Board's Remand Order of December 16, 1957." On December 31,
1958, the Regional Director issued a complaint against Roger Mil-
liken alleging that Roger Milliken personally, and by and with Re-
spondent Darlington and Respondent Deering-Milliken, committed
unfair labor practices. On the same day the General Counsel moved
to consolidate the complaint against Respondent Roger Milliken with
the prior complaint against Respondent Darlington. On March 11,
1959, the Board denied the motion to consolidate the complaints. On
April 9, 1959, a hearing was held before Trial Examiner Buchanan
upon the complaint as to Roger Milliken and on April 30, 1959, the
Trial Examiner issued an Intermediate Report, attached hereto, rec-
ommending dismissal of that complaint. Exceptions and briefs were
filed by the General Counsel, the Charging Union, and the Respond-
ent, Roger Milliken.
On January 11, 1961, the Charging Union filed a motion request-
ing that the Board remand the case to the Trial Examiner for the
purpose of taking newly discovered evidence. On February 15, 1961,
the Board granted the motion. On April 3, 1961, Deering-Milliken
filed a complaint in the District Court for the Middle District of
North Carolina requesting that the remand be enjoined and the case
returned to the Board. On April 28, 1961, the district court granted
the requested relief? On October 13, 1961, the Court of Appeals for
the Fourth Circuit modified the order of the district court to permit
a limited remand of the case to the Trial Examiner.' On February 5,
1962, a hearing was held pursuant to the remand permitted by the
court and on March 23, 1962, the Trial Examiner issued his Second
Supplemental Intermediate Report, attached hereto. Exceptions and
briefs were filed by the General Counsel and the Charging Union and
the Respondent Deering-Milliken filed a brief.
The Board has reviewed the rulings of the Trial Examiner made
at the hearings and finds that no prejudicial error was committed 4
I The Charging Union also requested oral argument as to this portion of the case. This
request is hereby denied as the record , including the briefs , adequately presents the issues
and positions of the parties
2193 F. Supp. 741.
2 295 F. 2d 856
' For the purpose of the first hearing, involving the liability of Darlington Manufactur-
ing Company , the Union obtained supenas directed to various parties not respondents in
this case. Upon petitions duly filed the Trial Examiner revoked the Union's subpenas.
The Union has excepted to the Trial Examiner 's revocations of the subpenas , but, in its
DARLINGTON MANUFACTURING COMPANY, ETC. 243
The rulings are hereby affirmed. The Board has considered the In-
termediate Reports, the Supplemental Intermediate Reports, the
exceptions and briefs, the oral argument, and the entire record in the
case, and hereby adopts the findings, conclusions, and recommenda-
tions of the Trial Examiner insofar as they are consistent with this
Decision and Order.5
In March 1956 the Charging Union initiated an organizational
campaign among Darlington's employees that culminated in a Board-
conducted election on September 6, 1956, which was won by the Union.
Throughout the campaign Darlington's supervisors interrogated em-
ployees as to their union activities 6 and made threatening statements
to the employees because of 'those activities.' At the same time
Darlington was also engaged in an extensive plant improvement pro-
gram.8 The day after the Union won the election Roger Milliken,
Darlington's president. decided that he would recommend to Darling-
ton's directors and stockholders that they close the plant. He testified:
I felt that as a result of the campaign that had been conducted
and the promises and statements made in these letters that had
been distributed [by the Unioii], that if we had had some possible
hope of achieving competitive ... [costs] . . . by taking advan-
tage of new machinery that was being put in, that this hope had
diminished as a result of the election because a majority of the
employees had voted in favor of the union.
Milliken thereupon called a special meeting of Darlington's board
,of directors to be held on September 12, although ordinarily 10 days
to 2 weeks' written notice was given for directors' meetings. The
directors subsequently met in a. session that lasted only about 75 min-
utes; they resolved to liquidate Darlington and to call a special meet-
ing of stockholders to approve the proposal. Also on September 12
the Union asked Darlington for a bargaining conference but was
told to wait until after it was certified by the Board.'
brief, the Union conditioned the exception upon a Hoard finding that the Respondent's
closing of its plant w,is not caused by the employees' selection of the Union as their
baigauung iepiesentatiie in view of the findings hereinafter made, the Union's exception
to the Trial Examiner's revocations of the subpenas is deemed to be withdrawn
The General Counsel and the Union have excepted to the Trial Exaniinei'e handling
of various documents eul nutted as evidence at the first hearing In some instances the
"Trial Examiner admitted the documents as evidence, in others he excluded them In view
of the findings hereinafter reached, the Trial Examiner's ruling,, on the aduussibllty of
the disputed documents were not prejudicial
6 The record contains evidence of about 20 such instances of interrogation
-There is evidence of about 30 threats made to employees daring the period of the
,organizational campaign
8Proin 1952 through '1956 the Respondent authorized about $723,000 for canitai ex-
pendituies of that sum approximately $400,000 was actually spent between .lanuaiy
and September 1950.
0 On the sane day Darlington filed objections to the conduct of the election. The Re-
gional Director, on October 8, issued a report on objections recommending that they be
overruled and the Union be certified Daihngton did not file exceptions and the Board
issued a certification to the Union on October 24, 1956.
672010-63-vol 139-17
244 DECISIONS OF NATIONAL LABOR RELATIONS BOARD
The stockholders met on October 17 to consider a resolution which
recited that the directors were recommending dissolution of the cor-
poration because of "certain developments" that related to Darling-
ton's operations. General Manager Oeland testified that Milliken
identified the "certain developments" as ". . . the recent election where
the majority of the people in the plant . . . [were] . . . for the Un-
ion ..." 10 South Carolina State Senator Mozingo, who was present at
the stockholders' meeting, gave uncontradicted testimony that Mil-
liken opened the meeting with the statement "that on September 6,
when [the employees] voted for a union that he decided to close the
mill." The stockholders approved the resolution to liquidate. Sen-
ator Mozingo testified, also without contradiction, that he had the
following conversation with Milliken after the meeting :
... he said, "Well, you will probably get another industry here
in Darlington," and I said, "How do you expect us to get another
industry when you are leaving a s[t]igma on us here that can't
be erased ... Not only that, it is unfair because eighty-three per-
cent of these people I am told have signed a petition to go back
to work. . . ." He said, "As long as there are seventeen percent
of the hard core crowd 11 here, I refuse to run the mill."
Darlington had accepted no new orders from customers after the
directors' meeting on September 12 but continued to operate the plant
to fill the orders at hand. The Charging Union's representatives did
meet with Darlington's officials on November 7 and requested certain
wage information, which Darlington never supplied. Darlington
discontinued productive operations on November 24 and sold the plant
machinery and equipment at auction on December 12 and 13, 1956.
The 8 (a) (1) Violations
The Trial Examiner found that Darlington violated Section 8 (a)
(1) of the Act by (a) interrogation of employees with respect to their
activities in behalf of the Union, (b) statements (made before the
representation election) that Darlington would close the plant if the
employees selected the Union as their bargaining agent, (c) state-
ments (made after the directors' special meeting) that connected the
decision to close the plant with the employees' activities in behalf of
the Union, and (d) encouragement of employees to sign the petition
10 For the period following the directors ' meeting, the record contains evidence of about
25 statements by supervisors to employees to the general effect that the Union 's election
victory was responsible for the closing of the plant and would result in the blacklisting
of the employees in their search for new jobs . There is also evidence that on eight occa-
sions supervisors tried to convince employees to support a petition that was circulating
among them to disavow the Union.
11 The witness subsequently elaborated on the "hard core crowd " and reported Milliken's
expression as "hard core labor people."
DARLINGTON MANUFACTURING COMPANY, ETC. 245
disavowing the Union that circulated after the election. The Trial
Examiner did not set forth all the evidence supporting these findings.
It is sufficient to state, however, that the evidence is overwhelming
and, to a large extent, uncontradicted.12 Accordingly, we adopt the
foregoing findings made by the Trial Examiner.13
The 8(a) (3) Violation
One of the major issues in this case was raised by Darlington's
contention that, as an employer, it had an absolute right "to go out
of business for whatever reason it may choose, and regardless of
whether union animosity may have contributed to the decision."
However, Darlington has not relied exclusively upon this contention
as a defense to the charge that it violated Section 8 ( a) (3).
Darlington also advanced a more conventional defense to the Sec-
tion 8(a) (3) charge; it claimed that the shutdown of its mill was due
to economic and financial factors. In its brief (at pages 15 through
24) Darlington has listed eight so-called "economic" factors that
assertedly caused it to shut the plant. Six of them fit the traditional
concept of "economic" factors. The remaining two asserted "eco-
nomic" factors pertained to the employees' union activities ; one of
them was termed "The TWUA Election." When an employer dis-
charges its employees for selecting a union to represent them, the moti-
vation is not "economic" in the sense contemplated by the Act-not-
withstanding the employer's belief that it could not afford to pay
increased wages that the union representative might demand.14 The
overall effect of Darlington's listing of the eight so-called "economic"
factors is an admission that the employees' union activities were, in
part, the cause of its decision to close the mill.15
"Darlington has not seriously challenged the Trial Examiner's Section 8(a) (1) find-
ings At page 48 of Its brief in support of exceptions , the Respondent has stated:
"With respondent 's corporate existence at an end, it seems particularly unrewarding to
debate whether these circumstances constituted a violation of the Act. Reference is made
to these (8 ( a)(1)1 findings here only because of the manifest unfairness of assessing the
company with liability for such acts and words of supervisors in the turbulent days follow-
ing the announcement that the mill would close . To direct that respondent publish a
notice that it will desist from further 'interfering ' of this kind is both futile and absurd."
is We do not pass upon any of the 8 ( a) (1) violations alleged besides those that the
Trial Examiner found were supported by the record , because in the particular circum-
stances of this case any additional findings of 8(a) (1) violations would be merely cumula-
tive. Moreover , we do not adopt , or pass upon, the Trial Examiner ' s findings that:
(1) unlawful statements made by Darlington ' s supervisors did not reflect declarations
by Roger Milliken ; ( 2) a supervisor ' s request that an employee keep him Informed of
employees ' union activities and the surveillance of such activities by the supervisor are
not unlawful ; ( 3) the supervisors ' unlawful threats were not proof of such threats by
Roger Milliken ; ( 4) certain posters posted by Darlington did not constitute unlawful
interference or threats ; and (5) Darlington did not instigate circulation of the petition
disavowing the Union.
i4 Industrial Fabricating, Inc., at al, 119 NLRB 162.
is Darlington has stated , at page 23 of its brief , that ". . . the election was responsible
for the decision to call the meeting at which it was decided to recommend liquidation to
the stockholders... .
246 DECISIONS OF NATIONAL LABOR RELATIONS BOARD
The Trial Examiner rejected Darlington's claim that all eight fac-
tors contributed to Darlington's decision to close the mill; he found
that Darlington's decision to shut the plant "would not have been
made but for the protected organizational activities" of the employees.
We agree. If Darlington's general behavior during the months that
preceded the election did not reflect actual confidence in its business
future, it established, at the very least, the intention to continue as an
operating concern. The six truly economic factors were problems that
had faced Darlington over an extended period, and Darlington's plant
improvement program was specifically designed to overcome such
problems. That program involved an expenditure of $400,000 in the
9-month period preceding the election. Just 1 month before the direc-
tors' special dissolution meeting, General Manager Oeland reported
a projected $40,000 loss to President Milliken, yet, despite such a
serious and unpromising economic forecast, Milliken took no action to
slow up the modernization program in any way. It was not until the
employees selected the Union as their bargaining representative that
Darlington's attitude toward its operations changed. With the elec-
tion, the renovation program was discontinued ; the directors met as
soon after the election as was possible for them; the directors' special
meeting lasted just over an hour-barely time for the directors to
itemize, much less to discuss, the six asserted economic factors that
caused the plant closing. After the directors' meeting Darlington's
supervisors told the employees that the election was the cause of the
mill shutdown ; and, at the stockholders' dissolution meeting, Milliken
specifically stated that he decided to close the mill when the employees
selected the Union as their bargaining agent.
Moreover, even assuming, as the Respondent contends, that the six
genuine economic factors as well as the employees' union activities
were responsible for the closing of the mill, Darlington's action was
no less unlawful.ls A plant shutdown resulting in the discharge of
employees that is partly due to employees' union activities constitutes
an unfair labor practice."
At this point we reach the fundamental issue noted above-whether
an employee has the absolute right to go out of business even if its
19 Contrary to Darlington , Mount Hope Fmtshing Company v. N L R B , 211 F 2d 365
(C.A. 4), is irrelevant here The court specifically found therein that the employer's re-
moval of a plant did not violate the Act because the employees' union activities merely
accentuated the employer ' s preexisting lawful reasons for moving its plant and that the
employer 's move of its plant was motivated by factors apart from its employees' union
activity. Darlington has, itself , distinguished this case from Mount Hope by conceding
that the closing of Its plant was partly attributable to the employees' selection of the
Union
17 N L.R B v. Jamestown Sterling Corp., 211 F . 2d 725, 726 (C A. 2), wherein the court
stated, "If employees are discharged partly because of their participation in a campaign
to establish a union and partly because of some neglect or delinquency , there is nonetheless
a violation of the National Labor Relations Act. . . See also N.L R B. v. Whctin
Machine Works, 204 F. 2d 883 , 885 (C.A. 1).
DARLINGTON MANUFACTURING COMPANY, ETC. 247
reason for doing so is its employees ' union activities . Section 8 (a) (3)
provides :
It shall be an unfair labor practice for an employer-
(3) by discrimination in regard to hire or tenure of employ-
ment or any term or condition of employment to encourage or
discourage membership in any labor organization ... .
Darlington discriminated in regard to its employees' tenure of em-
ployment by closing its plant-thereby discharging the employees-
and, because the plant closing was the direct result of the employees'
selection of the Charging Union as their collective-bargaining repre-
sentative, Darlington's retaliation against the employees for their
activities in behalf of the Union discouraged the employees' continued
membership in the Union.'8 Notwithstanding this uncomplicated,
literal violation of Section 8 (a) (3) established by its conduct, Darling-
ton contends its action was not unlawful.
The Respondent has advanced several arguments to support its con-
tention. The Respondent claims, first, that the South Carolina stat-,
utes under which it was incorporated gave it the "absolute right volun ,I
tarily to liquidate." 19 If the South Carolina Code did contain such
a right, it could prevail only if not in conflict with the National Labor
Relations Act.20 But it is unnecessary to resolve whether there is a
conflict between the South Carolina and the Federal statutes; the
South Carolina Code did not give Darlington the absolute, unlimited
right to liquidate that is claimed. The code, considered in its entirety,
provides, contrary to Darlington, that, in the event of a corporate
dissolution, the corporate entity survives for the very purpose of con-
tinuing the legal obligations that the corporation incurred before the
dissolution or in the course of dissolution 21
Darlington's second argument is that the shutting of the mill "effec-
tively and finally terminated" the existing employer-employee rela-
tionship, and that, thereafter, it was no longer an employer within
19 N.L.R B V. Jones 4 Laughlin Steel Corporation , 301 U.S. 1; Associated Press v.
N.L.R.B, 301 U.S. 103.
1s Code of Laws of South Carolina , Section 12-641 (1952 ), provides that "All corpora-
tions incorporated in this State . . shall always have the right to go into liquidation
and to wind up their affairs and dissolve by resolution of the stockholders representing a
majority of capital stock. . . ."
20 Joseph Garner, et at., t/a Central Storage and Transfer Company v . Teamsters, Chauf-
feurs and Helpers Local Union No. 776 ( A.F.L ), 346 U.S . 485, 500-501 . "We conclude
that when federal power constitutionally is exerted for the protection of public or private
interests , or both, it becomes the supreme law of the land and cannot be curtailed , circum-
vented or extended by a state procedure . . ... And see Lloyd Weber et at . v. Anhe 8er-
Busch, Inc , 348 U. S. 468.
" Code of Laws of South Carolina, Section 12-644 ( 1952 ), provides that any corporate
dissolution under Section 12-641 (the provision relied upon by Darlington) "... shall
not bar an action for two years thereafter against any corporation or any of its mem-
bers . . And Section 12-601 provides that "All corporations [ that are dissolved]. 11
shall be continued bodies corporate for the purpose of prosecuting and defending suits by
11or against them. . . .
248 DECISIONS OF NATIONAL LABOR RELATIONS BOARD
the meaning of the Act 22 The Act does not state the specific char-
acteristics of an "employer." The Act does, however, state that "The
term `employee' shall include . . . any individual whose work has
ceased as a consequence of, or in connection with, any current labor
dispute or because of any unfair labor practice. . . ." Darlington's
discharged workers remained employees within the statutory defini-
tion, and their employment relationship vis-a-vis their employer did
not terminate.23 Moreover, Darlington did not dissolve into nothing-
ness at the time it discontinued production operations on November 24.
It continued to exist as a corporate entity under the laws of South
Carolina; it liquidated fixed assets at auction in December 1956; it
has been distributing funds to its stockholders; and it has been vigor-
ously defending this proceeding before the Board.
Darlington also argued that the Board and the courts, in deciding
National Labor Relations Act cases, have established an employer's
absolute right to go out of business.24 All but one of the cases the
Respondent relies upon to support this proposition are irrelevant or
actually contrary to Darlington. Darlington has cited Seaboard
Packing Company, 10'7 NLRB 1295, but in that case the Board adopted
an Intermediate Report that stated ". . . the evidence does not . . .
establish that the Respondent closed clown [its plant] and locked out
its employees to avoid dealing with the Union." Darlington ad-
vanced these pronouncements to support its position.
The stockholders of Tupelo Garment Co., had the absolute
right to dissolve their corporation and the Board was without
authority to prevent this. [N.L.R.B. v. Tupelo Garment Com-
pany, 122 F. 2d 6031606 (C.A. 5).]
a bona fide shutdown of a plant does not of itself constitute
a violation of the Act . . . [The Atlas Underwear Company v.
N.L.R.B., 116 F. 2d 1020,1023 (C.A. 6).]
Examination of these two cases shows that the citations were taken
out of context. Tupelo, a contempt case, involved the issue whether
newly organized corporations were successors to the respondent; there
was no issue of the respondent's right to go out of business. The quo-
21 This argument cannot apply to the discharges that Darlington effected before its last
day of production on November 24, 1956, because Darlington has otherwise conceded that
an employer does "not escape liability for unfair labor practices committed while it was
still in business " The Respondent discharged its employees over a 6-week period Thus
on October 13 it had about 510 employees, on October 20 about 460 employees, on Octo-
ber 27 about 345 employees, and so on until November 24 when the Respondent discharged
the last of its employees. Inasmuch as the Respondent was an employer with a working
staff of employees up until the date it fired the last group of employees, even under the
Respondent's contention, the employees fired before November 24 were discriminatorily
discharged.
13 See Phelps Dodge Corp. v. N.L.R.B., 313 U.S. 177, 190-191.
u Darlington has conceded that Board and court decisions establish violations of Sec-
tion 8(a) (3) by employers that move or temporarily close their plants because of anti-
union considerations
DARLINGTON MANUFACTURING COMPANY, ETC. 249
tation from the Atlas case is taken from the context of the decision in
N.L.R.B. v. Asheville Hosiery Company, 108 F. 2d 288 (C.A. 4), in
which the Fourth Circuit stated more fully at page 293:
... while a bona fide shutdown of a plant does not constitute a
violation of the Act, a shutdown not made in good faith, and in-
tended to discourage unionization is illegal.
There is one decision that, at first glance, lends considerable support
to Darlington's claim that it could shut its plant for discriminatory
reasons. In view of its importance to Darlington's defense, we recite
at this point the entire portion of that decision on which Darlington
has relied. In N.L.R.B. v. New Madrid Manufacturing Company
and Harold Jones d/b/a Jones Manufacturing Company, 215 F. 2d
908, 914 (C.A. 8), the Eighth Circuit said:
But none of this can be taken to mean that an employer does
not have the absolute right, at all times, to permanently close and
go out of business, or to actually dispose of his business to another,
for whatever reason he may choose, whether union animosity or
anything else, and without his being thereby left subject to a
remedial liability under the Labor Management Relations Act
for such unfair labor practices as he may have committed in
the enterprise, except up to the time that such actual and perma-
nent closing or true and bona fide change in ownership has oc-
curred. No one can be required to stay in private business, and
no one can be prevented from permanently closing or abdicat-
ingly selling such a business. And the Act affords no basic on
which to order a person to reinstate employees in a business which
he has, with plain finality, put out of existence, or which he has
actually disposed of to another, and as to which he neither in
law nor in fact possesses any power over the operations of his
successor, either of management right in general or of labor-
relations control in particular. Cf. Southport Petroleum Com-
pany v. N.L.R.B., 315 U.S. 100, 106. No more, in our opinion,
can the Act be said to contain any basis to assess remedial back-
pay against such a person, beyond the date of his permanent clos-
ing or abdicating sale of the enterprise.
Reference to the entire decision in the New Madrid case shows that
the court agreed with the Board's findings that New Madrid's shut-
down of a plant violated Section 8(a) (1), (3), and (5) of the Act.
The court overruled, however, the Board's finding that New Madrid's
subsequent sale of the plant failed to rescind New Madrid's actual
control over it. The Eighth Circuit also rejected the Board's conclu-
sion that New Madrid and its successor (Jones) were jointly liable
for correction of the unfair labor practices that New Madrid, alone,
250 DECISIONS OF NATIONAL LABOR RELATIONS BOARD
had committed before the plant sale. In thus reversing the Board,
the court noted that New Madrid had decided not to reopen the plant
after an audit showing that the plant had lost money. The court com-
mented that in some circumstances a successor to a business is liable
for the unfair labor practices of his vendor and followed with the
above-recited paragraph, which cut off New Madrid's responsibility
for remedying the unfair labor practices at the point of the plant
sale. The court went on to hold successor Jones liable for the rein-
statement of the employees that New Madrid had discriminatorily
discharged.
Accordingly, the legal conclusions that the court reached were con-
trary to the court's obiter dictum that an employer can permanently
close a business "for whatever reason he may choose, whether union
animosity or anything else." The court found that New Madrid's
mill shutdown with its concomitant discharge of employees violated
Section 8(a) (3) of the Act. Indeed, the court issued an order re-
quiring the reinstatement of the discharged employees; such rein-
statement order could be made only in the case of unlawful discharge.
Moreover, Darlington's interpretation of the Eighth Circuit's decision
attributes to the court the overruling of his own earlier decisions,25
even though the statutory right of an employer to close a plant per-
manently was not in issue and was not briefed by any party. In the
circumstances we are loath to accept the Respondent's interpretation
of the circuit court's intendment in the New Madrid case. We view
the above-quoted paragraph as part of the court's concern with the
remedy in a case wherein the court otherwise found that New Madrid,
in a bona fide transaction, sold its plant to Jones. In any event, if
Darlington has correctly interpreted the court's meaning, we respect-
fully disagree.
There is no decided case directly dispositive of Darlington's claim
that it had an absolute right to close its mill, irrespective of motive.
We are convinced, however, that relevant Board and court decisions
reject Darlington's view. It has been decided by the Supreme Court,
for example, that an employer violated Section 8(3) of the Act by
the wholesale discharge of all the employees on its boat because they
were members of a particular union?s In a case very similar on its
facts to the instant case the Fourth Circuit found that an employer
25See, for example , NL.RB. v. National Garment Company, 166 F. 2d 233 ( CA. 8),
wherein the court, in rejecting the Respondent 's argument that the discharge of all its
employees was not discrimination , stated at page 238 , "They discriminated against all
employees by treating them differently than they would have treated them had some of
11 ;them not joined the union within the plain intendment of Section 7 and 8 (1) (3) . . .
Williams Motor Company v . N.L R.B , 128 F . 2d 960 (C A. 8), wherein the Eighth Circuit
found that an employer 's permanent discontinuance of a department violated Section 8(3).
x N.L.R B. v, Waterman Steamship Corporation , 309 U.S. 206. The court stated at
page 219, "And employees . . . have a right guaranteed by the Act that they will not be
dismissed because of affiliation with a particular union."
DARLINGTON MANUFACTURING COMPANY, ETC. 251
violated Section 8(a) (1) and (3) by shutting its mine after threaten-
ing to do so because of his employees' union activities. 27 In another
instance the Third Circuit held that an employer which closed one
of its plants because of opposition to its employees' union activities
violated Section 8(a) (1), (3), and (5) of the Act28 And the Eighth
Circuit upheld a finding that an employer which discontinued one of
its departments in retaliation for its employees' activities in behalf
of a union violated Section 8 (3).11
In summary, Section 8(a) (3) literally proscribes Darlington' s clos-
ing of its business in retaliation for the employees' selection of the
Union as their bargaining representative; Darlington has failed to
advance any substantial reason for excepting its conduct from the
operation of Section 8(a) (3); and, in cases factually similar to this
one, employers charged with violating Section 8 (a) (3) have been
found guilty thereof. In addition, Darlington's conduct was con-
trary to the fundamental spirit and purpose of the statute. Darling-
ton's threat to close its mill if the Union became the bargaining repre-
sentative of its employees is a classical example of a violation of Sec-
tion 8(a) (1) 30 As noted above, a partial effectuation of Darlington's
threat-such as a temporary closing of the mill, or a discharge of some
but not all of the employees-would have violated Section 8(a) (3).
Yet Darlington would have this Board find that total effectuation of
the threat-the permanent closing of its mill with the concomitant dis-
charge of all its personnel-did not violate the Act. In other words,
under Darlington's contention an employer with a staff of 100 em-
ployees violates Section 8(a) (3) if he discriminatorily fires 50 or
75 or even 99 of his 100 workers, or if he temporarily lays off all of
them, but, if he retaliates against them, for their union activities by
permanently discharging all of them, the finality of his conduct would
make it lawful. The argument is self-defeating.
The preamable of the amended Act provides, in part :
It is hereby declared to be the policy of the United States to
eliminate the causes of certain substantial obstructions to the free
flow of commerce and to mitigate and eliminate these obstruc-
tions when they have occurred by encouraging the practice and
procedure of collective bargaining and by protecting the exercise
n N.L.R.B. v. Norma Mining Corporation , et al., 206 F . 2d 38 ( C.A. 4) ; the finding re-
lated to respondent Ward. See also N.L R.B. v. Joseph Stremel d/b/a Crow Bar Coal
Company, 141 F. 2d 317, 318 (CA. 10), in which the court said , "A shut-down or lock-
out of employees for the purpose of discouraging membership in a labor organization con-
stitutes discrimination within Section 8(3) and (1) of the Act."
28 N.L R B v. Sam Wallick, at at., d/b/a Wallick & Schwalm Company, et at., 198 F. 2d
477 (C.A. 3). See also Town & Country Manufacturing Company, Inc , at al., 136
NLRB 1022.
21 Williams Motor Company v. N L.R.B., 128 F. 2d 960 (C.A. 8).
30 See, among other cases, Audubon Cabinet Company, Inc., et at,, -117 NLRB 861, 863;
J. H. Rutter-Rem Manufacturing Co., Inc, 115 NLRB 388, 389.
252 DECISIONS OF NATIONAL LABOR RELATIONS BOARD
by workers of full freedom of association, self-organizations, and
designation of representatives of their own choosing, for the pur-
pose of negotiating the terms and conditions of their employment
or other mutual aid or protection.
The "policy of the United States" is to mitigate and eliminate ob-
stacles to the free flow of commerce "by encouraging the practice and
procedure of collective bargaining" and by protecting workers in the
exercise of their right to organize and to select a bargaining repre-
sentative. On the other hand, Darlington's policy, as evidenced by
its conduct, is directly contrary to that prescribed by the statute.
Once the employees had exercised their statutory right of selecting
the Union by the process prescribed by the statute-the Board elec-
tion-Darlington destroyed the possibility of collective bargaining by
shutting its plant. Darlington is mistaken in its claim that by going
out of business and permanently reducing "the free flow of commerce"
the statute made lawful its discharge of employees for their engage-
ment in organizing activities. Congress has taken from employers
the right to discharge employees for engaging in protected activities.
The withdrawal of this right is absolute and unequivocal.
We find, in conclusion, and for the foregoing reasons that Darling-
ton's closing of the mill, with its concomitant discharge of employees
violated Section 8 (a) (3) and (1) of the Act.
There is, moreover, independent reason for rejecting the contention
that Darlington had an absolute right to close down its mill and dis-
charge its employees. As will appear below, Darlington was but
one constituent part of a single entity, consisting of Deering, Milliken
and Co., Inc., and its affiliated corporations. Thus we have here the
closing of a single plant of the several in one entity because of union
activity, conduct clearly proscribed by the Act "
The 8 (a) (5) violation
The Trial Examiner found that Darlington's violations of Section
8(a) (3) "were so complete as to discourage and ultimately thwart the
Union from pursuing its right to bargain" and were a fortiori violative
of Section 8(a) (5). In his opinion "as it is discriminatory against
its employees, so does it constitute a refusal to bargain for an employer,
on the basis of a union's campaign propaganda, oral and in writing,
concerning improved working conditions and greater pay, to anticipate
demands and compulsion to grant such demands, and therefore to
terminate its operations and avoid bargaining." The Trial Examiner
also found that Darlington's refusal to furnish the Union with wage
and related bargaining information independently violated Section
a' N.L.R.B. v. Norma Mining Corporation , et al ., 206 F. 2d 38, 41-42 (CA. 4).
DARLINGTON MANUFACTURING COMPANY, ETC. 253
8(a)(5).11 We adopt these findings of the Trial Examiner. We find
further that Darlington's refusal to bargain collectively with respect
to the employees' tenure of employment was in derogation of the
Union's status as the majority representative of the employees.
The Remedy
The Trial Examiner recommended that Darlington cease and desist
from committing further unfair labor practices and that Darlington
publish notices to that effect in local newspapers. He also recom-
mended, "dependent on resumption of operations," that Darlington
bargain collectively with the Union and offer reinstatement to the
discriminatorily discharged employees. Although the Trial Exam-
iner found that "an injury cognizable by law has occurred" and that
"there can be a decision to compensate" the discriminatees,33 he did
not recommend the payment of backpay to them.
We adopt the Trial Examiner's recommendations as to remedy to
the extent that they require Darlington to cease and desist from com-
mitting unfair labor practices, require Darlington to post notices in
newspapers, 14 and direct Darlington to bargain collectively with the
Union and to reinstate the discriminatees in the event Darlington,
at some time, recommences operations."'
The Trial Examiner refused to require direct mailing of notices
to employees, asserting that such a measure would be punitive. We
do not agree. Direct mail may be the only way by which some of
Darlington's former employees can learn of the Board's Decision and
Order in this case, inasmuch as some of them may have left the
geographical area covered by the newspapers that will carry the notice.
Accordingly, we shall order Darlington to mail copies of the notice
to the last known address of each discriminates 31
82 In the absence of specific exception we adopt the Trial Examiner 's finding that Darling-
ton's initial unlawful refusal to bargain with the Union occurred on September 12, 1956.
We do not adopt the Trial Examiner ' s finding , in effect, that Darlington 's violations of
Section 8 ( a) (1) were not relevant to Darlington 's bona fides in refusing to bargain with
the Union ; nor do we adopt his finding that the Union 's last request for bargaining in-
formation may have been "made with an eye to negotiating with prospective purchasers"
of Darlington 's plant.
13 The Trial Examiner otherwise stated , however , that the payment of backpay "would
reflect a punitive aspect "
u In the absence of a permanent plant location where notices can be posted, we find
this method of posting proper. Southland Manufacturing Company, 94 NLRB 813, 817;
The Russell Manufacturing Co., Incorporated , et at., 82 NLRB 1081 , 1088, enfd. in this
respect 187 F. 2d 296 ( C.A. 5) and 191 F. 2d 358 ( C.A. 5). Contrary to Darlington,
this form of notice posting is consistent with N.L R B. v. Reynolds Corporation, 155 F. 2d
679 (C.A. 5 ), wherein the court refused merely to require posting of notices at a non-
operating plant site.
85 We do not agree, however, with the Trial Examiner 's statement that there was "no
claim that the sale [ of the Respondent 's assets] was not to bona fide purchasers for value."
SO N.L .R.B. v. American Laundry Machinery Co., 152 F. 2d 400, 401 (C .A. 2) ; N.L.R.B.
v. Sunbeam Electric Manufacturing Co., 133 F 2d 856, 861 (C.A. 7).
254 DECISIONS OF NATIONAL LABOR RELATIONS BOARD
The Trial Examiner refused to recommend backpay for the ap-
proximately 500 employees unlawfully discharged by Darlington be-
,cause, in his opinion, there was no record proof that Darlington
would have continued to operate the plant absent the employees' union
activities and because he deemed controlling the court opinion in the
Mount Hope case 37
We do not agree with the Trial Examiner that it was necessary for
the record affirmatively to show that the Respondent would have con-
tinued to operate its plant, absent unlawful motivation, in order to
warrant a backpay award. Any uncertainty as to the continued
operation of Darlington's plant-based on some reason other than
its unlawful retaliation against the employees-is a matter to be
determined at the compliance stage of the Board's process. The
backpay remedy obtains where there is an unlawful discharge of em-
ployees. In the event a respondent liable for backpay has a super-
seding lawful reason for terminating its backpay liability, that re-
spondent has the privilege to establish that fact at the compliance
stage of a proceeding. In like manner, the Respondent herein would
have the opportunity, if necessary, to reduce its backpay liability by
showing that, as of a particular date, it would have closed its plant
or laid off some dischargees even if the employees had not voted for
the Union.38 We also find that the Trial Examiner improperly relied
upon the Fourth Circuit opinion in Mount Hope. The court reversed,
on the merits, a Board finding that the respondent had violated Sec-
tion 8 (a) (3) ; accordingly, the court had no remedy to pass upon in
Mount Hope.
We are convinced that a backpay award is essential in this case to
rectify Darlington's fundamental violation of Section 8(a) (3). The
Board has wide discretion in directing a backpay award under Sec-
tion 10(c) of the Act; 39 Darlington's discontinuance of its business
does not terminate the Board's authority in this regard 40 "The mere
fact that an employer may cease to do business certainly does not
3'Mount Hope Finishing Company v . N.L.R.B., 211 F . 2d 365 (CA. 4). The record
does not support the Trial Examiner's finding that the "General Counsel and the Union
here appear to have accepted the Court' s decision" in Mount Hope.
se In any event the Trial Examiner 's finding that the record establishes that Darlington's
mill would not have closed but for the employees' union activities gives rise to the pre-
sumption that Darlington would have continued to operate the mill absent that union
activity.
' Virginia Electric Power Company v . N.L R B., 319 U S. 533; Phelps Dodge Corp, v.
N.L R B., 313 U.S. 177.
au N.L.R.B v. S . W. Dixon d/b/a U.S Trailer Manufacturing Company, 184 F. 2d 521
(C.A. 8), wherein the court distinguished N.L.R B. v. Grace Company, 184 F. 2d 126
(C.A. 8), a case relied upon by Darlington , because, unlike the Dixon and instant cases,
the Grace decision did not involve reimbursement for loss of wages. See also N.L.R.B. v.
Caroline Mills, Inc., 167 F. 2d 212 (C.A. 5).
DARLINGTON MANUFACTURING COMPANY, ETC. 255
end the public interest involved in seeing that a backpay award under
the Act is satisfied.7 41
The unusual circumstances of this case, however, have made it more
than ordinarily difficult to decide on the period that the backpay award
should cover. The Darlington plant has been closed and there is no
immediate prospect that it will be reopened. The Board's remedy of
reinstatement with backpay to run until such time as reinstatement
has occurred, which is the Board's customary remedy where an em-
ployer has discriminatorily discharged his employees, is thus wholly
impractical where the closed plant only is taken into consideration.
Yet the approximately 500 discharged employees, thrown into the
ranks of the unemployed in a very small city,42 would suffer severely
from the closing of the plant. It is reasonable to assume that these
employees would have continued in their employment indefinitely,
particularly in view of the large sums spent and allocated for modern-
ization of the mill. In order to restore "the situation, as nearly as
possible, to that which would have obtained but for the illegal dis-
crimination," 43 we shall therefore order the Respondent, Darlington,
to provide backpay until the discharged employees are able to obtain
substantially equivalent employment 44
Were Darlington a single entity the remedy above would provide
the only practicable solution although this limited redress for the un-
fair labor practices found is clearly inadequate. The extended sup-
plemental hearings were held in order to determine whether or not
Darlington occupied a single employer status with Deering-Milliken
and its affiliated corporations. The Trial Examiner found that
Darlington did not occupy such a status. We do not agree. It is
now well established that for two or more legal entities to constitute
a "single employer" for purposes of assessing liability for unfair labor
practices it must be shown that there was a sufficient degree of common
ownership and common control of labor relations and operations so
that it may be said that they are engaged in a common enterprise 45
In our opinion the evidence fully supports a finding that Darlington
and Deering-Milliken and its affiliated corporations meet this test.
The "common ownership" necessary for such a finding is amply
demonstrated by the stockownership shown in the stipulation entered
41 N.L .R.B. v. Killoren, Trustee in Bankruptcy of Hamilton Brown Shoe Co., 122 F. 2d
609 (C.A. 8 ) ; see also Waterman Steamship Corporation v. N.L.R.B., 119 F. 2d 760,
763 (C.A. 5).
42 The 1960 census shows that Darlington had a population of 6,710.
93 Phelps Dodge Corp . v. N.L.R.B., 313 U.S. 177, 194.
44 If, however, the . employees are placed on a preferential hiring list at other Deering-
Milliken mills, which , as will appear below, occupy a single employer status with Darling-
tion, we shall toll backpay as of the time they are placed on such list.
45Dearborn Oil and Gas Corporation, et al., 125 NLRB 645, 647 ; Editorial "El Im-
parcial," Inc., 123 NLRB 1585, 1593, enfd. 278 F. 2d 184 (C.A. 1) ; Combined Century
Theatres, Inc., 120 NLRB 1379, 1380-1381.
256 DECISIONS OF NATIONAL LABOR RELATIONS BOARD
into among the parties. Thus the Milliken family owns, either
through direct stockownership or through ownership of corporations
holding stock, at least 66 percent of the stock of Darlington. In simi-
lar fashion the Milliken family owns a majority of the stock of Deer-
ing-Milliken and Cotwool and from 88 to 55 percent of all of the affil-
iated corporations. Such stockownership clearly satisfies the Board's
requirements for a finding of "common ownership." 4s
That "common ownership" here constituted something more than
the mere holding of the stock is shown by the identity of the officers
and directors elected pursuant to such ownership and their effectuation
of corporate changes when the occasion demanded. Thus Roger
Milliken was president of all of the corporations except the Lauren
Mills. In like vein a majority of the directors of each corporation,
with one exception, are members of the Milliken family. And, as
illustrated by the merger of Cotwool and Deering-Milliken, treated
more fully in the Supplemental Intermediate Report, the Milliken
family could and did eliminate corporate lines where circumstances
made such action advantageous. From this evidence we can only con-
clude the Milliken family had, and exercised, its ownership over all
of the corporations which constituted the Deering-Milliken complex.
In the "crucial area" of common control over labor relations'41 it is
likewise clear that the Board's standards are met. Roger Milliken,
the president of all of the corporations save one, exercised ultimate
control over the labor relations of all of the corporations. Thus he
received reports from each of the mills as to progress in reducing the
number of jobs, the pay raises given, hours worked, and job assign-
ments, was asked for approval of various personnel actions, and made
suggestions as to the hiring of personnel. More important, however,
was Roger Milliken's participation in the area having the greatest im-
pact on labor relations-the area of collective bargaining. Thus he
circulated a memorandum and editorial which was obviously intended
as a primer to the managers of the mills in combating union organiza-
tion. During the organizational campaign his pervasive influence was
demonstrated by the statements of supervisory employees that Roger
Milliken would close the plant rather than permit its unionization.
Moreover, it was Roger Milliken who, with the approval of his family,
decided to close the plant, admittedly because the employees had exer-
cised their rights under the Act and selected the Charging Party as
their representative. And finally it was Roger Milliken who told a
" Ecusta Paper Corporation , et al ., 66 NLRB 1204, 1212; Calcasieu Paper Co, Inc.,
et as., 99 NLRB 794, 802, enfd. 203 F. 2d 12 (CA 5) ; cf The Danspur Company, Inc,
et al, 114 NLRB 40, 41-42; A 3f. Andrews Company of Oregon, et al, 112 NLRB 626,
628-629; Somerset Classics, Inc, et al , 90 NLRB 1676, 1688, enfd. 193 F 2d 613
(C.A. 2) ; Federal Engineering Company , Inc, 60 NLRB 592, enfd as mod. 153 F. 2d
233 (C.A. 6).
47 Dearborn Oil and Gas Corporation, et at, supra ; Monsieur Henri Wines, Ltd, 44
NLRB 1310, 1314.
DARLINGTON MANUFACTURING COMPANY, ETC. 257
stockholder and director that he would not operate the mill so long as
there was "seventeen percent of the hard core" labor people remaining
in the mill.
From the above evidence , we conclude that Deering-Milliken, pri-
marily through the person of Roger Milliken , exercised control over
the labor relations of all of the corporations , including Darlington.
Although the details of day-to - day personnel relations may have been,
of necessity , conducted at the mills , it is manifest that the major de-
cisions were exclusively in the hands of Roger Milliken . Under such
circumstances it is clear that Deering-Milliken must assume responsi-
bility for control of Darlington 's labor relations.
There is abundant evidence that Deering -Milliken exercised even
tighter control over the operations of the other corporations . It exer-
cised complete control over their sales . The head of Deering-Milliken's
tax department was an officer of each of the mills and as such super-
vised all tax matters for the mills . The tax department concerned
itself with the accounting procedures , vacation plans, incentive com-
pensation contracts for supervisors , and reviewed the drafts of min-
utes of stockholder and directors ' meetings. Deering-Milliken's in-
surance department handled all insurance for the mills . Financial
reports were rendered by the sales department . And other officers of
Deering -Milliken also participated in the details of the operations of
the other corporations.
Control was also exercised through the Deering-Milliken Service
Corporation. Thus the purchasing department made all purchases
of equipment and machinery for all of the mills. The cotton purchas-
ing department purchased all the cotton used by the mills, specified the
proper mix of cotton for the production of particular kinds of cloth,
and disposed of waste cotton . The fiber quality control and research
department advised the mills on the methods of getting the maximum
efficiency from raw material, equipment , and personnel . The engi-
neering department performed similar services with respect to build-
ings and the physical plant. And the placement department oversaw
the hiring of supervisory -trainees.
Roger Milliken himself participated fully in the operations of the
mills. Regular reports regarding operations were rendered to him.
He required the mills to inform him of their capital expenditures and
report on their success in job reductions. He, in turn, informed the
mills on "policy" with respect to revealing information to competitors
and payroll deductions for charitable purposes . The many memo-
randums emanating from Roger Milliken were addressed to all of the
mills, not to the individual mill. In short, Roger Milliken exercised
close control over all of the mills alike in the entire Deering-Milliken
group. We are therefore convinced that Deering-Milliken exercised
258 DECISIONS OF NATIONAL LABOR RELATIONS BOARD
sufficient control over the operations of all of the mills to meet the
tests utilized by the Board.
Aside from the evidence set forth above, with respect to the indi-
vidual factors demonstrating that the Deering-Milliken group of cor-
porations were one enterprise there is much which persuades us that
Deering-Milliken and the corporations so considered themselves. In
the many documents which form part of the record in this case re-
peased references are found to "our organization" ; "Deering-Milliken
Mills"; "Deering-Milliken Group"; and "The Company." In describ-
ing movements from one mill to another the word "transfer" was
utilized. In the booklet published by Deering-Milliken entitled,
"Fabric Magic By Milliken," there are repeated references to the
"Milliken Mills," the "Milliken Operations," "Mills with Milliken,"
"Milliken's own industrial engineers," and statements such as "you
made the mill grow like this-1865 one mill; now 29 mills." Such
references are consistent only with the existence of a single , integrated
enterprise.
Although we have thus found that Deering-Milliken and its affili-
ated corporations, including Darlington, constitute a single employer
responsible for the unfair labor practices committed, the question re-
mains as to what remedy is appropriate. As Deering-Milliken and
the affiliated corporations occupy a single employer status with Dar-
lington, we shall, of course, make them liable for backpay to the same
extent as we have heretofore directed with respect to Darlington.
Unlike Darlington, however, Deering-Milliken and the affiliated cor-
porations 48 still exist.
It is therefore possible that even in the event Darlington does not
resume its operations so as to enable the discharged employees to be
reinstated there, the job rights of these discharged employees may
still be afforded a measure of protection. We direct, therefore, that
in the event the Darlington plant is not reopened, Deering-Milliken
shall offer employment to the discharged employees, if they desire, in
its other mills in South Carolina or adjacent States without prejudice
to their seniority and other rights and privileges, to the extent that
positions are available in such plants. Available positions shall be
distributed among the discharged employees in accordance with
Deering-Milliken's usual method of operation under curtailed produc-
tion, without discrimination against any employee because of union
affiliation or activities, following the system of seniority, if any, cus-
tomarily applied by Deering-Milliken. However, in order not to
injure innocent third persons presently employed in the other mills,
we shall not require that such persons be dismissed or otherwise prej-
48 Since it appears from the record that Deering, Milliken & Co., Inc , was merged with
Cotwool Manufacturing Company into a third corporation, Deering, Milliken, Incorporated,
we shall make our order also run against the last-named corporation.
DARLINGTON MANUFACTURING COMPANY, ETC. 259,
udiced in order to carry out the reinstatement ordered herein. Any
remaining discharged employees for whom no work is available under
the foregoing arrangement shall be placed upon a preferential hiring
list, and shall thereafter, in accordance with such list, be offered em-
ployment in their former or substantially equivalent positions as such
employment becomes available and before other persons are hired for
such work 49
We shall also order the Respondent Deering-Milliken to offer to,
pay employees the travel and moving expenses entailed in moving
their families and household effects to other mills in the event em-
ployees accept such offers of reinstatement.'('
It has been found that the Respondents Darlington and Deering-
Milliken violated Section 8 (a) (5) and (1) of the Act by refusing to.
bargain in good faith with the Union as the exclusive representative
of the employees in the Darlington mills. As we have indicated above
in our discussion of the remedial action to be taken by Respondent
Darlington, it is impossible for us to accord to the Union the bar-
gaining rights which normally attach to a Board certification unless.
the Darlington plant is reopened. Absent that contingency, how-
ever, we shall partially restore those rights by requiring Respondent
Deering-Milliken to bargain with the Union for the purpose of reach-
ing an agreement as to the mode of operation of the preferential hiring-
lists, and as to the terms and conditions under which the former
employees of the Darlington mills may, if they desire, obtain employ-
ment at other mills in South Carolina and adjacent States 81
With respect to the liability of Roger Milliken, as an individual,,
we do not believe the charge filed against ". . . Roger Milliken, Presi-
dent, ..." is sufficient to support a complaint against Roger Milliken
as an individual. Section 10(b) has long been regarded by the Board
and the courts as a statute of limitations and the test of the sufficiency
of a petition to toll the running of such a statue has been stated to be
(2 Moore's Federal Practice, 2d ed., sec. 4.44, p. 1042) :
Whether on the basis of an objective standard, it is reasonable
to conclude that the plaintiff had in mind a particular entity or
person, merely made mistake as to the name, and actually served
the entity or person intended; or whether plaintiff actually meant
to serve and sue a different person.
Here there is no cogent evidence that the Charging Union erred in
naming Roger Milliken in his capacity as president of Darlington.
The charge clearly names Roger Milliken as president, an office in
which he served at the time, and there is no evidence that any other
40 Sidele Fashions, Inc., et al, 133 NLRB 547, enfd . 305 F. 2d 825 (C.A. 3).
60 Sidele Fashions, Inc., at al., supra.
m Cf. Brown Truck and Trailer Manufacturing Company, Inc., 106 NLRB 999, 1003.
672010-63-vol. 139-18
260 DECISIONS OF NATIONAL LABOR RELATIONS BOARD
person of this name served the other Respondents in any capacity.
The charge itself, although filed against two entities and Roger Mil-
liken, president, speaks in the singular of the "employer" and thus
does not suggest that Roger Milliken, individually, was regarded as
an employer separate and apart from his position as president. The
offer of proof by the Charging Union at the first hearing which led
to the remand for determination of the single employer status of
Darlington and Deering-Milliken also indicates that Roger Milliken
was charged, as president, because in that capacity he served as a
connecting link between the various corporations. Applying an ob-
jective standard we conclude that it was intended to charge Roger
Milliken in his representative capacity as president and not as an
individual and that the charge will therefore not support the
complaint.
ORDER
Upon the entire record in this case, and pursuant to Section 10(c)
of the National Labor Relations Act, the National Labor Relations
Board hereby orders that the Respondents :
A. Darlington Manufacturing Company, Darlington, South Caro-
lina; Deering-Milliken & Co., Inc., New York, New York; and Deer-
ing, Milliken, Incorporated, New York, New York; their officers,
agents, successors, and assigns, shall, jointly and severally:
1. Cease and desist from :
(a) Refusing to bargain collectively with Textile Workers Union
of America, AFL-CIO, as the exclusive representative of all the em-
ployees in the unit found appropriate by the Board, with respect to
rates of pay, wages, hours of employment, and other conditions of
employment.
(b) Discouraging membership in Textile Workers Union of
America, AFL-CIO, or in any other labor organization of their em-
ployees, by a plant closing and by discharging their employees, or by
discriminating in any other manner in respect to their hire and tenure
of employment or any term or condition of employment.
(c) Threatening to close down an operation or to blacklist the em-
ployees if they select a union as their collective-bargaining representa-
tive, interrogating the employees concerning union membership and
activities in a manner constituting a violation of Section 8(a) (1) of
the Act, supporting a petition disavowing Textile Workers Union of
America, AFL-CIO, as the collective-bargaining representative of the
employees, or ascribing the closing of the plant to the employees'
union activities.
(d) In any other maner interfering with, restraining, or coercing
employees in the exercise of the right to self-organization, to form
labor organizations, to join or assist Textile Workers Union of
DARLINGTON MANUFACTURING COMPANY, ETC. 261
America, AFL-CIO, or any other labor organization, to bargain col-
lectively through representatives of their own choosing, and to engage
in other concerted activities for the purpose of collective bargaining
or other mutual aid or protection, or to refrain from any or all of
such activities, except to the extent that such right may be affected by
an agreement requiring membership in a labor organization as a con-
dition of employment, as authorized in Section 8 (a) (3) of the Act.
2. Take the following affirmative action which the Board finds will
effectuate the policies of the Act :
(a) Upon request, in the event that the Respondents resume opera-
tions at Darlington, South Carolina, bargain collectively with Textile
Workers Union of America, AFL-CIO, as the exclusive representative
of the employees in the unit found appropriate by the Board, and em-
body in a signed agreement any understanding reached.
(b) Make whole all the employees who were on the payroll on
October 13, 1956, for any loss of pay suffered by reason of the dis-
crimination against them, and offer employment to all those employ-
ees, in the manner set forth in the section herein entitled "The
Remedy."
(c) Preserve and, upon request, make available to the Board or its
agents, for examination and copying, all payroll records, social se-
curity payment records, timecards, personnel records and reports, and
all other records necessary for determination of the amounts of back-
pay due under the terms of this Order.
(d) Advertise once each week for 8 weeks in the News and Press,
Darlington, South Carolina, and in the Florence Morning News,
Florence, South Carolina, and mail to the last-known address of each
employee on the payroll on October 13, 1956, copies of the attached
notice marked "Appendix A." sa Copies of such notice shall be fur-
nished by the Regional Director for the Eleventh Region and shall
be duly signed by the Respondents' representatives.
(e) Notify the Regional Director for the Eleventh Region, in
writing, within 10 days from the date of this Order, what steps Re-
spondents have taken to comply herewith.
B. Deering, Milliken & Co., Inc., and Deering, Milliken, Incorpo-
rated, shall take the following affirmative action, in addition to that
set forth above, which the Board finds will effectuate the policies of
the Act :
1. Bargain collectively with the Textile Workers Union of
America, AFL-CIO, to the extent required, with respect to the re-
instatement of their employees in the manner set forth in the section
herein entitled "The Remedy."
52 In the event that the Board's Order is enforced by a decree of a United States Court
of Appeals, the notice shall be amended by substituting the words "Pursuant to a Decree
,of the United States Court of Appeals, Enforcing an Order" for the words "Pursuant to
a Decision and Order."
262 DECISIONS OF NATIONAL LABOR RELATIONS BOARD
2. Mail to the last-known address of each employee on the payroll
of the mill at Darlington, South Carolina, on October 13, 1956, copies
of the attached notice marked "Appendix B." 59 Copies of such notice
shall be furnished by the Regional Director for the Eleventh Region
and shall be duly signed by the Respondents' representatives.
3. Notify the Regional Director for the Eleventh Region, in writ-
ing, within 10 days from the date of this Order, what steps Respond-
ents have taken to comply herewith.
IT IS FURTHER ORDERED that the Board hereby reserves to itself the
right to modify the backpay and reinstatement provisions of this
Order, if made necessary by circumstances not now apparent.
IT IS FURTHER ORDERED that the complaint against Roger Milliken,,
as an individual, be, and it hereby is, dismissed.
MEMBER LEEDOM, concurring in part and dissenting in part :
I agree with my colleagues of the majority in this case, except in
two respects.
Unlike them, I would find, in agreement with the Trial Examiner,.
that Darlington and Deering-Milliken and its affiliated corporations,
did not occupy a single-employer status and, as Darlington alone en-
gaged in the unfair practices found, I would dismiss the complaint as
to the remaining corporate respondents. I believe that no single-
employer status exists for the reasons indicated by the Trial Examiner
in his Intermediate Report and particularly for the reason that there
is here an absence of common ownership within the meaning of the-
decided cases. Emphasizing this conclusion is the fact that, while
members of the Milliken family own stock in all the corporations in-
volved, all such members do not own stock in each of the corporations.
It would, in these circumstances, be an extension of the decided cases
to hold that there was, in fact, common ownership of these
corporations.
I further depart from the majority with respect to the backpay
remedy. My colleagues order Darlington to provide backpay from
the date of the discrimination found until the discharged employees
are able to obtain substantially equivalent employment or are placed
on a preferential list. For the reasons stated in Barbers Iron Foundry,
126 NLRB 30, and in the main opinion in M. Yoseph Bag, 128
NLRB 211, I would award backpay only from the date of the dis-
crimination to the date when the Darlington plant closed.
In all other respects, I concur in the majority decision.
MEMBER RODGERS, dissenting :
The principal issue in this case, whether Darlington, Deering-
Milliken, and the various other named corporations, constitute a single-
6' See footnote 52, supra.
DARLINGTON MANUFACTURING COMPANY, ETC . 263
employer within the meaning of the Act, is not, as the Trial Examiner
has fully stated, entirely free from doubt.
However, the burden of proof on this issue rests upon the General
,Counsel, and like the Trial Examiner, and unlike my colleagues, I
am constrained to find that, on the record before us, that burden of
proof has not been met.
This conclusion is, I feel, consistent with the Board's holding in
the recently issued Knight Newspapers 54 case in which it was pointed
out by the Board that, notwithstanding the fact of single ownership
(a fact which I might interpolate is open to serious question here) the
potentiality of common control and integrated operation is not a
sufficient basis to support a finding of single employer. I do not be-
lieve this case is substantially different, factually, from the newspaper
case, in that while there is much to indicate a potentiality of control
and integration, the actuality of such elements has not been established.
I would therefore conclude, on the basis of this record, that only
Darlington is properly before us in this case. I would dismiss the
complaint as to Deering-Milliken and other Respondent corporations.
Now as to the case against Darlington, I agree with my colleagues
insofar as they find a violation of 8(a) (1) based upon the interroga-
tion of employees by the Respondent and the statements made before
and after the representation election.
However, as to the finding of the 8 (a) (3) violation, and as to the
remedy ordered by the majority, I must respectfully disagree 55
The question to be resolved with respect to Darlington is the im-
portant and fundamental question of whether or not Darlington vio-
lated the Act by liquidating its plant and going out of business. My
colleagues have found that such a going out of business constitutes
a violation of law which must be remedied by this Board. I do not
agree.68 For-constitutional issues aside-there is nothing in the
basic Act nor in any amendment thereto which limits an employer's
right to go out of business at such time and under such circumstances
64 Miami Newspaper Printing Pressmen Local No . 4 6 (Knight Newspapers, Inc ), 138
NLRB 1346
sa It goes without saying, of course , that I disagree with so much of the remedial order
which is predicated on the majority' s finding of "single employer," and the resultant
Involvement of Deering.Milliken and the other corporations in remedying the unfair labor
practices found by them.
511 deem it an exercise in semantics to indicate , as some have done, that while it con-
etitutes a violation of law to go out of business , such action constitutes a violation for
which no remedial order can issue by virtue of the fact that the Respondent " has gone out
of business ." Likewise, I deem it an exercise in semantics to say that the law does not
interfere with the "right" to go out of business , but that a remedy in behalf of any
aggrieved party will attach if the right is exercised . Surely the type of remedy being
applied in this class of case, involving , as it does, heavy backpay liabilities which may
well run on indefinitely unless the enterprise is reestablished and the employees rehired,
is sufficiently harsh to render illusory the existence of, and effectively extinguish the exer-
else of, any such "right" to go out of business.
264 DECISIONS OF NATIONAL LABOR RELATIONS BOARD
as he chooses 57 As stated by the Court of Appeals for the Eighth
Circuit in N.L.R.B. v. New Madrid Manufacturing Company and
Harold Jones, d/b/a Jones Manufacturing Company: 511
... But none of this can be taken to mean that an employer
does not have the absolute right, at all times, to permanently close
and go out of business, or to actually dispose of his business to,
another, for whatever reason he may choose, whether union ani-
mosity or anything else, and without his being thereby left sub-
ject to a remedial liability under the Labor Management Relations
Act for such unfair labor practices as he may have committed in
the enterprise, except to the time that such actual and permanent
closing or true and bona fide change in ownership has occurred.
No one can be required to stay in private business, and no one can
be prevented from permanently closing or abdicatingly selling
such a business. And the Act affords no basis on which to order
a person to reinstate employees in a business which he has, with
plain finality, put out of existence, or which he has actually dis-
posed of to another, and as to which he neither in law nor in fact
possesses any power over the operations of his successor, either
of management right in general or of labor-relations control in
particular. Cf. Southport Petroleum Co. v. N.L.R.B., 315 U.S.
100, 106, 62 S. Ct. 452, 456, 86 L. Ed. 718, 726. No more, in our
opinion, can the Act be said to contain any basis to assess remedial
back-pay against such a person, beyond the date of his permanent
closing or abdicating sale of the enterprise. [Emphasis supplied.]'
er While the legi'lntive history of the law reflects no detailed consideration of this point,
such comments as can be found indicate that Congress gave no serious consideration to
the limiting of so fundamental a right as the employer's right to go out of business. For
example , Senator Walsh, chairman of the Senate Labor Committee, during the debate on
the Wagner Act stated: "Mr. President, there are some fundamental rights an employer
has, just as there are rights an employee has. No one can compel an employer to keep
his factory open. No one can compel an employer to pay any particular wage. No one
can compel an employer to hire others in addition to those he sees fit to hire So with
an employee ; no one can compel him to work, no one can compel him to go on strike, no,
one can compel him to leave his work.
"No one can keep an emioyer front closing down his factory and putting thousands of
men and women on the street . So in dealing with this bill we have to recognize those
fundamental things, and we have not gone into that domain. All we do is to remove the
barriers that have kept employees away from their employers , which have prevented
collective bargaining , which have resulted in strikes without any attempt to negotiate.
All we have done is to promote the orderly processes of collective bargaining." [ Emphasis
supplied .] 79 Cong. Rec 7673, 74th Cong, 1st sess . (1935).
Also, Congressman Griswold, during the House debate on the same bill stated , in answer
to a question : "There is nothing sn the bill to keep an operator from closing his plant. . . .
[ Emphasis supplied ] 79 Cong Rec 9682, 74th Cong., 1st sess. ( 1935).
58 215 F. 2d 908, 913-914.
DARLINGTON MANUFACTURING COMPANY, ETC. 265,
APPENDIX A
NOTICE TO ALL EMPLOYEES
Pursuant to a Decision and Order of the National Labor Relations
Board, and in order to effectuate the policies of the National Labor
Relations Act, we hereby notify our employees that :
WE WILL NOT discourage membership in Textile Workers Union
of America , AFL-CIO, or in any other labor organization of
our employees , by plant closings and discharging our employees
or by discriminating in any other manner in respect to their hire
and tenure of employment or any term or condition of
employment.
WE WILL NOT threaten to close down a plant or operation, or
blacklist our employees , if they select a union as their collective-
bargaining representative , interrogate our employees concern-
ing union membership or activities in a manner constituting a
violation of Section 8(a) (1) of the Act, support a petition dis-
avowing bargaining representative of our employees , or ascribe
the closing of our plant or operation to our employees' union
activities.
WE WILL NOT in any other manner interfere with , restrain, or
coerce our employees in the exercise of the right to self-
organization, to form labor organizations , to join or assist Textile
Workers Union of America , AFL-CIO , or any other labor or-
ganization , to bargain collectively through representatives of
their own choosing , and to engage in other concerted activities
for the purpose of collective bargaining or other mutual aid or
protection , or to refrain from any or all of such activities , except
to the extent that such right may be affected by an agreement
requiring membership in a labor organization as a condition of
employment, as authorized in Section 8(a) (3) of the Act.
WE WILL , in the event that we resume operations at Darlington,
South Carolina , bargain upon request with Textile Workers
Union of America , AFL-CIO, as the exclusive representative of
our employees in the bargaining unit hereinafter described, with
respect to rates of pay, wages , hours of employment , or other
conditions of employment, and embody in a signed agreement
any understanding reached. The bargaining unit is :
All production and maintenance employees at Darlington
Manufacturing Company's textile plant at Darlington, South
Carolina , including firemen , slasher foremen, and supply
room clerks , but excluding office clerical employees , profes-
sional employees , watchmen , guards, and all supervisors as
defined in the Act.
266 -DECISIONS OF NATIONAL LABOR RELATIONS BOARD
WE WILL make whole all the employees who were on our pay-
roll on October 13, 1956, for any loss of pay suffered as a result
of our discrimination against them.
WE WILL, in the event we resume operations at Darlington,
South Carolina, offer reinstatement to all employees who were
on our payroll on October 13, 1956, without prejudice to their
seniority and other rights and privileges.
All our employees are free to become, remain, or to refrain from
becoming or remaining members in good standing in Textile Workers
Union of America, AFL-CIO, or in any other labor organization,
except to the extent that such right may be affected by an agreement
,in conformity with Section 8 (a) (3) of the Act.
DARLINGTON MANUFACTURING COMPANY;
DEERING, MILLIKEN & CO., INC.; DEER-
ING, MILLIKEN, INCORPORATED,
Employers.
Dated---------------- By-------------------------------------
(Representative ) ( Title)
NOTE.We will notify any of the above-named employees presently
serving in the Armed Forces of the United States of their right to
reinstatement upon application in accordance with the Selective Serv-
ice Act after discharge from the Armed Forces.
This notice must remain posted for 60 consecutive days from date of
posting, and must not be altered, defaced, or covered by any other
-material.
Employees may communicate directly with the Board's Regional
Office, 1831 Nissen Building, 310 West Fourth Street, Winston- Salem,
North Carolina, Telephone Number, 724-8356, if they have any ques-
tion concerning this notice or compliance with its provisions.
APPENDIX B
NOTICE TO ALL EMPLOYEES OF DARLINGTOW MANUFACTURING COMPANY
Pursuant to a Decision and Order of the National Labor Relations
-Board, and in order to effectuate the policies of the National Labor
Relations Act, we hereby notify the employees of Darlington Manu-
facturing Company that :
WE WILL bargain upon request with Textile Workers Union of
America, AFL-CIO, to the extent required with respect to the
mode of operation of a preferential hiring list by which the em-
ployees formerly employed by the Darlington Manufacturing
DARLINGTON MANUFACTURING COMPANY, ETC. 267
Company, at Darlington, South Carolina, may obtain employ-
ment at other of our mills in South Carolina and adjacent States.
DEERING, MILLIREN & CO., INC. ; DEERING,
MILLIE;EN, INCORPORATED,
Employers.
Dated---------------- By--------------------------------------
(Representative) (Title)
This notice must remain posted for 60 consecutive days from the-
date of posting, and must not be altered, defaced, or covered by any
other material.
Employees may communicate directly with the Board's Regional
Office, 1831 Nissen Building, 310 West Fourth Street, Winston-Salem,
North Carolina, Telephone Number, 724-8356, if they have any ques-
tion concerning this notice or compliance with its provisions.
INTERMEDIATE REPORT AND RECOMMENDED ORDER
With the closing of the mill, the salient issue in this case is whether such closing
and the discharge of employees was discriminatory in violation of Section 8(a)(3)
of the National Labor Relations Act, as amended, 61 Stat. 136. The questions of
violation of Section 8(a)(1) of the Act by interrogation, threats, surveillance, sup-
port of a disaffiliation petition, and statements connecting plant closing with the
union victory; and of Section 8(a)(5) by refusal to bargain have become, relatively,
less significant.
This is pointed up by the problem of remedy which must arise with any finding
of violation of Section 8(a)(3). The major problem in the case, however impor-
tant, interesting, and difficult the other questions involved, is to find an adequate
and lawful remedy for discriminatory discharges where the employer has discon-
tinued its operations and sold its plant and equipment. The Company has no other
mill or operation and, we are told, does not intend to operate this mill again. Post-
poning consideration of the question whether the Act was violated,' our immediate
concern is that, after it is found that violation occurred, the element of continued
operation, but for the violation, and the period thereof are left undetermined.
A different aspect is pointed up by the General Counsel's argument, underscored'
by the Union, that a violator should not be permitted to go scot free, and that a
requirement be imposed of payment into the indefinite future or at least for a limited
but fixed period. But this would reflect a punitive aspect which the statute lacks .2
The problem is not solved by eloquent arguments which would show that the em-
ployees are entitled or are not entitled to continued payment of wages according to
some abstract notion of "elementary justice" or on the basis of a sympathetic under-
standing which may favor one side or the other.
However valiant the efforts, which I welcomed and encouraged so that an effective
and lawful remedy might be fixed if violation were found, it has not been established
with the certitude or definiteness which the law requires that, but for the discrimina-
tory motive, the plant would still be in operation or that it would have continued in
operation in whole or in part to a certain date after operations were in fact ter-
minated. The Board may apply its expertise in determining whether a violation has
been committed and also in directing a remedy. But not even expertise can substi-
tute for or provide proof of loss where none is otherwise shown. Neither may we,
as we seek to effectuate the policies of the Act, transcend the requirement that the
extent of loss be shown at least generally if there is to be a direction to make whole.
Even with respect to those operations which first ceased, in the spinning room,
since an inventory of warp yarn had been accumulated for use on wider looms which
I This, of course, was not the order in which the questions have in fact been weighed
and determined But, without minimizing the others, the most difficult problem before-
us is that of the remedy
2 Consolidated Edxaon Co of New York , Inc v N.L R.B, 305 U . S. 197 , 235-236; Republio-
Steel Corporation v. N L R B, 311 U S. 7, 11-12
268 DECISIONS OF NATIONAL LABOR RELATIONS BOARD
had been purchased-even as to such operations, while their termination is found
to have been discriminatory and part of the overall violation, we cannot say that but
for such violation those operations would have continued for any definite additional
period.
It follows that, despite a finding of discrimination, there can be no apparently
effective remedy: the Company is not to be directed to reemploy (except in the
event, not now foreseen, that it resumes operations) or to make whole by backpay.
One recalls that in other branches the law allows reasonable compensation although
opinions may differ as to the amount. For example, reimbursement is permitted
for loss of goodwill and even for loss of profits; in some jurisdictions recovery for
the latter may be denied because of the speculative nature of any determination,
while in others, a definite basis for recovery being recognized, it is permitted although
opinions may differ as to the amount to be allowed. To cite one additional instance,
inexact determinations are made in compensating for injuries and suffering in personal
injury actions, but only after the general extent of the loss or damage has been
ascertained. It can be seen that in such cases there is a fixed basis for the determina-
tion even if that basis allows for different evaluations. Where, after the decision to
compensate, there is a basis or rule, sometimes inexact in its application, for determin-
ing the amount of compensation, the law proceeds further and declares that amount.
In the instant case, there can be a decision to compensate; but we have no rule or
basis for fixing the amounts. Despite its ability to clear many obstacles, the con-
cept of making whole is too unruly a steed to be allowed to take us in unmarked
directions and over uncharted terrain without the restraint of a guiding hand.
It has been urged that we proceed on the assumption that, but for the discrimina-
tion, the plant would still be operating, as it had been; and that the remedy be fixed
accordingly. Alternatively, that backpay be imposed to cover an additional year's
employment. Or, should those proposals be rejected, that compensation be paid for
22 weeks, the period during which unemployment compensation payments are locally
made. There is as much basis for adopting one of these proposals as there is for
any of the others; but no sufficient basis for any. There is no more basis for direct-
ing pay to the date of closing, for those employees who were earlier discharged,
between the date of decision to close and the date of closing, as their work ran out;
or supplemental pay for those who worked fewer hours. While the shutdown itself
is found to be discriminatory, there is no evidence of discrimination in the manner in
which that shutdown was effected Orderly liquidation calls for progressive shut-
down by jobs and departments Only if a later date for closing were determined
could it be shown that those first laid off would have been employed longer than they
were; and in that case a similar finding could be made for the other employees.
In the Mount Hope case,3 reinstatement was directed with backpay "to the date
when (the respective employees) normally would have been discharged" absent the
discrimination. It was there left for later determination whether economic factors
would have dictated later closing and, if so, when. Setting this aside, the circuit court
commented with respect to the quoted phrase: "How the latter date could possibly
have been determined the Board does not venture to say and the record does not
indicate " 4 The General Counsel admits that it is "impossible" to direct reinstate-
ment and backpay as if the Company were still operating, in effect to put Humpty
Dumpty together again. The Board did not seek review of the court's decision in
the Mount Hope case (I draw no conclusion from this), nor has it had occasion to
declare itself on this point since that decision. The General Counsel and the Union
here appear to have accepted the court's decision in this connection as, in proposing
remedies, they have made an effort to show that the mill would have or should be
considered likely to have operated for certain periods beyond the dates when the
various operations were successively terminated.
Since we here seek to make whole, there is no basis for directing reinstatement
or payment of lost earnings without the date to which the employees would other-
wise have worked and when the plant would otherwise have closed if at all. This
brings us back to the Mount Hope Finishing case. Neither the arguments nor the
proposals submitted to me warrant a backpay order even though, counsel for the
Company to the contrary nothwithstanding, an "injury cognizable by law has oc-
curred." It seems that this is not a subject for the application of either wit or
wisdom in setting a remedy while the case is decided Whatever ingenuity may
accomplish as the Board or the court may seek to effectuate the policies of the Act,
3 Mount Hope Finishing Company, et al , 106 NLRB 480, 500
4 N L.R B. v. Mount Hope Finishing Company, 211 F 2d 365, 369 (C A 4) (The basis
for the reversal of the finding of discrimination in that case, that long before the union
made its appearance management was seeking another location, is not here present.)
DARLINGTON MANUFACTURING COMPANY, ETC. 269
I transmit the case in reliance on existing authority .5 We leave to other authority
the analysis of conditions which prompt and develop from such a situation, and the
decision whether the Act should be amended.
A hearing was held before Trial Examiner Lloyd Buchanan at Florence and
Darlington, South Carolina, from January 15 to 17 and February 19 to 27, 1957,
all dates inclusive. Prior to the hearing and at the Union's request, subpenas and
subpoenas duces tecum were issued addressed to Deering, Milliken Service Corpora-
tion; Deering, Milliken & Co., Inc., and Roger Milliken individually and as an officer
of Deering, Milliken & Co., Inc. Petitions were thereafter filed with the Regional
Director to revoke said subpenas, and were referred by the Regional Director for
ruling by the Trial Examiner at the hearing. The petitions were considered by me
together with the Union's answer thereto. In the arguments concerning the sub-
penas, no distinction was made between the subpoenas ad testificandum and the
subpoenas duces tecum. With respect to the former, Roger Milliken was present
and testified at the hearing; whatever his capacity or position, his examination was
limited, as noted, to the issues before us.
It appears that the Regional Director had earlier denied the Union's application
to take the deposition of Roger Milliken and the two other companies. On the
petitions to revoke subpenas, the General Counsel took no position. The amended
charge herein was brought against the Respondent Company and also against Roger
Milliken, its president, and Deering, Milliken & Co., Inc.; but the complaint was
issued against this respondent only. It is evident that from the inception of the
proceeding there has been a difference between the General Counsel and the Union
concerning the scope of the proceeding. This difference was further manifest as
counsel for the Union sought to extend examination of witnesses despite the limita-
tion of the complaint. It is the General Counsel's function to determine who shall
be respondents, and his is the primary burden of presenting the evidence. His posi-
tion is to be accepted rather than the Charging Party's where there is a difference
between the two. (The General Counsel further informed us that the Board has
investigated and at the time of hearing was still investigating the relation between
the Respondent and the other two companies.)
With that limitation and the further agreement at the hearing to avoid litigation
of events at other mills, the attempts by the Union, without the support of the General
Counsel, to extend the scope of the hearing and of examination of witnesses were
barred. Thus, for example, he offered statements by Milliken in October 1955 and
January 1956 as evidence of the latter's hostility to union labor. But these state-
ments made reference to mills elsewhere, and the General Counsel noted that they
should be taken in their entirety or not at all. Without exploring the situation at
those other mills, we cannot determine whether the facts there justified critical
remarks or whether these merely reflected hostility. There would thus be no basis
for evaluating such statements. Further details concerning the respective positions
and the rulings made, including the fact that Deering, Milliken Service Corporation
was not properly served with subpenas and the fact that the Union did not claim
or show that it had material information but was merely exploring possibilities for
their potential relevance, were set forth on the record.
After lengthy and eloquent argument by counsel for the Union and for the re-
spective subpenaed persons, I granted the petitions to revoke, with a statement of the
5In thus relying on the final decision In the Mount Hope case on the question of back-
pay, I would point out that the question which the court there posed concerning determina-
tion of the date when employees "normally would have been discharged" was not here
answered although specifically put to counsel Tennessee-Carolina Transportation, Inc,
108 NLRB 1369, cited by both the Union and the Company, is readily distinguishable
In connection with the question of remedy, I would also refer to i7 S. v. Minute Maid
Corp (Civil No. 6429-M, S D. Fla ), where the consent judgment provided, inter alia, for
maintenance of facilities, as follows
,(C) Defendant Minute Maid shall take such steps as are necessary to maintain
said frozen concentrate facilities at the standard of operational performance for the
production of frozen concentrates in effect at the time of the entry of this Final Judg-
ment. Pending such disposition of facilities defendant Minute Maid shall not permit
said facilities to be diminished in capacity or to be turned to uses other than the
production of frozen concentrates, where such use would in any manner, impair the
capacity of such facilities for the production of frozen concentrates.
That wholly different situation may provide a point of reference for further consideration
of adequate remedies in unfair labor practice cases. But what some will regard as
precedent will be, by others , distinguished ; consent in one case does not indicate authority
to decree in another.
270 DECISIONS OF NATIONAL LABOR RELATIONS BOARD
grounds for the rulings, which referred to the various points raised by counsel.
While the exclusion by the General Counsel of the issue of privity between the
Respondent company and other companies has not prevented findings of violation,
it has perhaps limited the remedy since we have no evidence that other mills are
in privity with the Respondent.
Pursuant to leave granted to all parties, briefs have been filed by the General
Counsel, the Company, and the Union, the time to do so having been extended.
Upon the entire record in the case, and from my observation of the witnesses,
I make the following:
FINDINGS OF FACT (WITH REASONS THEREFOR)
1. THE COMPANY'S BUSINESS AND THE LABOR ORGANIZATION INVOLVED
It was admitted and I find that the Company, a South Carolina corporation with
principal office and place of business in Darlington, South Carolina, manufactures
and sells cotton greige goods; and that during the calendar year it manufactured and
sold finished products valued at more than $6,500,000, more than 90 percent of
which was sold and shipped to customers outside the State, and purchased raw
materials, supplies, and equipment valued at more than $3,380,000, more than 92
percent of which was shipped in interstate commerce to the Darlington plant from
points outside the State. I find that the Company is engaged in commerce within
the meaning of the Act.
It was admitted and I find that the Union is a labor organization within the -mean-
ing of the Act.
II. THE UNFAIR LABOR PRACTICES
A. Outline of events
The Union initiated its organizing campaign at the Company's plant in or about
March 1956. Some 16 meetings were held between May 6 and September 2, all
in a public park outside the town of Darlington. On May 22, the Union sent to
the Company a letter claiming that a majority of the employees had joined the
Union, and requesting recognition and a collective-bargaining conference. On the
following day the Union filed a representation petition with the Board. After a
hearing on June 19, the Board, on August 24, issued its Decision and Direction of
Election. The unit, admitted herein to be appropriate for the purposes of collective
bargaining, was therein fixed as follows:
All production and maintenance employees at the Darlington plant, including
firemen, slasher foremen, and supply room clerks, but excluding office clerical
employees, professional employees, watchmen, guards, and all supervisors as
defined in the Act.
The election was held on September 6: of 523 eligible voters, 256 voted for
the Union, 248 against. On September 11 the Company objected to the election,
but the Board's Acting Regional Director, on October 8, recommended that the
objections be dismissed. (The Company did not produce any witnesses in support
of its objections to the election since at the time of the investigation there was a
recommendation from its board of directors that the plant be liquidated. We
need not decide whether, as the General Counsel claims in the face of a stipulation,
as above noted, the filing of the objections was a dilatory tactic by the Company.
The refusal to bargain is found, infra, to have occurred on September 12, when
the board of directors met, the day after the Company filed its objections.) On
October 24 the Board issued its Supplemental Decision and Certification of Repre-
sentatives, in which the Union was certified as the collective-bargaining representative
of the employees in the unit.
Between September 7 and 10, Milliken, the Company's president, arranged for
a meeting of its board of directors for September 12, at which time he submitted
and the board adopted a recommendation to the stockholders that the plant be
liquidated. Thereafter the Company accepted no new orders, there being suffi-
cient orders on the books to keep the plant in full operation for a time. On Octo-
ber 17 the stockholders voted to shut down operations and liquidate the plant. The
plant was thereupon advertised for sale at public auction. Beginning on October 18,
as the material on hand was utilized and the work ran out, employees were dis-
charged and departments closed, and all operations were terminated on November 24.
At the auction sale on December 12 and 13 the plant was offered for sale as a whole
but then sold piecemeal for a greater sum. There is no claim that the sale was
not to bona fide purchasers for value.
DARLINGTON MANUFACTURING COMPANY, ETC. 271
B. The alleged violation of Section 8(a) (3)
Without consideration of interests and associations, events, or statements else-
where, the General Counsel proved his case that the plant was closed and the em-
ployees discharged because of union membership and other lawful concerted ac-
tivities. Counsel for the Union, as did a witness on the stand, charged Milliken
with lack of regard for employees' welfare and undue concern with return on in-
vestment. This is not the forum to weigh, much less to judge, pan investor's attitude.
But as more emphasis is thus placed on financial consideration, there tends to be
a detraction from the significance of any discriminatory intent. Despite these
charges, the finding here will not be based on either counsel's argument or the
witness' characterization.
Since the Korean war the industry generally and the Company in particular had
faced constant difficulties. It is unnecessary to recount here the detailed evidence,
testimonial and documentary, which I have carefully parsed, or to recapitulate the
expert analyses submitted by counsel. Conditions varied from year to year, some-
times better thanin 1956, sometimes worse; as much may be said of the outlook
or prospects at various times. The facts in this connection do not themselves indicate
that the Company was compelled to or did, because of either economic factors or
outlook for the future (aside from election indications), decide in 1956 to discontinue
its operations. This finding, based on the mass of evidence submitted, is bolstered
by the Company's own decisions and plans for the future, made prior to the date
of the election, as we shall soon see.
Most impressive was the ingenuity displayed by the Company through the years
as it turned to new methods,and new products to meet competition. The evidence
in this connection as an eloquent tribute to the competitive free enterprise system.
Coming to 1956, there is no evidence that ingenuity suddenly vanished. On the
contrary, the great abilities which had enabled the Company to overcome past ob-
stacles reasonably warranted the expectation of continued success into the immediate
future at least. Having said this, we must add that the Company had every right
in 1956 and earlier to cease operations for economic or any other nondiscriminatory
reasons-even if someone had decided that he was "just too tired" to exercise his
ingenuity. Not only would I not suggest that operations were highly profitable;
but even if they had been, there would be no concern over a nondiscriminatory sus-
pension or cessation of business. Reference has been made to these economic con-
ditions because they have been cited in defense to the charge of violation. In
stating this defense, we must note that the Company does not rest on these conditions
per se but rather points to them as background or as a cumulative cause when
taken with its interpretation of the election results, which is considered infra.
Whatever the economic circumstances, up to the date when the board of directors
recommended liquidation, physical improvements were made at the plant and new
-equipment was being purchased and installed with the evident intent to continue
the plant in operation. Previously authorized, the improvement program was still
in progress up to the election although the board of directors who thereafter de-
cided to liquidate could earlier have discontinued that program. Whatever the
economic circumstances, until the election, orders were taken and accepted, clearly
with the intent to continue the plant in operation, and warp yarn had been ac-
cumulated for the new looms which were to be installed. One need not gainsay
these economic circumstances. But, although the balance sheets and the related
statements of income and surplus show that there was and for a long time had
been economic basis for liquidating and that the Company could have relied there-
on, the record shows that they did not themselves compel or prompt the liquidation .6
If other mills were compelled, by economic factors, to close, it is true as its counsel
argues that the Company here did not have to stand like a soldier until struck
down. It might have sought cover-and discontinued operations. But the new
factor here was not failures elsewhere and the Company's inability to keep pace;
it was the "Boo!" of the election The deciding or triggering element in the steps
taken to liquidate was the outcome of the election. Because of the emphasis placed
on these economic factors as the evidence was presented and because of their
importance in the conduct of the business, it should be made clear again that the
issue before us is not so much whether the officers, directors, and stockholders of
the Company were correct in their beliefs concerning economic conditions and out-
6 If termination is due partly to union activities and partly to acts or conditions which
would warrant lawful discharge, the Act is violated. N.L R.B. v. Jamestown Sterling
Corp., 211 F. 2d 725, 726 (C.A. 2).
272 DECISIONS OF NATIONAL LABOR RELATIONS BOARD
look as whether it was those beliefs or discriminatory motives which prompted the
shutdown and liquidation.?
We need not, as we might, rely on the very time sequence, the Company's board
of directors recommending immediately after the Union won the election, that the
plant be closed and the Company liquidated, as proof that the Company's decision
and action were based on organization of the employees. Milliken specifically de-
clared the effect of the designation of the Union as collective-bargaining representa-
tive even while he claimed that it was and must be considered with the other condi-
tions existing. Apparently recognizing that "The abruptness of a discharge and
its tuning are persuasive evidence as to motivation," B the Company ably advances
the contention that its action on September 7 and 12 and thereafter was based on
conditions dehors the election, and that the election merely emphasized those con-
ditions; the defense being that the decision to shut down was based on economic
factors, and the election merely aggravated the situation. The Company, we are
told in this connection, considered to be most important "the attitude of the
worker toward his job." But whatever the phraseology, and I am quite willing
to accept any other which will correctly represent the facts and the evidence, it
is clear that the immediate and the moving factor was the election result.
On the morning of September 7, the day after the election, Milliken was informed
of the election tally. He requested his attorney, Poag, to come to Spartanburg,
South Carolina, and later that day they there discussed the matter. In response
to Milliken's question, Poag explained that the Union had won the election be-
cause the union organizers had built up the employees' resistance to the Company's
"program of work assignment changes in line with the installation of new ma-
chinery"; Poag further declared his opinion that such resistance meant that the
employees "would not cooperate with the installation of work assignments with
the new machinery," and that the union literature had created an obstacle in the
minds of the employees by opposition to what it termed the "stretch-out" and by its
emphasis on increased wages. (We shall further consider, infra, the historical
"hard core" of resistance.) In response to Milliken's question, Poag agreed that
the Union's election victory foretold additional resistance with the result that the
Company would not be able to make its production competitive.
Milliken reviewed in his mind the various economic factors, and then over the
telephone discussed all of the considerations with three of the Company's directors
in New York, as well as with the successor, later elected, to one of them. It was
tentatively agreed to call a meeting of the board of directors for September 12,
and with agreement obtained on September 10 from the three directors in Darling-
ton, the meeting was called and held. (It appears from the testimony of Deland,
treasurer of the Company, that the local directors were not told before September 12
what the purpose of the meeting was.) As these events are appraised, we should
note Milliken's testimony that the election did not cause the liquidation; but it
constituted a factor in calling the meeting of the board of directors, and further
that it caused a review by the directors of all of the factors. This was a special
meeting, not one called in the usual course or in advance of the closing of the
Company's fiscal year.
But as we have seen, and even if we accept the Company's interpretation of and,
conclusions from the financial data which it submitted, the various factors and con-
ditions cited, including keen competition and allegedly low earnings but excluding the
election and its interpretation, had faced the Company for a long time-certainly
through a period during which it made permanent improvements and planned more.
(Concerning the financial data submitted, where comparison is made with respect
to earnings at various plants, consideration must be given to the fact that basic
conditions were not alike at those plants. Thus, the mills differed in size and pre-
sumably in setup and extent of mechanization, and certainly in the types and quality
of their products.) Whether in 1956, 1954, 1952, or any other time, the Company
could have pointed to obstacles apparently insurmountable, and to difficult condi-
tions in the industry as a whole. We could not, nor need we, have shown how the
various earlier problems were to be solved. We need point out only that the Com-
pany itself in 1956 and up to the election had indicated its willingness to meet all
of the obstacles and solve all of the problems which it has cited (except the problem
which, in its opinion, was indicated by the election results themselves). I do not
7 Under the principle of Rabin Bros Footwear, Inc, 99 NLRB 610 we would consider,
if necessary, whether the Company had a valid basis for such appraisal as would have
warranted a shutdown for economic reasons.
8 N L R.B. v. Montgomery Ward h Co , Inc , 242 F. 2d 497 (C.A. 2), citing E. Anthony,
f Sons, Inc. v. N.L.R B., 163 F. 2d 22, 26-27 (C A.D.C.).
DARLINGTON MANUFACTURING COMPANY, ETC. 273
minimize these. Nor need I find that the Company could have successfully over-
come all difficulties which it faced in 1956. It may be that, absent the election, a
decision would lawfully have been made to shut down in 1956 or shortly thereafter.
(This last issue, left open, has a bearing on the remedy ) No more than by the
Union's propaganda to employees, infra, are we to rely on or be affected by the
auctioneer's puffing of the mill as modern and up-to-date or the Company's news
release issued with the sale in mind. For present purposes I find only that the
Company's decision to shut down was an about-face motivated by its employees'
concerted activities as reflected in the election results. The extent of this about-
face is reflected in the fact that 523 employees were on the payroll just before the
plant closed as compared with 550 at peak production. (These figures appear to
include only employees in the unit Very slightly different figures were also men-
tioned ) The plant operated on three shifts, 6 days per week, for a total of 144
hours per week generally and until September 12.
The limitation on improvements, which the construction, shape, and age of the
building imposed, had previously been considered by the Company. These con-
ditions had not prevented the extensive improvements made to the date of the board
of directors' meeting. If the directors had several times previously discussed the
matter of additional improvements and "felt that the future was too uncertain, and
the facts concerning the building, itself, were too adverse to justify making such an
expensive factor (or investment) whenever it was brought up," these conditions were
not the moving consideration on September 12. As much can be said of the other
factors cited such as the trend toward wider cloth, other mill closings, falling prices,
and the number of new styles being produced; all had been considered, the improve-
ment program extended, and plans made and carried out to continue operations.
(Even had new conditions or factors developed, the triggering element was, as we
have and shall again see, the election results.)
A textile engineering survey had been made for the Company in the summer of
1955. Some improvements were thereupon made with the evident intention to con-
tinue operations despite construction handicaps. As for disappointment in the lack
of progress following installation of improvements, this had been noted and discussed
through the years.
The election was again underscored for its evidence of uncooperative attitude
when, although the rate of earnings at the mill was cited as one of the factors which
dictated the closing here, Milliken explained that he proceeded elsewhere with a
modernization program despite a lower rate of return-because the workers there
were more cooperative. The cooperation shown at Darlington, or the lack of it,
had not prior to the election cast the situation in a light worse than existed at the
other plant. Certainly a modernization program had also been followed at
Darlington.
While included in the many factors cited by the Company but which have been
found not to have triggered the shutdown and discharges, three so-called "new
factors should perhaps be further considered if only because of the greater emphasis
placed on them at the hearing and for the possibility that, arising later than the other
factors, they rather than the election results may have prompted the shutdown. (In
any event we would have to remember Milliken's testimony concerning the effect
of the election and the further fact that although these new factors had faced the
Company prior to the election, it had nevertheless planned to continue production.)
One of the new factors which the Company faced was, as Milliken testified, a
projected loss of 6 cents per pound on the products which it manufactured in 1956
if they were carried into 1957 with the same costs and the same prices. (We need not
consider whether the capital improvements made in 1956, which indicate the intention
to continue in business, were included in projecting a loss of 1957.) From the fact
that the Company had in prior years found it necessary to change its construction
or products, one can reasonably infer that losses were at those earlier times also
anticipated if the then current constructions were continued. This condition in
1956 was therefore not a new factor. The Company might have continued as in
earlier years and might have developed new and profitable constructions on 1957 as
it had before. The history of production and sales as detailed in the record indi-
cates that a regular and unchanging element was the factor of change. Further in
connection with this projected loss, the drop in market price had been steady through
the first 6 months of 1956 and therefore hardly a new factor in September. A loss
projected for the future would be based on the assumption that the price would
remain the same, whereas prices fluctuate; it would also assume that, while prices
continued lower, costs would remain the same. Actually, the $480,000 annual loss
or difference to the Company suggested by Milliken on the basis of the drop in prices
between January and June was not realized. A loss of $40,000, projected for 1956
by Oeland at the September meeting, had been considered in August by Milliken but,
274 DECISIONS OF NATIONAL LABOR RELATIONS BOARD
had not apparently been discussed with the other directors. On the other hand,
Oeland had not anticipated a shutdown, but was planning further improvements.
A second factor which the Company faced in 1956 was a wage increase granted
at other mills and the loss which would result were it granted at Darlington. Some
may view such an increase as an additional burden; others as an indication of a better
outlook. But however this might be construed, there was no requirement that an
increase be granted. Any concern which the Company may have had in this respect
could have been made known to the Union in at least preliminary exploration during
the course of collective bargaining. Whether or not the Company had maintained
a competitive wage level in the past, there was no sufficient basis on which the
directors, in Milliken's words, "could fairly conclude that they were either going to
have to raise wages or face an expensive strike." Campaign propaganda to the
contrary notwithstanding, the Company, had it been willing to recognize and nego-
tiate with the Union, could have attempted to obtain information and even a possible
commitment on this item. The increase not granted during such discussion, that
element of loss would be nonexistent. (It appears from later testimony by Milliken,
that the Company had been paying wages higher than the average for the industry in
South Carolina. This would suggest less need for an increase or need for less of
an increase to maintain a competitive wage level.) 9
The third new factor cited was the increase in textile imports from Japan. Fig-
ures submitted appeared to include textiles of a type different from those manufactured
at Darlington. But whatever those figures do show, it appears that the great threat
and actual increase in imports had occurred at the end of 1955 and the beginning
of 1956. Despite any problems caused by and the results of Japanese imports, and
whatever the expressions of optimism or pessimism in Government circles and in
the textile industry, the Company had continued to operate and, into the beginning
of September, had no intention of discontinuing. There was limited reference to
other mills in this connection, no objection being made thereto presumably because,
and correctly if so, whatever the overall situation at those other mills, the parties
in interest at those mills, including Milliken, who has interests in many, believed that
the threat of Japanese competition in 1957 did not preclude the wage increase there
granted. It does not appear that production and earnings outlook at these other
plants differed from those at Darlington, or that the import problem here was more
serious. Milliken testified that he was not encouraged by the statement by a govern-
ment official in September 1956 that the Government was seeking to work out a
solution to the problem of Japanese imports, rather, he saw seeds of future trouble.
But he testified that, although he did not rely on it, he credited that statement and
announced a wage increase in other mills, effective October 8. This may indicate
that his immediate concern over economic prospects had been generally lessened.
While it was an "old" condition, another adverse factor was cited by the Com-
pany as having been aggravated. It thus may be considered as at least partially
"new": the resistance by employees to work assignments and general refusal to
cooperate with management. We recall the testimony that the Union's election
victory was interpreted by the Company as indicating the growth of this resistance
to the point where profitable operation would no longer be possible (as Milliken
informed the stockholders on October 17). Milliken testified that whatever hope
the Company had had to meet competition "had diminished as a result of the elec-
tion" because of the Union's campaign promises and statements and because a
majority of the employees had voted in favor of the Union. Oeland had -through
the years referred to a small group or hard core of the employees who had
resisted assignment changes; even the signing of a protest petition in 1952 by 95
percent of the employees had not disturbed Milliken to the point of making an
inquiry. But formal organization of the employees, reflected in the election results,
now brought action.
It is one thing for management to cite a condition which prevents operation;
it is quite another to equate .the result of a Board-conducted collective-bargaining
representative election with establishment or evidence of such a condition. The
latter conclusion, if permitted to stand as a defense, would create built-in inter-
ference with the statutory right to select a collective-bargaining representative. We
are told in the Company's brief that "[t]he union's victory was not susceptible to
any other interpretation" than that it "meant further efforts to cut the mill's costs
would be impeded or halted." To allow an employer to cite an election tally as
the cause or proximate cause or even triggering factor for a decision to suspend
operations would be to undercut the statutory election machinery. In the instant
case we have no evidence of employee resistance after September 6 greater than
e Although here and elsewhere specific factors or issues are considered , we must not lose
sight of the determining point: the results of the election prompted the action taken.
DARLINGTON MANUFACTURING COMPANY, ETC. 275
existed before the Company took steps to liquidate its assets. The Company could
not lawfully point to the election results per se as evidence of such resistance or
anticipated resistance. It does not help the Company to say that the election results
did not arouse its resentment but caused an impartial review of all of the factors;
and therefore to liken the situation to a tornado or fire as an act of God. Other
considerations aside in comparing this with an act of God, the Act forbids such
action as was here taken because of the election results; it does not forbid such
action in cases of tornado or fire.
As for campaign propaganda and promises of greater pay and improved work-
ing conditions, expressed at union meetings, in letters to employees, or elsewhere,
the Company may no more rely on these as dictating conditions which it would
have to establish than it is required by law to grant them in response to union
requests. Such statements are not to be equated with violence as an unprotected
activity; employees' membership in a union and their concerted activities are spe-
cifically protected, even encouraged, by the Act. To treat the Union's propaganda
as reflecting an inflexible position assumed not only by the Union but also by the
employees is to impose a penalty on lawful election tactics. (Some of the Union's
letters were the basis for objections to the election, which were overruled.) Just
as there is many a shp in the bargaining process between demand and agreement, so
may that process not be circumvented by assumption that an agreement must mirror
the demands. Whether demands are excessive or unreasonable may be considered
at the bargaining table; the granting of demands, in whole or in part, is certainly
the subject of such consideration: it is no foregone conclusion, as both unions and
employers well know. An employer, by anticipating, not only union demands but
even the need to grant such demands, may not close its plant to prevent negotiation.
No more is an employer to assume that such charges as that management is rotten
to the core, included in a union's propaganda, has permanently poisoned employees'
minds so that they will no longer properly perform their functions. The Com-
pany did not act when the statements were made, but only after the election, when
it construed the tally as proof of such poisoning and consequent recalcitrance.
This is another example of building interference into the election process.
The factors cited were sufficient to support a decision to terminate operations;
certainly it cannot be said that such a decision could not reasonably, or even un-
reasonably but credibly, be based on those factors. It might not have been neces-
sary under the circumstances for Milliken to apply the rowels to his fellow directors
and stockholders. Thus we do not ignore the existence and the contributory effect
of the various reasons or factors It may be that, had economic conditions been
different, the plant would have been continued in operation despite the election
results; we need not speculate on that. But the facts and the evidence concerning
them lead to the finding and conclusion that the decision to close the mill was not
in fact based on economic factors, and that, but for the Union's election victory,
that decision would not then have been made. It is undenied that, when Milliken
was told immediately after the stockholders' vote on October 17 that 83 percent of
the employees had petitioned to return to work, he .replied that he would not run
the mill so long as there were 17 percent of the hard core crowd. (He had taken
no action when Oeland reported to him over the years that there was a resisting
minority, perhaps 20 percent.) This might be found to indicate that, regardless of
the other factors cited, the existence of a hard core of union adherents itself prompted
the decision to liquidate or barred a reversal of that decision But it is unnecessary
to make such a finding We have seen that termination due to a mixture of reasons,
some lawful and others not, violates the Act.io Further, as Milliken testified, the
election constituted a factor in calling the meeting of the board of directors, and
caused a review of all of the factors It does not appear that the "problem .
would have compelled attention," certainly not the attention and action which it
received, but for the Union's election victory. As a matter of law it must be held
that, with new and expensive equipment acquired and installed as late as September
1956, such a decision which would not have been made but for the protected organ-
izational activities interferes with such activities; and the consequent discharges are
discriminatory within the meaning of itheAct ii
10 Footnote 0, supra
'-The Company is quite correct in its statement that the criterion is the situation as it
existed in 1956, and not as it exists today. The footnote nevertheless appended to its
brief, while indicating that prices have recently slumped to an 8-year low, discloses further
that there was a "buying flurry" last autumn, when a high was reached-a condition
which at that time would presumably have pointed to continued operation.
672010-03-vol 139 19
276 DECISIONS OF NATIONAL LABOR RELATIONS BOARD
In addition , if the result of the election prompted a review of all of the factors
which bore on the question of continued operation , that review and the decision to
close the plant, so connected with the election and even if not discriminatory (as with
respect to employees not in .the unit ), would constitute interference within the mean-
ing of the Act since it would tend to discourage freedom of choice at elections. The
remedy for such interference can be similar to that where discrimination is found.12
To show a predisposing tendency or animus on the part of the Company, counsel
for the Union elicited testimony concerning company reference to the alleged ideology
or sympathies of union leaders. Counsel for the Company offered to prove such
ideology, but even if proved it would not be a defense.
Various supervisors ' statements concerning closing of the plant, which are found
infra, reflect the discriminatory motive here found. Although , as we shall see, those
statements warrant the findings of interference by the respective supervisors, they
are not shown to have reflected any declaration by Milliken . Those statements are
therefore not relied on in the instant finding of company motive
(Because of the Company 's position on the effects flowing from its right to go
out of business , it may be helpful to consider the cases which are cited in its brief
and the arguments there made to the extent that they are not elsewhere covered
herein, and even with some repetition . On the finding that it was no longer in
business , the New Madrid case 13 limited the employer 's liability; it did not grant
absolution . The distinction , it must once again be said , is between finding of
violation and declaration of remedy.
The Company thereafter argues that "motivation loses all significance when the
employer permanently quits business ." But the cases cited in support of that proposi-
tion exculpate the employer in each case because it acted from economic considera-
tions. Not only does motivation not lose all significance , but the analysis of each
case, as submitted in the Company 's brief, specifically stresses motivation.
Since several times herein I indicate recognition of its practical significance, I do
not question the statement : "Searching out motives in such a case is futile; the em-
ployer has ended his existence as an employer ." But again , futility or absence' of
remedy does not determine the issue of violation (Actually, we are not entirely
without remedy here . even if it be not very effective.)
Other cases cited, in which it was found that the employer "had been considering"
moving or closing, or that it was otherwise not motivated by antiunion considera-
tions, differ in those respects from the instant case Finally, unlike the Martel Mills
case , 14 the decision here can be based , as has been indicated several times supra, on
the Company 's own explanation of the cause or causes of its action.
C. The alleged violation of Section 8(a)(5)
The Board has held 15 that, by layoffs in violation of Section 8 ( a)(1) and (3) of
the Act, a company "created an atmosphere in which the `free opportunity for
negotiation ' (N.L.R.B . v. Jones & Laughlin Steel Corporation , 301 U S. 1, 45)
contemplated by the Act did not exist ," and thus failed to bargain in good faith, in
violation of Section 8(a)(5) although negotiations were being maintained. A
fortiori is there a failure to bargain in good faith in the instant case , where the acts
in violation of Section 8(a)(3) were so complete as to discourage and ultimately
thwart the Union from pursuing its right to bargain . As it is discriminatory
against its employees , so does it constitute a refusal to bargain for an employer,
on the basis of a union 's campaign propaganda , oral and in writing, concerning
improved working conditions and greater pay, to anticipate demands and compulsion
to grant such demands, and therefore to terminate its operations and avoid
bargaining.
The instant case can be contrasted with the recent Leeds Shoe Storer, Inc., case,ls
where the Board held proper an employer 's unilateral reduction of the workweek
to conform with that of other employers and "in accordance with ( a) predetermined
timetable ." Whereas the employer there properly questioned the union's majority,
the Company here admittedly made its decision after the Union had requested
(as we shall see ) and prima facie proved its right to recognition. -
At issue here are also the date since when the Union is to be found to have rep-
resented the employees , whether there was a refusal to bargain , and, if so, when.
12 Rome Specialty Co, Inc , 84 NLRB 55
12 NL R B v New Madrid Mawufaeturnia Company and Hai old Jones, d/b/a Joiics
Manufacturing Company, 215 F 2d 908 (C A 8)
'4 Martel Mills Corporation v N L R 13., 114 F 2d 624 (C A 4)
,6 American Brake Shoe Company, Ramapo A9ax Division , 116 NLRB 820, 833
16117 NLRB 585
DARLINGTON MANUFACTURING COMPANY, ETC. 277
The complaint alleges that on or about September 6, 1956, and thereafter, the Union
requested the Company to bargain, and sets that date as the date when the Company
refused to bargain. The answer, on the other hand, declares that not until October 31
did the Union request the Company to meet with it; that they did meet on Novem-
ber 7, when the Union offered no proposals, and that there have been no further
requests to meet. While the complaint alleges that the Union has been the em-
ployees' representative since September 6, the date of the election, the answer cites
the date when the Board issued its certification, October 24.
Absent other violations from which it infers earlier refusal to bargain, the Board
declares a union to have been the collective-bargaining representative since the date
of its certification. Where interference prevents an election, the request for recogni-
tion is noted: in such cases an informal showing of majority may be relied upon
and the employer, presumed to have sought in bad faith to have awaited Board
certification, is found to have refused to bargain on the date of the request for
recognition.
The General Counsel here argues that the refusal to bargain "culminated" when
the decision was made to liquidate the plant; he has urged the date of September 7,
when Milliken learned of the election result, and certainly no later date than
September 12, when the board of directors recommended liquidation. The recom-
mendation of its board effectively constituted the decision of the Company, and it
was so declared when the stockholders met on October 17. The directors them-
selves represented a majority of the stock, and the Company's estimate of the ef-
fectiveness of their decision may be gauged by the fact that, although objections to
the election were filed on September .11, the Company did not produce any witnesses
in support of its objections in view, as was stated at the hearing, of the recommenda-
tion to liquidate We have seen also that, in anticipation of the stockholders'
adoption of the directors' recommendation of September 12, no new orders were
thereafter accepted. Similarly, structural changes which had been begun were
immediately halted, and it was decided to use the warp yarn which had been
accumulated for the new machines which had been anticipated. On the day of
the board of directors' meeting, a union representative asked the Com-
pany's attorney to arrange a bargaining conference, but was told to wait
until after certification by the Board. The violation which pointed and led to
the closing of the plant and which was set in motion that day indicates that the
refusal to bargain on September 12 was in violation of the Act. The Company's
attitude was formally and finally declared on October 17; it had existed and had been
indicated on September 12. As in the cases where an election is prevented, we
may, in fixing the date when the Union represented the employees, go back to the
date when the Union proved (formally in this case) its majority. Clearly it rep-
resented a majority on September 6 even if certification was delayed.
I find therefore that since September 6, 11956, the Union has been the collective-
bargaining representative of all of the employees in the unit; and that since
September 12 the Company, in violation of the Act, has refused to bargain with the
Union.
As to any bearing on refusal to bargain which might be seen in violations noted
infra and which occurred prior to September 12, we must first consider the question
of waiver of those which occurred prior to the Direction of Election on August 24 17
Also, those violations, while attributable to the Company, do not prove bad faith on
the part of those who were responsible for indicating the Company's willingnes or
refusal to bargain. (Only Milliken and Oeland had that status )
The Company and the Union did thereafter meet on November 7, at which time
the Company submitted information concerning vacations, holidays, the incentive
plan, and other fringe benefits. Information concerning wages was refused, the
Company declaring that there was no point in furnishing this since an irrevocable
decision to liquidate had already been made. Depending on circumstances, a deci-
sion to shut down and imminent closing might justify a refusal to submit informa-
tion and negotiate. As the union representative said at that time concerning any
proposal, bargaining would be "pretty empty" in view of the Company's irrevocable
decision to liquidate
But we have seen that the decision to liquidate was in violation of the Act. Being
violative, it could not justify a refusal to bargain or, as part of that process, to submit
information needed to bargain. As for irrevocability of the decision to close, the
same stockholders who had voted to close the plant could reverse their decision
Certainly the Union was entitled to the information, both in order to bargain for
1' Aiello Dairy Farms Co, 110 NLRB 1365,1366-1369, Alexander Manufacturing Com-
pany, 110 NLRB 1457, 1460
278 DECISIONS OF NATIONAL LABOR RELATIONS BOARD
a contract and, as representative of the employees, to attempt to persuade the com-
pany not to close the plant. We need not hold that the Company was obliged to
submit information for use by the Union in discussions with prospective purchasers
of the plant: the refusal to bargain would be found in the Company's refusal to
submit the information for use by the Union, whether effective or not, in discussions
with the Company itself. It may well be that the Union's last request for informa-
tion, in a letter dated November 26, when it was quite clear that the plant was
going to be sold, was made with an eye to negotiating with prospective purchasers.
But whatever the situation at that time, the Company had earlier refused to bargain,
as has been found.
D. The alleged independent violation of Section 8(a) (1)
Although they have not abandoned the allegations of independent violation neither
the General Counsel nor the Union has covered this facet in their briefs; the General
Counsel did allude to it in his closing argument. The Company's argument and
brief have been no more detailed or comprehensive in this connection. Quite in
agreement with all counsel, I recognize that, relatively, this is a minor aspect of
the case. Out of deference to the mass of evidence received, I shall give it some-
what more attention than have counsel in their concentration on the more important
issues
1. Surveillance
The Union's meetings were held on Sunday afternoons in an open pavilion in a
public park about 2 miles from town. The pavilion is not walled, and anyone walk-
ing or driving along the highway nearby could see people under the pavilion roof.
Payton, the Union's southern director, testified that the public was invited to the
meetings, written invitations were sent out, and some may have been sent to com-
pany supervisors. He explained, "We had no secrets." Two supervisors each at-
tended one or more of these meetings, having received invitations in the mail ad-
dressed to them. If the letters addressed recipients as "Dear TWUA Member," I
would not charge these supervisors, having observed them, for overlooking such
limitation. In any event, with respect to the presence of these or other supervisors,
the Union's attitude may well have been known to the employees, and the location
of the meetings made it clear to them that the Union had no secrets." We therefore
cannot assess against the Company any tendency to interfere with organizational
activities if such tendency did adhere to the presence of the supervisors. In this
light, a request that an employee keep a company representative posted on union
activities or tell him who attended meetings would not tend to interfere with em-
ployees' union activities any more than would surveillance by a supervisor himself.
2, Telling employees the plant would be closed because the Union had organized it
H. A. Campbell, a spare hand, testified that on October 5, in the office, he broached
the subject of the Union and asked Oeland, the general manager, how the situation
looked. Oeland replied that it looked very dim and that "if the union was out the
mill would run and definitely in the mill would close." Oeland more credibly
placed the incident on September 21, explained Campbell's presence in the office,
and testified that Campbell, exhibiting what he said was a copy of an affidavit re-
quested "by certain people up town to be used in an effort to throw out the election,"
asked whether such an affidavit "would help the situation any"; and that he replied
that he "took a dim view of it being helpful." I find no interference here.
Immediately after the board of directors' meeting on September 12, the various
supervisors were told to inform their employees of the recommendation to close
so that the first news of it would not be via the newspaper on September 13. Good-
win, the Company's production supervisor, thereupon told employee Cook that the
Company had made a mistake when they hired him and that he (Goodwin) hoped
that Cook would be satisfied when he had all of the unemployed on his conscience.
Goodwin explained that he was disturbed and spoke in anger because he too would
lose his job. Similarly, early in the morning of September 13 Goodwin asked em-
ployee Andrews whether the union badge had done him any good, and told him that
he had better start hunting another job. Notice of the recommendation to close
might properly be given to the employees before word of it appeared in the news-
paper But to connect the closing, as Goodwin did, with union activities tends to
interfere with such activities, in violation of the Act.
The other supervisors also transmitted the news to their employees. It is un-
necessary here to try to determine to what extent, if any, in each case the closing
was connected with the election either in the telling or as the employee's own infer-
DARLINGTON MANUFACTURING COMPANY, ETC. 279
ence although in some cases the violation is_ clear even if the supervisor was in-
forming the employee, as when Passmore voiced an I-told-you-so to employee
Harrelson.
3. Threats
It is also alleged and I find that on or about September 11 Goodwin told employee
Johnson that in any recommendation he would have to say that she was a good
hand but that, by her own admission, she had voted for the Union. The necessity
for the latter information in any recommendation is not apparent; the threat of
blacklist in Goodwin's remarks is, and the Act was thereby violated. Employee
Harrelson testified also to a threat of blacklist by Passmore, her second hand. Black-
list threats before the election are not alleged although there is testimony concerning
such.
It was testified by various employees without contradiction that overseers and
second hands, all of them supervisors, had said that the mill would close if a union
came into the plant. Such statements are threats in violation of the Act. It is un-
necessary to resolve the issue whether any supervisors attributed such a threat to
Milliken since, even if they did, we would have no more than a similar offense
chargeable to the Company without sufficient proof to charge it against top man-
agement generally or Milliken personally. The statements attributed by supervisors
to Milliken could be found violative only for their restraining effect on employees;
they could not be considered proof that Milliken had in fact so threatened. Nor need
we pursue the issue whether some of these supervisors threatened to discharge em-
ployees for union membership or activities. "It is not meet that every nice offence
should bear his comment." 18
Shortly before,the election (whether before or after the Direction of Election on
August 24 does not appear) the Company posted on bulletin boards throughout
the plant a series of four posters, two of which were received in evidence. One,
under the caption, "Which Will You Choose" depicts -a plant in operation and
one closed. Underneath the pictures is printed:
The records prove that TWUA-CIO has caused many textile mills to close,
ending jobs and bringing hunger and privation to people who want to work.
Where that happens, only the money-hungry union dues collectors benefit-
everybody else loses.
DON'T LET THREATS OF VIOLENCE OR VOTE
FANCY PROMISES DESTROY YOUR JOB NO!
The other poster is entitled "TWUA-CIO `BENEFITS' FOR WORKERS," and
contains what appears to be copies of almost 20 newspaper reports of violence in
connection with various strikes, union strike defeats, and employees' loss of jobs.
The words, "Do You Want This?" appear at some half dozen places on the poster.
The clippings shown refer to the Union and incidents elsewhere.
These posters do not appear to be a threat of loss which would result from any
actions taken by the Company. They appear, rather to be expressions of "opinion,
based on experience, that the employees would lose . benefits because [the Union]
would not faithfully represent their interests." 19 (The reasonable effect or tendency
of these posters is not to be judged in the light of subsequent events.) I would
not find that the overall impression of the posters, weighing any suggestion in the
pictures against the reading matter, constitutes a threat, or that they tend to interfere
with concerted activities, in violation of the Act.
4. Support of a disavowal petition
Employee King testified that when another employee brought her a petition which
was being circulated for disavowal of the Union, her second hand, Kinsey, came up
and told her that two other employees were "100% for it " Kinsey offered no
explanation, and it seems that he appeared on the scene to encourage her to sign
the petition. This was unlawful interference. Kinsey also asked employees M B.
ii Julius Caesar, act IV, scene 3, line 7 Cf United Association of Journeymen and
Apprentices of the Plumbing and Pipefitting Industry, etc., Local 428 , Plumbers, APL
(Frank W Hake, et at ), 112 NLRB 1097, 1102: " the extensive violation findings of
the Trial Examiner, which we have adopted, and the warrant they provide for the broad
remedial order we shall issue herein, render unnecessary any decision with respect to the
foregoing incidents , which the Trial Examiner either passed upon or failed to pass
upon. . . "
i9 Nash -Finch Company, 117 NLRB 808
280 DECISIONS OF NATIONAL LABOR RELATIONS BOARD
Gainey and G. E. Truett to get employees to sign the petition to help keep the mill
open.
King testified also that she had asked her overseer, Shirley, "what kind of a paper
was it that was going around ." She later testified that she "thought he would give
[her] advice on what [she] wanted to know." She did not ask whether she should
sign the paper. Shirley told her that he did not know what kind of a paper it was,
but he wanted her to sign it. That she had not asked for "advice" on signing is clear
from her determined reply that she would not sign it. Thereafter, Shirley one day
said to her, "Well, I see you didn't sign the petition like I asked you and you are
going to suffer." Shirley testified in this connection only that King asked whether,
if he were she, he would sign the petition; and that he replied that he did not see
where it would help her, and "I have never seen it and I don't know what it is but
I don't think it would hurt you any if you did." I find that Shirley did ask King
to sign the petition. While it does not appear to have instigated the petition, the
Company in these and a few other instances (not all have been alleged) unlawfully
encouraged employees to disavow the Union as their collective-bargaining repre-
sentative after it had won the election.
5. Interrogation
A few weeks before the election, H. W. Campbell, an overseer, asked employee
Whitley how she felt about the Union. Employee Grant testified that in May Camp-
bell asked her whether she had attended a union meeting the day before and had
signed a union card. Campbell testified that he wanted to see how Grant stood,
and that he asked whether she was for or against the Union. Overseer Shirley
admitted questioning various employees concerning the Union and their 'stand.
There is no need to list all of the instances of questioning of employees by super-
visors concerning the Union and their activities and attitude toward it. Interroga-
tion of employees was not isolated, even if we exclude questions concerning union
meetings for the reasons noted supra, and in the context of the violations found, it
constitutes interference within the meaning of the Act.
III. THE EFFECT OF THE UNFAIR LABOR PRACTICES UPON COMMERCE
The activities of the Company set forth in section II, above, occurring in connection
with the operations described in section I, above, have a close, intimate, and
substantial relation to trade, traffic, and commerce among the several States, and tend
to lead to labor disputes burdening and obstructing commerce and the free flow of
commerce.
IV. THE REMEDY
Having found that the Company has engaged in and is engaging in certain unfair
labor practices affecting commerce, I shall recommend that it cease and desist
therefrom and take certain affirmative action in order to effectuate the policies of the
Act.
Cease-and-desist recommendations and conditional recommendation for affirmative
action will be made although I would not undertake to refute the argument that in
the existing circumstances they are futile. If this adds up to no effective remedy,
no acceptable alternative has been indicated or appears to be warranted. Some
may irreverently say that we have been flogging a dead horse. Others, quoting
the bard, that we have an "airy nothing." Except for the publication of a notice,
recommendations for affirmative action will be made dependent on resumption of
operations.
It has been found that the Company refused to bargain collectively with the Union
thereby interfering with, restraining, and coercing its employees. I shall therefore
recommend that the Company cease and desist therefrom and also, upon request
in .the event that the Company resume operations, bargain collectively with the Union
with respect to wages, hours, and other terms and conditions of employment, and
embody in a signed contract any understanding reached.
It has been further found that the Company, by ascription of the closing of the
plant to union activities, threats, support of a disavowal petition, and interrogation,
interfered with, restrained, and coerced its employees in violation of Section 8 (a) (1)
of the Act. I shall therefore further recommend that the Company cease and desist
therefrom.
It has been further found that the Company, by closing the plant and discharging
its employees, discriminated against them in respect to their hire and tenure
of employment in violation of Section -8(a)(3) of the Act. (As to those not in
the unit, Section 8(a) (1) was violated.) The record shows that, on or about
DARLINGTON MANUFACTURING COMPANY, ETC. 281
October 15, as his work fell off (with the extra warp yam on hand, some operations
ran at less than capacity between September 12 and October 17), employee Andrews
quit his job to seek full-time employment. While we cannot say how much more
work he would have had but for the discrimination, the decision to accept no more
orders and to shut down the mill led to the drop in work and thus to his quitting.
Employee Kelly, who quit on October 15 to take another job, appears also to have
been constructively discharged. That question with respect to any of the employees
can be determined on compliance should it develop further. There is no evidence
of wholly voluntary quittings or of discharges for cause after September 12. I
shall therefore recommend that, in the event that the Company resumes operations, it
offer immediate reinstatement to their former or substantially equivalent posi-
tions,20 to all employees who were on the payroll on September 12, without prejudice
to their seniority and other rights and privileges. Positions when available shall be
distributed among employees on a preferential basis according to such system of
seniority or on such other nondiscriminatory basis as heretofore has been applied
in the conduct of the Company's business. Because of the unusual circumstances, I
shall further recommend that the Board reserve the right to modify the reinstate-
ment provision of its Order. Loss of pay shall be based upon earnings which the
employees normally would have earned from the date of the discrimination against
them, to the date of their reinstatement, less net earnings, computed on a quarterly
basis in the manner established by the Board in F. W. Woolworth Company, 90
NLRB 289; N.L.R.B. v. Seven-Up Bottling Company of Miami, Inc., 344 U.S. 344.
It will also be recommended that Respondents preserve and, upon request, make
available to the Board payroll and other records to facilitate the computation of the
backpay due.
It might appear to be almost sadistic, not against the Company but against the
Union and the General Counsel, to direct that the Company post notices by advertise-
ments in local newspapers. But the Union has so requested and, if such advertise-
ments will lessen the effect on employees and potential employees of the inter-
ference, discrimination, and refusal to bargain, they may serve a worthwhile purpose
and effectuate the policies of the Act. In this small community, the employees can
be expected to acquire full knowledge of the advertisements. With the plant closed,
there is no reason, except punitive, to direct mailing of notices to the employees
The unfair labor practices found herein indicate a purpose to limit the lawful
concerted activities of the Company's employees. Such purpose is related to other
unfair labor practices, and I find that the danger of their commission is reasonably
to be apprehended. I shall therefore recommend a broad cease-and-desist order,
prohibiting infringement in any manner upon the rights guaranteed in Section 7 of
the Act.
Upon the basis of the above findings of fact, and upon the entire record in the
case, I make the following:
CONCLUSIONS OF LAW
I Textile Workers Union of America, AFL-CIO, is a labor organization within
the meaning of Section 2(5) of the Act.
2. All of the Company's production and maintenance employees at its Darlington
plant, including firemen, slasher foremen, and supply room clerks, but excluding
office clerical employees, professional employees, watchmen, guards, and all super-
visors as defined in the Act, constitute a unit appropriate for the purpose of collective
bargaining within the meaning of Section 9(b) of the Act.
3 Textile Workers Union of America, AFL-CIO, was on September 6, 1956, and at
all times since has been the exclusive representative within the meaning of Section
9(a) of the Act, of all employees in the aforesaid unit for the purposes of collective
bargaining
4 By refusing to bargain collectively with Textile Workers Union of America,
AFL-CIO, as the exclusive bargaining representative of the employees in the
appropriate unit, Darlington Manufacturing Company has engaged in and is engag-
ing in unfair labor practices within the meaning of Section 8(a)(5) of the Act.
5. By discriminating in regard to the hire and tenure of employment of its em-
ployees, thereby discouraging membership in a labor organization, the Company
has engaged in and is engaging in unfair labor practices within the meaning of Sec-
tion 8(a)(3) of the Act.
6 By such refusal to bargain and discrimination and by ascribing the closing of
the plant to union activities, threatening a blacklist and closing of the plant if the
=o The Chase National Bank of the City of New York, San Juan, Puerto Rico, Branch,
65 NLRB 827
282 DECISIONS OF NATIONAL LABOR RELATIONS BOARD
Union came in, supporting a disavowal petition , and interrogating employees concern-
ing union membership and activities , thereby interfering with, restraining, and
coercing employees in the exercise of the rights guaranteed in Section 7 of the Act,
the Company has engaged in and is engaging in unfair labor practices within the
meaning of Section 8 ( a) (1) of the Act.
7. The aforesaid labor practices are unfair labor practices affecting commerce
within the meaning of Section 2(6) and ( 7) of the Act.
[Recommendations omitted from publication.]
SUPPLEMENTAL INTERMEDIATE REPORT AND
RECOMMENDED ORDER
This is a report after three rounds of what, if not for any championship , may yet
be regarded as a historic fight. As referee with the additional duty to explain my
decision , mine is not to reason the why of all this. But one can wonder whether
more progress toward a determination of the problems here would not have been
made, once the complaint was issued in the form determined by the General Counsel
in 1956, had the issues presented in the original hearing and covered in the first
Intermediate Report herein, that of April 30, 1957, been passed upon as urged
exactly 2 years ,ago.
These thoughts intrude on our present consideration since however strictly we
apply ourselves to the items of fact , which are myriad, and the issues of law, which
are novel and difficult , we realize that there has for a long time persisted a very
real and practical situation which, if not clamoring for decision , has certainly war-
ranted one : on the one hand more than 500 employees no longer employed and
clearly not bargained for; on the other, pendant charges of violation of the law
and hundreds of thousands of dollars tied up with the threat of liability running into
millions as time elapses . The delay is underscored by the provisions for priority
handling in the new Section 10(m) of the Act, effective November 13, 1959
Nor have these been 3-minute rounds. The extent of the problems first presented
was hinted at in the remand order of December 1957. The third hearing, based on
an additional complaint , represented an attempt to have ditto marks inserted under
the findings and conclusions of the first so that they would apply to the individual
respondent. The second hearing, on which we must now report , was an inquiry
into the relations among various corporations as indicated by lengthy and detailed
oral testimony and examination of almost 400 documents which themselves were,
as we were informed , the distillate of many thousands earlier examined . Darlington
and other companies have here been viewed paradigmatically in an exhaustive exam-
ination of its various activities and their nature.
Extreme effort needs neither apology nor defense . But such effort has been mani-
fest here in the hours of preparation , hearing, and argument . The concept of public
service and recognition of the rights of litigants give rise to the hope that the prob-
lems here involved will before long be resolved.'
We might at this time consider the words of Mr. Justice Holmes: "And it seems
to me that at this time we need education in the obvious more than investigation
of the obscure "2 The hearing which this Supplemental Intermediate Report covers
has been an education in the obvious : existence of many corporate entities is recog-
nized and the facts concerning their relations largely agreed upon or admitted. But
findings and conclusions to be developed from those facts are disputed and, with
the claim that the corporate setups obscure a single entity status, we are indeed
engaged in an investigation of the obscure.
I would normally state at this point that briefs have been filed by the respective
parties . the time to do so having been extended . In this instance I want to say that
counsel have favored me with well-documented briefs, which I regard as I would
many an author 's autographed work That the briefs do not cover all of the items
cited at one time or another in the hearing as relevant to the issues is quite under-
standable despite counsel 's thoroughness in their briefs as in preparation for and
conduct of the hearing.
By a remand order on December 16, 1957,3 after it had heard oral argument fol-
lowing issuance of the first Intermediate Report, the Board has called for determi-
i I realize that whether this report be concluded with a period or an exclamation point,
there will actually be a question mark as it awaits further consideration Our procedure
provides almost built-in, quasi-automatic question marks In this case they have pre-
ceded and indeed prompted this supplemental hearing and report
2 Quoted by Max Lerner in "Mind and Faith of Mr. Justice Holmes, " page 388
3119 NLRB 1069.
DARLINGTON MANUFACTURING COMPANY, ETC. 283
nation whether what some have called an integrated operation and others an empire
constitutes a single employer so that a remedy for violation by one corporation can
be applied against other corporations . Conceivably 4 it might be found under the
order that the other corporations or some of them were directly or indirectly in-
volved in and guilty of the violations found . If these statements be an oversimplifi-
cation, they at least suggest the problem here, which will be more fully described.
The Respondents have noted that the offer of proof to which the remand order
referred alleged single employer status of the Respondents Darlington and Deeiing-
Milliken. While counsel is correct in saying that the offer is important, I must
rely on the order itself , which clearly embraces various other mill corporations.
Circumstances do indeed order things as they alter cases . Our problem would be
to determine whether the order of things here, the relationships and activities , reflect
that measure of ownership and control which warrants a finding of single employer
status or whether such order is merely circumstantial and indicative of or com-
patible with independent status of the various companies and Darlington in par-
ticular. With the mass of evidence before us and the detailed preparation by counsel,
the allusions are specific ; but the probative effect is obscure . Unlike other long
cases under the National Labor Relations Act, the need here is not to weigh credi-
bility in resolving many different if relatively uncomplicated questions as where
issues of violence, employees ' fitness, or employer's motives are involved; but to
measure admitted activities on a scale which will ultimately indicate voluntary
cooperation and independent status, or control and single employer status.
Yet, whatever the scope of the remand order, the hearing was largely confined to
the proof of the relation between Darlington on the one hand and Deering-Milliken
and the related Deering, Milliken Service Corporation (now known as Palmetto
Service Corporation ) and Deering , Milliken Research Corporation , hereinafter
DMSC and DMRC, respectively , on the other . At the General Counsel's request,
the hearing was kept open for 3 weeks so that he might consider the advisability
of "further investigation of the relations of the other companies ; along with or
parallel to what (he had ) attempted to do here in regard to Darlington ," and of
a request to the Board for clarification of the scope of the remand order. (No
request for extension of the hearing was made, and by prior arrangement, it was
closed on November 13, 1958.)
Whether there ultimately proved to be a substantial or a tenuous connection be-
tween the offer of proof originally made and what was in fact presented at this hear-
ing, one would expect that , the offer having been made , the proof would soon
thereafter be forthcoming . Yet many months elapsed between the remand order
which cited the offer and the hearing . It is not a sufficient reply that the months
were spent in accumulating evidence .5 For this would merely underscore the extent
to which the hearing under the remand order exceeded the scope of what was orig-
inally available to be offered . The thread of continuity may have disappeared.
But never has a mill worked on so long a yarn.
But the hearing was based on more than the remand order. For on February 3,
1958, the Regional Director for the Eleventh Region issued an amended complaint
against the three Respondents named herein. Thereafter a hearing under the remand
order and on the amended complaint was held before me from September 30 to
October 10 , 1958, at Charleston , South Carolina, and from October 15 to 23, 1958,
in Charlotte , North Carolina , all dates inclusive . Whether the hearing directed by
the Board could properly be so extended by the Regional Director by issuance of
an amended complaint with new allegations without leave from the Boards was
not at that time tested : for reasons which need not now be considered ,7 no objection
was raised to this procedure of bringing in additional respondents in the remand
hearing ; its acceptance was specifically declared by counsel . The amended com-
plaint was thus received subject to Board approval ; such approval, only to the
Counsel indicated disagreement on this point , which need not now be decided.
5 The term "evidence" will be employed herein to refer to testimony received at the
supplemental hearing Although not material to the issues raised by the pleadings and
tried at the original hearing , such testimony is relevant under the terms of the remand
order
6 The virtue of such procedure remains undiscovered It could introduce many new
problems and seriously delay action which the Board had itself postponed for a limited
purpose
I pointed out early that, if single employer status were shown , the determination
beiein would include all who are embraced within such status Counsel for the Respond-
ents appeared to agree at one time.
284 DECISIONS OF NATIONAL LABOR RELATIONS BOARD
extent that a corporate party was added , was implied when, as we shall now note,
the complaint was on motion dismissed as to the individual respondent.
This motion to dismiss as to Roger Milliken was granted for several reasons which
I stated on the record. Upon appeal, the Board affirmed my ruling "upon the sole
ground (the first which I had stated) that the amendment to the complaint to the
extent that it included Roger Milliken as an individual respondent went beyond
the permissible [sic] scope of the Board's remand order of December 16, 1957."
This left the two named corporations as sole respondents.
With the issuance of a new complaint against Roger Milliken (same case number)
on December 31, 1958, and a motion to consolidate that complaint with the one
herein, I suspended work on this Intermediate Report pending Board decision on that
motion. The motion was denied 8 on March 11, 1959, and I further deferred action
herein until after I had issued reports in 40 other cases, 9 of them heard after the
instant hearing. On April 30, 1959 (2 years to the day after issuance of the first
Intermediate Report), I recommended dismissal of the complaint against Robert
Milliken.
The violations and the proceedings to date can thus be summarized. But the answer
to the question of single employer status depends on the facts adduced at the remand
hearing, and these cannot be readily summarized. The General Counsel and the
Union do not rely on a certain few elements alone to prove their contention: They
urge the whole record, several thousand pages and hundreds of detailed exhibits
almost each of which lends itself to, lengthy argument, as a unit. Conversely the
Respondents must be heard with respect to each item and the whole.
To attempt to select and analyze what appear to be salient elements must there-
fore evoke objections that not only have other elements, also salient, been omitted
but that the entire picture relied upon has not been presented. Yet the alternative
of reciting all of the facts developed at the hearing is not practicable for it would
mean repeating most of the record and multiplying it many times for analysis
of the pros and cons. That record remains available although we are perforce
limited here to a precise of the testimony and exhibits. In fact, because of the repeated
references and many cross-references to various items, a detailed reference index
would be necessary to insure coverage of all of the testimony and avoidance of
repetition. (In fact, on completion of this report, I find not so strangely that I do
have indices of the various subjects mentioned and of the exhibits, prepared to insure
coverage of the salient points and to avoid duplication despite repeated references
and cross-references.)
While the briefs refer to various exhibits, the arguments, although sometimes
detailed, are frequently general, and necessarily so having regard to the quantity
of the evidence and the nature of the findings sought. Most of the exhibits men-
tioned (many with little more than their citation and -a phrase or sentence to describe
them) and some which are not mentioned 9 are herein noted; it is unnecessary to
point out the specific respect in which others do not prove what has been claimed
for them. I do not delude myself believing that the parties, the Board, or a court
will accept my selection (and concomitant omission) of salient or representative
points, not to mention my analysis of those points, although the same selection might
have been received before unfavorable analysis.
Here is no nicely ordered bill of fare from appetizer to dessert or from soup
to nuts. (Cocktails and liqueurs can be left for other tastes.) The smorgasbord
spread before us is without such an orderly pattern. This is not to say that there is
no plan or purpose: in lieu of nicely routined variety leading to a climax, we are
surfeited by quantity. (The mass here compels redundancy.) Even a generous
helping can do no more than suggest what is on the serving platters But who
wants the entire buffet or a steam table? If it will not do justice to the General
Counsel's case and the Union's position to cite only some of the items which they
have noted, it is manifestly impractical to describe and analyze each one with the
arguments pro and con. All have several times been considered, at the hearing
(as was evident to counsel) and since. It is with full awareness that there are many
more, that I shall mention some typical or outstanding (in the sense that they are
s In its order the Board recited "Upon exceptions to the Inteimediate Report, the
Board remanded this case in 1957 for further hearing." The suggestion of causal con-
nection between the exceptions and the remand was surely unintentional. we shall note
infra the terms of and the basis for the remand.
9 Of the 81 exhibits received while Roger Milliken testified, 1 is not listed as such
although referred to in the transcript, and 2 others are shown as having been marked
for identification only.
DARLINGTON MANUFACTURING COMPANY, ETC. 285
among the more persuasive which have been cited as proving or denying single
employer status) items, and some others. The respective proponents may complain
that a limited selection is per se improper; they will surely object that mine is at
least unrepresentative. Aggrieved parties, whether on one side or the other, will
likely take such exception (and more) at each stage of the proceeding although it will
be necessary to recite the evidence not detailed here and to indicate its value in
support of the exceptions thus taken. Even if not specifically cited in this report,
all of the testimony, written and oral, and the arguments of counsel have been
carefully weighed even as it was clear that none was sligh-ted at the hearing. Un-
willing to leave to those who from mere reading of the record may not sufficiently
familiarize themselves with the facts, I shall mention or specifically refer to approxi-
mately 175 exhibits, passing over only those which can most readily be seen to be
without probative value, and including many not cited in the briefs.
Having said this, I must add that I do not mean to slight the painstaking efforts
of counsel in preparation for, during, and, in briefs, since the hearing. In extenua-
tion I can only and anticipatorily point to the determinations which will be made
on review or appeal and which, whatever their conclusions, will undoubtedly cite
relatively few facts in coming to a decision. Since I have been with this case in its
various stages for such a long time, I may be permitted the observation that having
alone heard it and being the first to analyze the record and contentions to findings,
conclusions, and recommendations, I should be more satisfied that the time spent
in hearing and decision was warranted were accurate review and greater acceptance
and recognition accorded to a Trial Examiner's rulings and conduct of a hearing
and his report and recommendations.
On the other hand and in contrast to any charge of undue condensation, it might be
urged, although this will be denied by anyone against whom a specific finding is
made, that there is here any unnecessary detail of facts and analysis; that far less
would suffice for all who have been concerned with these issues, and who have
undoubtedly penetrated to the correct conclusions. But we must further make all
this clear to those who follow us (in point of time if not in agreement) in considera-
tion of these matters; and heed must be paid to the injunction that reasons be
here stated for the findings and conclusions made.
Since it was not within the issues presented at the original hearing and passed on
in the first Intermediate Report, we can assume ie that the remanded question of single
employer status has been presented in connection with the question of remedy rather
than for possible finding of violation by other, if related, corporations. Seventeen
mall corporations (there is also reference to "eighteen mill corporations"), some of
them wholly owned subsidiaries of others of them, and owning 27 mill plants, have
been referred to and identified as related" corporations and Deering-Milliken mills
without prejudice to the issue before us. The relationship is alleged to be with
Deering-Milliken, DMSC, and DMRC. It is admitted that a majority of the stock
in the various corporations is commonly owned. Appended hereto as exhibit A
are lists of officers and directors of Deering-Milliken and Darlington as succinctly
set forth in the Union's brief. Additional details concerning stock ownership and
the officers and directors of the various corporations are in the record and need
not be repeated here.
Another of what may be called basic financial facts is that Darlington and some of
the other Deering-Milliken mills operated on their own capital, i.e., unlike others
of them it did not borrow from Deering-Milliken or from a bank any capital needed
to finance its operations. This affects the pattern of uniformity cited as existing
in other respects among these mills. But it does not bear on the more basic issue
of control, which could exist or not regardless of uniformity in source of capital.
It was admitted and I find that Deering-Milliken, a New York corporation with
principal office and place of business in New York City, New York, acts as exclusive
sales agent and extends credit to and factors the accounts of various textile mill
corporations among which was Darlington; that during the calendar year 1956, as
exclusive sales agent, it sold finished products valued at more than $100 million,
which were shipped in interstate commerce to customers in various States throughout
the United States; and that Deering-Milliken is engaged in commerce within the
meaning of the Act.
10 These preliminary and other speculative remarks arise out of a desire to provide what
the Board will deem adequate basis for a decision.
it In using this term in its remand order, the Board followed the Union's offer of proof
but quite evidently did not intend to foreclose the issue
286 DECISIONS OF NATIONAL LABOR RELATIONS BOARD
There is no claim that any of the various corporations other than Darlington, or
any of their departments, was in any way itself directly 12 connected with the viola-
tions alleged. The allegations of extended liability in the amended complaint are
the same as those brought in by the remand order, and depend on proof of single
employer status; ,there are no new or additional violative acts, and and it is only by
some finding of taint in the other companies' relationship to Darlington rather than
by acts on their part that additional findings of violation and liability can be made.
Neither has it been claimed that liability for the violations found should be
widened because the mills, and specifically Darlington, have controlled Deering-
Milliken; rather, that the latter has controlled Darlington. But, with exceptions such
as those to be noted infra, this record discloses generally the natural business desires
and activities which would characterize any independently controlled mill and sell-
ing agent or factor. (Since this is a written, not an oral report the reader's suspense
has already been dispelled by a quick glance at the end.) That both mill and agent
have common interests is not surprising: both want a sound, substantial, and reliable
manufacturer, a salable product, and sales. From such desire and purpose stem the
various services, from joint purchasing facilities and engineering assistance to market-
ing service and sales, and including technical and administrative advise, which sales
agents and factors commonly render and which were here rendered by Deering-
Milliken. Acceptance of facilities and advice is consonant with control; it is also
consonant with independent status: it proves neither. (This is not to overlook
the question of degree, infra.) But rejection of advice does negate control, and
although we might expect general acceptance of advice and assistance from experts,
there are instances of rejection, as we shall see. Nor does it appear that Deering-
Milliken's desire to sell adversely affected Darlington's or the other mills' operation to
the former's benefit or for what might be an overall profit or benefit were the
companies one.
Not only does integration of operations, which is compatible with independent
ownership, management, and control, not prove single employer status between
Darlington and Deering-Milliken; but such status would not be meaningful in the
present context The problem of remedy here is not so much that of finding or
following assets; enough remains in Darlington to cover most of the varied requests
for backpay. Our greater concern is with continued production and continued
employment; and Deering-Milliken is no substitute for Darlington in that connection.
Detailed and lengthy as the evidence is, it centers (as has been noted) on
Darlington's relationship with Deering-Milliken, DMSC, and DMRC, with only
occasional and sometimes oblique reference to the other mill corporations, as we
shall see. Whether .to extend findings of violation, or for purposes of remedy or for
whatever reason, the evidence called for by the remand order and received might
thus extend liability to these three DM corporations, but with respect to affirmative
relief, only for backpay since these corporations do not themselves employ mill
workers. The situation might be different were there proof connecting Darlington
with the three "Deering Milliken" companies and, through them, with the other
mills; for then reinstatement and bargaining possibilities would exist. The General
Counsel and the Union clearly have not proved a single employer status of the mill
corporations other than Darlington with the three DM corporations. It appeared to
me at the hearing that the General Counsel recognized this (although he may argue
that his review indicated the sufficiency of the proof in all respects) when he sought
and received leave to keep the hearing open to consider an application for permis-
sion to offer proof concerning the question of "chain" connecting all of these latter
corporations. As far as the other mill corporations are concerned, therefore, their
liability must depend on the evidence of single employer status between them, or
any of them, and Darlington directly, despite the present prayer that in the alter-
tive Deering-Milliken be directed "to reinstate these employees in other Deering-
Milliken mills " (In addition to the extent of common officers, directors, and owner-
ship of stock, referred to supra, we shall note evidence of dealings among the various
mill corporations.)
If these statements concerning the limited basis for findings of relationship and
liability are not clear to one who has not closely followed the ramifications and
intercorporate dealings, it may be said, to simplify roughly, that the attempt was
made mainly to lay track A between Darlington and the three DM companies, with
some light lines drawn between Darlington and other mills; but there is no track B
between the latter and the DM companies which might, if track A could carry the
12 This is not a case of such control by a parent or other corporation that it may be
said to have wronged or defrauded anyone insofar as remedy is concerned Cf N L B B.
v Timken Silent Automatic Company, et at, 114 F 2d 449, 450 (CA. 2).
DARLINGTON MANUFACTURING COMPANY, ETC. 287
load from Darlington to Deering-Milliken, continue the run from Darlington via
the Deering-Milliken companies to the other mill corporations. Thus with very
little (generally in connection with sale of some orders and inconclusive evidence
concerning constructions manufactured, infra) submitted to connect Darlington
with the other mills directly, and even less to connect DM companies with such
other mills, there is no basis for imposing liability on the latter whatever may be
shown with respect to the DM companies; unless the extent of cooperation among
the mills as in their sponsorship of DMSC and DMRC can be held to create a joint
liability.
The concept of single entity or single employer and any decision with respect
thereto will vary with the field of law and the questions involved Thus, while the
framework of this case has been stretched beyond the issues raised by the pleadings
and originally presented, it should not be presumptuous to note that we are ultimately
limited by the nature of the inquiry and the scope of the Act.13 To cite an instance,
what we would recognize as separate and independent organizations might be char-
acterized by such a degree of cooperation and joint effort as would violate the
antitrust law. Toward the other extreme are cases involving jurisdiction, where the
Board, interpreting its own limiting standards, accepts jurisdiction in a case and
over several entities even if it regards them as separate for the purpose of remedy.14
Similarly in cases involving employer associations or local branches of nationwide
organizations, as we shall note infra, while jurisdiction is taken because of the overall
extent of interstate activities or the nationwide aspect of the business, the violation
and remedy are assessed only against the violating segment. Our own concern
with single employer status differs from that in these cases. The Board will here
presumably stress centralized control of labor relations while also considering inter-
relation of operations and common management and ownership 15 (It was noted in
the original report that there was no claim that the sale at auction was not to bona
fide purchasers for value One aspect, raised at the instant hearing, will be con-
sidered infra in connection with sale of orders.)
is "But administrative discretion is no broader or stronger in its field than is judicial
discretion in its field, or legislative discretion in its field, or executive discretion in its
field Chief Justice Marshall said of judicial discretion, 'Judicial power, as contra-
distinguished from the power of the laws, has no existence Courts are the mere instru-
ments of the law, and can will nothing when they are said to exercise a discretion, it
is a mere legal discretion, a discretion to be exercised in discerning the course prescribed
by law, and, when that is discerned, it is the duty of the Court to follow it.
Prettyman, Trial by Agency, page 8
In New York v. United States, 342 U S 882, Justice Douglas declared at page '884
"Unless we make the requirements for administrative action strict and demanding,
expertise, the strength of modern government, can become a monster which rules with
no practical limits on its discretion. Absolute discretion, like corruption, marks the be-
ginning of the end of liberty." Some may question or object to this concept of expertise
The question is from one who highly endorses it
14 See Radio Station KBTM, LM-1721, Case No. 32-RC-1097, decided October 10, 1958
(not published in NLRB volumes), where the Board combined for jurisdictional purposes
a jointly owned but otherwise unrelated radio station and grain elevator See also Orton
Exterminating Company, Inc. (of Kentucky), 115 NLRB 622, 624, 627
is The remand order quotes the offer of proof in connection with the latter's claim of
centralized control of operations and labor relations See also Central Dairy Products
Co., Stefen's Branch, 114 NLRB 1189; Metco Plating Company, 110 NLRB 615, Cren-
shew's, Inc, at at , 115 NLRB 1374 The importance of the element of control was
recognized in the Union's offer of proof at the original hearing herein , and it was on the
basis of that offer that the Board, declaring that "it is desirable" to have additional
evidence, remanded the proceeding for further hearing
See also Dearborn Oil and Gas Corporation, at at, 125 NLRB 645, where, in denying
that a single employer status exists "for the purposes of the Act," the Board noted that
1 of the 3 legal entities under consideration there rendered services to the other 2 on a
cost-plus basis ; its foreman and 3 of its 20 employees "were involved in temporary or
permanent transfers between" it and 1 of the other 2 ; the employees of this latter one
were directed by the supervisors of the first "to an extent not specified in the record",
and all 3 used the same bookkeeper and the same office The dissent, aiguing that a
single employer status exists, noted that "all the Respondents were under the common
control and direction of one individual . . in their business operations as well as in their
labor relations," etc All agreed that common control is the most important factor, and
the majority, refeiring to the ciucial area of laboi relations," stressed "centialized con-
trol of labor relations '
288 DECISIONS OF NATIONAL LABOR RELATIONS BOARD
Actually the remand order calls for findings which go beyond mere control of
labor relations : we have been asked to explore the existence of a single employer
status. A measure of control might exist where there is no such status. This brings
us back to the point where, whether we label our finding as one of complete control
or of single employer status , Darlington 's functions have been discontinued; and
the three "Deering Milliken" companies ( here excluding the mills), even if they had
previously controlled those functions , cannot be considered the employer and cannot
be directed to employ or otherwise completely remedy the violations found.
While Section 2(2) of the Act includes as an employer "any person acting as an
agent of an employer, directly or indirectly ," it does not appear that the related
corporations here acted as agent for Darlington in connection with its labor relations
policies. Certainly the responsibility and liability of an agent does not extend beyond
the scope of his duties or activities . Furthermore , as distinguished from single
entity, the question of agency on the part of entities not named as respondents would
not be the subject of a remand at this point ; it would await decision and direction
of a remedy , and then be passed on in the definition of "officers , agents, representa-
tives, and assigns" if that usual phrase were here adopted . It is unnecessary to repeat
here, as was pointed out in the Intermediate Report of April 30, 1959 , that whatever
restrictions might be imposed on agents they would not be directed to carry the
burden of positive remedy, i . e., to bargain , reinstate , to make whole , unless the
elements of intent to evade and subterfuge were present so as to make them
liable for the violation.
If as has been suggested the evidence fails to show a single employer relationship
between Darlington and the other mills, and no remedy can be imposed against Deer-
ing-Milliken , such facts alone would appear to dispose of any aspect of our inquiry
which is relevant to the issues raised by the pleadings . But we continue with the
testimony received under the remand order.
With the conclusion of this introductory portion , it is clear that this report is ex-
tended because of the quantity of material received , the number of claims and ques-
tions raised , and the extent , although severely limited, of the necessary written
analysis of even a portion of that material . A general resolution of the issue presented
by the remand order could quickly be made on the overall impression ; a so-called
"common sense" generality might be uttered which would not even begin to support
one position or satisfy the other ( a fatuous hope ), and which would omit the reasons
which point to the decision to be made. While the evidence does not and need
not lead to Descartian certainty , I submit the conclusion in this case with less
doubt than frequently exists, as in resolution of questions of credibility.
FINDINGS OF FACT ( WITH REASONS THEREFOR)
Decision here does not depend on resolution of credibility : testimony and exhibits
were received without contradiction with only occasional aspects which called for
attempts to reconcile or explain . We are left with the need to draw inferences rather
than to establish credibility ; and with respect to inferences the Board , as it has
frequently noted , need not rely on the Trial Examiner 's findings and conclusions as
it does on his credibility resolutions.
We have been informed that no stone or paper which related to Darlington and
any of the other corporations was left unturned in preparation for this hearing,
and that everything has been submitted which might conceivably show the relation-
ship claimed by the General Counsel and the Union ( and some which could not
conceivably show it ). The unnecessary is superfluous . But what, which can be
analyzed, will be superfluous , and to whom? The feasible method here appears to be
to consider all of the evidence cited by counsel and their arguments, and then, with-
out detailing such evidence and arguments except those which appear to be most
weighty, to summarize them and make findings. We now turn to the very real
problem of being temperate and selective in our analysis to avoid an evidentiary
crapulence while at the same time doing full justice to the proof
The facts concerning ownership of stock in the various corporations are set forth
in an exhibit in evidence and, uncontroverted , need not be detailed here. It is
conceded that members of the Milliken family, directly or through ownership of stock
in other corporations , own a majority of the voting shares of Deering-M illiken and
of various mill corporations, including Darlington . The question of piercing the
corporate veil is considered infra.
Omitting for the moment any questions of ownership or control of other corpora-
tions, Deering-Milliken is a sales and factoring corporation . Its services to the mills,
in sales, taxwise , etc., will be described infra.
DMSC shares are owned by the mill corporations affiliated with Deering -Milliken,
each such corporation owning one share for each of its mills. Thus Darlington,
DARLINGTON MANUFACTURING COMPANY, ETC. ' 289
with one mill, owned one share in DMSC. The mills are not required to avail
themselves of DMSC's services, various phases of which will be hereinafter de-
scribed, nor are they prohibited from using such services from other sources. The
service agreement between each mill and DMSC is terminable at will on notice, but,
except on liquidation, none of the mills has ever terminated its agreement. There
are no service agreements with any domestic mills other than Deering-Milliken mills.
It was testified that work by DMSC for the mills was at their request, and that "lack
of uniformity" among the mills was uniform, some recommendations being variously
adopted and rejected by the mill treasurers. As in other respects, it does not appear
from the mass of documents considered in this connection or from the greater num-
ber examined by the General Counsel, that control was exercised outside of the respec-
tive corporations or that decisions were imposed on them by Deering-Milliken,
the service of research corporations, or other mills. In connection with operating
procedures and maintenance, a system of demerits and comparative mill records was
developed by DMSC to assist the mills and to serve as incentives. There was no ele-
ment of any penalty which was or could be imposed by DMSC. Prior to 1951, when
DMSC was organized, the industrial engineering department at Judson Mills serviced
the other mills.
DMRC was organized and maintained as a cooperative effort by the Deering-
Milliken mills and Deering-Milliken for research and advice when called upon. The
mills contributed to DMRC in proportion to their sales, and Deering-Milliken accord-
ing to its commission income. Reference was made at the hearing to memorandums
which noted research on machinery types and improvements, and assistance in
maintenance programs, as we shall note
Various functions of these three corporations and points of contact among them
and various mills will be noted infra. Neither the General Counsel nor the Union
claims economic homogenization of the various corporations and mills and their
business. The organization of these entities does not itself indicate single employer
control over the mills. Rather it is urged that the contacts and relations shown
indicate control and single employer status. The elements of control may be dif-
ferent in various situations: in large operations, in small, in one industry, in another.
But control there must be if single-employer status is to be found.
As distinguished from ownership,is execution of policies at the various mills is in
the hands of the respective treasurers Even in cases where a permanently binding
and exclusive arrangement exists that fact does not pcr se indicate single-employer
status There can be various degrees of cooperative activity among several entities
without such control as to constitute the entities a single employer.
The corporate bylaws and the evidence in that connection indicate that the chief
executive officer of Darlington was Oeland, its treasurer, not Roger Milliken, its
president, their authority typifying those positions in cotton mills generally, accord-
ing to the evidence. As I have found in the proceeding against Roger Milliken
individually, Oeland was Darlington's "chief active or operating executive" and
this is apparently conceded. He alone was authorized to spend $25,000 for capital
additions for the year ending November 1955; and the officers were jointly authorized
to spend an additional $100,000 without approval of the directors. While president
of Darlington, and except for his employment of Oeland, infra, Milliken had never
hired, fired, or transferred any employee; this was done by Oeland as treasurer and
administrative head.
Here the question naturally intrudes. Because of the extent of Milliken family
ownership, were Roger Milliken's wishes in fact command's to the mills? But Minot
Milliken and Roger Milliken testified that at various times suggestions or proposals
by the latter to mill treasurers have not been carried out They appear to have been
no more controlling than were suggestions from sales personnel or others who sought
to assist the mills, the decision remaining with the mill treasurer. Even a presump-
tion that Roger Milliken's suggestions received greater consideration might be un-
warranted since full consideration was evidently given to suggestions from all expert
and responsible sources; as noted at the hearings, the achievement of optimum results
is a general desideratum. Milliken could plan, urge, and exhort; he did not control.
If, as the Union claims, directions which "were usually stated politely as `suggestions'
or advice' " were constant in their flow and exact in specificity, control was not proved
thereby. More in point is the claim that "the record leaves no doubt but that the
understanding by both commander and commanded was they were to be followed."
But, as noted, the record is replete with testimony concerning suggestions which were
not adopted.
16 The differences should be clear stock ownership; control of policies other than labor
relations, control of labor relations ; single-employer status
290 DECISIONS OF NATIONAL LABOR RELATIONS BOARD
Besides the points that actual control and authority lay with the mill, not with
Deering-Milliken, and that Roger Milliken, as we shall be reminded, was a mill
officer, the question is raised whether in offering suggestions to the various mills he
was acting on behalf of Deering-Milliken and attempting .to exercise control for the
latter. Many documents in evidence and described in detail might be discussed here
in this connection. All have been considered but the principles which govern them
need not be repeated with respect to each. We have a memorandum dated Novem-
ber 14, 1956, from him to various mill treasurers and to various DMSC people, to
which are attached a quotation from the October 1956 Newsletter 17 of the South
Carolina Chamber of Commerce and an article and editorial from America's Textile
Reporter of November 8, 1956. The Newsletter refers to turmoil and inefficiency
at a stranger mill since a labor contract was signed several months before, and the
announcement that the mill would be closed the following month.
Milliken's memorandum declares that the union leaders had misled the employees
and that Darlington had been negligent in its public relations; it urges that the
recipients of the memorandum make a mental review of the steps which they were
taking to bring about an understanding of the respective mills and their problems
in the community. The memorandum concludes, "The unions are going to be
making a tremendous drive all though this area, and there ire few things that are
more important to us than making sure that the leaders in ,our community under-
stand and are sympathetic to what you are trying to do." This memorandum is
not to be analyzed as if it were a document prepared after thorough study of its every
word and implication and their legal significance. Milliken's interest in all of the
mills is not to be regarded as Deering-Milliken's (of which mote infra) and certainly
does not prove single-employer status But even a technical analysis here could
show only the distinction between the importance of the matter to "us" while "you"
are trying to do the things which need to be done. So far from proving Roger
Milliken's or Deering-Milliken's control "in dealing with the problems of labor
relations and of unions" (in the words of the Union's brief), the memorandum
indicates rather than those problems were handled by the mill treasurers and that
Milliken was here "alerting" them and pointing out to them an area in which be
believed that they could function.
The exhortation in the magazine is addressed to textile mills throughout the indus-
try. No more than this indicates a single-employer status throughout the industry
does Milliken's distribution of the article indicate single-employer status among that
Deering-Mil liken mills. The call for "contact on a local and national level for larger
firms, operating in several areas" reflects the magazine's impression that there are
larger firms which operate in several areas; it does not prove the existence of such
firms or that the corporations before us constitute one of them. What is then
pointed out concerning "Darlington officials who decried the utter lack of any
attempt at public relations before, during or after" the union campaign would be as
applicable whether or not Darlington were part of a "larger firm " Thus there
is no evidence here that Darlington was part of a larger firm and certainly no proof
of multiple plants in a single employer status. Hence, aside from the question whether
Milliken, by distributing the article, adopted its remarks, there can be no question
concerning the significance of the remarks themselves
On the right-hand column of the article's second page as reproduced and dis-
tributed is an editorial. This declares, "If the people of Darlington knew anything
of the Deering, Milliken record they would know that management does not intend
an unprofitable division, nor has it intended to share the prerogatives of manage-
ment with labor union leaders." Milliken testified that, although he distributed the
editorial, he did not subscribe to all of its statements; he undertook to explain why
he could not subscribe to the sentence just quoted. In fact. the General Counsel
stated his belief that the editorial refers, not to Deering-Milli ken's management, but
to the various mills After pages of testimony and discussion on the record, we
17 This is to be distinguished from a newsletter which Oeland sent weekly to Milliken
Shortly after his arrival at Darlington, Oeland said "that if it was all right with
(Milliken), he would like to keep sort of a personal diary which lie would like to put in
the form of a weekly letter to (Milliken) so that he could put down what he was woii,-
ing toward, what his goals were. and what his accomplishments had teen" Millil-on
apparently never commented on these newsletters He also received a monthly letter from
Monarch ; no newsletters from any of the other mills The newsletters indicate a desire
by Deland to gain Milliken's anprobation hwond what would follow glom Vu(eessfnl opera-
tional results This is further indicated by Oeland's requests for Milliken's opinion and
approval. Originating with and voluntarily continued by Oeland, they do not indicate
diminution of his authority or of the authority of the various mill treasurers
DARLINGTON MANUFACTURING COMPANY, ETC. 291
thus conclude with not even the claim that this refers to or tends to prove single-
employer status. Whether correct or not in his estimate of the value of the article
and the editorial (and the Newsletter), Milliken sent his memorandum out because
he believed that these called for action by "all textile mills," not as noted after review
and expert advice concerning the legal significance of the statements therein made,
as one can believe and even reasonably assume.
Time and again, as we received in evidence memorandums recommending action
by Darlington, it was shown that Oeland rejected the recommendations. An exhibit
most diiectly related to the violations heretofore found is a letter dated 1 month
before the September 1956 election, in which Oeland indicated that he had decided
and was carrying out his plan to "fight the union's activities"; that he had so in-
formed Poag, Darlington's attorney; and that he had gotten Poag's approval to
continue. Such "approval" of an important policy already adopted by Oeland
does not indicate that Oeland's was a subordinate position.
Also in evidence are communcations in which Oeland requests or anticipates
"approval." But it will be seen that in those cases his reasons were generally
accepted as convincing, and the approval forthcoming. Certainly his rejection of
advice from others stands undiminished in significance. In one of the letters last
referred to, he persists, in a recommendation contrary to advice from Poag; and
quite confidently in tone, as if the decision had already been made, submits it for
Roger Milliken's approval ("I would like to have your approval before we move
in the matter"), still looking forward to Poag's approval, which certainly does not
appear to have been any sine qua non.
Thus it does not appear that Darlington was under compulsion to join in various
efforts, whether purchasing, selling, operational; or that it was not free to terminate
the relationships which existed The record shows that from time to time mill
treasurers took action or made decisions vis-a-vis other Deering-'Milliken mills or
corporations It does not appear that those actions or decisions were controlled
by Deering-Milliken. Time and again correspondence submitted in evidence to
show control indicates rather that suggestions were submitted, received with "appreci-
ation" by the mill treasurer, and by him accepted or rejected. Nor is there evidence
of conflicts of interest between Deering-Milliken and Darlington which were resolved
against the latter. We shall see that the evidence does not show loss of separate
identity, permanently binding and exclusive arrangements, single-employer status,
or liability of one corporation for the unfair labor practices of another.
The functions of purchasing of equipment and material, personnel recruitment
and advice, sales and its concomitant of styling, tax savings, etc., etc., are as vital
to the proper conduct of textile manufacture as is the role of an egg in an omelet.
If the egg is not obtained from one source, it will be from another.
In some cases the poultryman may employ and direct the cook in a truly inte-
grated and single entity status; he may even be the consumer. But use of the egg
and acceptance of the advice do not prove employment of the cook or control over
him by the poultryman. For this we must look to factors which do prove control.
The role of the egg is not a whit less important where the poultryman and the cook
are quite independent in their decisions and actions. The former, with knowledge
of his product (or the market), may be in a position to advise concerning its opti-
mum use The latter may well adopt the advice, or, having received and even
sought it, he may reject it Advice and assistance are one aspect; control is quite
different even if the advice is so clearly good that it would be foolhardy to reject
it and it is uniformly followed.
In the instant case it is clear from the evidence before us that, however frequently
advice from Deering-Milliken, DMSC, DMRC, other mills, or Roger Milliken was
adopted, it was not uniformly followed by the various mills or mill treasurers, or
specifically by Darlington or Oeland. This should be sufficient to refute the claim
of control inherent in single-employer status. But we shall go further and consider
various instances which may suggest control (even if we thus ignore the plausible
argument that elements which are among those which exist where there is control
do not prove such control in the face of the denial and absence of other elements
which cannot be denied and must be present where there is control).
Leaving for later consideration all comparisons with other factors and their rela-
tions with mills which they represent, we must consider the significance of such
terms as "DM mills," "our mills." "our organization," "mills affiliated with Deering
Milliken " It was testified that in industry parlance, mills are referred to as XY
mills where XY is the selling agent or factor but has no other financial interest and
the mills are independently owned. Thus mills which are alleged to be recognizably
independent and do not occupy any single-employer status are referred to as Cannon
07201 0-(i3-vol 139-20
292 DECISIONS OF NATIONAL LABOR RELATIONS BOARD
mills, Iselin -Jefferson mills, etc . ( We shall later note the facts and actual relation-
ship among mills within such groups .) At least partial explanation may be found
in the testimony that an advertising agency pointed out the difficulty in acquainting
the public with multiple names, and advised that in advertising even "Deering Milli-
ken" should be avoided , with emphasis to be placed on the single name "Milliken." 18
Analogous situations in other industries were noted : AMC stores being a group
of independent stores or chains banded together for buying economies ; CBS radio and
television stations, very few of which are owned by CBS, the others being financially
independent; and Howard Johnson restaurants, where the outlets are individually
and separately owned, the name being used for advertising purposes and to indicate
that a uniform type of operation is maintained. Here, as in "Romeo and Juliet," one
can ask, "What's in a name?" This does not dispose of the issues before us. But it
serves the negative purpose of showing that use of a name jointly does not show
single-employer status. Decision must be based on such other evidence as has been
offered . In this consideration of impressions and descriptive references as dis-
tinguished from proof of actual control and status, we can note that there is no
evidence that the employees of Darlington ever considered or referred to themselves
as employees of Deering Milliken or of any of the other mills or mill corporations.
As I stated in overruling an objection made on the ground that certain exhibits
offered by the General Counsel were immaterial since they did not support the pro-
ponents' burden of showing integration, proof of given activities which do not show
integration is material to the issues before us , especially where such activities and
proof are extensive; for to the extent that these activities, although they might be
of such a nature as to show single employer status, do not show that status, they
tend to deny its existence here and limit the possibility of a finding in conformity
with the Union's proof. Similarly, as the General Counsel touched on possibilities
which, were they in existence, would tend to show single-employer status among
these corporations (guarantee by other corporations of a loan to one of them, to
cite an example), the fact that the relationship or activities thus inquired into were
nonexistent tends to indicate that there is no single-employer status.
Activities indicated among the corporations here, which characterize the rela-
tionship among factors and independent companies which they serve or among
cooperating but independent companies generally, tend to show an independent
status here. In fact, I consider the relative number and the nature of the activities
which are common among independent companies if no attempt was here made to
list all of such activities; 19 as on the other hand I consider the number and nature
of activities which are not usual in independent relationship but which did char-
acterize the relations here The Board may prefer a different statement of the rule
to be applied here But however the basic principles be declared, the fact is that
the activities and relations among the various corporations do not show a single-
employer status.
We shall soon note items which most nearly of all those submitted suggest single-
employer status; these are few and certainly not determinative. The most persuasive
are scarcely, certainly insufficiently, so. Our task would be greatly simplified could
we point to certain items as clearly probative of single-employer status; 20 i.e., that
certain items exist here and where there is single employer status, and we are never
present where there is no such status. (We have already mentioned the importance
of showing centralized control, especially of labor relations.) But we are unable
to do that Neither can we, nor need we, prove the universal negative.
As presented on the record, certain evidence immediately suggests independent
status. (Such evidence is in contrast with items which do not indicate either inde-
pendent or single employer status, and those which suggest the latter ) Thus there
were suggestions to Oeland and other mill treasurers from Deering-Milliken, some
of them adopted, others rejected. the decision in each case quite evidently made by
the mill treasurer To cite one instance, a letter to Oeland from Deering-Milliken's
order department transmitted a suggestion by Roger Milliken that the mills apply
bale numbers to lessen warehousing problems Declaring that Darlington had no
'e One aspect of this single-name emphasis will be considered infra in connection with
an exhibit entitled "Fabric Magic by Milliken "
19 Admittedly there were many contacts among the various corporations here which did
not suggest to the General Counsel in his prehearing investigation a single-employer status.
20 Certainly in the lengthy oral testimony and the many exhibits there are no one, two,
or five facts which can be relied on as proving the General Counsel's case This is attested
to by the length of the briefs in support and the number of items relied on therein , and
it makes necessary a voluminous analysis of many items which are not probative in lien
of recognition of a few which might be
DARLINGTON MANUFACTURING COMPANY, ETC. 293
problem in that connection, Oeland closed his reply as follows: "We appreciate your
willingness to work with us, and if the occasion arises we will take it up with you."
[Emphasis supplied]
Again, a suggestion from Deering-Milliken's controller's office that the fiscal year
end on Sunday, November 27, 1955, instead of November 30, was followed by the
mills only after the respective board of directors decided that it was "a good idea"
and adopted it. A standard practice instruction was thereafter issued to the mills by
the controller, setting forth the dates to be used in closing the financial records of the
corporations whose fiscal year ended on November 27 Although as peremptory
as administrative details are when reduced to writing, the instruction reflected the
decision already made by those corporations.
Thereafter Smith, the vice president in charge of Deering-Milli ken's credit depart-
ment, asked Oeland to what extent Darlington'E large credit could be reduced to
demand notes to be left at least through Novem )er 30, 1956, almost 7 months off.
Oeland replied that, after analysis, of its cash requirements, Darlington could invest
only a small portion for the entire period although it could, if so desired, put an
additional amount into notes to be liquidated when Darlington needed cash. Clearly
the decision here was Darlington's, with a further tentative and indefinite commitment
by Oeland. From Deering-Milliken came a suggestion; from Oeland a limited agree-
ment without further obligation. Smith's reference to Darlington's "current account"
was to its balance at Deering-Milliken; his concern was not with Darlington's
balance sheet, profit-and-loss statements, or other accounts.
Further evidence of Darlington's independence is seen in the testimony by Minot
Milliken, Deering-Milliken's treasurer, that he lacl ed information concerning Darling-
ton's property records, has nothing to do with such records at the mills, and is not
acquainted with the form in which the mills m aintain records. He also testified
that Darlington's stock transfer registry had been at the mill in Darlington, that stock
transfer questions were referred to Oeland, and that the latter in turn referred legal
problems to counsel in Darlington.
Because of the emphasis on the question of centralized control of labor relations
in cases involving violations of the Act and extension of liability for such viola-
tions, our inquiry should devote special attention to the labor relations of the various
corporations which allegedly occupy the single-employer status. But here the proof
of uniformity is meager indeed Hours and corditions of employment were deter-
mined by each mill for itself, and there was no uniformity among them. The so-
called Deering-Milliken vacation plan has been cited as a common labor policy
referrable to Darlington and other mills. Pacole', one of the mill corporations, con-
ceived a vacation plan, discussed it with Kahle, the head of Deering-Milliken's
tax department, and sought the best tax counsel available before applying for and
obtaining a beneficial ruling from the United States Treasury Department The
plan was proposed or submitted to other mills, ar d thereafter it was up to the board
of directors of the respective corporations to adopt a like plan to the extent appli-
cable. This is the testimony as received; an ex iibit in evidence declares Oeland's
understanding of the advice to Darlington's board of directors in this connection by
Kable's office so that the vacation plan previous y in effect at Darlington might be
continued without imposition of any change by an Internal Revenue agent.
To the extent that an inference of a common or similar vacation plan might be
warranted, the evidence of common joint activity here is entirely consonant with
and indeed indicates independence 21 of decision If some mills used a substantially
similar vacation plan which was given the Deering-Milliken label, control over the
mills is not thereby shown Here, further, the changes initiated by Pacolet merely
assisted Darlington to continue what it already had in operation. Minot Milliken
testified that he believes that the mills have various plans and that no one at
Deering-Milliken is acquainted with all of those.
Another plan which bore the Deering-Milliken name, and was adopted at some of
the mills, is the Deering Milliken Mills retirement plan (to be distinguished from
the Deering-Milliken retirement plan in effect at Deering-Milliken itself). All of
the mills' salaried employees are covered by the mills' retirement plan, and during the
course of a discussion some of the mill treasurers wanted to know what the addi-
tional pension cost would be to each mill if their second hands, paid hourly, were
put on salary Lowry of DMSC thereupon called on the mill treasurers for such
information as age, salary, and length of service so that the cost could be determined
on an actuarial basis. The actuary's report wa; then submitted to the mills, each
of which then decided whether to extend its retirement plan: some did, others
did not. It was further explained that each mill adopted the type of plan which it
3 This factor distinguishes the instant case from 3ethlehem Steel Company v. N.L R B.,
120 F 2d 641 (C.A.D.C.), and similar cases cited b) the General Counsel.
294 DECISIONS OF NATIONAL LABOR RELATIONS BOARD
preferred. The plans are grouped as the Deering-Milliken retirement plan for
purposes of investment, but lack that uniformity which a single control would
dictate. That there are no differences in options among the various mills no more
proves integration among the mills than does provision of similar plans by various
insurance companies indicate integration among the latter or their insured.
There is nothing to suggest that the inquiries which initiated the retirement plan
studies could not have been made elsewhere. But here was a convenient source
of information. If payment had to be made for the time spent in obtaining advice,
it was presumably cheaper when put on a mass basis. As in the case of other tax
assistance, infra, the same firm of tax specialist attorneys was called in. The extent
of cooperation among the mills does not lessen the evidence of their independence.
It will serve no useful purpose to describe all other examples of cooperation, with
independence of decision, which indicate independent status But other instances
will be introduced by reference to the respective claims herein.
Wages are a most significant aspect of labor policy and relations. That aspect
here does not indicate single-employer status When Darlington's wage rates were
considered here and at the original hearing, it was testified that they were different
from other southern or South Carolina mills Comparison was thus general, and
there was no suggestion of similarity or even comparison with other Deering-Milliker
mills although references were made and comparisons with them were attempted
in other respects. In short, there was and is no evidence of a common wage policy.
Uniformity has not been shown, and Oeland now testified that piece and wage rates
and premiums at Darlington differed from those at other Deering -Milliken mills.
He made changes in wage rates after discussions with the overseers and super-
intendents; he did not consult Milliken, Deering-Milliken, DMSC, or DMRC, nor
does it appear that he was goveined by any recommendations from these latter.
Labor policy (in fact the very events which preceded the violations found) was
directly involved when in August 1956 Oeland called on his friend Glenn, employed
as director of industrial relations at Monarch mills, to advise him in connection with
the organizing and election campaign at Darlington. In his newsletter of Septem-
ber 28, 1956, Oeland informed Milliken that Darlington had paid Glenn for his
expenses and had reimbursed Monarch for the time during which he had been away
from his job there.
There was no intercorporate relationship here. Neither Monarch nor Glenn was
under obligation to assist Oeland The latter called on his friend Glenn and there-
after sent him a check in appreciation. This episode reflects on several items which
concern as: the personal rather than corporate relationship, just noted; Oeland's
authority on behalf of Darlington; and the latter corporation's responsibility as
quite separate from that of Deering-Milliken or Milliken personally, with whom
Oeland did not discuss Glenn's services until after they had been rendered, although
Oeland believed that he had informed Milliken in a newsletter.
We are also asked to rely on so-called striking similarities, with some sections
identical, others almost so. between the Darlington employees handbook (which
had not been distributed since at least 1951) and handbooks at Judson, Drayton, and
Monarch mills as indicative of single and overall control of employee relations
These similarities have been minutely detailed by the Union.22 The handbooks have
not been copyrighted As we shall again note, good ideas are not to be discarded
merely to be different. Whethei other Deering-Milliken mills besides these have
handbooks, whether any such are different from those here referred to, whethei
handbooks at outside mills are similar, we do not know. The similarities indicated
are not probative; they have not been shown to be characteristic of Deering-Milliken
mills and exclusively so, nor do they meet the objections pointed out in connection
with other evidence received, that they are consistent with both single-employer and
independent status. Here as elsewhere, while various similarities do not prove
control, dissimilarities are significant
A most meaningful and important element connected with actual operation of these
mills and their factor, is their competition in constructions Under an integrated
or single-employer operation the various mills would make constructions which
would complement one another and togther constitute a full line, they would not
compete in given constructions Yet the testimony is that Darlington had lost busi-
ness to other mills, either Deering-Milliken or non-Deering-Milliken mills, because
it had not been able to produce wider goods. May, Deering-Mill i ken's vice presi-
dent in charge of print cloth sales, gave advice, as requested by Oeland, on the basis
of his ability to forecast sales so that the mill could plan its production with that in
22 On behalf of the Respondents it has been argued "That no two of these employee
handbooks are alike" and that there is no basic uniformity among them
DARLINGTON MANUFACTURING COMPANY, ETC. 295
view. This followed by about a month an inquiry from Monarch's treasurer to
Oeland concerning a certain construction which was too wide for Darlington to
handle. While cooperating with Monarch, Dar ington took steps to handle such
constructions itself by acquiring wider looms. With respects to a market for wider
material which Monarch mill was then producing, there was no question of sub-
ordinating sales of any such widths which Darlington might manufacture. In fact,
before its liquidation (this was cited in connection with the earlier finding of viola-
tion), Darlington had begun to install wider looms.
Detailed as was the examination of production records and of witnesses concern-
ing constructions manufactured by the various rr ills, there is no evidence that one
mill avoided a given construction to favor another mill; or that competition among
these mills in their manufactures and attempts to sell was restricted as by existence
of a single,employer status. We have just seen that there has been no centralized
control of labor relations. We shall note infra that it does not appear that, when
it was liquidated, Darlington's constructions, accounts, and orders were transferred
to the other mills as mere successors or alter egcs.
Not only can it be said that the proof does not show integration among the various
mills in cloth manufactured, in fact it appears that they are competitive since given
constructions have been through the years made by more than one of them. There
were requests for information and advice concerning possible competition but in all
the mass of evidence before us there is none which indicates deference by one mill
to the profitmaking interest or intent of another in purchasing, manufacture, sales,
etc. Yet harmonization and deference would characterize a single-employer status
existing directly among the mills or indirectly through their respective relationship
to Deering Milliken. While deference or enforced limitation on manufactures would
indicate single-employer status, availability of and requests for information and
advice do not.
The point was noted at the hearing and later argued that Deering-Milliken control
was exercised to the extent that acceptance of a product as premium depended on
salesmanship. But this is a common aspect of salesmanship; to this extent it may
be said that every salesman "controls" his principal or determines its success. There
is no evidence that Deering-Milliken or its salesman preferred one mill to another,
and certainly none that one mill was compelled t:) defer to another in either manu-
facture or sales.
The mill treasurers' independence in deciding what their mills would make has
its counterpart in their independence in sales polic 3 Some are "free sellers," making
sales commitments well into the future while others, more conservative, sell for
early delivery; and in some instances a long-term policy is adopted on certain con-
structions and a short term an others. There is no control of one mill by another
in this respect, nor any overall control by Deering-viliken or Roger Milliken There
is testimony that "[t]hese treasurers were highly competitive in their outlook. And
if they could see that one treasurer had achieved something at one of his mills
they felt that they probably could do likewise." T us suggests the absence of restraint
on their competitive and self-favoring outlook, which might have been exercised
by a central control.
It is true that the industrial engineering department of DMSC worked with the
smaller and more limited industrial engineering departments at the mills, and when
the mill treasurers at their meeting agreed that each mill would work on a certain
project involving mechanics of production and that they would later exchange
information to improve production, DMSC's I E I) advised the mill's I E D concern-
ing the course the project should take. This cooperative effort among the mills
was typified by assistance given by Darlington to Gaffney in connection with specifica-
tions for high-speed looms. Another instance is t ie exchange of information, which
we have just noted parenthetically, betweeen Darlington and Monarch concerning a
construction which was too wide for the formcr's looms. Such interchanges of
information, like other activities of mutual benefits, have not been shown to have
been forced on Darlington or any of the other mills. Rechecks of competitors'
cloth were performed at some mills at the request of the mill treasurer, the charge
being made to the requesting mill. A further element of cooperation enters where
more than one mill benefits from a given recheck; there is no joinder in sharing
the cost but the purchases for recheck are scheduled to accomplish that objective.
That the liability of each mill was based on the service performed for it is further
indicated by a later proportionate billing for an accumulated rechecking deficit.
A further example of cooperation between DMSC and Darlington is seen in Roger
Milliken's suggestion which prompted Oeland to write to Defore, who is in charge
of the fiber quality control and research department of DMSC, for information
concerning certain frames. This does not show any control of Darlington from
296 DECISIONS OF NATIONAL LABOR RELATIONS BOARD
without; Roger Milliken was its president.23 If we heed the argument that he was
also president of other mill corporations and of Deering-Milliken, and that these
facts, with the stockownership shown, prove single-employer status, we have wasted
a great deal of time in this hearing; those facts were known before the remand
order issued.
As for Milliken's activities on behalf of the various corporations, the emphasis
given that in the briefs is misplaced: the issue is rather one of control of one corpora-
tion by another or of common policy so established and exercised as to indicate
single-employer status. The "relationship" abundantly instanced by the General
Counsel is not one of control of null policy or activity generally or of labor relations
specifically. To cite suggestions by Milliken to the mills as illustrative of his control 24
may mislead anyone whose attention is not called to the testimony that those sug-
gestions were reviewed by the mill treasurers, that decisions were separately made
by the latter for their own mills, and that the proposals were in many cases not
adopted; also that in many cases, Milliken did not even receive replies from the mills
to his suggestions or requests for information. So much for possible "impact" on
mill personnel of Milliken's attempts to follow up on his proposals or "to make
sure" (quoting the General Counsel )of "some thought" at the mill level. Whatever
Milliken's ideas and the scale of his thinking, control is exercised at each mill. As
spread on the record and even as described by the General Counsel, Milliken's
proposals appear to have been more nearly precative than authoritative.
Nor need more be said here than was said at the hearing concerning a pencilled
draft prepared prior to filing of a report with the Federal Trade Commission, the
draft having been found in Darlington's files. Darlington's accountant (bookkeeper),
who evidently prepared this draft for the period immediately preceding the com-
pany's liquidation, checked item 4 of the printed form, thereby indicating that
Darlington was a subsidiary of Deering-Milliken. While this draft is properly before
us as a record, even if erroneous, prepared and kept in the regular course of Darling-
ton's business, it is relevant and necessary to note that correction or change was made
prior to filing with the Federal Trade Commission so that as filed the report declared
that Darlington was not a subsidiary of any other corporation. Attention to this
item can only emphasize self-serving statements which do not help carry the General
Counsel's burden. The report thus filed was the last of three, and those for the two
earlier periods likewise recite that Darlington was not a subsidiary of another
corporation.
Some items, although presented in detail at the hearing, are quite equivocal 25 on
the question of independent or single-employer status. We have already considered
vacation and retirement plans. On another aspect of employee relations, an em-
ployee of one of these corporations is occasionally made available to another, the
change in most cases being from DMSC to a mill as when a mill seeks the full-time
and permanent services of a DMSC employee who has advised or otherwise assisted
it. But this is not an unusual procedure between independent consultant organi-
zations and companies which they service, and even between business firms and
their clients. Specific reference in the record to several employees (in the generic
sense ) who were employed by more than one of these corporations may be re-
called. Thus Oeland had himself been controller at Monarch when in 1951 he
accepted the position of treasurer at Darlington. The former treasurer having
decided to retire, Robert Milliken discussed the change with Oeland. While formal
employment arrangements would be handled by the board of directors, it was natural
that the president of the Company should discuss the matter with Oeland. If we
must search out every possible basis for inference, it can be noted that Milliken
did not as president of Monarch seek out Oeland; William Sibley. Monarch's treas-
urer or manager, told Oeland that Milliken wanted to see him. Oeland's tenure at
Darlington depended on his success there, and he was so told; but he was also told
that he was to be in complete charge and that, whether or not he sought advice,
the responsibility for decisions would be his own
13 Despite Milliken's desire that the frames he bought, they were not
21 The General Counsel does not strengthen his position with respeet to either violation
or remedy when he leaves the coneent of control and notes that "chain operation" i^ here
indicated This aspect is considered infra
25 The General Counsel appears to recognize this as he cites a window-cleaning analogy
to show that performance of acts by independents does not "disprove" relationship But
the need here is to prove the relationship alleged by the General Counsel and the Union ;
and this is not done by a mass of evidence which does not disprove it. As noted , we can-
not substitute such evidence for the necessary proof of control.
DARLINGTON MANUFACTURING COMPANY, ETC. 297
Before any conclusion can be drawn from this employment sequence from one
Deering-Milliken mill to another, we must con,ider whether it is more significant
than Oeland's earlier move from a non-Deering-Milliken mill. It does not appear
that in either case there was more than an indivic ual's natural and successful attempt
to obtain a better job. The relationship between the different companies was no
more nor less independent in the one case than in the other.
Other testimony showed that Allen Sibley, vice president of Pacolet, designated
officers of some of the companies (not Darlington) to be general manager of other
Deering-Milliken mills. Positions as manager of some of these mills were also made
available to a few top supervisors of other Deering-Milliken mills. On the other
hand, managers and top supervisors were in about equal number taken from com-
panies outside this group
These and other instances of which we have details do not indicate that general
transferability or maneuverability of Darlington's employees which might charac-
terize a single-employer situation. Voluntary cooperation is as readily understand-
able here as in other connections: not only does the new employer gain the em-
ployee whom it seeks, but the former employer -reates an incentive for others who
might likewise be interested in change and improvement of status. Whatever the
relationship among some of these companies, in none of these instances does there
appear to have been any overriding control by another corporation over Darlington
in the change of employment.
If, as counsel for the Union argued with reference to some of these mills other
than Darlington, "the exchange of employees in all of the respondents held [sic]
to be included in the single employer status is one of the paramount facts that de-
termines whether there is a single employer ;status," the showing here is weak
indeed; and without consideration of the argument by counsel for the Respondents
that, whatever movement from one company to another (other than Darlington)
may prove with respect to their relationship, it does not bring Darlington into
single-employer status with them.
One change which, because of the language employed, might be listed infra among
the items which do suggest single-employer str tus, is the "promotion within the
Deering-Milliken mills" of W. H. Stallworth. Using these words in a memorandum,
Oeland explained that Stallworth, who had been card room overseer at Pacolet plant,
had been made production superintendent at Darlington Conceivably Oeland was
overenthusiastic in stressing the element of incentive. Certainly nothing in this
change of employment except Oeland's language in describing it indicates a single
employer. The same memorandum declares that Mullendore, Darlington's former
production superintendent, had accepted a position with a cotton mill in Georgia,
not one of the Deering-Milliken mills. Aside from Oeland's language, Stallworth's
change of employment no more indicates a single-employer relation between Darl-
ington and Pacolet than does Mullendore's indicate such a relation between Darl-
ington and the mill in Georgia. Here it may be pointed out again, as at the hearing,
that the evidence which is cited as characteristic of single employer status must
likewise be incompatible with independence if he General Counsel is to prevail.
Later, when Oeland informed Lowry on a visit by the latter to Darlington that
Stallworth was not satisfactory as production superintendent, Lowry declared that
he could use Stallworth's experience in the IED, and hired him. Thereafter, writing
to Stallworth concerning cancellation of his incentive bonus, Oeland refers to his
having been "transferred to D M I.E.D." Here again we are concerned with the
accuracy of Oeland's impression or the accuracy of his use of terms. We shall see
infra that there was no "D.M.I.E.D.," but as referred to above, an IED at DMSC.
Immediately thereafter Oeland wrote to Lowry concerning "transfer" of Goodwin,
DMSC employee, to succeed Stallworth as production superintendent at Darlington
This was after Oeland and Goodwin had talker. and "come to an understanding"
concerning the latter's new job. Johnson, who in 1951 started in the placement
department which functioned for some of the mills (the record is not quite clear
on this point), became personnel manager at Judson mills. When DMSC was set up,
he became head of its placement department. Thereafter he returned to Judson
mills as its personnel director. Lowry testified that one of his industrial engineers,
Hubbard, had prior experience at Judson mills. 3ut at the same time it was brought
out that Lowry's assistant, Moss, had come from a subsidiary of Owens-Corning
Glass. There is no indication that any more significance attaches to the change
of employment of the one within the group of corporations before us than to the
change of the other from an "outside" corporate on
More generally and in the main perhaps on a Lower level than most of those just
mentioned, it was testified that in 1955 and 1956 approximately 10 IED employees
of DMCS had gone to work for mills selling through Deering-Milliken; and that
298 DECISIONS OF NATIONAL LABOR RELATIONS BOARD
perhaps 2 or 3 had gone from the mills to the IED. There were also hirings from
and losses of men to other mills. These changes in employment do not show
single employer transferability. Kahle, secretary and assistant treasurer of Deering-
Milliken, testified that neither he nor any of his employees had had any prior
background or association with Deering-Milliken mills. Not for any lack of effort
is the number shown so small. I have not overlooked, in the testimony concerning
the functioning of the placement department, reference to mills' occasional inquiries
whether other mills and available employees with certain qualifications. The sig-
nificance and the results of such inquiries are presumably to be seen in the evidence
of transfers or changes noted.
Another item which called for explanation and was explained is the statement in
a letter from Oeland to Milliken on October 12, 1956, that D.M.I.E D. "agrees to
carry for a period of 3 months after their separation from the Darlington payroll"
16 office and supervisory personnel. It was testified that Lowry had said that he
had work for them and that the mills which DMSC serviced would want any whom
he could not hire since the mills were always looking for qualified people; and these
were qualified Darlington personnel. (This was never effectuated; except for Good-
win, infra, the men got jobs elsewhere.) It appears also that after it had been
decided to liquidate Darlington several of its supervisors and staff employees were
given time off to visit other mills, both Deering-Milliken and outside, to see whether
they could get other jobs. As he testified concerning this, it did not appear that
Deering-Milliken mills stood out in Oeland's memory or that they were his special
concern.
A single-employer status would perhaps be characterized by a transferability
of employees which does not exist here. Certainly the evidence adduced by the Gen-
eral Counsel in this connection does not show such status. Nor could an ap-
propriate unit be found which would include employees of the various corporations
who perform like or related tasks. There is no proof of a common labor force or
a uniformly managed labor relations policy.
Memorandums prepared by DMSC which permitted comparison of the mills
with respect to annual labor turnover could, like the demerit system employed, be
examples and an incentive for improvement. Similar information was obtained from
the National Industrial Conference Board and other patently independent sources, and
it can no more be held that comparison with other Deering-Milliken mills indicates
single-employer status among them than that comparison with other companies
and other operations indicates single-employer status with such others. Trade
associations, whose members do not jointly occupy single-employer status, prepare
and distribute such information Here again we have no evidence that DMSC or
anyone else outside a given mill corporation "got after" the mill tieasurer or
otherwise exercised or attempted to exercise a measure of control The mills re-
ceived unemployment insurance memorandums from DMSC; they also received
trade association and independent consultants' memorandums and bulletins. All
were advisory, and the weight to be given them was determined at each mill for
itself. General circularization of all of the mills when only one mill treasurer sought
information and whether or not the information was applicable to the other mills
or was desired or used by their treasurers represented DMSC's own interest in such
matters and its desire to be helpful. Trade associations act similarly
Cooperation in changing employment and questions in that respect developed at
various times. Of greater significance was the question of possible transfer of
Darlington's supervisory personnel at the time of liquidation. Oeland made recom-
mendations and Lowry indicated which men he thought would be useful, with
the expectation that they might be picked up by other Deering-Milliken mills or by
DMSC. Some 10 or 12 men were listed but, except for Goodwin, who returned to
DMSC, apparently none were picked up by the other mills or DMSC.
We need not undertake to prove a universal negative or the nonexistence of all
conceivable factors whose existence would prove single-employer status But to the
extent that certain factors have been pointed to as indicative of integration, such
factors, as we have seen, can be cited and the finding made that they do not support
the General Counsel's and the Union's position. Thus while a marked degree of
interchange of employees between Darlington, Deering-Milliken, and Deering-Mil-
liken mills would suggest integration and constitute a factor for finding single-
employer status, no evidence has been submitted of interchange beyond that which
may well characterize cooperating but independent corporations Clearly there is
no established system here of a course of interchange of employees. The occasional
hire by one corporation of an expert employee who had served one of the others
does not even suggest single-employer status. The situation is no more frequent
here or probative than is a company's employment as officer or house counsel of an
DARLINGTON MANUFACTURING COMPANY, ETC. 299
attorney who has previously served it as an independent practitioner or member of a
law firm.
Leading to the subject of recruitment and tra ning of employees, which we shall
next consider, but also connected with the eleme it of transferability of employees is
a memorandum from Johnson, when he was heat. of DMSC's placement department,
to Oeland. In this memorandum Johnson suggests the possibility of "borrowing" a
trainee or part-time student from Pacolet, "sharing" a man with another mill, or
of using someone from the IED or the cotton department "on a special assignment"
basis. Whatever impression of close relationship is thus created is largely dissipated
by Johnson's testimony, "They were just general suggestions of a line [of] approach";
that "employing" would be more accurate than "borrowing," and that he had not
known of any such practice Here again is an individual's impression of a relation-
ship and his use of certain terms, without proof hat the relationship in fact existed
(It must be noted that Johnson was suggesting, it was for Oeland to decide and
act.)
Another memorandum from Johnson to Deland, in March 1955, entitled "Super-
visory and Trainee List," might well be includes among those items which do sug-
gest single-employer status among the mills. Most of the memorandum might be
considered to have been issued to obtain for D 14SC's placement department more
complete information so that it might be able to render better service to Darlington.
But it sought, inter aka, information concernint, "[njon college supervisors at the
level of overseer or higher who may advance within youi mill, or are capable
of assuming greater responsibilities in another D. M. unit " The memorandum
declared the placement department's intention to prepare a list of certain personnel
at all of the mills. It must be noted, on the o.her hand, that the possibility thus
suggested of intermill transfers was not realized beyond the limited extent noted
supra. Certainly here is no evidence of authority outside of any mill corporation to
remove or otherwise control the hire of any employee of that corporation. The
services of the placement department, from the preinterview stage through employee
statistics, was advisory only. The mill treasurers decided whether to follow the advice
and the extent to which the services were employed
A training committee, which included several mill treasurers, the head of the cotton
department, and the president of DMRC, was crganized, and a proposed form of
trainee agreement drafted which was sent to Deering-Milliken mills in November
1955 with the request that they indicate whether they planned to use it. Some mills
indicated an intention to pay trainees on an hourly basis; some, equivalent amounts
as a monthly salary; and the rates were changed by various mills from time to
time. Thereafter DMSC and Johnson particularly developed a program of inter-
viewing college students and offered various suggestions, some of which were
voluntarily adopted by some of the mills Many of the suggestions were embodied
in a formal training program which included job instructor training and job relations
training. Without fully detailing the overall program, it will suffice to note that
various mills then jointly, or singly on a recip oval basis, sponsored meetings or
dinners for potential recruits. There is no evidence that, in the exercise of these
joint or reciprocal efforts, any mill deferred, voluntarily or otherwise, to the wishes
of another. The mills were here as in other rc spects merely sharing expenses to
accomplish what they could not separately manage.
To assist in making contacts at the various schools and getting better men as
trainees, the placement department prepared a "College Recruiting Program" which
suggested "points ... to bring out when talking with the students."
The purpose here was to impress, and like the Fabric Magic book, infra, the over-
all organization was stressed. Under "Opporti nities and Future," the following
was suggested as a point "to be brought out". "Man hired by one unit-not Deering-
Milliken-but is available to entire organizaticn. Stress cross transfers mill to
mill-staff to line, etc." Whether this suggestion was followed by mill representa-
tives who met the students we do not know. The grandiose if hopeful aspect is clear
in Johnson's testimony that the instruction that "[I]n no event should a man be invited
to more than two of our mills for a job offer" v as not observed. Johnson testified
that it was up to the mill representatives to bring out what they wanted to bring out
when they talked to the students While the program and the suggestions made are
evidence to be considered in determining the relationship between the various
corporations, of greater weight are the facts concerning actual availability to the
"entire organization" and "cross transfers" from mill to mill.
Nor, regardless of their number, are programs which are developed for sub-
mission and assistance to various companies indicative of single-employer status
among those companies which adopt or consider such programs. Thus, to cite one
example, the American Management Association is currently sponsoring for various
and unrelated companies a seminar on college recruitment. That seminar, which is
300 DECISIONS OF NATIONAL LABOR RELATIONS BOARD
related to memorandums and certain activities described in this proceeding, refers
inter alia to makeup of the recruiting team ; examination of studies indicating work
records of college students previously hired as basis for selecting current candidates;
preliminary steps taken with college placement bureaus before interviews with po-
tential employees; use of publicity; screening effectively before final job candidate
selection; proper timing of interviewing trips; discussion of common errors from view-
point of placement officer; what techniques are apt to work; preinduction and induc-
tion program of college graduates into company; continuing relationship between
college and companies, etc.
The apparent complexity of this single nonmanufacturing, albeit important, item
indicates the wisdom of a joinder 26 of efforts and of assignment to specialists 27
but such joinder was without loss of authority to the representative mills; and the
assignment did not transfer control. These are consonant with full independence of
the respective companies . Except where a treasurer was acting for his own mill,
not only were the recruiters limited to making recommendations to the mills, but
their continued service was at the mills' pleasure . Experience in the industry must
bring an awareness of similar complexities in many respects, and may lead to
reference to specialists for advice: all without surrender of control and without
creating a single-employer status among the companies which thus call for and even
pool their efforts to obtain assistance and advice.
Similarly with respect to advice concerning purchase of supplies and equipment
and by Roger Milliken generally, if the latter or others, because of their experience
and contacts in the industry, could offer suggestions to the mills, those suggestions
provided the mills with opportunities for benefit at their own discretion A delivery
schedule prepared by DMSC's purchasing department and received in evidence was
based on dates requested by the mills. The decision was not the purchasing depart-
ment's and the mills could make revisions subject of course to the seller's agree-
ment. In another memorandum from the purchasing department it is clear that its
services are advisory only- although it concerned a technical problem, the decision
ultimately lay with the mills, one of which had already decided on contrary action.
Whatever the purchasing department's advice, it is clear that there is no uniformity
among the mills in the equipment and supplies used. It should also be noted that
the testimony concerning activities of DMSC's purchasing department relates almost
without exception to the mills. Deering-Milliken has its own purchasing department.
On a different level, that of the production superintendents, if the production
superintendent of one mill inquired of his counterpart at another concerning some
phase of plant supervision, did this reflect a spirit of helpfulness which might be
reciprocated, camaraderie, or integration? What if personnel managers exchanged
information, most of which would be commonplace at a convention of personnel
managers or management experts so-called or a luncheon discussion among repre-
sentatives of independent companies? Mill treasurers had similar meetings and dis-
cussions and exchanged memorandums, for more formal and technical advice a
treasurer sometimes looked to outside consultants, whom he had to pay. Oeland
also testified that he visited non-Deering-Milliken mills and bleacheries from time to
time, and he named more than a dozen such. Here presumably were other instances
of cooperation, the extent and details of which were not spread upon the record.
From testimony that some of Darlington's supplies were sold to other Deering-
Milliken mills prior to the auction sale, one could jump to the conclusion that
Darlington's assets on liquidation, or some of them, were sacrified to other Deering-
Milliken mills; and on the next landing conclude that a single employer relationship
therefore existed. But it appears that such supplies, returned to the makers or sold
to other Deering-Milliken mills where possible, brought about 80 percent of cost while
approximately 20 percent was realized on similar supplies sold at the auction. Similar
advantage accrued to Darlington from sale of cotton which it owned to other
Deering-Milliken mills after Truluck (infra) had attempted to dispose of it elsewhere.
It is true that, like others, the recruitment program as described in this proceed-
ing was limited to Deering-Milliken mills and was availed of by only some of them.
But this reflects recognition of similarity of problems and the extent of cooperation
among these companies in other respects. Cooperation is still cooperation even
though it be limited as to the number cooperating (just as it remains cooperation
even if certain steps in programing, manufacture, sales, and especially the decisional
26 See "the Jointly Owned Subsidiary," Harvard Business Review, vol 37, No 4
(July-August 1959), page 31, et seq
"Whether or not "Macy tells Gimbel." independent business organizations (certainly
independent for our purpose , of which more infra ) do cooperate for mutual benefit; not
only among rival athletic coaches are seminars conducted
DARLINGTON MANUFACTURING COMPANY, ETC. 301
process are not included in the joint efforts). There is no evidence of compulsion
on the mills to join in these programs. But had they attempted to do their own
recruiting, training, testing, etc., the results would have been regressive and markedly
limited. The General Counsel recognized this when he argued that, like Deering-
Milliken, DMSC provides "top flight specialists that the nulls themselves, if they
were completely independent, could not afford." His five-word qualification is quite
unnecessary since the mills' ability to enlist specialists cooperatively would in nowise
be limited were they admittedly independent. We have in this argument an instance
of what has already been pointed out as typical of the evidence received: that condi-
tions are cited which are consistent with but not probative of single employer status.
Conceivably one of the mills might at some time prefer not to share with another
certain information which it obtained in one of these joint programs. That, however,
could only be at the price of developing the program without joint effort and support,
which would be expensive and therefore impractical. But a practical limitation
in the number of cooperating mills having been found, it is quite understandable
that these mills preferred to limit that cooperation and exclude others. Mutual
benefits thus accruing to Deering-Milliken mills might constitute an incentive to
continue their joint efforts; they do not prove single-employer status, control, or any
element beyond voluntary cooperation.
Thus the New York Stock Exchange may counsel its members and advertise
their services, and at the same time neither counsel nor advertise nonmembers.
Membership there even provides a measure of control Yet such assistance and
control and the exclusion 28 of nonmembers therefrom do not create a single-employer
status As much can be noted with respect to local unions, their so-called parent
bodies, and their federations.
The various memorandums concerning recruitment and training, and the arrange-
ments made, indicate a wholly voluntary relationship among DMSC, DMRC, and
the mills which joined in these plans. The breadth of recommendations by DMSC
is not determinative of status; the area of actual cooperation among the mills was
much narrower, and superimposed control nonexistent. Significantly, individual mill
treasurers made their own selections among available recruits Nor is the extent
of cooperation shown so great as to warrant a finding that, however voluntary their
acts, the corporations were in fact operated as a single entity. It should be added
that, if the cooperation shown does not prove single-employer status, certainly
reference to such cooperation by memorandums to the various mills or to DMSC or
DMRC, with copies to the mills, proves no more.
We have already noted the voluntary aspect when mills adopted suggestions which
they received. Even if we were to ignore that aspect, do suggestions and recom-
mendations by Deering-Milliken to the various mills and adopted by the latter prove
control and single employee status9 What of the recommendations which were
rejected?
Deenng-Milliken's quality control department, established in 1950, naturally
sought to anticipate or avoid complaints with respect to some of the finished products
of the mills. Thus Darlington adopted "truth marks" (apparently common in the
industry) so that material could be identified as to origin. To a great extent the
quality control department functioned as the complaint adjustment department:
Shotwell, who was in charge of quality control for Deering-Milliken, tested material
on a customer's complaint and then made a recommendation to the mill for settle-
ment; but the decision with respect to settlement, whether or not to make an
allowance to the customer, was the mill treasurer's. The credit and complaint
adjustment services rendering by Deering-Milliken to Darlington are not unusual
procedures for factors or even independent sales organizations. Such services are
quite understandable if only as designed to protect the agents' investment. If a single-
employer status existed, where outside of Darlington did control lie? To try to satisfy
customers is good business practice. As much can be said for taking expert advice.
There is no evidence that Deering-Milliken determined Darlington's decisions in
these respects, The record shows that at times mill treasurers did not accept the
recommendations made to them for resolving differences with customers, but settled
on a different basis.
Thus with respect to customers' complaints concerning tar spots, each dispute was
handled on its merits and by the mill treasurer involved. As in other matters, uni-
formity in handling would not prove single-employer status: it might reflect in-
dependent decisions and agreement that certain methods are best But the absence
of uniformity suggests independence. Although the General Counsel argues that
78 There is testimony that IDD representatives of DMSC visited other mills for informa-
tion, as an example of a wider area of cooperation
302 DECISIONS OF NATIONAL LABOR RELATIONS BOARD
the significant fact here was that Deering-Milliken was trying to establish a general
policy for the mills, and that whether such a policy was established is unimportant,
failure in such an attempt negates the concept of control ; while the attempt signifies
no more than a desire for proper handling of complaints of all customers to whom
Deering-Milliken sold as sales agent. It is no reflection on Deering -Milliken and
no evidence of single-employer status that , as the General Counsel declares , it "felt
strongly about its position in the market and its reputation with customers." Such
a "general policy ," explains action taken as that which a responsible independent
sales agent would take.
Standard practice instructions , prepared in the controller's office of Deering-
Milliken and distributed at Deering -Milliken and among the mills, might be regarded
from their very title as indicative of control by Deering-Milliken over the mills
But the testimony indicates that these are not instructions directed out of New York
and to the mills. Rather, they are prepared from information received from the
mills, and represent Controller Flanigan 's understanding of what the mills have
decided to do. Thus they constitute a confirmation and a handy and succinct refer-
ence guide for the mills , and at the same time information and a guide to interested
Deering-Milliken employees . What may suggest single-employer status in fact here
indicates independence . The standard practice instruction referred to supra was thus
explained.
To expedite resolution of disputes on long overdue payments , Flanigan sent a
memorandum to mill office managers in which he suggested bookkeeping procedural
changes and a procedure which it was hoped would move the nulls to resolve such
disputes more promptly . The factor 's interest here would be evident. While the
procedure involved a charge-back against the mill, the latter on settlement of the
dispute received credit retroactively ; and this procedure , it was testified , is common
whether or not the factor owns stock in the mill. Deering-Milliken pressed for early
settlement of such disputes , but it does not appear that such settlement, sometimes
by arbitration , was handled or determined by Deering -Milliken
A memorandum in March 1957, after the plant had been sold, from Flanigan
to Oeland concerning assistance by the former in obtaining a reduction in a bill
Tendered to Darlington by a firm of accountants has been cited as proof of the
status claimed by the General Counsel and the Union, and has been countered with
the argument that it cannot show single -employer status in 1956 While subsequent
events do not prove earlier status , a later relationship may, on the presumption of
continuity , suggest that the relationship existed before , in this case at and prior
to the time of liquidation . But the later event noted indicates only assistance by
Flanigan scarcely different from that which has already been noted and is far short
of proof of single-employer status.
In connection with the Deering-Milliken retirement plan mentioned supra, a
memorandum from Kahle to Oeland refers to a recommended amendment to the
plan, and declares: "Please place this proposed resolution on the agenda of the next
meeting of the Board of Directors of your corporation " If this last gives any
impression that Kable was directing Darlington's action, it is quickly dispelled by the
testimony that mill treasurers are themselves members of the pension committee
which recommended the resolution; Kable was intermediary between them and the
tax attorneys who prepared the resolution ; and only after such resolutions were
adopted by the mill's board of directors (he did not "anticipate " such action) would
Kable advise how many copies should be signed , etc Here again a possible im-
pression of control by Deering -Milliken vanishes with evidence of independent deci-
sions by the mills
Let us turn now to evidence which more nearly suggests a single-employer status.
( Opinions will of course differ as to the existence or extent of any such suggestion.
Whatever disagreement may follow my selections from the record. I shall not aegra-
vate it by attempting to correlate importance with order or sequence ) In June 1956,
Nielson , Pacolet's office manager , suggested to Flanigan that a new category be
included in the mills' financial statement, and detailed his reasons therefor . Flanigan
promptly forwarded the memorandum to Oeland at Darlington.
Nielson's reference to employemnt at various Deering-Milliken mils and his sug-
gestion that all mills be "consistent " would be characteristic of a single -employer
setup. But it must then be noticed that, in Nielsen's words , " the accounting policy
as far as what particular category of labor to charge them to varies drastically
between mills ." Here is apparent recognition that freedom of action existed. This
is confirmed by Nielsen 's further statement , "We do not feel that we should go
ahead with this, however , without all mills being consistent ," in view of certain
comparisons made between or among mills. Apparently Pacolet was free to "go
ahead" but preferred not to for the reason stated Nielsen concludes with a request
DARLINGTON MANUFACTURING COMPANY, ETC. 303
for Flamgan's comments and a check among other mills to see whether they are
in agreement . This last, indicating the mills' independence, is underscored in a
covering memorandum to Oeland, which Flanigan closes as follows: "If you are in
favor of adding this category in your mill, we would appreciate hearing from you."
Reference by a mill office manager to employment and accounting policy at the
various mills, his call for consistency, and the transmittal to Deering-Milliken and
then to Darlington-all of these gain our attention in this examination for evidence
of single-employer status. But the memorandums themselves indicate the volun-
tary aspects for Pacolet, Darlington, and the other companies. Pacolet's office man-
ager may desire an integrated accounting system; someone else may propose an
integrated noncompetitive manufacturing system. But adoption of these suggestions,
much less their imposition, has not yet been evidenced.
The suggestion from Nielsen to Oeland through Deering-Milliken might represent
the approach from one independent company to another through their mutual factor,
or contrariwise an integrated relationship working "thiough channels." On the
other hand, yet similarly, a direct suggestion from Nielsen to Oeland might reflect
a close working relationship which in turn might indicate either no more than such
a relationship between independent companies or an integrated status. As if the
absence of probative value in this either-or aspect of the evidence were not sufficient
to show that it proves nothing, one can speculate on the extent to which protocol
required that the office manager of one company should not directly approach the
treasurer of another, even if this was at times done; whether contact could have
been made through the Pacolet treasurer, and finally, what if any significance for us
would have attached to any other procedure
Again, in a long list of suggestions to assist the mills in their training program,
Johnson makes reference to "transfers" and suggests that his IED employ a trainee
for 6 months with the mill footing the bill. We have already considered the ele-
ment of transferability and seen that Johnson used terms which, by his own expla-
nation and from actual events, were inexact. No more than in the instance where
Pacolet's office manager hoped for consistency in the mill accounting do Johnson's
ingenuity and thoroughness in distributing many suggestions which in fact he
received from various mills prove a relation which did not actually exist. Further,
the suggestion that a mill pay the salary of a trainee at DMSC's TED would not
prove control or single-employer status; nor does it appear to have been adopted
The General Counsel at the hearing called attention to 18 of the 40 suggestions listed
by Johnson in a memorandum. I have examined all of these.
Oeland testified that the accounts at Monarch, where he had formerly been em-
ployed, had been in different form from those which Darlington kept; but that all
followed good accounting practice, and there were similarities, as in accruing ex-
pected expenses at the end of the accounting year; no routine had been established
for the various corporations. Good judgment and business practice are not to be
sacrificed merely to be different. Similarities may be fortuitous or the product of
independent judgment or cooperation. We are still concerned with the question
of control or that element of cooperation which belies independence. Certainly
that Oeland "did draw on [his] accounting experience at Monarch in helping to
set up" Darlington's accounts is neither surprising nor probative of anything here.
The General Counsel has also cited a memorandum from the office of Deering-
Milliken's controller to Darlington's accountant, in which suggestions are made for
changes in the financial statement forms. But any impression of dictation or control
must be quickly dispelled as it becomes clear that this is but one instance of sug-
gesting to the mills a helpful idea already adopted by one of them or suggested by
some individual This memorandum specifically poses the questions without making
any decision thereon. Minot Milliken testified frankly that copies of financial forms
were sent by the mills to Deering-Milliken as it was important that the mills'
balance sheet items be known to it; Deering Milliken submits similar information
to banks when it borrows from them.
The issue of extent of assistantce as reflecting on the relationship of the various
companies is raised by Deering Milliken's employment of Turnowski tinder Flanigan
and Kahle for a short time. It was explained that he worked on property accounts
for proper handling taxwise of purchases of new machinery, consulting with mill
treasurers as they attempted to modernize their facilities after World War TT The
mills' property accounts were independently maintained at the respective mills, and
Deering-Milliken's treasurer, Minot Milliken, had no knowledge of them. But for
a time Roger Milliken's interest in the mills was expressed in the employment of
Turnowski by Deering-Milliken. This was Minot Milliken's explanation for Tur-
nowski's employment. Although a small matter in itself, the possible significance
of this temporary employment and the explanation given constitute in my eyes a
304 DECISIONS OF NATIONAL LABOR RELATIONS BOARD
challenge to my findings and conclusions herein . One could perhaps pass this item
off as evidence of Deering -Milliken 's further interest in its principal mills' welfare
instead of combining Roger Milliken 's personal interest with this employment by
Deering Milliken as Minot Milliken has . The situation can be viewed in a light
more favorable to the Respondents if we recognize any factor 's interest in the
well-being of its clients and regard Turnowski 's assistance as similar to the other
tax assistance and that given in connection with production , sales, insurance, etc.
That Turnowski 's services were advisory rather than controlling is further suggested
by the testimony that he did not have copies or summations of Darlington 's property
records.
As an exception to the time-spent basis for payment by the mills to DMSC for
services which it rendered to them, the head of its cotton purchasing department,
Truluck, received payment from each mill as a percentage of its production, such
payments going through DMSC. ( DMSC also purchases synthetic yarn for mil's
which we it .) This arrangement , entered into at different times with the several
mills, whereby they pooled their buying of cotton so as to avail themselves of an
expert in the field and carload freight rates, was voluntary on their part and does
not appear to have barred them from freely purchasing elsewhere and under other
arrangements . Although the cotton purchasing department could be and apparently
was very helpful in buying for and advising the mills, neither Deering-Milliken,
DMSC, nor Truluck exercised control over the nulls in this respect . The record
includes evidence that cotton purchasers render similar cotton purchasing and
related services to admittedly independent mills.
There are other instances in which a factor purchases cotton for mills in which
it holds a stock interest and also for mills which are independent in ownership.
Thus cotton purchasing arrangements do not tend to show either independent or
single-employer status Nor is division of a limited quantity of a given quality
among several mills which had ordered it significant : any purchasing agent, ethical
and concerned with pleasing his principals , would do likewise. Further , with fluctu-
ations in the cotton market, hedging by transactions in futures is common. The
evidence indicates that the extent of such hedging here is determined by the respec-
tive mill treasurers and varies among the various corporations
In connection with the erection of a central cotton warehouse originally planned
to accommodate 5 mills which are within a 100-mile radius , it was noted that a
DMSCIED memorandum first cites the savings contemplated for each of these mills,
including Darlington , and then lists the total net savings to all of the mills expected
to join in the project and the return on investment , again computed for all rather
than for each mill The suspicious circumstances here is the grouping of all of
the mills. The savings to the respective mills would be considered by each of them
were they indeed independent . In a case of overall control and single-employer
status, the total net savings and the return of the entire investment would take
priority ; and these letter items in the memorandum suggest that single-employer
type of consideration here. But (with the exception of Pacolet ) the investment by
each mill in the warehouse was in proportion to the quantity of cotton consumed
by it so that with minor variations ( some of the figures used were themselves esti-
mates ) the return on investment for all was and would be the same as the return
on investment for each mill Thus there is no lack of concern for the benefit to
each participant but only a single overall computation which was referable to each.
This does not indicate single-employer status, whatever the impression As in other
instances , we must distinguish between a prima facie impression which may warrant
further examination or questioning , and a finding when the facts are understood )
On the contrary there is one facet here which further suggests independence: Paco-
let's treasurer "elected" to join this venture to the extent of only 5 percent of his
cotton consumption.
Among the services rendered by Deering Milliken were those performed by its
tax department, which Kable supervises That department is responsible for the
drafting and preparation of Federal and State income and other tax returns for
Deering-Milliken , and its services are also available to all mills which sell through
Deering Milliken . The department 's services are charged to the mills according
to weighted hours spent , weighting being according to the salary of the person whose
time is thus spent . It was in this connection Kahle was made an assistant secretary
or treasurer of the various mill companies ; that status earned him no additional
compensation, and he had no authority except to settle tax disputes with the consent
of the mill treasurer . In effect his title afforded him recognition as he dealt on
behalf of the mills with various tax authorities.
Kable had a $2,000 coverage in Darlington 's group life policy and similar cov-
erage with the other mills of which he was thus assistant treasurer or secretary-
DARLINGTON MANUFACTURING COMPANY, ETC. 305
This was the maximum amount that any individual could carry under each policy,
and all of the companies ' plans were with one insurer, although separate . Here was
an attribute of employment of Kable by each of the mills. But whatever the insurer's
attitude, it is clear that Kable was not a mill employee . The mills could and did
avail themselves of his services , for which they paid Deering Milliken ; and while
each mill could terminate his services for itself , they could not terminate his em-
ployment by Deering Milliken . Certainly the fact that he gave tax and other financial
advice to Darlington does not prove single-employer status between the latter and
Deering Milliken Tax counsel were called in from time to time and their advice
transmitted to Darlington and other mills. Similarly the Darlington stockholders,
through Oeland , selected an "outside" auditor from time to time. But neither tax
counsel nor the auditor, despite the joint efforts thus made , was a Darlington em-
ployee; nor did the efforts of either create a single-employer status. While Kable's
efforts on behalf of the various mills are detailed and include lengthy discussions
with tax officials , decision after his negotiations is in each case made by the mill
treasurer . This is consonant with either independent or employee status; it would
exist were there a single -employer relationship among these companies , but it is
not limited to and does not prove such a relationship or status. It may be well to
recall at this point that , although Pacolet discussed tax aspects of its vacation plan
with Kahle, it sought advice from tax attorneys.
Presumably significance is claimed in the fact that Kahle prepared in final form
the minutes of stockholders and directors meetings to the extent that they referred
to action taken which had a bearing on tax. But Oeland would first send to Kahle
a draft of such minutes after the action had been taken . Here again as in other
matters the decision was made at and by the mill, Kahle advised and otherwise
assisted . ( What is here said concerning Kahle applies on a very small scale to
barely mentioned advice by Kennedy, Deering-Milliken 's general counsel, with re-
spect to an item in the minutes of a directors ' meeting. It appears to be Kennedy's
function to have independent counsel prepare necessary documents for mill corpora-
tions, which he then passes on to the respective mills. Darlington 's general corporate
legal problems were handled by local attorneys in Darlington . Not in criticism of
the General Counsel, but as a reflection on the available proof, it may be said that
the reference to this item constitutes straining at a gnat when there is no camel to
swallow ) Considering the services performed by the tax department , no signifi-
cance would attach to its possession of a copy of Darlington 's bylaws But some
slight significane may be found in the fact that, as the Darlington liquidation devel-
oped, Kable noted that he did not have a copy of its bylaws, which he would need
as tix problems arose In January 1957 he asked the various mills to send him a
copy of their bylaws. One would expect copies to have been maintained at the seat
of government were this an "empire."
In more general terms, Deering Milliken interested itself in Darlington 's taxes
and yearend dividends , as indicated in a request by Minot Milliken in September 1955
for Darlington 's estimate of profits for that year so that a tax attorney might review
it to determine Darlington 's yearend dividend . Deering Milliken rendered a service
in securing the advice of tax attorneys ( who might not have been readily available
to the individual corporations ) for the mills, but did not itself become involved in
any sense of control of dividend declarations Nor did the attorneys , advising
Deering-Milliken mills and acting at their request, create a single -employer status
among them any more than such status could be held to include other clients of those
attorneys.
Of similar importance to the factor are other financial details, including capital
expenditures and commitments , depreciation , etc., and the amount available for
additional capital expenditures or investment in modernization . But interest in
these items does not prove control over decisions made or to be made with respect
to such expenditures , and certainly not with respect to labor relations and policies
To the extent that it is prepared to help , a factor's or sales agent 's interests lie with
its principal 's benefits If what is good for General Motors be deemed good for
the United States , and what is good for Darlington be deemed good for Deering-
Milliken. such concurrence of benefit even if planned does not prove control or
single-employer status within the respective groups. ( Any attempt to inject a politi-
cal issue here is rejected.)
A related situation with respect to Deering -Milliken Research Corporation was
noted at the hearing. Organized on a cooperative basis in 1945, DMRC had been
allowed only an 80-percent deduction by the Federal Treasury Department. A new
and more advantageous plan was then worked out by Kahle and tax counsel, and
submitted to and approved by Darlington 's stockholders in January 1955. There is
nothing significant to us in the fact that Kable explained to Oeland the details of
306 DECISIONS OF NATIONAL LABOR RELATIONS BOARD
the transfer of the certificates which was to be made and the sums involved. Similarly,
when Darlington was liquidated, Oeland consulted Kahle concerning the mechanics
of redeeming Darlington's stock in DMRC.
Considering Kable's services to Darlington and the other mill companies, we are
not warranted in finding integrated status because a consultant is employed over a
period of time rather than ad hoc. It is clear from the evidence that these were
consultant or advisory services without that element of control or dominance over
decisions which would characterize a single-employer status involving both the
source of the expert assistance and the Company thus assisted
Having referred to DMRC, we can at this time briefly note the testimony concern-
ing its efforts in connection with the incoming parts inspection and maintenance and
preventive maintenance programs of the various mills, together with a limited ma-
chinery purchase effort availed of by some of them. While anything done at a mill
may impinge on the terms and conditions of employment, this work was not so much
in connection with labor relations or the terms and conditions of employment as
with the industrial engineering of jobs and work procedure. With respect to each
facet of the assistance and suggestions offered by DMRC, it was necessary to con-
vince the mill treasurers even as the latter in the first place determined the activities
to be considered by DMRC.
Payment to DMRC for its services according to sale or commission income, is
entirely consonant with independent status. Where a given activity was of interest to
only one mill, the charge therefor was made to that mill only. although such ar-
rangements appeared to be loose. Comparison and even competition among the mills,
with a demeriting system based on the condition of the machinery-all of this rep-
resents joint effort independently agreed to for mutual benefit In one case, it was
brought out, Oeland stated that he did not want the figures let out to other mills;
McCullough, who was secretary of DMRC and was intimately involved in these
programs, testified that he had to honor Oeland's request With respect to a slubbing
device which it owned and which DMRC had developed and sold to it, Deland stated
that Darlington preferred not to auction it off at the sale, and suggested that DMRC
purchase it after agreement on the price. The inference that this meant a prefer-
ence for other mills which maintained or contributed to DMRC is not warranted; in
a letter 7 months before, Oeland mentioned Darlington's trial shipment of the device
for sale to Burlington Mills, an "outside" organization.
In response to a request by Roger Milliken for a recommendation on the best
methods for certain operation, DMRC replied that it had been working on a plan
so that it could report to "mill management" on mill practices as well as machinery
condition. The mill treasurers were of course interested in assistance. But it was
testified that they were sensitive about their mill practices. It does not appear that
Milliken or DMRC could or ever did force on mill treasurers any changes in prac-
tice or operation. In fact the rating of the mills' maintenance systems was soon
discontinued when the treasurers decided that it was not sufficiently meaningful to
warrant consideration at their quarterly meetings.
Another and more serious question is raised by an agreement to make retire-
ment or pension payments to Nicholson, who had preceded Oeland as treasurer of
Darlington. On Nicholson's retirement in 1951, the directors of Darlington com-
mitted themselves to make monthly payments to him. With the dissolution of
Darlington this commitment continued, but Darlington's obligation was measured
by actuarial computations The question arose as to what would happen if Nicholson
outlived the actuaries' expectation. At this point Milliken suggested that Cotwool,
another "related" corporation. pick up any payments which might be due to
Nicholson should he outlive the actuaries' expectation The director of Cotwooi
agreed to do this. In explanation it was pointed out at the hearing that Nicholson
had at one time been employed by a subsidiary of Cotwool. Whether this last ap-
peared to the Cotwool directors to create a moral obligation to assume the possible
future payments, and if they thereupon committed themselves, the commitment
is clear. This item does not show control of one corporation by another; but the
element of cooperation is close and is related to the status of a former employee,
albeit a top one and not an employee within the meaning of the Act. (The reference
here is to the element of centralized control of labor relations.) This is certainly
one of the General Counsel's "stronger" instances. That it is not probative reflects
on or is itself a reflection of the nature of his case. An attempt to show further con-
nection between Nicholson and Deering-Milliken or these mills failed.
Reference was early made to the Deering-Milliken foundation, formerly the Deer-
ing-Milliken welfare fund This was organized for charitable purposes; Darlington
and other corporations and individuals have contributed to it voluntarily Once
received, the funds are administered by a bank as trustee on recommendation of an
advisory committee The control thus exercised by the advisory committee and the
DARLINGTON MANUFACTURING COMPANY, ETC. 307
bank, and the loss of control by Darlington and other contributors over funds
once turned over to the foundation do not indicate any measure of control by one
corporation over another, or by or over any individual. Whatever goodwill or other
benefits attach to the name Deering Milliken from use of this plan which also pro-
vides tax benefits, any consequent impression of control over contributors is erroneous.
The General Counsel has also cited a statement by Roger Milliken on October 2,
1956, which was received in evidence at the original hearing on the issue of Darling-
ton's business prospects . That statement , posted at Darlington and some of the other
Deering-Milliken mills, was as follows:
The Administration in Washington has not yet worked out the details of a
positive or permanent solution to the problem of low cost Japanese imports
competition . But in a speech last weekend , Sherman Adams , speaking for the
Administration , promised that they were committed to work out a solution of
this problem that would be satisfactory to the American textile industry, and
would stop the liquidation of American jobs and American mills that has been
taking place.
Relying on this promise, without which a wage increase would be impossible,
we hereby announce an upward revision of wages, effective Oct. 8.
The statement is material here as it may indicate a common wage policy among
the mills and control of such policy. On the other hand, if a quondam leading
Government official's remarks prompted action in Deering-Milliken and non-Deering-
Milliken mills , announcement of such action by the president of various mill corpora-
tions here no more proves that such corporations occupy a single -employer status
either among themselves or with their factor and sales agent than that they occupy
such status with other corporations in the industry which announced similar action;
no more than , where there is an industrywide association , does such an announce-
ment by the association indicate a single-employer status among its members
Neither would the fact that the action, in putting increases into effect , as distinguished
from the announcement , was simultaneous and similar ( if the increases were si-
multaneous and similar ) indicate single-employer status or control . The increase,
not the announcement , was the salient fact; and that was determined throughout
the industry by a long-existing demand for higher wages and the prospects raised
by the Government official's remarks ( and other general as well as specific factors).
It is argued that an outstanding aspect of a common wage or labor relations policy
among the mills (this must exclude Deering-Milliken , DMSC, and DMRC) is the
fact that the employees are not unionized; but this proves too much since it typifies
many other cotton mills.
Close operation among the various Deering-Milliken mills is further exemplified
by a memorandum entitled "Cotton Spindle Activity," from Flanigan to the various
mills in March 1956. This referred to a chart showing such activity for Deering-
Milliken mills and throughout the industry from 1941 through 1954, and then through
1955. Prepared by Deering-Milliken, it was regarded as a selling argument to
stimulate future activity and to boost sales. Were claims of successful operation
and multiplied sales to be regarded as evidence of single employer status , the Board
would have to modify its findings and its orders in countless cases. (See infra.)
Also cited as indicative of single employer status is a "unanimous " decision reached
at a weekly meeting of Deering-Milliken salesmen on June 9, 1955 , and before
the mills were consulted, not to confine a given blend to one customer . This decision
was evidently deemed by all who considered the matter to be in the best interest
of Deering-Milliken and, presumably for the same reason, of the mill. Certainly it
is not claimed that the salesmen controlled the mills; yet the language here is that
they decided, Milliken agreeing. One can think of the admonition against "all
eggs in one basket" and of the desire to maintain goodwill with all accounts The
salesman's interest would thus generally follow that of the manufacturer. That
interests coincide does not prove single-employer status . The action taken does
not show such control by one corporation over the other as to indicate single-
employer status: such a decision by Deering-Milliken and its sales force might well
be made with the corporations occupying a multiple employer status and even if there
were no common stockownership . Nor would a sales organization 's decision made
without consulting its manufacturer and even contrary to the latter's interest nrove
single-employer status. Should we then hold that, because the interests are p rallel
and the decision favors both, single-employer status is indicated9 Sales and style
information is suggestive not of domination or control but of an advisory service to
protect advanced funds and to further sales Such fund advancement is character-
istic of independent factors who, even if there has been no Board determination of
672010-63-vol. 139-21
308 DECISIONS OF NATIONAL LABOR RELATIONS BOARD
the issue , can by no stretch of the imagination or the law properly be held to con-
stitute a single employer with their clients.
As for the statement , in another weekly resume of a sales meeting, "We would like
to make a decision as to whether we will put looms on (one or a second construc-
tion) sometime today . Please everyone contact all your customers who might
have interest in this number"-to cite this is to grasp at straws . The reference
immediately before was to the "situation at Darlington" and some inquiries concern-
ing a given construction , on which Sales Supervisor Miller had "obtained prices from
Mr. Oeland ." It is understandable that Miller, to his salesmen , would identify himself
with Darlington in the decision to put looms on certain constructions after the
salesmen reported on sales possibilities . But as Oeland set the price on the basis of
various factors including market information from the sales force, so did he make
the decision whether to manufacture various constructions . To conclude that these
decisions were Deering-Milhken 's or those of its sales force would be to distort
the evidence.
In December 1954 DMSC had suggested a program for customer visits to the
mills. This suggestion appears to have been followed up in January 1955, when
Dillard , who was at that time vice president in charge of certain sales and who was
succeeded by May, notified Oeland of a plan to set up a room at Monarch mills to
display finished and greige goods from various Deering-Milliken mills. Monarch
apparently did display some samples from some other mills. This seemingly close
relationship between the mills was explained by an item in the memorandum sug-
gesting the program , which called for an "offer of liaison " between Deering-Milliken
as selling organization and the various customer staff departments "to improve com-
petitive position of both ." The impulse to jump to the conclusion that Monarch
was pushing sales of the other mills as in a single employer situation is thus replaced
by the realization that Deering-Milliken and the various mills including Monarch
believed that there was an advantage to all in advertising the idea that "you can get
them all at Milliken," noted infra. The testimony concerning display of samples at
Monarch is sketchy, and it does not appear that Monarch showed any other mill's
construction which was competitive with its own. The evidence throughout shows
that any all-for-one concept was limited to what was favorable to the one; and that
is a far cry from all in one.
It was explained that assistance in development of new fabrics is a sales function.
This might be called a "Western Electric" type function , of which more infra. (We
have already noted that there was competition among the mills in the manufacture
and sale of similar construction .) Here is another instance of mutual or concomitant
benefit: as Minot Milliken voluntarily summarized when asked generally about other
assistance , a very close relationship exists between mill treasurers and Deering-
Milliken sales departments , there being an almost constant and daily flow of informa-
tion back and forth in the interest of further sales. But the nature of this relationship
is clear: Although May , Deering-Milliken 's vice president in charge of these sales,
pressed Oeland to accept orders so that sales could be made , the latter considered
the aspect of profits for Darlington 's stockholders , with the result that offers were
sometimes turned down and sales "lost." Here, as in decisions to limit operations,
Oeland 's authority was clear.
A market summary from Miller, as sales supervisor , to Oeland in April 1956
as pointed to as indicating control of Darlington 's output by the other mills or by
Deering-Milliken . The report reads in part as follows:
We understand that this is a very good running number at the mill and that
you would be glad to have additional business on the cloth . If we can arrange
to get the clearance from Department 2 and operate in a sensible way in relation
to the other pocketing twills being made by the other mills, we will press for
additional business.
Miller testified in explanation that "clearance" was a poor word ; what he wanted
from department 2, which handled heavy goods , was market information concerning
pocketing twills; such twills, used in great volume, are normally heavy but Darlington
had been able to make and obtain an order for a lighter twill; Miller now wanted
market information concerning the traditional pocketing twills as he sought to avoid
pushing a poorer quality and developing what might be a short -lived business. As
thus explained , Darlington 's sales were not limited by consideration of the effect
on other mills or of other elements entraneous to Darlington 's own welfare. This
explanation is suspect if only because "clearance" suggests authority or control.
Yet, with an order already accepted by Darlington , action had been taken without
DARLINGTON MANUFACTURING COMPANY, ETC. 309
actual clearance 29 As for the procedure in actually closing orders, pricelists on the
various constructions are periodically given to the salesmen as a guide. A salesman
can quote a tentative price to a customer, who then makes a firm bid which is ulti-
mately referred to the mill for acceptance. The General Counsel understandably
emphasizes this exhibit in his brief. But he proceeds to stress the "numerous evidences
of cooperation" between the mills, which is quite different from the necessary element
of control.
Further on the question of terminology and the employment of right or wrong
words, use of "we" by Milliken in memorandum to various mill treasurers is cited
as indicating single or joint control. (Whether the control thus allegedly indicated
is claimed to be by Milliken, Deering-Milliken, or both, is not always clear.) Whether
this be regarded as another incorrect term or whatever the explanation, the fact is
that in each case actual control lay with the mill. Thus Milliken wrote to treasurers,
. we are planning to install a great deal of Pneumafil equipment," as he proceeded
to transmit a suggestion which a mill treasurer had made concerning such installa-
tions. Leaving for the moment the aspect of cooperation in engineering, it is clear
that the "we" is not Milliken or Deering-Milliken in an overall plan for the installa-
tion at all mills, the decision in each case rested with the mill. It was only the plan-
ning which had elements of joint effort and cooperation, and in that sense it was
quite correct to speak in the first person plural.
A similar first impression of control, which analysis proves to be only coopera-
tion appears in the very next exhibit received, a memorandum to some mill treasurers
which refers to capital expenditures for other equipment, asks for a study and
report by the treasurers, and states, ". . . we will review the situation for the whole
organization" in the hope of obtaining a more advantageous price with some equip-
ment supplier. The term "review" may suggest control and single entity; and this is
bolstered by "we" and "the whole organization." But all that we have here is a
proposal for joint or simultaneous purchase after separate authorization by each
mill. As for attaching significance to the word "organization," what shall we say
when reference is made to the plural, "organizations"?
One admittedly independent company, Liberty Mutual Insurance Company,
cooperates to the extent that it is called upon and can cooperate with Deering-
Milliken and these mills. But this does not bring that company within a single
employer status with the others. It cannot be denied that the various corporations
referred to in the remand order cooperate with one another to a great extent. But
no more in their production and attempts to improve it than in their sales do I find
that joint or superimposed control which is necessary to a conclusion that they
occupy single employer status. To borrow terms used by counsel for the Union,
interrelationship is shown; but not interdependence, and certainly not control.
Not clearly explained are certain references to Accident Prevention Procedure.
A book so entitled was prepared by the insurer, and certain procedures therein were
stamped as approved by Lowry on behalf of "Deering, Milliken and Company In-
dustrial Engineering Department." Such a stamp in use before DMSC was formed
in 1951 does not show that any different services were rendered to the mills at that
time or that the relationship among them and Deering-Milliken was different from
that under DMSC. Insofar as Lowry's efforts since 1951 are concerned, we have
here only another example of assistance by DMSC to the mills, which pooled their
accident insurance to obtain just such assistance and lower premiums while at the
same time trying to lower their accident rates. Use after 1951, of the stamp de-
scribed has not been explained. But, it is clear from the testimony that Deering-
Milliken does not have an industrial engineering department; DMSC does. Despite
the rubber stamp, approval had apparently been given by Lowry on behalf of
DMSC or DMSCTED. (Even after this was pointed out and while a witness referred
to "the Industrial Engineering Department of the Service Corporation," the General
Counsel and the Trial Examiner quite unintentionally continued to speak of DMTED.
Complete forgiveness will surely be vouchsafed if it be pointed out that the witness;
in a memorandum headed "Deering Milliken Service Corporation Placement De-
partment," which department was part of that corporation's TED, himself referred
to DMIED!) Nor are the facts altered by Oeland's reference to "DMIED" in a
letter to Roger Milliken, as in one to Stallworth, both already noted.
These are not the only instances of reference to DMTED. But before we lose
ourselves in a tangential flight or spacial orbit, it should be noted that, whether
DMIED or DMSCIED, no control over the mills is here shown. Whatever the
title mistakenly used and the form, the advisory nature of Lowry's effort was made
w Cf. Sweet Home Veneer, Inc, 124 NLRB 113, where it was held that "propaganda"
referred to by the employer did not mean union propaganda.
310 DECISIONS OF NATIONAL LABOR RELATIONS BOARD
very clear as he testified that he was only slowly and partially successful in per-
suading the mills to install an engineered standard cost system. His assistance was
available to Darlington and other mills as and when they desired and developed
a cost engineered system tailored to their respective organization and operations;
and when mills so desired, they retained other industrial engineers as consultants.
As for the mills' pooling of their insurance, reliance on Deering Milliken's insur-
ance administrator and joinder to obtain favorable fire, accident, workmen's com-
pensation, or other insurance rates does not even remotely suggest the elements of
control which indicate single-employer status. (Our brief consideration of accident
prevention procedure suggests advantage to the insurer, which favors such joinder.)
Neither does joint treatment by the insurer indicate such status any more than sep-
arate treatment by tax authorities indicates separate status. The advantages in an
overall policy apparently do not extend to group life and hospitalization insurance,
and benefits under different policies have varied from mill to mill.30 One may
wonder about the element of free service or benefits rendered Darlington by Deering-
Milliken in an inclusive air insurance policy; also about the fact that the mills are not
charged for the services of the insurance department, which consists of the insurance
administrator and a clerk. (Fire insurance has covered churches and community
houses in some towns!) But while provision of advantages may lead to control,
the latter must be shown. Finally in this connection it may be noted that the only
insurance policies which touched Darlington's hourly paid employees were workmen's
compensation and group life; and while a master policy covered all of the mills with
respect to the former, Deering-Milliken was not named in either the one or the other.
It has its own workmen's compensation and group life coverage. It is not quite cor-
rect to say that, when Darlington was liquidated there was an amount on hand in
excess of the cost of the insurance program and that it was decided to leave it in the
experience fund for the benefit of all of the other mills. The record shows only that
Oeland declared finally that, since the amount remaining in the reserve fund was less
than the cost to Darlington to administer the policy, it should be kept in the Darling-
ton account.
At this point, if at all, should be mentioned an old form now used as a scratch pad
and employed by "Deering Milliken Mills Textile Machinery Department" before
DMSC was formed in 1951. While common use of the name Deering, Milliken Mills
does not prove status, the situation is different where it is formally employed on sta-
tionery. But in the absence of proof of the circumstances when the form was in use
prior to 1951, of the functions and status of the textile machinery department, and
of the nature of any connection among the various companies with respect to that
department at that time, there is no warrant for making a finding of single-employer
status among these companies.
In a memorandum to May, who was at that time in charge of print cloth sales
for Deering-Milliken, Roger Milliken used the terms "our mills," "the whole com-
pany," "the manufacturing of Deering-Milliken." If it be urged that we do not
credit Milliken's testimony that he noted with chagrin his own use of such phrases,
and his statement that he used such terms incorrectly there and elsewhere, we are still
left with what would at most be an admission that there is a close, even single-
employer, status. Such an admission would be evidentiary, to be weighed with
the other evidence. Milliken is not qualified to determine the legal significance
of such language; but I credit his testimony, and find that it was not his intention,
as he employed those terms, to ignore or to set aside the relationships which actually
existed as the evidence here shows.
With respect to the substance and purpose of this memorandum, a factor's interests
as well as its manufacturers' are furthered as the sales staff is informed and itself
"sold" on improvements in the mills' procedures. Milliken wanted May's assistance
in obtaining recognition in the market of some of the mills' goods as premium
by virtue of the improvements which they had effected.
As for a few other items in the record, use of an old form ("Deering, Milliken
Mills Purchasing Department") in one case of 35 to 50 noted instead of the current
form ("Deering Milliken Service Corporation"); use by an employee of the am-
biguous word "transfer" where the evidence indicates that a sale was made from
one mill corporation to another; 31 use of a form which calls for approval in "New
su It was testified that each mill decides which benefits it wants under these insurance
policies. As for plate glass insurance, only a few mills carry this, and these policies vary
from year to year. Boiler insurance and factory insurance have also been rejected.
a Although we have considered the significance of the use of such words as possibily
indicative of an existing relationship, we must not "make a man an offender for a word."
Isaiah 29: 22.
DARLINGTON MANUFACTURING COMPANY, ETC. 311
York" when such approval was noted in New York only by Milliken as president of
a given mill when he had been in New York and before he moved to Greenville:
these do not prove the single-employer status which the General Counsel and the
Union claim. Here again we must remember that, in weighing the evidence which
may suggest single-employer status, effect must be given to both the quality and
the quantity of such evidence; and the quantity must be evaluated in relation to
the thousands of documents examined by the General Counsel and the many months
spent in his unhindered search for evidence.
Whether and to what extent Darlington's former customers have since its cessation
of operations purchased through Deering-Milliken and from other Deering-Milliken
nulls we do not know. There is no evidence 32 of a pattern of sales to them by
Darlington which, after its liquidation, was continued by other Deering-Milliken
mills, as we shall now see. Nor does it appear that there was a transfer of accounts,
of constructions manufactured, or of styles to another mill when Darlington was
liquidated. Yet such transfer and assumption of Darlington's functions would
naturally and almost automatically occur were this a single-employer situation. As
for the few orders which Darlington was unable to fill because of the liquidation, it is
clear that some were sold to other Deering-Milliken mills, some to non-Deering-
Milliken mills. In fact, the first testimony concerning this was to the effect that an
order was transferred to a Deering-Milliken mill only after an attempt to transfer
it elsewhere had failed. The several orders were taken over by various mills as if
purchased in the open market: Darlington kept a premium or bonus if an order
was now advantageous as the result of market fluctuation; it paid for the assumption
of the obligation by another mill if the order price now seemed to be insufficient
or if a change in construction would result in higher cost. (What conclusion could
be drawn and what would the General Counsel's argument be had these orders
been transferred without a differential, Darlington or the acquiring mill assuming
the entire gain or loss as in an out-of-one-pocket-into-the-other situation!) One
contract was canceled with an allowance to the customer. There is no basis for
concluding that the transfers favored other Deering-Milliken mills or that they
indicated an element of control over Darlington or the other corporations which,
for example, might have permitted dictation or insistence in connection with the
taking over of the orders. As for Deering-Milliken, its concern with these orders
was that of the sales agent which had secured them and was obliged legally or
morally to see that they were fulfilled.
To the extent that the Board is interested in the Union's offer to prove that
Deering-Milliken "has suffered no depletion in the type and amount of products
available for sale by it," this was not shown at the remand hearing; the sale of
orders to non-Deering-Milliken mills suggests the contrary, and there is no proof
that Darlington's products, in their type or amount, were compensated for and
provided in addition to what would otherwise have been the other Deering-Milliken
mills' production. As the offer of proof was thus discussed and the evidence sub-
mitted, the General Counsel could only state that he hoped to show that Darling-
ton's constructions were made at the other mills when the former was liquidated
or were begun by them shortly afterward. The latter alternative might be construed
to support the offer of proof although, even had that been shown, it might reflect
any competitors' attempt to fill a void. The other alternative, that Darlington's
constructions had been and were being made by other Deering-Milliken mills, still
calls for proof that Deering-Milliken "suffered no depletion in the type and amount
of products available for sale by it."
If a Deering-Milliken salesman found that a customer wanted a given construction
which was not being made by any of his manufacturers, it was Deering-Milliken's
function to try to persuade one of them to make it. The testimony that Deering-
Milliken persuaded Monarch to make a construction which Darlington had formerly
made but which had "lapsed into inactivity" before the liquidation shows only that
Deering-Milliken suffered no depletion so far as that order was concerned. Why
Darlington had discontinued the construction, we do not know; nor whether Darling-
ton would have returned to it and filled this order. Neither is it shown whether or
to what extent this construction replaced another on Monarch's looms. Certainly
production by one mill of a fabric which had sometime earlier been made by another
does not prove single-employer status.
With respect to another construction, the testimony shows that, with liquidation
impending, Darlington could not guarantee delivery and an order was therefore
8'" It might be advisable to omit the details about to be set forth in this connection, and
to proceed at once to the conclusion which appears a few pages later But the evidence
is involved, and analysis may be especially helpful here.
312 DECISIONS OF NATIONAL LABOR RELATIONS BOARD
placed with Monarch . But proof of the issue of depletion is not to be found in
evidence that some constructions were picked up by other Deering-Milliken mills
and thus not lost to Deering-Milliken (here again is the problem of the universal
negative); on the other hand, any loss is probative, and we have evidence of loss
to outside mills. In like vein , a construction which Darlington alone of the Deering-
Milliken mills made in 1956 was not thereafter picked up by any of the others. As
for the styles encompassed in 13 percent of Darlington 's 1956 production , the testi-
mony is that no records are available to show whether those styles were thereafter
manufactured by any Deering-Milliken mills.
The attempt to show that other Deering-Milliken mills succeeded to Darlington's
business in fact would have proved too much . Thus with respect to some of
Darlington 's constructions it was shown that Monarch and others had not made
some in 1956, and had made and sold others of them, generally in larger amounts
than Darlington had; but that after 1956 they made and sold them in quantities
several, even many, times larger than Darlington 's sales had been , with an increase
in the amount sold over their own sales in 1956 . With respect to one of these,
before Monarch was persuaded to make this construction , Deering-Milliken as sales
agent lost sales, the customer purchasing it elsewhere . Thereafter Monarch's sales
to this customer on this construction were increased greatly over Darlington's
in 1956. As counsel for the Respondents suggested, a single-employer entity with
overall control could be expected to have effected a transfer of production to other
mills in the entity without interim loss to outside mills. (Of the styles included in
two contracts sold by Darlington to Monarch , Darlington 's production in 1956
was less than 3 percent of Monarch's in that range . It is difficult to find here
evidence that Monarch succeeded to Darlington 's business when it is noted that
Monarch's 1957 production in that range was only 60 percent of that in 1956 )
But the reference to increased sales in 1957 suggests an unwarranted claim that
Darlington's sales would have continued and been thus greatly expanded had it not
been liquidated . If the argument be only that Darlington would have continued
with some sales and that these fell to other Deering-Milliken mills, the answer is
that we do not know general market conditions with respect to various styles;
whether total sales of given construtcions remained constant, with other Deering-
Milliken mills taking over Darlington 's; how many of Darlington 's customers
bought elsewhere when "everybody move[d] in"; the extent to which some styles
lost in popularity while others gained , etc. The same kind of general and incon-
clusive proof was presented by the Respondents ' evidence that , considering all of the
Deering-Milliken mills except Darlington, the increase in production of carded cotton
fabrics in 1957 and 1956 was at approximately the same relative rate as the increase
in 1956 over 1955, and that such increases were due primarily to new equipment;
there was no increase in 19517 which could be attributed to succession to Darlington's
business I would no more base on this testimony a finding that the increase over
1956 shows that other Deering,Milliken mills did not succeed to Darlington 's busi-
ness (actually their 1957 production was less than that for 1956 including Darling-
ton's; other figures show a dropoff in cotton yarn spindles produced at other mills
in 1957) than I would find the contrary on the basis of the facts brought out by
the General Counsel. Too many other factors and conditions exist as a bar to defini-
tive findings on the limited evidence in this connection. We can only guess at what
caused lesser production at other mills in 1957, and whether their production
would have been still smaller had not Darlington been liquidated. But that Deering-
Milliken suffered no depletion in the products available to it for sale or that Darling-
ton's business was transferred to other Deering-Milliken mills (which mills?) has
not been shown.
Similarly, what conclusion can be drawn from the fact that, of Darlington's 10
best customers, 7 in 1957 decreased by 17,000,000 yards their purchases from
Deering -Milliken mills of constructions "generally competitive" with those which
Darlington had made, while 3 increased their purchases by some 8,000,000 yards"-
or from the fact that, of the 8 customers who had unfinished contracts with Darling-
ton at the time of liquidation , some of which contracts as we have seen were trans-
ferred or sold to other Deering-Milliken mills, 6 including the 3 largest purchased
less from Deering-Milliken mills in 1957 than from Darlington in 1956? (As the
General Counsel pointed out, "overall" figures do not have validity without details
of the underlying circumstances ) Again it must be said, whatever might be deduced
from this, that the evidence does not show single-employer status or that the Deering
Milliken mills "picked up the complete or anywhere nearly the complete business of"
Darlington. Nor can we base any conclusion on the "general pattern" of the market
and its unknown effect on the sales here ; also unknown is the extent to which sales
to the various mills could be compared because a general pattern was considered.
DARLINGTON MANUFACTURING COMPANY, ETC. 313
It was further testified that orders placed with Monarch after early September
1956 for one of Darlington 's constructions represented an attempt by Deering-
Milliken to retain Darlington 's business . Such an attempt would be made by a sales
agent regardless of single-employer status.33 Monarch's production of this item in
1956 was 21/2 times as great as Darlington 's; it increased slightly in 1957. Whether
this item standing alone would show that Deering -Milliken suffered no depletion, the
other evidence on this point cannot be ignored.
Whatever the problems connected with an attempt to earmark sales and to trace
those of one period to those by another corporation at another time, the argument
here is only of the nature of post hoc ergo propter hoc; new constructions or increases
in old ones ( ignoring decreases ) are not ipso facto to be accepted as proof of transfer
or succession without regard to the many undeveloped factors which determine styles
manufactured and the amount of sales. We recall that the evidence in the original
hearing showed the variety of Darlington 's constructions through the years and the
fluctuations in sales, these without any issue of succession to or transfer of customers
or their orders.
Not only has it not been shown that in 1957 the other Deering Milliken mills
added to their 1956 production in the amount of Darlington 's last annual production,
but it appears that total spindle activity in the Deering-Milliken mills was less in
1957 than it had been in 1956; and while there was a drop in 1957 in total spindle
activity of all mills in the industry , the drop percentagewise was greater among the
Deering-Milliken mills. We have already noted the failure to support the offer of
proof ( that Deering -Milliken suffered no depletion ) with an attempt to show transfer
of or succession to its business . We now see that, contrary to the proffer , there was
in fact a depletion.
Were it shown that other Deering-Milliken mills made sales which but for its
liquidation Darlington would have made, it is nevertheless clear that they did not
succeed to other Darlington business . This is a picture of competition in a free
market as "everybody moves in "; not of Deering -Milliken control and transfer of
Darlington 's business to related mills. As was pointed out at the hearing, whether
these were independent or integrated corporations , there would be absorption of
Darlington 's constructions after it was liquidated . Acquisition of some of Darling-
ton's customers and their business , even if shown to be such , is consonant both with
single-employer status and with independence , and proves neither.
Aside from the issue whether the detailed testimony concerning the manufacture
of certain constructions by Darlington and other mills shows any increase in con-
structions formerly made by Darlington which could be traced to the liquidation,
several pertinent questions call for answer. Would single-employer status be extended
to a non-Deering -Milliken mill which obtained a Darlington customer and sold to it
constructions which Darlington had made? To the extent that a Deering Milliken
mill obtained such business , did any non-Deering-Milliken mill manufacture the
constructions and seek the account ? As for Deering-Milliken 's role in selling for
mills other than Darlington , would not an admittedly independent agent, losing one
manufacturer , seek to retain its customers ' business by obtaining the constructions
from another of its manufacturers? The General Counsel is quite correct in declar-
ing: "Deering-Milliken , in its capacity as sales agent , has a definite interest in at-
tracting and holding established customers . In offering as wide a selection as pos-
sible, the sales agents' opportunities for sales is enhanced and possibilities for new
sales are created ." But it does not follow that the "absorption of Darlington 's busi-
ness by the other D-M mills helps to establish the single employer status." With
the publication of the news that Darlington was no longer accepting orders, there
was general competitive activity in the industry in the direction of its largest cus-
tomers: generally in such situations , and here, "everybody moves in "
What the General Counsel called a substantial increase in Pacolet 's and Gaffney's
1957 production of one construction but was actually relatively small brought the
total of their 1957 production of that item to little more than half of Monarch's 1955;
Monarch did not make any in 1956. The argument of transfer or succession to
orders based on increased production would lead to the conclusion that Darlington,
Pacolet, and Gaffney succeeded (but with limited success ) to Monarch ' s business.
The same argument addressed to fluctuations throughout the industry would "prove"
similar transfer of orders and presumably single-employer status of all mills in the
industry . Only if we assume single-employer status and general transferability of
orders can we conclude that the fluctuations of business in each mill from year to
13 Even a showing of "no depletion ," as claimed , would not prove single-employer status.
It would be necessary to find that control ( or single-employer status, first shown') pre-
vented depletion , rather than the competitive activity and successful "moving in" of
other Deering -Milliken mills.
314 DECISIONS OF NATIONAL LABOR RELATIONS BOARD
year reflected in large measure transfer of orders from one to another among the
Deering-Milliken mills or in the industry as a whole.
The General Counsel appeared to try a different tack when, after examination
concerning types of construction and overall spindle activity, he inquired concerning
yarn variations. Here it was brought out that Monarch did not in 1956 run warp
yarn which could produce fabrics similar 34 to Darlington's but that it did make such
yarn and six other types in 1957. But this does not indicate succession to Darling-
ton's business since in 1955 Monarch had likewise produced such yarn with five addi-
tional types. Monarch's production of this one type did not depend on Darlington's
absence, and it has not been shown to have stemmed from succession to the latter's
customers and business.
It was recognized 35 throughout the first hearing that Darlington's operations were
terminated, as we have already noted. Not only have machinery and equipment
here been sold,36 but they were disposed of piecemeal,37 and there is no question
concerning relationship between the closed company and a new operator of its plant
and equipment 38 The relationship between Deering-Milliken and Darlington is not
that of companies making the same product; nor has it been shown that the other
manufacturing corporations in the chain have occupied such a status vis-a-vis Darling-
ton as to make applicable the reference in the Mount Hope case 39 to an attempt
"to take refuge behind the corporate entities." That the other Deering-Milliken
mills did not succeed to Darlington's equipment orders, and that they did not be-
come liable for the violation or any remedy herein was evidently recognized by
the General Counsel and the Union when, although the question of remedy was
then clearly before us, they sought no more at that time than a declaration that
Darlington should resume operations; there was no claim that other mills had
succeeded to Darlington's business and that, because of some relationship with
Darlington, they should be directed to remedy the violations found.
Such evidence as is here noted and similar proof was received with respect to
one department after another at Deering-Milliken, DMSC, and DMRC, and one
activity after another by and at those corporations and the various mill corpora-
tions We could describe many more series of letters and memorandums which
show only suggestions to the mills and decisions by the mill treasurer. In numerous
instances, after many documents were discussed and received. it became quickly
evident at the hearing that we had been laboring over items which do not indicate
single-employer status. It would serve no useful purpose to extend our analysis
and specific findings. What has been noted is typical, and what has been said is
generally applicable.
Were this case less complex. with fewer and no more probative items of proof,
it would be necessary only to point out that, despite the extent of common owner-
ship by members of a family group (rather than by given individuals). these corpora-
tions are operated as separate entities from separate offices in different cities or
towns; and that Darlington alone was involved in the activities which led to these
proceedings. Interrelationship is clear, but not control or single-employer status
We have received evidence of many lawful cooperative acts to attain lawful
objectives. Whether the nature and extent of this cooperation are such as to war-
rant a finding of control, particularly control of labor relations, is something else.
The evidence before us does not show control of the labor relations or policies
of one corporation by another. A fortiori they do not show single-employer status.
94 At this point we recall testimony that Monarch did in 1956 produce constructions or
styles similar to some of Darlington's that year, and in larger quantity
$ The argument for backpay is based on this very recognition of the cessation of
operations as violative of the Act Similarly, the General Counsel's and the Union's
emphasis in their briefs to the Trial Examiner after the original hearing was on Darling-
ton's "liquidation," and no claim was made that its operations had in fact been continued
elsewhere
85 See New Madrid Manufacturing Company at at, d/b/a Jones Manufacturing Company,
104 NLRII 117.
87 The offer of proof which the Board cited in its remand order alleged that a "large
portion of the machinery and equipment was sold at a substantial loss , pursuant to
Deering, Milliken & Company's plant, to its other plants in the area which produced the
same broadcloth and print cloth as produced by Darlington " But no evidence, as might
warrant piercing the corporate veil, was offered to show that the best prices were not
obtained or that, whether or not pursuant to a plan (and whatever the extent of pur-
chases by Deering Milliken mills), any of the other Deering Milliken mills were favored
in the sale of Darlington 's machinery and equipment
sa Cf. Drennan Food Products Co., 122 NLRB 1353
se Mount Hope Finishing Company, et at., 106 NLRB 480, 499
DARLINGTON MANUFACTURING COMPANY, ETC. 315
I have found that Darlington violated the Act in its reaction to the results of the
election of Sepember 6, 1956; Milliken, as its president, took the lead in such
violation. But it does not appear that Deering-Milliken determined that violation
or had any responsible connection with it. Neither the functions nor the activities
of these two corporate entities met at that point. We have here only the claim
that, since the president of one corporation was active in or dictated its decision,
and since he was also president of the other corporation, the latter (as well as the
president individually) is legally connected with and responsible for the other's
decision.
No more are the other corporations of which Milliken is president connected
with the violations here found. Certainly there is no per se carryover of any relation
between Darlington and Deering-Milliken, DMSC, or DMRC so that it can be
found to exist between Darlington and the other mills. As for the attempt to show
that labor relations at other mills were somehow connected with those at Darlington,
we can summarize by noting that counsel's efforts were brave but the result was
puny. The proof concerning labor relations at the mills, including evidence of
independence in connection with vacation plans, transfer of employees, recruitment,
retirement, and other items, indicates that labor relations, even when parallel, were
independently determined.
It will be recalled that the evidence at the earlier hearing indicated that ingenuity
and improvements in methods characterized Darlington's management and its
operations; and that these were recognized in the finding of violation Accepting
this, the General Counsel and the Union now in effect would force strict limitation
on outside, i.e., other than Darlington, research and other services which make that
ingenuity possible; such outside services are now cited as proof of single-employer
status. But such limitation would seriously impinge on the ingenuity noted.
What of admittedly independent textile institutes and others, such as tax attorneys
and insurance companies, which provide assistance? Are these to be included
in the single-employer entity? What if a tax attorney owned stock in one of the
mills? What if he were of the Milliken family and thus related to someone who
owned stock in that or another of these companies? Would his advice under such
circumstances make him liable for the mills violation of our Act? The claim here
raises more questions than can reasonably be answered if the General Counsel's
position be sustained. (Joint efforts in the textile and other industries are considered
infra.)
It is unnecessary to determine here by percentage or adjectives the extent to which
a single entity is suggested. The question is rather whether such an entity has been
proved for purposes of imposing liability or directing a remedy. As the various
subjects or the aspects of the evidence have been weighed, it has been found that
they do not severally indicate single-employer status among these corporations. Nor
are there enough of such aspects in combination to indicate that status. It can be
argued that we should consider "the mass of information," a nebulous totality which
the General Counsel and the Union cite without thereby abandoning any of their
specific but insufficiently supported items: the whole is to be found greater than
the sum of the parts available The validity of this kind of finding, which can be
denied only by general argument of the same order as that offered in support, usually
cannot be disproved; neither can it be proved. Such an overall finding as is thus
urged is of the nature of "'Tis so; 'tisn't." It must leave the judical mind in a
quandary. But having said that a finding of so-called totality usually cannot be
disproved, we can indicate a greater measure of success here, where the missing part
is the element of control.
It appears that somehow, if a point suggests a 1-percent doubt or possibility of
single-employer status, 100 such points are assumed to prove the case beyond all
doubt, or 90 to show 90-percent certainty. And a 20-percent doubt in 4 instances
creates an 80-percent certainty. But this ignores the 100 instances of 99 percent
on the other side, and the other contrary figures down to the last example: 4 in-
stances, each pointing to or consonant with independent status. True, no attempt is
made in such instances to assign percentage values. But such assignment in the
examples here should serve to remind us that the argument of "a little here and a
little there" overlooks the preponderant values elsewhere.
It is true, as counsel has stated, that we may not be able to "isolate one exhibit"
as proof of a given point But citation of an amorphous mass may cause one to
forget that we have nothing more than a mass of trivialities when all of the opera-
tions of the various corporations and all of the evidence are considered.
More important than even the percentage or relative extent of assistance and co-
operation is the fact that they were determined and limited by the decisions of the
mill treasurer: they do not indicate control from without. And, while counsel differ
on the nature and extent of control shown, they do agree, by their repeated references
316 DECISIONS OF NATIONAL LABOR RELATIONS BOARD
to and stress on it, that the element of control must be found. Without control over
decisions and operations, the total of instances of advice accepted (even were the
number far greater than here shown) may reflect no more than the mills' opinion
that their advisers are both faithful and competent.
The respective positions here may roughly be represented as claiming or tending
to claim on the one hand that Darlington is independent of the other corporations
in management and control and, on the other, that the various corporations, includ-
ing Darlington, occupy a single-employer status. To be meaningful here, any single-
employer status found must include Darlington. The evidence indicates that there
are many aspects and instances of operation which typify independent organizations.
Yet there are some instances which characterize or suggest a single entity. There
is thus some basis for each of the respective positions although counsel for each side
could readily enough propose changes in the operations which would strengthen
their own respective claims.
The question is, in the accepted terminology, whether "sufficient integration exists";
it is thus one of degree or the extent to which the management and control of these
corporations indicates one or the other type of operation, and supports one position
or the other. In thus evaluating degree, opinions may well differ, and they probably
will. My own, with full recognition of all of the evidence, is that these corporations
do not occupy a single-employer status.
It is evident that Board cases involving the issue of single-employer status are
quite dissimilar from the instant one; none has been cited which involves a factor,
although there are cases of sales agents in a narrower scope. It may be concluded
that the absence of any allegation of single-employer status in cases where relation-
ships are of the nature of those which exist here indicates the determination to be
made in this case. Contrariwise, similarity must first be shown, and it may be that
absence of prior allegation reflects only a less assiduous Charging Party; and, of
course, new law may be declared here. Whether the Board will now depart from
established precedent remains to be seen. I have already indicated, by analysis of
the evidence before us, that the law does not warrant a finding of single-employer
status on the instant facts.
Several recent cases involving the question of an ally relationship throw light on
the issue before us: Conceivably such a relationship might exist between corpora-
tions to the extent that picketing would be held to be primary rather than secondary,
as for instance where a struck employer becomes allied with another or with one of
several plants of another employer. But that relationship can be found on less proof
than is needed to included one corporation in a finding of violation against the other,
or in a remedial order directed against that other.
We speak of single-employer status, alter ego, integrated operation,40 etc. But it
does not appear that any of the other corporations here were "in active concert or
participation with" 41 Darlington in the violations found; that they unlawfully reaped
benefit therefrom; or that they have been in active concert or participation with
Darlington in a common plan of evasion 42 Even if less need be shown to establish
an ally relationship as a defense to an allegation of unlawful secondary boycott, the
following extract from the Board's decision in the "Bachman Machine Company
case 43 may cast some light here:
Here, not only do the members of the same family own all the stock and
property, and compose the boards of directors, of both employers, but the same
individual is the president and active head of both, controlling all their opera-
tions, including labor relations policy. [Emphasis supplied.]
This Board statement of the general rule was apparently endorsed by the Court
of Appeals for the Eighth Circuit, which first recited the facts in the Bachman case
as follows: 44
Bachman and Plastics are two separate and distinct corporate employers; the
capital stock of each is owned by one family; each has officers and boards of
directors drawn from members of the family, the head of the family being the
President of each company; each company is engaged in a different, separate
40 Regal Knitwear Company v N L R B , 324 i7 S 9. 19
41 A highly restricted definition of this term is noted infra
12 Cf the Board's position as recited in N.L R B. v. Deena Artivare, Inc. 261 F 2d
503, 506-507 (C.A. 6).
43 Warehouse and Distribution Workers 'Union, Local 688, etc (Bachinan Machine Com-
pany), 121 NLRB 1229 Sep also Dearborn Oil and Gas Corporation, et al, 125 NLRB
645, cited supra in footnote 15
44 266 F. 2d 599, 602-603 (C A. 8).
DARLINGTON MANUFACTURING COMPANY, ETC. 317
and nonintegrated business; each is a substantial customer of the other; each
operates a separate business in a separate plant, the plants being in fairly close
proximity to each other, in the same city; each plant has a separate labor force
represented by a different union; the employes of one plant are skilled or semi-
skilled mechanics; the employees of the other are unskilled; the President of each
company is its majority stockholder, concededly in the actual control and man-
agement of one company, and found by the Board to have been in actual con-
trol of the labor policies of the other company and to have participated actively
in the negotiations with the Union which represented its striking employees, who
extended their strike to the company which was not their employer.
The court then pointed out that in J. G. Roy and Sons Company v. N.L.R.B.,45
the First Circuit Court
held that there was no evidence of mutual common control over labor policies
or any other phase of the operations of the two companies, and that potential
common control, because of the common ownership of stock, was not enough
to justify a ruling that the two corporate employers were a single employer
under Section 8(b) (4) (A). [Emphasis supplied.]
Bachman was then reversed with this statement:
But we think the evidence fell short of establishing that both companies were
under such actual common management or control as to make them allies or a
single employer for the purposes of Section 8(b) (4) (A) of the Act.
The court then continued as follows:
We fail to see why Bachman should, under the evidence, be regarded as an
offending employer or why it and its employees should be embroiled in the
controversy between Plastics and its employees and their Union, merely because
the President of Bachman, who was also the President of Plastics, controlled
or participated in the control of the labor relations of that company.
Whatever the difference in Bachman concerning management and control, the Board
itself there relied on single control of operations, including labor relations policy.
No more than would ownership alone prove single-employer status does the testimony
before us that Darlington and other mill stock prices were publicly quoted and traded
in prove independent status. Either single-employer or independent status can exist
among both closed and publicly owned corporations. We are and have been more
properly concerned with evidence of control.
The court's rejection of the "allied-employers" defense in Bachman has been ac-
cepted by the Board as the law of the case.46 In several obvious respects, the rela-
tionship is not close between Darlington and the other corporations here. Whatever
may be said concerning ownership, potential control of labor policies, and actual
control of such policies, integration and actual common control over labor policies
call for greater proof; single-employer status goes even further, and calls for still
more proof.
Plainly, the Board has asserted jurisdiction in integrated companies. But the
converse is not true: where jurisdiction is taken, integration (much less, joint liability,
and still much less, single-employer status) does not necessarily exist. Joinder in a
trade association will be considered for jurisdictional purposes even if liability is not
imposed on each component entity. It is clear that evidence of a closer relationship
is required for an allied-employers finding in secondary boycott cases 47 When we
consider the purpose and effect of a single-employer finding here, it must be evident
that still more must be shown.
Clearly (in this situation I do not hesitate to use the term) no single-employer
status has been shown here. Whatever the finding in the Bachman case concerning
ownership and common control, the several companies played a part during and in
connection with the events considered in that case. In the instant case, there is no
evidence that any of the other corporations were involved in the commission of the
violations found. As for joinder in any of the benefits or results from the violations,
as a moral basis for disseminating a remedy, the evidence shows only that other mills,
among them some of those covered by the remand order, took over a few orders,
4s 251 F 2d 771 (C.A. 1).
46 124 NLRB 743 The importance of control of labor relations is pointed out in N.L R B
v. New Madrid Manufacturing Company , and Harold Jones , d/b/a Jones Manufacturing
Company, 215 F 2d 908 ( CA. 8), as cited by the General Counsel
47 Cf Dallas General Drivers , Warehousemen & Helpers , Local No 745, AFL-CIO
(Associated Wholesale Grocery of Dallas , Inc), 118 NLRB 1251, 1255
318 DECISIONS OF NATIONAL LABOR RELATIONS BOARD
all of them on an open market basis or, to use a phrase more apt in strict buyer-
seller dealings, as bona fide purchasers for value.
There is no evidence or even suggestion that Deering-Milliken or any of the other
corporations, or all of them, had authority to resolve the labor dispute between
Darlington and the Union; or that the Union, the employees, or any other group
or persons had ever looked to those other companies to accomplish that. Yet
such authority, which may exist where there is no single-employer status, is a
necessary attribute of such status. The Board, through its General Counsel, argued
as follows in its brief to the circuit court in the Bachman case: 48
When two entities are thus allied through common ownership and actual
common control of their labor relations policies, the same employer to whose
premises the picketing has been extended is in a position to resolve the labor
dispute of the struck employer and thereby end the picketing at his premises.
The authority and attribute have not been shown here; they were not claimed
before Darlington violated the Act. Not only has single-employer status not been
shown, but authority elsewhere to resolve any labor dispute at Darlington does not
appear to have been recognized, considered, or claimed until the question of remedy
for violation here arose
We have seen that no less proof of single employer status is required within con-
templation of liability for violation of Section 8(a)(1), (3), and (5) and remedy
for such violation than is required for a finding of ally relationship to bar a sec-
condary boycott claim. Nor should we lose sight of the difference in applicability
of remedy. Whereas in Bachman picketing would be banned, the possible remedy
here is reinstatement and payment of lost wages. Of the various corporations, only
the mill corporations could instate these employees; and the proof does not warrant
that remedy. Neither does the proof warrant imposition of backpay liability, for
whatever period, on any of the other corporations.
We need not here attempt an analysis of all of the cases on the subject of
allied, integrated, or single-employer status. We have already seen that the require-
ments for finding these may differ, as may the effect of such findings, from permitting
limited exposure to what would otherwise be secondary picketing, to direct liability
for remedying unfair labor practices. If other cases where the issue of single-
employer status was involved are different from this one, the language employed in
some may nevertheless be helpful as indicative of underlying principle and Board
attitude.49 Of the cases cited 50 by the General Counsel or the Union, the Allen
case 51 was based on more than stock ownership alone. This is true of the frequently
cited Somerset Classics case 52 also, and of other cases cited by the Union, although its
brief emphasizes the ownership aspect The factual analysis herein, the findings, and
the stated principles of law are submitted with full recognition of the rule as repeated
in National Shoes, Inc., et al.53 and which, quoted as follows in the Union's brief,
supports the rule hereinabove recognized.
Decisions of the Supreme Court and of the courts of appeals establish that
where the operations of 2 corporations are closely integrated under common
control, and particularly where this integration and control are manifest in their
labor policy, the 2 corporations will be considered a single "joint employer"
for the purposes of the Act.
In Industrial Fabricating, Inc., the Board found that various corporations con-
stituted a single integrated enterprise The following language from the Inter-
mediate Report in that case indicates elements which are not here present: 54
48 Following the quoted sentence, the brief continues in support of the principle noted
supra that "(u)nder settled principles, two entities enjoying a separate corporate existence
may nevertheless be regarded as one 'employer' for purposes of Section 8(a) of the At
if they are under common ownership and control and their labor policies are subject to
common direction"
as Surely comparison of the facts here with those in situations which we shall note infra
where independent status is recognized is no less worthwhile than comparison with single-
employer cases where the facts are different.
50 All of the cases cited have been examined . In the main , their differences and in-
applicability here are readily to be noted
61 A K. Allen Co , Inc., at al ., 117 NLRB 568 , enfd . 252 F 2d 37 (C.A 2).
52 Somerset Classics, Inc , at al ., 90 NLRB 1676.
53 103 NLRB 438, 441
54 Industrial Fabricating Inc, et al ., 119 NLRB 162, 199.
DARLINGTON MANUFACTURING COMPANY, ETC. 319
Where the relationship of one company or individual to another presents such
features as financial control over the latter through advance of operating capital
and inventory, supervision and direction by the former over the latter's produc-
tion operations, and control by the former over the latter's production opera-
tions, and control by the former over the latter's labor relations policies, there
is a "measure of domination ... [which is] inconsistent with the notion that
[the latter is] . a free agent either in handling the enterprise or in dealing
with the men employed." [Citations omitted.]
As review of the facts in Industrial Fabricating discloses the elements there present,
the control and the interchange of assets, similar enlightenment can be found in the
A. M. Andrews, California Footwear, and Dayton Coal and Iron cases 55 In Andrews
the Board found that "the Respondents form(ed) a multi-state enterprise. . . .
The Trial Examiner's finding there "that the Respondents (were) separate employers
.. . (and therefore were not to) be held responsible for remedying the unfair labor
practices" was reversed, the Board finding that "the Respondents constitute(d)
a single employer within the meaning of the Act"; and that one Respondent was "an
integral part of a multi-state organization, and . . . (that the other Respondent
was) responsible for remedying the unfair labor practices (t)herein found. .. ."
The Board there cited and relied on "factors of paramount significance" which indi-
cated single-employer status but which are not here present. It might be argued
on the basis of the Andrews decision alone, although the Board there reserved this
question, that remedy could be withheld against one of several respondents which
was connected with the violations, even where the operation is integrated. This is in
harmony with that suggested infra concerning need for a joint labor policy.
The Board's decision in Industrial Fabricating issued 6 months after the first
Intermediate Report in the instant case. That decision is of further interest for,
after finding violation of Section 8(a)(5), (3), and (1), and joint and several
liability where there was a "transfer of operations," the Board significantly added:
This is not the case of an employer who decides to go out of business rather
than deal with his employees' statutory representative.
But the finding of violation in the instant case stemmed from the employer's decision,
as pointed out in the Intermediate Report of April 1957, to do what was not done
in Industrial Fabricating: to go out of business rather than deal with the Union.
This was declared to be violative despite the protests of counsel for Darlington.
In considering the question of remedy in that first report, I relied on this very
distinction between transferring a business and going out of business.
As for any further concern over so-called social consequences or the question
whether an employer would be enabled to violate the Act with impunity, it may
not be amiss to refer at this point to the second Intermediate Report in this proceed-
ing, issued on April 30, 1959, in which it was recommended that the complaint
against Roger Milliken be dismissed. It was there pointed out that Darlington
had gone out of business, and that going out of business is a self-limiting and not a
common situation; whatever is sought to be prevented, it does not constitute a
benefit to the employer. Here is an important distinction between a runaway plant
situation and single-employer status on the one hand, and a going out of business:
the transfer and accrual of business and benefit which characterize the former are
absent in the latter.
In the first Intermediate Report, while making my recommendation with respect
to remedy, I explained generally why the various proposals for backpay could not
be supported There has since been some apparently special attention, as noted
at this resumed hearing, to backpay from the termination of the respective em-
ployees' employment until the date when the plant actually closed or until the date
of completion of the contracts of sale entered into at the auction of plant proper-
ties. Because of the attention given that proposal, I would add the following to
what was said in this connection in the report of April 30, 1957:
Award of backpay to the date of closing of the plant or the date of sale
suggests that, had the gates been closed and assets sold immediately after the
decision to take such action, no backpay would be allowed. But the testimony
is to the effect that the gates, figuratively speaking, had to be closed successively
and over a period of weeks instead of all at once. To assume that employees
would have continued on their jobs until the date when the plant was closed
or sold, and to pay them for such period is to assume that Darlington did not
WA. M. Andrews Company of Oregon, et at, 112 NLRB 626; California Footwear Com-
pany, 114 NLRB 765; Dayton Coal and Iron Corp., et at, 101 NLRB 672.
320 DECISIONS OF NATIONAL LABOR RELATIONS BOARD
actually terminate operations in what the record discloses was the proper manner.
Nor is there any indicated basis for preferring by greater backpay those em-
ployees whose departments could earlier be closed over those who were
employed for a longer time; presumably in any beginning or resumption of opera-
tions, past or future, the former would be employed, and paid, earlier than the
latter. It should be unnecessary to point out that there has been no claim
of discrimination against individuals as such, as by termination prior to the
progressive closing of their departments; the discrimination alleged and found
lay in the decision to liquidate and the progressive liquidation which followed.
(The fact that Darlington's various departments were thus shut down seriatim
may, as argued by the Respondents, have a bearing on the issue of single
employer status, under which it would have been simpler to have closed down
at once, transferring to related mills the work in process.)
When, in the Intermediate Report of April 1957, I pointed out that backpay
could not be awarded because one could not say how long Darlington would
have continued in operation but for the violation found, 1 sought to and did
avoid emphasis on the concept of directing an employer to go back into busi-
ness; and reference to the Circuit Court's decision in the New Madrid case,
supra. (New Madrid was considered at that time only in connection with the
issue of liability, not of remedy.) But there has since been reference to this
principle without Board disapproval, and it appears that the Board would not
now direct such a return. One can, therefore, with perhaps better logic and
greater support, note that if Darlington is not to be ordered to resume its busi-
ness, there is no basis for asserting a partial direction to resume by ordering
back pay for any period after the respective departments were closed and the
employees terminated.56
Since the Board will considered the Intermediate Report of April 1957 in connec-
tion with this Supplemental Report, it may be helpful at this time to refer to another
remand order, which the Board issued in the Barbers Iron Foundry case.57 The
Board did not there subscribe to the Trial Examiner's opinion that "until final liquida-
tion, the closing, no matter of what duration, must be presumed to be temporary";
and, presumably because it deemed the question significant, it directed that evidence
be taken to determine whether the closing was a temporary shutdown or a permanent
discontinuance of business operations.
In Indegro, Inc., t/a Eddie's Super Market,58 the Board held that individual
owners do not constitute a single employer although members of an incorporated
association to purchase, sell, and advertise. On the other hand, such recent cases
as General Engineering, Inc., et al.,59 in which the Board found a single-employer
status, are readily distinguishable on their facts. Nor do such as Venus Die Engi-
neering Company,60 Metco Plating Company,61 Roanoke Railway and Electric Com-
pany, et al.,62 and Gibbs Oil Company, et al., d/b/a Boulder Transportation Co.63
to cite a few others, points to any basis for finding single-employer status here.
More important than ownership is the extent of common control over operations
and policies.64
The evidence of common ownership and control and of common direction of
labor policies is clearly different in the instant case from that note in those cases
in which single-employer status has been found. There is no evidence that labor
policy at Darlington was controlled by any other company, or that there was a
labor policy at Darlington and other companies which was controlled by Roger
Milliken or any other individual. Darlington's labor policy was directed by its
treasurer, Oeland, subject to supervision by the board of directors and ultimately
the stockholders. Where Milliken could intervene, it was through his status as
stockholder, director, and officer of Darlington, not because of his position or interest
in another corporation.65 In the absence of joint policy or operation, ownership or
66 See footnote 13, supra.
61 126 NLRB 30.
98117 NLRB 386.
59123 NLRB 586.
60110 NLRB 336
81110 NLRB 615.
62 117 NLRB 1775.
63 120 NLRB 1783.
6; N L.R.B. v. Condenser Corporation of America, 128 F. 2d 67, 71 (C.A 3)
65 Were we to go beyond the record and take notice of conditions in southern textile mills
generally and the problems connected with attempts to organize them, even as referred to
DARLINGTON MANUFACTURING COMPANY, ETC. 321
officership in several corporations by one person is not the same in significance as
control of one of the corporations by another or the single-employer status of all.
Here further distinction might be made between control by one individual or
company (if that were shown) of the labor policies of different companies, and a
common labor policy controlled at one focal point. While a Board brief may refer
to "labor policies subject to common direction," such language must be construed
as meaning common labor policy or labor policy jointly applied.66 Else there would
be widespread and apparently unintended piercing of the corporate veil among all
commonly owned companies otherwise wholly unrelated except in their source of
advice with respect to labor policy. For example, single-employer status would
have to be found where an individual controlled the labor policies, however different,
and owned a shoe factory and a stone quarry! 67 The distinction here noted is
supported by the holding in the Concrete Haulers case,68 where the court similarly
cited a common labor policy, declaring:
The interdependence and integrated nature of the operations of the respond-
ents, the common ownership of stock, and the fact that the same officer ad-
ministers a common labor policy, clearly indicate that there is only one employer
for the purposes of this Act. [Emphasis supplied.]
The decision in Concrete Haulers is not unique; nor is the interpretation unwar-
ranted. The books are replete with cases involving chain organizations and nation-
wide operations in which unlawful acts were locally committed and both violation
and remedy were limited to the local entity. It might be urged that holding com-
panies generally, because of their ownership and ultimate authority, greater than
in the instant case, be held responsible for violations committed by their subsidiaries.
The short answer is that, in the absence of proof of liability for the unlawful acts or
policies, the Board has not so held, but has limited the liability to the lesser entity.
One can consider the Bell System, infra, or picture a wholly owned subsidiary whose
products are determined completely by the needs of the parent organization, labor
relations and employees' activities being nevertheless independent; so that, as relevant
here, a violation found against the lesser would not be charged to the parent Such
related situations can be distinguished from the instant one, but they indicate that
the findings and conclusions herein are in line with the decided cases.
In short, in these cases, as we consider labor relations and their centralization, the
emphasis is not on ownership or general supervision but on the aspect of labor rela-
tions which touches the rank-and-file employee. Managerial identity does not make
one company or branch liable for the violations of another or liable for remedy, but
common application of a violative policy or practice does. If this has not been
spelled out clearly in the cases, it is implicit in the decisions and needs to be recog-
nized. It has not been shown that Deering Milliken controlled Darlington's labor
policies so as to be liable for the latter's violations; or that a joint policy existed
under which any other corporation became liable.
It appears both from testimony in exhibit form and from that of Roger and
Minot Milliken, whose qualifications are clear, that so-called independent factors
and sales agents perform many services similar to those which have been noted as
performed within the Deering Milliken group. It can be argued, of course, as it has
been, that in the absence of any adjudication that these others are independent and
do not themselves occupy a single-employer status, their relationship might prove
that they in fact are in such a status. But a general awareness of conditions in this
and other industries precludes a finding of that status among factors and sales agents
generally and the companies which they serve. When this subject was discussed
early in the hearing, the General Counsel contended that, while Deering Milliken
renders services similar to those rendered by Iselin Jefferson, the former "does a
good bit more." We shall next consider the evidence in this respect: this good bit
more has not been shown.
at these hearings , we probably would conclude that the policies followed here reflected
those at many other and diversely owned mills in the South. It has not been claimed that
community of policy among all mills in the area creates a single-employer status among
them
6O This aspect of what may be called Attributed violation is related to the conei'pt of
liability for remedy based on common control and fraud , noted supra.
"We have noted the KBTM case, footnote 14, supra, where jurisdiction was taken over
a radio station and a grain elevator jointly.
es N L R B. v. Concrete Haulers, Inc, et at., 212 F. 2d 477, 479 (C.A. 5), enfg. 106
NLRB 690.
322 DECISIONS OF NATIONAL LABOR RELATIONS BOARD
Various other groups within the textile industry have been noted and cited for
their bearing here. Thus we have earlier considered the significance of reference
to mills by a common or joint name. Testimony was also received concerning joint
activities within other groups of companies in the industry which do not occupy
a single-employer status. (While not as detailed as the evidence concerning Deering
Milliken and the instant mills, the evidence offered showed, as by testimony of
independent ownership, that the other groups do not occupy such a status. Some of
this latter evidence was submitted as of common knowledge; full opportunity was
given to refute it at the hearing or in an appendix.) Surely, whatever differences may
be argued concerning services performed by independent factors, it is a truism that
such services, voluntarily accepted or rejected by Darlington, do not prove single-
employer status here. While the Union has argued that services performed by an
independent factor are not relevant, the fact is that the General Counsel has sought
to prove his case by evidence of many services performed; and with such evidence
received, it is relevant, indeed necessary if we are to evaluate it, to inquire whether
those services characterize or are compatible with an independent status.
Thus there was submitted a list of 13 firms which are both selling agents and
factors and the principal competitors of Deering Milliken, and some of whose officers
and directors hold positions in the mills for which they sell. It was testified in gen-
eral terms that those 13 firms offer services similar in almost all respects and in
some instances beyond the services which Deering Milliken offers to the mills here.
An example was cited where a factor, as an inducement to an independent mill
whose business had been handled elsewhere, promised to set up a production control
system, reorganize the mill's cotton buying, help set up a study of work assignments,
and make available, for out-of-pocket costs only, a man who would make a study of
the mill's machine layout Examples were also noted of factors and sales agents
which deal with mills in which they do not have any ownership interest as well as
with mills in which they do. It was reported that one company, which was most
prominently mentioned at the hearing, factors for five mills in which neither it nor
its directors own any substantial stock interest beyond the minimum necessary to
serve as directors of those mills.
These examples further indicate that cooperative or joint efforts in the industry
do not establish single-employer status. In fact it was testified 69 that factors and
sales agents perform identical services for their mills in which they have a large
financial interest and for their mills in which they have no financial interest. Thus
we are again led to the conclusion that neither the services performed, as earlier
described, nor the financial or ownership interest held indicate single-employer
status: we are back to the question of control of the policies and activities which
have been found to be violative. As for control of other activities, this stems from
the factoring element itself regardless of ownership or single-employer status. Con-
sidering a factor's investment and interest, it is not surprising that it weighs and
seeks to promote its principals' welfare and that, like other assignees and mort-
gagees, it concerns itself with insurance, taxes, and other responsibilities of its
principals.
If we reflect even briefly on the example cited supra concerning CBS stations, we
must realize that, whatever their relationship and their treatment under the Federal
Communications Act and other statutes, this Board has not found in unfair labor
practice cases that such stations occupy a single-employer status. A similar realiza-
tion must emerge as we consider the frequently announced "NBC and its independent
affiliated stations."
The Union early argued that activities and services among other groups of corpora-
tions which may not occupy a single-employer status are not relevant to the issue
of single-employer status here- whether such other group has been designated as a
single employer or entity needs to be shown. It is true that the status of the other
corporations needs to be shown (Board determination with respect to other corpora-
tions is no sine qua non, but examination of other situations may disclose Board
standards), and evidence was received that various ones as noted are independent
of one another in management, control, and ownership. With proof of independence,
the nature and extent of their joint and mutual activities is relevant here, as has
already been suggested; for if joint and mutual activities are relied on in the instant
case to prove single-employer status, participation in similar activities among inde-
pendent corporations reflects on the probative value of the evidence first cited here.
The evidence before us indicates that factors and sales agents in the textile in-
dustry render to companies which they do not manage or control and which are in
69 All of this testimony makes it unnecessary to rely on or even to cite articles offered
by the Respondents on the role and activities of factors.
DARLINGTON MANUFACTURING COMPANY, ETC. 323
an independent as distinguished from a single-employer status, many services similar
to those performed in the Deering Milliken chain . Groups of independent companies
are also referred to as a chain , group, the factor's mills, etc. Whether the corpora-
tion shown elsewhere is somewhat more or somewhat less than that among the Deer-
ing Milliken mills, the differences from group to group do not warrant a finding of
single-employer status here . (This is probably a narrower finding than the one al-
ready made that all of the evidence of joint effort here does not warrant such a
finding.)
The General Counsel has further argued that, while independent or outside pur-
chasing agents operate for gain, purchases are here made and the service corporation
performs at cost. But it is clear that were charges by DMSC greater , its profits
would be divided according to the number of mills or roughly , after more complex
bookkeeping and computation , back to those who paid for the services . We must
realize also that an improvement obtained at the instance of one mill and perhaps
at substantial expense is made availble to the other mills; omission of the element of
profit tends to equalize the cost to the various mills and avoids a greater burden on
the first. As in joint efforts generally, the honestly motivated element of "you
scratch my back, I'll scratch yours," more loftily expressed is, in the absence of im-
propriety and illegality , a mark of industrial progress , as it is of progress in civiliza-
tion generally ; the important element here is that it is voluntary and is not imposed
on the corporations by virtue of any outside control.
It is clear that all or various ones of these mill corporations support joint purchase,
research , recruitment , accident prevention and insurance , and other efforts, which
are advisory and are deemed helpful. A corporation 's appreciation of the element
of benefit may determine its inclusion and the extent of its inclusion in such joint
efforts , as witness Pacolet's self-limitation to 5 percent in the central cotton ware-
house plan . It is also clear that as selling agent and factor Deering Milliken renders
important sales ( this impinges on styling and manufacturing ) and financial , includ-
ing tax, services . One can recall certain so-called institutes in this and other indus-
tries, which are independent : certainly no claim of single-employer status has been
made to include research organizations , referred to at the hearing, which are main-
tained by universities or trade schools . To the extent that joint technical efforts and
developments are emphasized ( and they have been at the hearing and in briefs), one
need only note the well-known cooperative institutes maintained or supported by
independent companies in various industries-unless it be urged, to cite one example,
that the manufacturers of Camel, Lucky Strike, Chesterfield , Old Gold, and other
cigarettes , or some of them, occupy a single-employer status. Or shall we find such
status among corporations in different but related industries because they have joined
in forming a company to test food preservation by irradiation in cooperation with the
Department of the Army ? In all of these , as here, the element of single control of
a labor policy everywhere applied is absent.
There are cases where common ownership exists to a lesser extent and cases where
assistance to individual corporations is less than here; while in others assistance is
greater; and in some ownership is total. But greater attainment of the desideratum of
cooperation does not here or elsewhere make the cooperators or their cooperative a
single employer . The position of the General Counsel and of the Union , if sustained,
would have serious and probably unintended repercussions on recognized coopera-
tives. While our concern need not be for cooperatives or other organizations,
startling and unintended effects throughout industry suggest that the finding of single-
employer status would be as startling and uncalled for here.
As for Deering-Milliken selling for the various mills, were the sales market staked
out and divided in advance , with each mills' products and sales limited to certain
constructions and outlets , such an arrangement would be evidence of an integrated
structure ; but even that would not necessarily show that the various corporations
occupy a single -employer status. Yet we have no evidence of any staking out of the
market and advance limitation of one corporation 's production for the benefit of
other corporations . In sum , I do not find evidence of such management , direction,
control, and ownership as would warrant a finding of single-employer status.
The General Counsel and the Union argue for something akin to an isotopic con-
cent of corporate authority . But instead of showing an elemental identity with
different characteristics , they have attempted to show that some characteristics or
activities are similar and have argued from this that the organizational structure and
elements are the same. This argument and the facts shown are insufficient. Thus
we have evidence of some activities which are characteristic of integrated or single-
employer situations . But if such situations are characterized by certain activities, it is
something else to argue and to prove the converse : that the given activities show single-
employer status . The validity of this last as a proposition in logic should be clear.
672010-63-vol. 139--22
324 DECISIONS OF NATIONAL LABOR RELATIONS BOARD
To cite one instance , various ones of these companies might simultaneously introduce
a wage increase . But a similar increase might be placed in effect at the same time
in mills which are admittedly not related.
An interesting example of independent corporations in close cooperation is to be
seen in the American Telephone & Telegraph Company and the Bell System. What-
ever caution may be needed in any comparison with operations in another industry,
the general principles indicated there might be helpful in the instant situation. As
can be determined from the records of the Federal Communications Commission
and the Securities and Exchange Commission ,70 there are 20 principal domestic
operating telephone companies each wholly or almost wholly owned by A .T. & T.,
and 3 operating companies in which A T. & T. owns a minority of the stock. These
23, with Western Electric Company, Incorporated , Bell Telephone Laboratories,
Incorporated , and A.T. & T. itself , comprise the Bell Telephone System. The 25
corporations other than A.T. & T. are and are identified as subsidiaries of AT. & T.
The latter owns almost all of the Western Electric stock, and each of these owns
one-half of the Bell Laboratories stock. A.T & T. is directly represented in the mem-
bership of the board of directors of each of the operating companies in which it
owns a majority of the stock , and it makes advances to the various corporations,
which are also referred to as associate companies.
In addition to this close relationship in stock ownership and representation, the
research , development , and engineering work for all of the operating companies
are provided mainly by Bell Laboratories with some assistance from Western Electric,
which manufactures , procures , and installs equipment for the various operating
companies and is recognized and referred to as their manufacturing arm and supply
unit. The operating telephone companies and A.T . & T. also cooperate in submitting
ideas for development by Bell Laboratories.
It is commonly known 71 that Western Electric functions on behalf of the various
operating companies , which are independent in their labor relations and are con-
sidered independent for our purposes . The importance of the element of control of
labor relations is further emphasized by the fact that various companies associated
with Western Electric ( these are not operating telephone companies , but among a
reputed 3 , 900 independent but associated manufacturing companies ) have joined to
accept large contracts , as from the Department of the Army . Clearly joint develop-
mental, manufacturing, and sales efforts do not themselves create a single -employer
status.
The various operating telephone companies cooperate in all activities which involve
more than one of them and their respective territories and operations , whether in
construction or in customer service; and they share , according to a formula based
on the respective amounts of plant involved , in joint revenues as well as in the cost
of joint operations . Comparison can here be made with the arrangements in con-
nection with DMSC and DMRC, supra.
The Bell System and A.T. & T. names and services are advertised with whatever
benefit accrues to the various operating companies . Some system -wide advertising
is paid for by the local operating companies according to coverage in addition to
their own separate advertising . We can recall what was said supra concerning em-
phasis on the Millikin name in advertising as we note that large advertisements stress
the Bell System's "large-scale programs of research and improvement."
The following is from "The Bell Telephone System": 72
The American Telephone and Telegraph Company coordinates the whole en-
terprise in five ways : ( 1) by stock ownership in the operating companies, (2) by
functioning as a general staff for the operating companies , ( 3) by furnishing
interstate service over its long lines between the different operating companies,
(4) by ownership of the Western Electric Company , which manufactures and
furnishes apparatus to the manufacturing companies , and (5 ) by ownership in
conjunction with the Western Electric Company of the Bell Telephone Labora-
tories, which does the research for the improvement of telephone plant and
operations.
Despite the high degree of cooperation in operations , the separate corporate setups
are recognized, and it would appear that external control is not imposed on the
respective corporations . Labor relations of the various companies are independently
70 See also company directory, Directors, Officers, Principal Organization Heads of the
Bell System, May 4, 1959
71 Should any party desire to show the contrary with respect to facts officially noticed,
an opportunity shall be afforded to do so on timely request.
72 By Arthur W. Page, vice president, American Telephone and Telegraph Company,
1941, Harper & Bros., pp. 4-7.
DARLINGTON MANUFACTURING COMPANY, ETC. 325
directed and controlled , and the companies refer to themselves as independent com-
panies connected with the Bell System. While the Board has heard and decided
cases involving various ones of these companies, each corporation has been treated
as separate and independent: in representation cases, separate units have been
recognized; where violations have been found, no company has been charged with
the violations of another, and no remedy has been imposed for another's violations.
Taking this example of the telephone companies, we can understand that if some of
them should in the future jointly control and administer their labor policies, there
might be pro tanto a joint responsibility, this would be based on such joint labor
policy control and administration , not on their joint operations and research, and
mutual advice.
Certainly the Bell System and its developmental and engineering work are more
closely intertwined with individual telephone companies than with such others as
radio and television stations which may also and in lesser degree avail themselves
of the opportunities provided by Bell . Such stations , despite their employment of
Bell facilities and improvements, are quite independent of the System.
If unity of purpose establishes an integrated enterprise , as the General Counsel
declares, then the Bell System is such an enterprise. But with such a broad definition,
integration has no meaning in the context of these proceedings: unity of purpose
"to make and sell a wide variety of cloth" would include an entire industry. But
such unity does not establish the status which is our concern.
This is not to equate the Bell System with the Deering-Milliken system. They
are quite different. As differences are pointed out, the argument can be made,
as noted supra , that failure to urge and prove a relationship elsewhere does not
prove that it does not exist here. But we do know at least that such a relationship
has not generally been recognized. At any rate-and this at least should be clear-
the point is that joinder for certain purposes does not create a joint venture for
other purposes or a single-employer status.
No more than in what is called and recognized as the Bell System, where from the
nature of the business , operation , and planning are and must be combined to a
great degree-no more than there, do the various corporations here occupy a
single-employer status. Certainly for purposes of evaluation under the Act herein,
there is no such common control of business and labor aspects as to warrant a find-
ing that such a status exists or did exist among the various operating corporations.
There is here no such proved relationship as is suggested in the administration and
reference to the Western Electric Company as the "manufacturing arm of the Bell
System"; yet there has been no claim and no suggestion that, for the violations of
the Act by one operating telephone company, another operating company, Western
Electric, A.T. & T., or the entire Bell System be held liable, or that a single-
employer status there exists Similarly, despite the services rendered to the various
telephone operating companies by Bell System Laboratories, the violations of one
of the former under the Act are not chargeable to the latter. Neither the Deering-
Milliken system nor the Bell System is a single polymastic entity. The various
corporations which cooperate in the one are, as in the other, independent in activity
and responsibility.
Further detailed comparisions could be made with situations involving apparently
independent financing by General Motors Acceptance Corporation despite similarity
of name and interest; and with the relations between General Motors Corporation
and its franchised dealers with their commonly cited "factory trained mechanics"
whose labor relations and terms and conditions of employment are not the re-
sponsibility of the "factory." Nor does the occasional employment by an independ-
ent dealer of a mechanic formerly employed at the factory make that dealer less
independent. Again it may be argued in answer that these other situations have not
been passed upon and, were they before us, a finding of single-employer status would
be made. To this the reply must be that , as has been and will again be pointed out,
unless we are ready to make such findings and until there is indication of such read-
iness, the very opportunity for but absence of similar claims suggests that there
should be no recognition of single-employer status under these facts. Further,
the thoroughness with which the General Counsel and the Union prepared and
presented their testimony may reflect on the facts and point the way to the decision,
as the paucity of evidence to support the offer of proof is emphasized. Many avenues
of contact between Darlington and the other corporations were explored. With
respect to some, we have seen that the proof is as compatible with independent
status as with single-employer relationship . Other joint activities present even less
evidence of anything more than a measure of cooperation which frequently char-
acterizes activities in the same industry.
Before leaving the example of General Motors, it should be noted that the auto-
mobile industry presents a reverse , although related. situation from that before
326 DECISIONS OF NATIONAL LABOR RELATIONS BOARD
us: various services are there performed centrally by single ( instead of many)
manufacturing organizations 73 for many (instead of one ) sales agents . Yet, al-
though all dealers must operate in a certain manner as provided in their franchise
contracts , must maintain their business in a certain form, must operate in a given
manner, etc. (the central name is also emphasized for advertising purposes), there has
been no suggestion of a claim nor any finding of single-employer status embracing
a manufacturer and its dealers.74 True, the element of common ownership does
not there exist; but that element, absent others which are probative, insufficiently
suggests that the corporate veil be pierced.
With the awareness that comprehensive advertising is not unusual although those
who join in it are and have been considered to be independent corporations, we can
better appreciate the testimony noted supra concerning advertising the Milliken
name. This also sheds light on a large-size, 24-page (including its glossy covers),
well-illustrated booklet entitled "Fabric Magic by Milliken " This booklet was
produced in 1952 at Deering-Milliken's expense and distributed at a dinner to
which store representatives, including buyers, and synthetic fiber manufacturer repre-
sentatives were invited. From the introductory sentences 75 inside the front cover,
indeed beginning with the title on the cover, reference throughout is to what
Deering-Milliken creates and produces, to magnificent mills, to Milliken's engineer-
ing and fabric development by the Research Trust, now DMRC. Then there are
descriptions of Milliken's fabrics: Milliken's dacron-worsted, Milliken's brand name
of "Milium," "Lorette," "Cuenella," "Vicinette," "Bunara," etc. "Milliken spe-
cialists set out to `engineer' " these magic fabrics.
But the looseness of these characterizations is indicated by early reference to "the
mills associated with Milliken," and later, several times to "mills with Milliken."
Then appear the statement that "Milliken represents the widest variety of modern
mills," and a reference to "the mills served by Milliken." Later we are told that
"the textile team with Milliken [is) a group of specialist mills . closely integrated
to control-from start to finish-the properties, costs and quality of the fabrics they
produce," and we find the phrase "the integrated group of mills with Milliken."
Teamwork, it was explained, means "to pull in the same direction." The meaning
and effect of integration of operations has already been considered; cooperation
in successive stages of manufacture (this does not appear to have applied generally
to Darlington) does not prove single-employer status, and we have seen that Darling-
ton's operations and the decisions as to what it would make were determined by
itself, not by any other corporation. The booklet also refers to central cotton
buying and research, both of which have been considered supra. The very reference
to "central cotton buying offices" may suggest separate mills and perhaps even their
independence; certainly central buying could without mention more readily be as-
sumed where single-employer status exists although it might also be pointed out
(not assumed) where operations are scattered. Nor does reference to "Selective
Buying By Milliken" alter the fact that the raw material is in fact bought and paid
for by the mills themselves.
When the booklet mentions both Deering-Milliken and the mills, it is "Milliken
and the Mills," not Milliken and its mills. Finally, as the history of Deering-
73 Despite companywide bargaining , jurisdiction is assumed of individual plants and the
remedy for discrimination at one plant is imposed against that plant alone See, for
example, Chrysler Corporation (Ohio Stamping Plant), 119 NLRB 1312; Chrysler Corpora-
tion , 54 NLRB 510; Ford Motor Company , Aircraft Engine Division , 96 NLRB 1075 :
General Motors Corporation, Chevrolet Forge Plant, Detroit Michigan, 114 NLRB 234 ;
General Motors Corporation, Cadillac Motor Car Division, 109 NLRB 1429
74 The Board has even refused to assume jurisdiction over a dealer or agency whose com-
merce facts did not meet the Board's standards, and without regard to the manufacturer's
commerce. See Wilson-Oldsmobile, 110 NLRB 534.
76 These read as follows
This is the story of Magic Fabric and of what makes it possible It weaves a tale
of textile adventure-of new fabrics created first by Milliken through the wizardry
of science-of standard fabrics produced in thousandfold varieties-of mills magnifi-
cent even by modern measure-of the many millions spent to equip them, the up-to-
date machinery to power them-of textile technicians highly proficient in their art
Here is the magic of American textile pioneering and teamwork and know-how-and
here is the evidence of a faith in the future, founded in the wisdom of nearly ninety
years of progress in producing more quality in textiles of all types for more people
At the bottom of the page is one line:
Deering, Milliken & Co., Inc . "quality-controlled textiles in quantity."
DARLINGTON MANUFACTURING COMPANY, ETC . 327
Milliken and its operations are traced, we read of the "Deering, Milliken Company"
and its expansion; then of "its associating with many cotton mills in the South";
and of the building of "new mill affiliates." It was testified at the hearing that
this association was "as selling agent" for the mills, and that it is stated on every
sales note that Deering-Milliken is acting as agent for the given mill corporation.
The meaning of all this can be summed up in the phrases "There Are Fabrics
from Milliken for 'most Every Need ... ," and "you can get them all at Milliken.
The name Milliken is advertised and reemphasized; the attempt is consistently made
to identify the products with Deering-Milliken sells and the mills which produce
them, with Deering-Milliken and particularly with the name "Milliken." But if
such identification has in fact been effected in the industry and among the public,
we have no more than the identification noted in such terms as Chevrolet agency
and Ford dealer. That the name "Milliken" means a great deal in the textile market,
as brought out by counsel for the Union, is a reason for mills jumping on the
bandwagon and associating themselves with that name. But it need not provide
incentive for mills' surrender of independence or control, nor does it prove single-
employer status.
The question can first be raised whether these statements or, in such a context,
others perhaps more suggestive than these of common ownership, control, and even
single-employer status, are to be taken as admissions; or whether, used for advertis-
ing purposes, they would be classified as puffing or self-praise for the purpose im-
mediately at hand, which did not involve labor relations or mill employees. After
all, our concern is with the facts of relationship, and, while statements made and
brochures prepared may shed light on the facts, such material is to be evaluated
in context. Nor is there any question of estoppel to deny or limit the presentation
made in the exhibit; it was not prepared for, submitted to, or connected with the
employees of any of the mills or the bargaining representative of any employees.
In determining whether this exhibit, in its emphasis on Deeri ng-Milliken's leader-
ship while recognizing the important role played by the mills, indicates single-
employer status, we can consider the similar emphasis on Ford, Mercury, Chevrolet,
Buick, Plymouth, Chrysler in the simultaneous nationwide first showing of each
of these in their new models. There too the identity of the local organization is sub-
merged; arrangements are controlled at the center, and this despite the fact that the
public unveiling does not occur at the center equivalent of the Waldorf-Astoria,
where "Fabric Magic" was unveiled, but at the various local sites. Neither in the
one case nor in the other, neither at Ford nor at Deering-Milliken does the
emphasis on centrality indicate single-employer status of the corporations involved.76
Here is but another instance where a peripheral activity is cited in the absence of
proof of control and joint policy with respect to the labor relations activities which
concern us.
Returning to the analysis of the cases cited by the General Counsel and the Union,
if counsel are unable to show that the instant case contains the elements on which
the Board and the courts rely in finding single-employer status, they may never-
theless and do urge the presence of facts otherwise sufficient to show such status
here In the absence of a similar case as precedent, the instant case must stand
by itself. Of course the facts in each situation are different; but, if one situation
does not determine or point the way to solution in another, there is nothing in the
Board's decisions to warrant a finding of single-employer status here. Considering,
as we must, the law and the Board's policy in cases involving other companies, it
should be clear that a finding of single-employer status here would not only be novel;
it would be at variance with other decisions and indicated policy as well as with
the law and the facts herein found.
The importance of the element of control may further be seen if we consider the
cases which involve the question of union responsibility. Even where organizational
relationship of local and parent International is admitted, the issue of responsibility
rests, not on such relationship, but on the evidence concerning joint pursuit of a
common objective, i.e., on express assumption of control as in constitution or bylaws
or on actual commission of violative acts on behalf of each 77
76 We have noted supra the contrast between the instant situation and that of one manu-
facturer with many so -called sales agencies. Again, here the advertising emphasis is on
one name at the location of the single sales agent; in the automobile industry the em-
phasis is similarly on one name, but at the several sites of the various sales agents. The
advertising purpose in each case explains the locus of such advertising.
77 Hitchman Coal and Coke Company v. B. Mitchell, etc., 245 U . S. 229, 249; National
Maritime Union, AFL-CIO, et al. (Standard Oil Company , an Indiana Corporation), 121
NLRB 208. Cf. Millwrights' Local 2 832, United Brotherhood of Carpenters , etc. (Farna-
328 DECISIONS OF NATIONAL LABOR RELATIONS BOARD
Since the hearing and in the course of further consideration of the evidence, many
thoughts and different ways of expressing them have come to mind. These have been
set down and in large measure here submitted. An approach, a concept, an expres-
sion which may not be persuasive to one may be to another. (And this report
will pass through many hands before decision.) This may be said to parallel the
efforts of the General Counsel and the Umon as they offered a great variety of evi-
dence which they hoped might separately or collectively support their position.
Having come to a conclusion on the basis of the hearing and the evidence adduced,
and required to state my findings, conclusions, and recommendations and to give
reasons, I am now the proponent for those findings, conclusions, and recommenda-
tions; and I have presented the reasons called for so that they may appear to be
reasonable and persuasive. Where differences of opinion so frequently appear,
reason may unfortunately be in the mind, if not in the eye, of the beholder or viewer.
All that has been said to this point, the reasons, the analogies, the arguments, may
be persuasive even if not to all litigants and partisans. (Experience indicates that
objections or interpretations not yet voiced must be anticipated, and what is clear
from one viewpoint may not be from another so that detailed clarification may be
advisable; withal this report is written for the judicial mind, not for a general
audience or the reading public.) But since "What is past is prologue," what has been
noted in detail needs to be summarized. My findings have already been several
times stated. But the realization that it has been necessary to explain in various
and many ways that the discrimination here was general, not individually directed,
that there is no practical remedy at his point, and that the situation is not one
which can easily be repeated-all of this suggests the advisability of restating the
findings in different fashion to anticipate and guard against a misconception of the
evidence before us and a conclusion which may not be supported by the record.
The need to proceed thus apparently exists, whether because the case has been
considered by too many or not sufficiently considered by any, although the Board
has yet to declare its ultimate conclusions. In remanding the proceeding, the Board
may have assumed and relied on the claims made by the Union's counsel in his
early offer of proof. Aside from the question of relevancy pointed out in the
dissent on remand, it is now clear that these claims of fact have not been supported.78
This is not to say that these corporations deal with each other at arm's length;
they do not. But it is one thing to find cooperation, even intimacy, and another
to declare single-employer status with common control and mutual liability.
The general standards recognized have made it clear from the beginning that our
problem here would be and is to relate the evidence to those standards. Whatever
differences may appear in different evaluations of that evidence, the conclusion
can reasonably be only that, with full recognition of those items which are compatible
with single-employer status and some which even suggest it, such status, or in the
General Counsel's words the requisite "degree of centralization of the necessary
functions," has not been shown to exist among the various corporations here or,
more narrowly, between Darlington and other corporations
We have employed different phrases which indicate different degrees of relation-
ship; and we have been seen that the proof for assumption of jurisdiction, for ex-
ample, may not suffice for a finding of liability by a different entity and ultimately
for a finding of control and then single-employer status. "Single-employer" suggests
a very close relationship, and indeed a very close relationship is a requisite to exten-
sion of findings of violation or of a requirement for remedy.
It has already been noted that, were evidence available which indicates single-
employer status, that could be set forth with reasonable brevity. In the absence
of such evidence, it would probably not be satisfactory to announce only that the
evidence needed for the finding thus sought has not been submitted. What has ap-
peared to come closest to the General Counsel's and the Union's position has there-
fore been detailed and considered to the conclusion that even such evidence, much
less the remainder, has not indicated single-employer status.
worth if Chambers, Inc.), 122 NLRB 300, where the Board found that, under the Inter-
national's constitution, locals are "subject to its laws and usages"; and that the Inter-
national controlled the local's acts and compelled the violations found No such control
or compulsion is here found. Cf also The Marley Company, 117 NLRB 107
78 Regardless of the "ultimate" conclusion, I am unable to endorse the General Counsel's
statement that the "signposts . . are clear and outstanding," and the conclusion for
which he argues "inescapable " Were he correct in this, it would probably have been,
unnecessary (although the contrary is logically possible) to seek so many signposts and
to take so much time and offer so much evidence in the attempt to attain the conclusion
thus urged and indeed to escape a contrary conclusion.
DARLINGTON MANUFACTURING COMPANY, ETC. 329
One further reminder: I have not overlooked but I reject the argument that the
number of factors which are consonant with a single-employer status, even if none
of them depends on or proves such status, proves the General Counsel's case.
On the contrary, it cannot reasonably be denied that, since each might exist in an
independent setup, all are consistent with such a setup. Here again, as repeated
throughout the hearing, we have the distinction between cooperation and control,
particularly in labor relations. A finding of single-employer status might avoid the
problem of remedy noted at the first hearing herein and the first Intermediate Report.
But even if an arcane mystery must be faced, the finding is that such a status has not
been shown.
The ingenuity which was testified to at the original hearing, which was so im-
pressive, and which was recognized and discussed in the earlier Intermediate Report
was Darlington's. In all of the testimony at the various hearings there is nothing
to indicate that, faced with manufacturing, competitive market, and other problems,
Darlington relied on or could have relied on another mill or corporation for more
than those services which are commonly available to independent mill corporations.
Whether the related corporations or any of them faced similar problems, we do
not know. There is no evidence that all marched together in solving and meeting
problems or that survival of any depended on ingenuity by phalanx. Oeland's
problems differed from those elsewhere, and the corporations had varied success
in solving their problems.
Conceivably, Deering-Milliken might have provided Darlington's capital, and by
agreement have had a lien on or full title to property in Darlington's possession, all
without being an alter ego or creating a single-employer status. We are dealing
with labor relations and the violations of the Act which have been found. The
relationship between Deering-Milliken and Darlington does not embrace such
relations. Their cooperation in financial, technical, and administrative matters did
not impinge on or affect Darlington's full and sole control of its labor relations.
Whatever the elements of advice, assistance, and cooperation here (1) they do not
extend to joint control over Darlington and other corporations, and (2) they do
not cover Darlington's labor relations. Whatever the General Counsel's and the
Union's hope, whatever their wish, they cannot reasonably believe that the facts
adduced show single-employer status. Certainly I do not. The General Counsel's
attempt to analogize the situation here with that of the General Counsel of the
Board in Washington and his 35 field offices must fail. The difference between
the two cases with respect to autonomy and control whether, as he cites, in decisions,
help (or guidance or direction) from Washington, or transfers is too clear to
require elucidation for those who, like the Board, are acquainted with the General
Counsel's organization and who will acquaint themselves with the facts in this
proceeding.
After the issue of violation comes that of liability, and as to that it does not appear
that the relationship between Darlington and any or all of the other corporations is
such as to make the latter or any of them liable for Darlington's violations. As for
remedy, there is no evidence of alter ego continuance of operations or management,
transfer of machinery, orders, profits, etc., or even legal successorship to Darlington,
which could warrant imposition of a remedy on any of the other corporations.
No corporate veil is here being employed to hide unlawful activities or to evade
lawful responsibilty, and there is none to be pierced. A contrary conclusion would
constitute a roadblock on the highway of interpretation or analysis of the corporate
structure and its significance. The exceptions for modifying or setting aside the
concept of limited corporate liability do not apply here; and there is no basis for
finding single-employer status or for imposing one corporation's liability, whether
potential but nonexistent, or in esse, on the others.
The additional evidence which the Board directed be taken has been received. It
is neither necessary to support, nor does it, in the language of the dissent from the
remand order, "support the complaint and prove the illegal motivation behind the
closing of the Respondent [sic] plant." In ordering the remand, the Board decided
to proceed "without regard to the original [sic] purpose of the Union's offer of
proof." However the Board, in "giving thorough and final consideration to the issues
in this case," may evaluate this additional evidence, such evidence does not affect
my findings, conclusions, or recommendations of April 30, 1957, on the issues
framed by the pleadings and tried in this case; nor was it offered to modify those
findings, conclusions, or recommendations, to which exceptions have long since
been filed.
With respect to the amended complaint, the proof indicates no basis or warrant
for finding either that violation was committed by any individual or corporation
other than Darlington (specifically, there was no violation by Deering-Milliken), or
that liability for remedy may be imposed on any other.
330 DECISIONS OF NATIONAL LABOR RELATIONS BOARD
I find from all of the evidence as implemented by the arguments and briefs of
counsel at and since the hearing, that Darlington, in the terms of the offer of proof
and the remand order, is not "but one in a chain of about 30 mills whose operations
and labor relations are controlled by Deering, Milliken, & Co., Inc." and that Darling-
ton does not occupy a single-employer status with the other corporations or any of
them.
With this synoptic if itself lengthy treatment of the words, perhaps running into
the millions, of oral and written testimony and argument, let us inquire, what might
conceivably be found here which could reflect on possible remedy? No basis has
been shown for directing any other mill to employ Darlington employees. Nor can
they be employed by Deering-Milliken, DMSC, or DMRC. So much for "reinstate-
ment to their former or substantially equivalent positions." As for backpay, Darling-
ton's remaining assets on hand are presumably sufficient under most of the remedies
proposed against Darlington and unless employment in the other mills were directed;
and in the latter eventuality, those mills could with equal legality be directed to make
the employees whole! But since it does not appear to me to be even remotely possible
that employment in the other mills will be directed, the question remains, What
might conceivably be found here which could reflect on possible remedy? Aside
from the objections such as those noted in the dissent to the order of December 16,
1957, to requiring this labor, we have indeed labored but brought forth not even z
mouse.
This is the third intermediate Report in this proceeding, the first, as noted, having
been issued 21/z years ago. It appears that the Board will review all three jointly.
I have consistently attempted to apply the law to the facts as found. I have recog-
nized ideas and attempts, and anticipate more, to prevent a "social wrong" and to
promote what is "fair." But this is not the occasion to debate social problems; and
any who seek to achieve what they deem to be social improvements must, whatever
their disappointment, seek elsewhere and in a different forum. We do not here con-
sider the question whether the legislature should or would react to arguments ad-
dressed to the "good of the country." Whether there be agreement or not with my
findings, conclusions, and recommendations, and whatever may lie within the tropics
of anyone's heart, this must be recognized as a proceeding which does not create
rights but finds and declares them as established by the Act and the cases. In this
connection I would quote from a recent opinion of Chief Judge Hutcheson, himself
quoting as follows: 70
Philosophical speculation about law and politics is an attractive pursuit. A
small knowledge of the rules of law, a sympathy with hardships which have been
observed and a little ingenuity, are sufficient to make a very pretty theory. It is
a harder task to become a master of Anglo-American law by using the history
of that law to discover the principles which underlie its rules, and to elucidate
the manner in which these principles have been developed and adapted to meet
the infinite complexities of life in different ages. Such students of our law will
learn even though at second hand, something of the practical wisdom which
comes from knowledge of affairs. They will for that reason be able to suggest
solutions of present problems which will depend not merely on their own un-
aided genius, but on the accumulated wisdom of the past.
An official who had no connection with this proceeding at the time of the hearings
has recently but unofficially declared: "Where the administrative responsibility re-
quires interpretation of the law, it is necessary to find a reflection of the common
will in the way that the law-making body intended." At the risk of causing some un-
happiness and even arousing displeasure (how frequently can that be avoided in de-
ciding these cases?), I do not conceive it to be my duty or even my prerogative "to
find a reflection of the common will." It is necessary "to find the way that the law-
making body intended"; and that is indicated in statute and decisions.
This is no sociological 80 problem, but a legal one. It is not for us here to strive
to bring grapes of Eshcol to some who seek relief; our function is to recognize ex-
isting rights and liabilities. To quote Judge Prettyman again, "The function of an
79 Refinery Employees v. Continental Oil Company, 268 F . 2d 447, 460 (CA. 5), con-
curring opinion, quoting from Holdsworth, Some Lessons From Our Legal History, page
105. See also footnote 13, supra.
80 We have seen that the remand hearing lay beyond the scope of the legal involved,
and even of the administrative questions raised by the pleadings Whether or not the
remand was born in whole or in part of a sociological emphasis , it may have encouraged
such emphasis by presentation of the issue of "empire."
DARLINGTON MANUFACTURING COMPANY, ETC. 331
administrative agency is the administration of law-no more, no less." 81 This is as
true of the Trial Examiner's function.
Substantial evidence on the record as a whole must be our modus decidendi and our
decisional cockade. As we consider our freedom, our responsibilities, and our rights,
any other gonfalon unfurled will be seen to be a "pestilence that walketh in darkness;
. destruction that wasteth at noonday." 82
Upon the basis of the above findings of fact, and upon the entire record in the
case, I make the following:
CONCLUSIONS OF LAw 83
1. Deering, Milliken & Co , Inc., does not control the operations or labor relations
of Darlington Manufacturing Company.
2. Darlington Manufacturing Company does not occupy a single-employer status
with "related" 84 or other corporations.
3. Deering, Milliken & Co., Inc., has not engaged in unfair labor practices within
the meamng of Section 8(a) (5), (3) or (1) of the Act.
[Recommendations omitted from publication.]
81 Trial by Agency, page 10
sa Psalm 91: 6.
sa These conclusions supplement those in the Intermediate Report of April 30, 1957. As
to the Respondent Roger Milliken, reference is made to the Board's Order of October 22,
1958, and the Intermediate Report of April 30, 1959
84 Thus designated in the Board ' s Order of December 16, 1957.
APPENDIX A
EXHIBIT A
The officers of Deering, Milliken & Co., Inc. are:
Roger Milliken, president
Gerrish H Milliken, Jr., vice president and assistant treasurer
Seth M. Milliken, vice president
J. C Harris, vice president
A J Dillard, vice president
W. Kuenzel, vice president
Harold A. Hatch, vice president and assistant treasurer
Joseph R. Smith, vice president and assistant treasurer
Minot K. Milliken, vice president and treasurer
Francis G. Kingsley, vice president
I. P. Crowther, vice president
Alexander J. May, vice president
Charles W. Kable, Jr., secretary and assistant treasurer
E. P. Flanigan, comptroller and assistant treasurer
The directors of Deering, Milliken & Co., Inc. are:
Roger Milliken
Gerrish H. Milliken, Jr.
Minot K. Milliken
Francis G Kingsley
Harold A. Hatch
The officers of Darlington Manufacturing Company are:
Roger Milliken, president
H. A. Hatch, vice president
J. M. Oeland, secretary and treasurer
C. W. Kahle, Jr., assistant treasurer
The directors of Darlington Manufacturing Company are:
F. G. Kingsley, resigned September 12, 1956
H A. Hatch
J H Lyles
Minot K Milliken
Roger Milliken
W S. Nicholson
J. M Oeland
G. H. Milliken, Jr., elected September 12, 1956, in place of Mr. Kingsley
332 DECISIONS OF NATIONAL LABOR RELATIONS BOARD
INTERMEDIATE REPORT AND RECOMMENDED ORDER
Issuance of an Intermediate Report at this time itself calls for an explanation con-
cerning procedure in these proceedings, which have been beset by procedural com-
plications. How this question arises we shall now see as we briefly review the history
of the various proceedings to date, all under the same charge and amended charge;
the basis for answering this question will be shown infra.
On September 6, 1956, the Union won a Board-conducted election at Darlington
Manufacturing Company. On October 17, the stockholders voted to dissolve the
corporation; operations were at once discontinued except that the stock in process
was run out, and the employees were successively dismissed as their work ran out;
all operations were terminated on November 24, and on December 12 and 13, 1956,
mill and equipment were sold at public auction.
The Union had filed, on October 16, a charge which alleged violation by Darling-
ton of Section 8(a) (1) of the National Labor Relations Act, as amended, 61 Stat.
136. An amended charge, which alleged violation of Section 8(a)(1), (3), and
(5), was filed on November 1 against "Darlington Manufacturing Company, Roger
Milliken, President and Deering-Milliken & Company, Inc." On December 4 a
complaint was issued against Darlington alone. The issues raised by that complaint
were heard in January and February 1957, and an Intermediate Report issued on
April 30.
After oral argument on exceptions to the Intermediate Report, the Board on De-
cember 16, 1957, called for a hearing on the single-employer status of Darlington
and Deering, Milliken, and other corporations. That hearing, report on which had
to be held in abeyance with the issuance of the instant complaint (the third in the
series) and a motion to consolidate, was based on the remand order and on a com-
plaint (the second in these proceedings) against "Darlington Manufacturing Com-
pany," "Roger Milliken," and "Deering-Milliken and Company, Inc."; as noted infra,
the second complaint has been dismissed as to Roger Milliken.
The Board having denied the motion to consolidate the second and third com-
plaints, there came on for argument before me at New York, New York, on April 9,
1959, a motion to dismiss the latter. Briefs had previously been filed, and counsel
were heard in detailed argument which, as we shall see, was not limited, as on a
motion to dismiss, to the third complaint: this Intermediate Report is based also
on the statements concerning the proposed proof to be offered at the hearing, on an
affidavit submitted by the Union with its brief, and on an agreement among counsel
at the argument to the extent that the answer admits the allegation of the instant
complaint concerning ownership of Darlington stock. All of the latter are factual
items which supplement the complaint.
More inclusively, the determination or findings herein are made on the basis of
the entire record in these proceedings to date, including the charges filed in 1956,
the testimony concerning Roger Milliken's acts as previously found, the statement
of what would be shown at a further hearing, the duties and authority of Darling-
ton's officers, and the affidavit received to explain the Union's intent when the
amended charge was filed. It becomes unnecessary, in view of the various and
sufficient bases for the determination herein, to consider such controverted items as
the extent of Roger Milliken's control, as distinguished from ownership, of Darling-
ton stock. It appears that, conversely, were the General Counsel's position here
sufficient as a matter of law, the facts previously found and those here noted
would warrant an Intermediate Report and the conclusion that Roger Milliken is
liable individually even without decision on such issues as the extent of his control
of Darlington stock. In short, the General Counsel, who as we shall see is relying
on the evidence previously adduced as support for the instant complaint, would
here prevail were that evidence sufficient for findings against Roger Milliken in-
dividually; he cannot where it is not. The arguments of counsel, as pointed out
at the time and as counsel agreed, and this Intermediate Report search the record
of this entire case to date, the earlier proceedings being part thereof and relied
on herein, and further testimony is unnecessary.
Having indicated the scope of the instant proceeding and the extent of the matters
relied on for the decision and recommendation in this report, we come to analysis
of the bases for a decision. We have already noted that the amended charge of
November 1, 1956, upon which the instant complaint against Roger Milliken is
based, refers to "Darlington Manufacturing Company, Roger Milliken, President and
Deering-Milliken & Company, Inc." As early as the beginning of the first hearing,
in stating my reasons for granting a motion to revoke subpenas, I stated that "the
amended charge in these proceedings was filed not only against Darlington Manu-
facturing Company and Roger Milliken as President," but also against Deering,
DARLINGTON MANUFACTURING COMPANY, ETC. 333
Milliken. That interpretation , i.e., that the reference to Roger Milliken, president,
meant Roger Milliken as president , appeared to me to be natural , legal, and correct;
it still so appears.
On those subpenas , reference by the Union was to Roger Milliken individually, as
president of Darlington , and as president and treasurer of Deering , Milliken; similarly
on the contemporaneous application to take depositions and for the issuance of sub-
penas. The Union 's recognition of the significance of the phrase "Roger Milliken,
president" was further indicated by the reference to "Roger Milliken, President of
the Respondent" in its brief to the Trial Examiner after the first hearing , filed within
6 months of the October 1956 events.
To the present argument that the word "President" in the amended charge does
not indicate that the charge is against him in his capacity as president but merely
"serves to identify who Roger Milliken is ," the short answer is that "A. B., President"
is construed as a reference to or identification of A. B . in his capacity as officer, not
to A. B . individually . With full understanding that Davis , the Unions International
representative who filed the charges , is not a lawyer, the fact remains that they were
not filed against Roger Milliken . Davis' affidavit of intent cannot overcome the
legal effect of the language which he used and the limitation thereby created; this
aside from the argument by counsel for the Respondent against that affidavit's
reliability , which at this point I do not question . If the charge and the 6-month
statutory limitation are intended to put respondents on notice , the charges here
did not give such notice to Roger Milliken individually . Whatever the intent and
however innocent the error, the burden is not to be transferred to one who is
innocent of that error. Further , ample opportunity existed to amend the charge
again: 3 months or less after the original and amended charges were filed, and well
within the statutory period, I referred , as noted supra , to the amended charge as
having been filed against "Roger Milliken as President." If that interpretation was
not the General Counsel's and the Union 's, and if it did not reflect the Union's
intent, there was neither protest from them nor amendment of the charge.
The Respondent points out that in Republican Publishing Company , et al.,i cited
by the Union , the Board dismissed the complaint against "Bowles as Trustee"
because the charge named "Bowles." The Union answers that the dismissal
there was based on the failure of the complaint to name Bowles as trustee, while
the instant complaint does name Milliken individually . To this the reply is that,
if omission of a name or proper designation from a complaint warrants dismissal,
then ommision from the charge is as important for its failure to serve the purpose
of giving notice. This is not a case of a technically erroneous listing which, in the
absence of other reasonable construction, can be held to have given notice to a person
other than the one designated . It is understandable and not at all uncommon, from
charge through final decision , to cite a corporation and a named officer qua officer.
A frequently taken and recognized step is not to be construed as something else
merely because it is unnecessary . With respect to the findings made and remedy
directed against Bowles, who "actually conducted " the business , the Republican
Publishing case is included in the footnote reference infra to cases involving or
related to the principle of piercing the corporate veil. (Nor does the instant case
involve the question of a charge, sufficient to support a complaint , reinstated after
it had been dismissed because of a clerical error.)
From the filing of the charges , through the protests and objections, to limitation
of the original complaint to Darlington , and thereafter , the attempt has consistently
been made to show an interrelationship to the point of liability among the various
corporations ; Milliken has been referred to in his capacity as officer of Darlington
and other corporations, not individually ; and the intent thus disclosed and the factual
finding here of such intent are in harmony with the ruling that as a matter of law
Roger Milliken individually was not named in the charges. The distinction and
difference noted are carried out in the instant complaint , which is not brought
against "Roger Milliken, President " If it be argued that the latter would defeat
the purpose of this proceeding , that would be but recognition of the variance between
the amended charge and the complaint.
This ground for dismissal was included as one of the reasons for my dismissal
as against Roger Milliken of the second complaint in October 1958. While it became
unnecessary to pass on it at that time since the Board in its ruling of October 22,
1958, relied upon and cited as "the sole ground" the first reason which I had stated,
the very question has here been presented . Similarly, while decision on this ground
makes it unnecessary to consider other bases for dismissal , statement of such other
bases may serve to avoid future reference , argument , or hearing.
1 73 NLRB 1085
334 DECISIONS OF NATIONAL LABOR RELATIONS BOARD
We shall soon turn to consideration of the evidence of violations heretofore
adduced and indicated for further hearing. We can here note that such evidence,
characteristic of proof of corporate violation but not of individual liability, indicates
that the charge, found to have been filed against Milliken as president, was properly
so filed: it may be small consolation, but the evidence warrants the charge as filed
against him in his corporate capacity, not as an individual.
Before leaving this point, it should be noted that there is no suggestion that
Milliken sought refuge behind a corporate entity and organized, maintained, or
dissolved Darlington to avoid an obligation to comply, as successor or otherwise,
with the Act or a Board order, to enable him to violate the Act without penalty,
or to evade the Board's jurisdiction. Mere organization of a corporation for the
purpose of limiting financial liability, saving on taxes, or other common corporate
purpose does not make the owner of some or even most of the corporation's stock,
with the extent of control of stock here suggested, personally liable for the
corporation's violations. The Board has pierced the corporate veil in cases of sale
or dissolution and organization of a successor, where a scheme to evade has been
shown. But there is no warrant for piercing the corporate veil here to impose liability
on Milliken individually under the allegations of the complaint as amended. Un-
lawful intent in organizing the corporation has not been shown; and the findings
of violation heretofore made were, as noted infra, based on acts chargeable to
Darlington and Milliken, not individually but as its officer. His activity in connec-
tion with the violations found, detailed by the Union, do not call for a proceeding
or remedy against him individually under the Act and decisions thereunder or
under the principles of corporate law. The cases cited by the Union are distinguish-
able by the tests noted above None of them involved a complete cessation of
business and permanent liquidation, as here.
In the Cookeville Shirt Company, et al., case,2 cited by the Union and the Re-
spondent, the complaint named French, an officer of the respondent company as a
respondent in his individual capacity, and the remedial order was directed against
him because of "the prominent role" played by him in the violations.3 But the
Board there specifically refused to issue a blanket order against French in connection
with other plants of which he was an officer, and the order against him did not cover
any 8(a)(3) remedy, there being none in that case. Aside from the point, noted
infra, that the corporation is not a party here, we shall soon see that there would be
no practical difference here so far as remedy is concerned were an order to run
against Milliken in connection with the Darlington violations. We are not at the
moment considering cases involving individuals who, as respondents, are individually
liable for reinstatement and backpay because they sought to evade obligations, and
who can be reached by piercing the corporate veil. Nor, in the light of the ruling
concerning remedy in the Intermediate Report in the Darlington proceeding, is
there basis for further remedy here At most (this is a concession which may only
lead to further argument), considering Cookeville Shirt, and if greater personal
involvement by Milliken than has been shown were found, we could here direct
a remedy against him limited to Darlington's operations with respect to the 8(a)(1)
and (5) violations, and excluding the 8(a)(3) aspect with respect to reinstatement
and backpay, as in Jackson Daily News,4 and Sanco Piece Dye Works, Inc., et al5
But as an additional remedy this would be quite meaningless and could not justify
the taking of testimony for the third time in this proceeding. It is unnecessary
to explain and further distinguish each of the other cases cited by counsel; all
have been examined and considered.
As before, the request to bargain is here alleged to have been directed to Darling-
ton, not to Milliken personally. No more than he was asked to bargain did the
2 79 NLRB 667, 671.
s Conceding that Darlington acted through its president, directors, and stockholders in
violating Section 8(a) (3) and (5), I cannot see how it could have committed those vio-
lations with less involvement of Roger Milliken. As for the 8(a) (1) violations, we shall
note that they were not chargeable to Milliken individually and that they are not even
now alleged against him.
4 90 NLRB 565.
5 38 NLRB 690 Cf. also Consumers Lumber & Veneer Company, et al, 63 NLRB 17
In H McLachlan & Company, Incorporated, et al ., 45 NLRB 1113, the remedy ran against
an individual who, as stipulated, was "a person acting in the interest of" the corporate
employers Similarly in National Lumber Mills, Inc., et al, 37 NLRB 700, the remedy
was imposed against an individual who controlled a closed corporation. The 8(a) (3)
remedy has been included in other cases, which embraced the element of piercing the
corporate veil.
DARLINGTON MANUFACTURING COMPANY, ETC. 335
latter in his individual capacity refuse. Nor is there evidence of any other per-
sonal violation by him. For example, it is not claimed that he prompted the
8(a) (1) violations found. Darlington is liable for its supervisors' acts under the
doctrine of respondeat superior. That doctrine does not impose liability on Milliken
any more than it does on Darlington's chief active or operating executive, who
under the bylaws as previously shown is its treasurer, Oeland.
True, the original hearing was held on the issues of violations by Darlington.
But we know from the General Counsel that, beyond the acts or statements brought
out in that hearing, evidence might conceivably be offered of "only one or two
things" not already in the record; there would be very few additional matters, like
Roger Milliken's speeches. Those speeches were cited at the first hearing to show
Darlington's violations, and their rejection was not based on the fact that Milliken
was not a party. They were rejected because they were collateral to the issues
and would have opened the door to a mass of collateral testimony as pointed out at
that hearing and in the Intermediate Report thereafter issued. The testimony con-
cerning those speeches would not have proved further violation of Section 8(a)(1)
beyond those alleged and found; nor would they prove that the violations alleged
in the complaint now before us were chargeable to Roger Milliken individually.
Neither would a few acts or statements like Milliken's speeches have constituted
violations of Section 8(a)(3) and (5) or add to the violation of those subsections
already found. Further, such additional acts or statements are not even included
among the detailed allegations of violation of Section 8(a) (1) which are set forth in
the instant complaint against Roger Milliken. If it be urged that the acts and
statements would indicate such an attitude or animus by Milliken as would support
findings of violation of Section 8(a)(3) and (5), the answer is that his attitude
has already and clearly been noted in connection with the finding of company
motive in terminating operations.
Counsel for the Union did declare his inability at the time of the argument herein
to state what would be shown. But we must bear in mind that this complaint
was issued more than 3 months ago and that an early hearing has been anticipated;
and, more significant, that 21/z years have elapsed since the filing of the charge
which allegedly cited Milliken individually and presumably was and is based on ac-
tivities by or chargeable to him. Under these circumstances there can be no justifica-
tion for an additional hearing when, after the General Counsel has indicated that the
proof would in general consist of that at the first hearing (it would be shown that
Milliken committed the unfair labor practices by and with Darlington and Deering,
Milliken), the Union states only that proof will be submitted at the hearing to sup-
port any allegations which the General Counsel has not substantiated.
We do have clarification in the General Counsel's arguments that Milliken and the
other directors are not "compartmentalized": they act as individuals as well as
in their capacity as corporate representatives. But this argument, resting on the
reference to evidence already received, does not call for further hearing; the evidence
can be considered as received here, and its sufficiency determined as a matter of law.
Such procedure follows the line called for by the Union itself for stipulations to avoid
repetition of testimony.
The General Counsel and the Union have acknowledged that Milliken is not
guilty of so-called independent violation of Section 8(a)(1) (we have just noted
that there is no such allegation); this in spite of a statement which he made to a
public official concerning a "hard core" of union supporters, which statement was again
cited by the General Counsel at the instant argument. Thus counsel for the
proponents even now correctly treat this statement by Milliken as one charge-
able to Darlington (it was so regarded in the Intermediate Report), not to Milliken
individually. In identical manner, the violations of Section 8(a)(3) and (5) depend
,on Milliken's acts as representative of the corporation, not in an individual capacity.
Since there is no indication that new or different evidence would now be offered, we
can evaluate such evidence at this time as offered against Milliken individually,
and rule on it as on a motion to dismiss at the close of the General Counsel's case.
(We have thus gone beyond a motion for summary judgment, which the Union
recognizes.)
The limitation to Milliken as officer, both in the proof received and in the proposed
proof further warrants dismissal of this complaint. As officer of Darlington, he is and
will be included in any remedial provisions directed against that corporation. As for
other corporations, should they be brought within the ambit of liability, the remedy
there proposed or directed will similarly include corporate officers. We thus already
have complete coverage of Miliken as officer to the extent that the charge refers
to him as such; and, as just shown, no personal liability on his part even were
the charge construed as referring to him personally.
336 DECISIONS OF NATIONAL LABOR RELATIONS BOARD
Nor does the presence of Milliken individually solve any problem of remedy.
Certainly if Darlington is not to be directed to go back into business, Milliken can-
not be directed to enter the business and personally employ the discriminatees. With
respect to backpay, were any to be directed, the remedy runs against Darlington, its
officers, agents, successors, and assigns. In the latter connection we can compare a
recent decision in which the Board declared the business agent "was acting for the
Union and within his authority when be engaged in the various actions that the Trial
Examiner found violated the Act. . Accordingly we find that (the business
agent), as agent for the Union, has similarly violated" the Act. The Board's order
was there directed against the Respondent Union, "its representatives, officers, suc-
cessors, assigns, and agents, including the Respondent Business Representative"; and
the notice to be posted called for the signature of "(the named agent), Business
Representative." 6 Surely another hearing is not warranted to obtain an order against
Milliken as officer or agent of Darlington instead of against Darlington, its officers,
agents, successors, and assigns. Neither am I aware of any request, to the Trial
Examiner or to the Board in the Darlington portion of this proceeding, that the
remedial order cite Milliken as an officer or agent
On behalf of Roger Milliken it is here further argued that, when it was pointed
out at the beginning of the lengthy hearing in 1958 that Roger Milliken was not prop-
erly before us as a respondent, the General Counsel could and should at that time
have sought enlargement of the scope of the Board's remand order to include him if
a complaint was not previously issued against him individually; and that the Board
and the General Counsel "are estopped, or would be abusing their discretion in not
considering themselves estopped, presently to prosecute or entertain this or any other
proceeding against Roger Milliken which purports to be based upon the same
amended charge.. "
The law is well settled that there is no estoppel here. While that principle was
emphasized by the Respondent at the argument, there remains the plea of abuse of
discretion, which I must leave for action by the Board in the first instance should
it be deemed necessary to consider this point.
The further point is urged by the Respondent that, while the complaint alleges
that both Darlington and Deering, Milliken are engaged in commerce, Roger Milli-
ken, the sole respondent herein, is not himself so engaged, nor is it alleged that he
is; and that the Board lacks jurisdiction herein since there is no respondent who is
alleged to be engaged in commerce within the meaning of the Act. (Here is perhaps
a practical and immediate result of the procedural involvements and complications,
of which the motion to consolidate and the order thereon are the most recent prior to
the problems here raised.) In support of its position, the Respondent cites the Fifth
Circuit's decision in the National Paper Company et at. case 7 Having gone so far
in stating other grounds for dismissal of the complaint, I believe that we can safely
say at this point that it is unnecessary to pass upon this last.
Contrary to the contention of the Respondent herein, I find that Roger Milliken
was "an agent," using the term in its generic sense, of Darlington in his capacity as
officer and director. But this is no more than saying that Darlington was liable for
his acts, as previously found, and that any remedial order against it runs against him
in his corporate capacity.
The attempt, legal and proper, has been made in the motion, at the argument
(which, as noted supra, was extended by all counsel beyond the scope of the motion),
and in this Intermediate Report, to avoid protraction of this litigation. It is not for
me to serve or indulge the predilections of counsel or to impose any personal notions
of my own on the issues before us. Thus we are not to consider the arguments of
counsel addressed to the welfare of individuals or groups, or to be swayed thereby
in passing upon the issues. This is a legal proceeding, and we are to proceed to
decision according to the law in statute and cases.
With respect to the question of remedy, which has proved disturbing and been made
the subject of exceptions and pleas (which I respect) for justice and the general
welfare, it is not our function in this proceeding to amend the Act. But it may prove
of some comfort to those who stand aghast at the idea of a violation without an ap-
parent remedy, to point out that the situation in this case is self-limiting and does not
indicate that the Act can be violated with impunity. We have seen that Darlington
went out of business; the evidence submitted does not show that it has been continued
under a different name to permit violators to escape a remedial order while reaping
the benefits of the business. Whatever the factors which the Darlington stockholders
0 Local 4 9 of the Sheet Metal Workers Association (New Mexico Sheet Metal Contractors
Association, Inc ), 122 NLRB 1192.
a N L.R B. v. National Paper Company, et al ., 216 F. 2d 859, at 868, reversing 102
NLRB 1569.
DARLINGTON MANUFACTURING COMPANY, ETC. 337
weighed, corporations will not generally go out of business and liquidate their hold-
ings to avoid dealing with a union. Where such steps are taken, financial loss will
normally result and there will certainly follow the loss of profits and of that hope
for future profits which motivated the enterprise. (If one thinks of motivation other
than hope for profit, satisfaction of that motivation, whatever it be, will be denied as
the business is liquidated.) If this does not line the pockets of those discriminated
against, no more are they compensated when an employer is unable to pay; and it
is not our broad social function to provide compensation and a remedy beyond the
provisions of the Act. The fact remains that the situation here will hardly become
common.
On the basis of the findings of fact and upon the entire record in the case to date,
I conclude that no charge has been filed against Roger Milliken, and that he has not
individually, as distinguished from his capacity as officer and director of Darlington,
engaged in unfair labor practices within the meaning of Section 8(a)(1), (3), or
(5) of the Act. It is unnecessary to repeat here the earlier conclusion of law that
the Union is a labor organization within the meaning of Section 2(5) of the Act,
or, for the reasons set forth supra, to find or conclude whether Roger Milliken, the
sole respondent cited in this complaint, was engaged in interstate commerce within
the meaning of Section 2(5) of the Act.
[Recommendations omitted from publication.]
SECOND SUPPLEMENTAL INTERMEDIATE REPORT
AND RECOMMENDED ORDER
Delay in the decision of this case has brought forth further hearings, required
additional Intermediate Reports, and encouraged desperate dialectics. Bearing in
mind that our concern has been with the situation in and about 1956, this install-
ment might well be called The Apotheosis of The Insignificant. (This is intended,
not in disparagement of the parties, counsel, or any of them but as encouragement
to a decision more effective and determinative than the Trial Examiner's reports,
first made a long time ago and then several times since.) The portion immediately
before us has already been on preliminary inspection by the courts and has extended
by more than 1 year the serialization of the problems involved.
The Intermediate Reports issued herein on April 30, 1957, April 30, 1959, and
December 31, 1959, were before the Board when by notice of motion dated Janu-
ary 9, 1961, the Union moved that the Board remand the proceeding to receive newly
discovered evidence. The Board granted this motion on February 15, 1961, and
proceedings then were held in the United States District Court for the Middle Dis-
trict of North Carolina and in the United States Court of Appeals for the Fourth
Circuit. Thereafter a notice of hearing issued on January 22, 1962, and a hearing
was held before me on February 5, 1962, at Winston-Salem, North Carolina.
The issue at this hearing concerned the merger of Deering, Milliken & Co., Inc.,
into Cotwool Manufacturing Corporation and the effect thereof on any responsibility
of the former or its successor, Deering, Milliken, Inc., for the unfair labor practices
of Darlington or to remedy those unfair labor practices I
At the close of the hearing, counsel were heard in brief oral argument. Pursuant
to leave given to all parties, briefs have been filed by the General Counsel, the
Union, and the Respondents, the time to do so having been extended.
The stipulations and testimony concerning the relationship between Deering, Milli-
ken & Co., Inc. (and its successors) and the various mill corporations in 1960, re-
ceived at the hearing, are by the remand, deemed material to the present inquiry.
Although reference will necessarily be made to the evidence with respect to other
mills, I consider it unnecessary to go beyond the relationship between Deering,
Milliken & Co., Inc., and Darlington since that is the primary issue to be determined
in connection with the question of responsibility which is before us. The evidence
here is to be weighed and, by a process of working backward as urged by the General
Counsel, deductions are to be made concerning the situation as it existed in 1956,
with a finding that Deering, Milliken & Co., Inc., "had caused the discrimination."
(This latter is not quite the same as the claim of single-employer status )
By comparison with the problems previously considered, the additional matters
offered at this hearing provide relatively little problem. The issue litigated in the
second hearing and covered in the third Intermediate Report was the relationship
between Deering, Milliken & Co, Inc, and Darlington, and the conclusion was lim-
i All findings , conclusions , recommendations, and responsibility with respect to Deering,
Milliken & Co, Inc., herein attach to Deering, Milliken, Inc, its successor by merger and
change of name
338 DECISIONS OF NATIONAL LABOR RELATIONS BOARD
ited to that; that hearing, although left open for a time for the purpose, was not
extended to the relationship between the former and the various other corporations.
In this latest hearing, our inquiry although more brief refers to the various manu-
facturing companies.
There is neither conflict nor contradiction with respect to the facts adduced; the
lone witness now called, Minot K. Milliken, who had previously testified as vice
president, treasurer, and a director of Deering, Milliken & Co., Inc., was not cross-
examined. But the opinions of the parties and their arguments based on these facts
are antipodal.
The exhibits received at this hearing were primarily offered and received as back-
ground to support and explain the oral testimony and the action taken. They have
been examined and relied on to the extent that the parties have themselves indicated
and relied on them. Upon the entire record at this hearing, considered both sep-
arately and in conjunction with the record previously made in this case, I make the
following:
FINDINGS OF FACT (WITH REASON THEREFOR)
In the spring of 1960 Deering, Milliken & Co., Inc., heretofore admitted and
found to be a sales and factoring corporation, and The Cotwool Manufacturing
Corporation, a manufacturing corporation which owned (in the generic sense) a
number of mills, were merged; and the new entity by change of name is now known
as Deering, Milliken, Inc. The latter is a manufacturing, sales, and factoring or-
ganization, and the Respondents point out that for the first time here all of those
functions are performed by one corporation. The General Counsel has previously
and now seeks to show that all of these functions, particularly the first, were per-
formed by Deering, Milliken & Co., Inc., in and about 1956 with special reference
to Darlington.
Working determinedly, but necessarily within the limit of available facts, the
General Counsel has brought out that the merger was effected after a series of in-
formal meetings which began in the late autumn of 1959 or January 1960 and were
attended by Roger Milliken, Minot K. Milliken, Francis G. Kingsley, and Gerrish
H. Milliken, each of whom was and is an officer of both Deering, Milliken & Co.,
Inc, and Cotwool. (Minot Milliken testified that not a week went by but he dis-
cussed some phase of the business of the two companies.) The first formal meeting
of the directors of both corporations was held on April 5, 1960; and the merger
or reorganization was formally agreed upon in May and consummated, it was indi-
cated, in June 1960 and thereafter.
Members of the Milliken family, i. e., descendants of Seth Milliken, collectively
owned a majority of the shares of both merging corporations, but individual owner-
ship by the various descendants was not the same in both. Some owned stock in
one of the companies, some in both but in different amounts. Stock ownership was
quite different after the merger, the holders of shares of Deering, Milliken, Inc., own-
ing aliquot interests in the combined assets.
Minot Milliken testified that the merger was prompted by two factors: adminis-
trative problems, and tax considerations of growing significance. The latter were
not explored, but concerning the administrative problems it was explained that there
had been a conflict of interest between Deering, Milliken & Co.. Inc , whose costs
had been increasing as its services for Cotwool had been expanding, and Cotwool,
which was the beneficiary of those expanding services. The meetings were held and
action taken to provide a fair arrangement among the stockholders of both companies
For whatever conclusions may be argued from this, we may note that after the
merger, and in the latter part of 1960, several subsidiaries of Cotwool (by that time
presumably subsidiaries of the new corporation) were in status merged into the
parent company. The motion for the instant remand was based on the announcement
of the new divisional setup in connection with these latter mergers The press re-
lease was prepared by Roger Milliken, who was president of the merged corporations
and is president of Deering, Milliken, Inc.
We have seen that as between Deering, Milliken & Co, Inc, and Cotwool, the
merger was accomplished to resolve administrative problems and to obtain tax ad-
vantages. It was brought out that since the merger, Deering, Milliken, Inc., has
continued the selling and factoring functions formerly performed by Deering. Milli-
ken Co., Inc., and that with former Cotwool employees it has continued Cotwool's
manufacturing operations All of this, including an equitable arrangement to cover
services and charges therefor, could be accomplished by previously wholly independ-
ent companies.
In this connection we note the testimony that the renorting methods were not
changed after the merger; that boards of directors of the affected mills were changed,
DARLINGTON MANUFACTURING COMPANY, ETC. 33)
but the officers and managing personnel retained their prior functions; and that there
has been no substantial change in methods with respect to sales, in insurance plans
covering the former Cotwool mills, vacation plans, purchasing arrangements, techni-
cal assistance to mills, or recruitment policy (these considered in the Intermediate
Report of December 31, 1959). All of this is as consonant with independent status
before merger and certainly with absence of that measure of control which here
concerns us as with the earlier single-employer status which has been alleged. In
the affidavit in support of the motion for this remand it is stated that the manufac-
turing divisions may have existed for many years. (That they were owned by or
divisions of Cotwool, not of Deering, Milliken & Co., Inc., has been explained.) It
can similarly be urged that the merger may be indicative of prior single-employer
status; but by the same token, it may not be. The fact of status prior to the merger
and specifically in 1956 needs to be proved.
Merger to effect a more equitable arrangement does not prove a preexisting single
employer status. Rather, such a status might result in informal changes and transfers
without a merger. Nor is that status shown by a subsequent merger to achieve
savings.
Neither does it appear that the relationship and problems between Cotwool and
Deering, Milliken & Co., Inc., were similar to those between the latter and the cot-
ton goods mills generally and Darlington specifically. in fact it was testified that
the administrative problems so-called did not exist with respect to the cotton mills.
The merger before us was prompted by problems with respect to mills owned by
Cotwool, and other than and different from any with which we have been concerned.
In short, the current aspect of these proceedings can be summarized as follows:
Deering, Milliken & Co., Inc., denying that it controlled Darlington and was in a
single-employer status with it, had claimed that it was not itself a manufacturing com-
pany. The published stories which emanated from the press release of December 28,
1960, indicate that Deering, Milliken, Inc., which had been formed from the merger
of Cotwool Manufacturing Corporation and Deering, Milliken & Co., Inc., is a
manufacturing company, and thus appeared to give the lie to the claim previously
made by the latter and analyzed in the Intermediate Report of December 31, 1959.
The evidence now received shows that the Union's impression noted in the motion of
January 9, 1961, was erroneous, and that the manufacturing functions of Deering,
Milliken, Inc., stemmed from Cotwool and mills which Cotwool had controlled. In
fact, most of the mills listed in the release were, in a single exhibit received at an
earlier hearing, shown to be divisions or subsidiaries of Cotwool. The General
Counsel urges that what appear to be descriptive references to retention and con-
tinuance of duties at other mills (in one case the phrase used is "also is Treasurer
") reveal "a recognition that the entire entity included" such other mills; the
Union's argument is that these references show that the new corporation took for
granted that it controlled the nonwholly owned mills. I find that although now in-
cluded in the divisions of Deering, Milliken, Inc., the mills actually covered by the
release have not been shown to have borne such a relation to Deering, Milliken &
Co . inc.
,rn the Intermediate Report of December 31, 1959, cases were cited to show that
where, under the conditions there detailed, there is no joint labor policy or exercise
of control over labor policies, even common ownership does not make one entity
liable for violations of another. Conceivably what was said or done in 1960 might
indicate such necessary control as would warrant a finding of common liability. But
for such a finding as of 1956. we must now find that the vital elements of control
were exercised at that time. Continuity must be shown in order to connect the 1956
situation with the 1960 events so that by a process of working backward the sub-
sequent can be related to and equated with the prior. Events and activities among
certain companies in 1960 do not ipso facto relate to our 1956 situation, and the
question remains, what were the facts in 1956?
Aside from the absence of necessary proof of single-employer status in 1960, 1 can
see no sufficient relevance of events among other companies in 1960 to the issue be-
fore us, that issue being single-employer status as a basis for the liability which was
created in 1956. Evidence of events in 1960 shows no more than relationship be-
tween Deering, Milliken & Co, Inc., and certain corporations other than Darlington;
it does not show this as of 1956 with respect to Darlington, which cannot be sub-
stituted for the corporations cited as of 1960. I therefore find that the e' fence
received concerning Deering, Milliken & Co., Inc., and other corporations in 1960
does not affect the findings made concerning single-employer status when, as pre-
viously found, the Act was violated and when Darlington became liable for such
violations. Nor does this evidence indicate liability by succession to Darlington's
obligations and responsibilities.
672010--63-v o l 139-23
340 DECISIONS OF NATIONAL LABOR RELATIONS BOARD
Insofar as succession is concerned, and without repeating the examples cited and
the analysis made in the Intermediate Report of December 31, 1959, it may be said
(until the Board speaks otherwise) that where the element of control there described
has not been shown, the test of liability of one entity for the violations by another is
as follows: Referring to the entity which is now sought to be held, has that entity
taken over or succeeded to the assets and interests of the violator other than at arm's
length as by a bona fide purchase for value or an open market acquisition? Thus
for example, aside from control, an alter ego attempt to act for the violator, a prefer-
ential transfer and attempt to continue the violator's business merely under another
name-these would indicate liability of the successor. It is that very element of
identity or substitution which provides the basis for a finding of liability where there
is common control or general transferability. For in these latter situations the com-
munity or continuance of control provides the element of benefit which has been
obtained or sought by a preferential assumption while the concomitant liability found
has been evaded. But as the analysis of the evidence previously received has shown,
preference and evasion have not been shown.
The instant hearing has thus brought the answer to several questions posed by
the remand application, as noted in the circuit court's opinion of October 13, 1961.
We now have the facts concerning the merger of Deering, Milliken & Co, Inc., and
Cotwool. It has not been shown that the press "announcement (of December 1960)
was inconsistent with the earlier contention of Deering, Milliken & Co., Inc. that it
was not engaged in manufacturing operations." That announcement referred to fine
goods, worsted, and woolen divisions, not to print cloth mills, like Darlington, as the
circuit court pointed out. Control of mills by the new Deering Milliken, Inc., through
its succession to Cotwool does not show prior control by Deering, Milliken & Co., Inc.
Cotwool's control of various mills in 1960 does not indicate that it similarly con-
trolled Darlington in 1956, or that Darlington did. Nor are the 1960 activities con-
nected with Darlington, which has not existed for several years except perhaps by
prolongation because of these proceedings.
Despite the passage of time, the report of April 30, 1957, is and will be before the
Board for consideration, and it may be of some help to allude here to an argument
which, if not raised before me may nevertheless at some time be deemed worthy of
resolution. This is that backpay should be awarded until the date when Darlington
officially "ceased its existence." But the answer to that proposal or argument is that
the question of remedy resolves not around Darlington's existence as a corporation
but around its continuance of operations, when employees could work and be paid.
Were the argument of continued existence followed, what would be said were the
respondent an individual rather than a corporation?
As for any concern 2 over the absence of deterrent to commission of unfair labor
practices if a violator is permitted to go scot free, i.e., without application of a back-
pay and reinstatement remedy, it should be noted that such circumstances are self-
limiting. The Board has not been deluged with such cases, and for good reason.
This situation exists only where the employer goes out of business, a drastic step
indeed to avoid the usual remedy. Quite different are cases (some of these will be
noted infra) of plant removal, sale, partial closing, etc.
In the Supplemental Report of December 31, 1959, I declared that no objection
was raised to bringing in of the additional respondents in that remand proceeding.
The transcript shows that counsel for the respondents was there willing to have the
proceeding extended to all who had previously been served with a charge. In view
of my findings, it appeared unnecessary to explain further or to support my declara-
tion to that effect. Since the respondents thereafter questioned this, it may at this
time be pointed out that the limitation of Section 10(b) of the Act is against issuance
of an unfair labor practice complaint against a person not served with a timely
charge; but that the statutory limitation does not apply where the General Counsel
seeks to extend the remedy only and where alter ego or single-employer status exists?
2 It is within the Board's functions to consider practical effects, as it does. With respect
to concern for the effect of the recommendations, the Board has in another connection
stated: " . . any conclusion as to detrimental effects of the Act here would be born of
speculation, and we do not believe that speculation is a sufficient basis to support a finding
that it will not effectuate the national policies set forth in the Act to proceed in the case."
(West India Fruit and Steamship Company, Inc , 130 NLRB 343, 366.)
8 Although such questions, especially when not alleged in the complaint, may be left for
compliance, that or similar reasoning presumably prompted the remand order of Decem-
ber 16, 1957, and the acquiescence of the respondents, just noted. Cf the following from
N L R B. v. Aluminum Tubular Corp, et al., 299 F. 2d 595 (C A. 2) : "A 'finding' that one
company is the 'alter ego' of another is a conclusion of law, not entitled to the benefit of
11section 10 ( e) of the National Labor Relations Act.. . .
DARLINGTON MANUFACTURING COMPANY, ETC. 341
Hence, "jurisdiction" may be extended for purposes of remedy where single-employer
status is shown. However strained some arguments in the past in support of jurisdic-
tion (these have frequently been based on little more than a sense of necessity and
nebulous "justice"); however skillful, as in the instant case, the arguments contra;
the distinction between unfair labor practice violation and liability for remedy should
be clear, as should be the limitation of Section 10(b) to the former.
Since this is a Supplemental Intermediate Report, it may be helpful to consider
briefly some decisions which the Board has issued during the pendency of this case.
Of course, what had been noted in the various Intermediate Reports herein was be-
fore the Board when those decisions were issued, as it was when their respective
Intermediate Reports were made.
In The R. C. Mahon Company 4 case, as the Board pointed out in Bonnie Lass,
infra, "the operation was still required and being performed, having only been let
out on contract." The Board ordered Mahon to reopen the closed departments, re-
sume the operation, and effect full reinstatement with backpay, "no more than ad-
ministrative alterations" being required.
In Bonnie Lass Knitting Mills, Inc.,5 the employer's business operations were being
continued, but on a substantially reduced scale. There again the contrast with the
instant situation is clear. The Board ordered reinstatement if full-scale or manu-
facturing operations were resumed; otherwise, backpay until the respective discrim-
inatees secured substantially equivalent employment elsewhere.
In Barbers Iron Foundry,6 the Board in 1960 directed backpay for the period of
the temporary closing of the plant? The refusal to order unconditional reinstate-
ment or backpay after the discriminatory permanent closing suggests confirmation
pro tanto of the original recommendations herein.
In Morris and David Yoseph, d/b/a M. Yoseph Bag Company,8 on its finding that
the employer "did not cease functioning entirely" when the employees were discrimi-
natorily discharged, the Board directed payment of backpay until the business was
sold or until the employer in fact ceased functioning. To the extent that operations
were partially continued, the Board may have analogized that situation with the facts
in Mahon and Bonnie Lass. Again, reinstatement was conditioned upon resumption
of operations.
This attempt to distinguish the "tangled underbrush of past cases" among them-
selves and from the instant case may lead to the impression that the principles
involved have been "not always clear . consistent or reconcilable." 0 But they
are in fact reconcilable and consistent with the recommendations heretofore
made in this case with respect to the remedy, and of course the findings of unfair
labor practice.
As for the issue of single-employer status, further reference may be made to that
portion of the Intermediate Report of December 31, 1959,10 which included an
analysis of the J. G. Roy and Sons Company 11 and Bachman Machine Company 12
cases. The criterion of common control of labor policy rather than mere common
ownership was applied by the General Counsel in the recent Section 10(1) proceeding
involving the Knight Newspapers; 13 and a temporary injunction there issued because,
despite admitted common ownership, there did not appear to be common control
of labor policy. If common ownership without common control is consistent with
the existence of "neutrality" in connection with secondary boycotts, a fortiori such
ownership without common control does not warrant a finding of single-employer
status here for purposes of remedy.
4118 NLRB 1537.
6126 NLRB 1396.
6126 NLRB 30
7 There was no such condition in the instant case. As pointed out in the first Inter-
mediate Report, Darlington's closing was immediate and orderly as the work in process
was completed.
6128 NLRB 211.
9 Northwestern States Portland Cement Co. v. Minnesota, 358 U.S. 450, 457
10 While reference is being made to the Intermediate Report of December 31, 1959, a
typographical correction can be made by inserting the words "issues" after "legal" at
the end of the first line of footnote 80
11118 NLRB 286; 251 F. 2d 771 (C.A. 1) ; 120 NLRB 1016.
i2121 NLRB 1229; 43 LRRM 2645 (D.C. E. Mo) ; 124 NLRB 743.
l6 Thomas Roumell, Reg. Dar. v. Miami Newspaper Printing Pressmen Local No. 46
(Knight Newspapers, Inc.), 198 F. Supp. 851 (D.C. E. Mich ).
342 DECISIONS OF NATIONAL LABOR RELATIONS BOARD
In another recent case ,14 the Board has reiterated the factors of controlling owner-
ship, common control generally, and centralized control of labor relations . Again,
even where there were separate bargaining units and the labor relations of two
corporations were conducted separately, the Board found single-employer status;
but the labor relations of both companies were there controlled by the same owners,
and there was an interchange of employees , equipment, and contract work.15
The General Counsel argues an analogy with Local 138, International Union of
Operating Engineers, et at. (Nassau and Suffolk Contractors' Association, Inc.) 16
and the direction there that a responsible party, although in the background, remedy
unfair labor practices found. The question of control by and responsibility of Deer-
ing, Milliken & Co., Inc., has previously been considered in detail even though this
analogy was not.
The question of jurisdiction was featured in the recent case of Peninsular & Oc-
cidental Steamship Company, et al.17 Going beyond the element of ownership, the
Board there held that the chief respondent had full control of the vessel and was in
fact the employer of its crew and that other companies were merely its instrumental-
ities. (The relative significance of ownership and other factors herein have previously
been indicated.) Similar findings beyond ownership were made in the leading
case there relied on by the Board, West India Fruit and Steamship Company, Inc.
et al.18
Neither with respect to remedy against the original respondent nor single-employer
status do the Board's recent decisions warrant modification of the findings, con-
clusions, or recommendations heretofore made. Given the opportunity, on the basis
of activities by other companies in 1960, to prove a single-employer status between
Darlington and Deering, Milliken & Co., Inc., in 1956, the General Counsel has not
shown that, whatever the present or 1960 connection between Deering, Milliken, Inc.,
and other companies, that relationship and specifically a single-employer status
existed in 1956 and that it included Darlington.
Upon the basis of the above findings of fact, and upon the entire record at this
hearing and in the case , I make the following:
CONCLUSION OF LAW 19
1. Deering, Milliken & Co., Inc. (Deering, Milliken, Inc.), is not responsible for
the unfair labor practices of Darlington Manufacturing Company, or to remedy those
unfair labor practices.20
[Recommendations omitted from publication.]
14 Amalgamated Lithographers of America , et al. ( Miami Post Company), 130 NLRB
968, 975.
15 Aluminum Tubular Corporation, et al., 130 NLRB 1306.
10 123 NLRB 1393, 1405.
17 132 NLRB 10.
1$130 NLRB 343, 347-348.
19 The conclusion and recommendation herein supplement those heretofore made in this
case.
20 This conclusion is in the language of the remand order of February 15, 1961.
Stewart & Co. and Warehouse Employees Union, Local No. 570
affiliated with International Brotherhood of Teamsters , Chauf-
feurs, Warehousemen and Helpers of America, Petitioner.
Case No. 5-RC-3784. October 18, 1962
DECISION AND ORDER
Upon a petition duly filed under Section 9 (c) of the National Labor
Relations Act, a hearing was held before Robert A. Gritta, hearing
officer. The hearing officer's rulings made at the hearing are free
from prejudicial error and are hereby affirmed.
139 NLRB No. 21.