H. P. Townsend Mfg. Co.

National Labor Relations Board - Board Decisions

Jul 20, 1995

317 N.L.R.B. 1169 (N.L.R.B. 1995)

1169
317 NLRB No. 174
H. P. TOWNSEND MFG. CO.
1 Respondents TCE Corporation, MT Assembly Corporation, Kim-
berly P. Barrett, and Richard B. Barrett have excepted to some of
the judge’s credibility findings. The Board’s established policy is not
to overrule an administrative law judge’s credibility resolutions un-
less the clear preponderance of all the relevant evidence convinces
us that they are incorrect. Standard Dry Wall Products, 91 NLRB
544 (1950), enfd. 188 F.2d 362 (3d Cir. 1951). We have carefully
examined the record and find no basis for reversing the findings.
2 There was no ultimate finding on these points because Somers
was not on notice of the allegations.
3 The conduct occurred during the precomplaint investigation. The
deposition was taken in response to an investigative subpoena.
The H. P. Townsend Manufacturing Co., Inc., a
subsidiary of Comtec, Inc.; TCE Corporation;
MT Assembly Corporation; Kimberly P. Bar-
rett, Richard B. Barrett, and David M. Somers
and International Union of Electronic, Elec-
trical, Salaried, Machine and Furniture Work-
ers, Local 281, AFL–CIO. Cases 34–CA–4196,
34–CA–4913, 34–CA–5099, and 34–CA–5661
July 20, 1995
DECISION AND ORDER
BY MEMBERS BROWNING, COHEN, AND
TRUESDALE
On February 24, 1995, Administrative Law Judge
Wallace H. Nations issued the attached decision. Re-
spondents TCE Corporation, MT Assembly Corpora-
tion, Richard Barrett, and Kimberly Barrett filed ex-
ceptions and a supporting brief, and the General Coun-
sel filed a response.
The National Labor Relations Board has delegated
its authority in this proceeding to a three-member
panel.
The Board has considered the decision and the
record in light of the exceptions and briefs and has de-
cided to affirm the judge’s rulings, findings,1 and con-
clusions as modified by this decision and to adopt the
recommended Order as modified.
Respondent David M. Somers is a former National
Labor Relations Board attorney, and is knowledgeable
about Board law and procedures. The judge found,
prima facie, that Somers used his knowledge to at-
tempt to circumvent the National Labor Relations Act,
and that he suborned perjury to further that attempt.2
Further, Somers chose not to appear in this proceeding,
though subpoenaed to appear and named as a Respond-
ent. We agree with Judge Nations’ findings.
We also agree that a strong prima facie case of ag-
gravated misconduct has been established. We shall
not order Somers, however, to defend against the alle-
gations. The Board’s current Rules and Regulations
(Board’s Rules) preclude our adoption of the judge’s
recommendation that Somers show cause why he
should not be permanently barred from practicing law
before the Board. The Board’s Rules governing attor-
ney misconduct in the context of unfair labor practice
proceedings are set forth in pertinent part as follows:
Sec. 102.44 Misconduct at hearing before an
administrative law judge or the Board; refusal of
witness to answer questions.—(a) Misconduct at
any hearing before an administrative law judge or
before the Board shall be ground for summary ex-
clusion from the hearing.
(b) Such misconduct of an aggravated character,
when engaged in by an attorney or other rep-
resentative of a party, shall be ground for suspen-
sion or disbarment by the Board from further
practice before it after due notice and hearing.
[Emphasis added.]
Thus, the Board’s Rules specifically apply only to
attorney misconduct of an aggravated character that oc-
curs at a hearing. Because Somers’ conduct occurred
at the prehearing stage of the proceedings, it is outside
the reach of Section 102.44.3
In our view, this case highlights a need to reexamine
this aspect of our Rules. In order to deal with the al-
leged misconduct in this case, however, we shall trans-
mit a certified copy of the record in this case to the
State bar association for each State in which Somers
is admitted to practice, with our request for appropriate
disciplinary action if deemed warranted.
ORDER
The National Labor Relations Board adopts the rec-
ommended Order of the administrative law judge as
modified below and orders that the Respondents, the
H. P. Townsend Manufacturing Co., Inc., a subsidiary
of Comtec, Inc.; TCE Corporation; MT Assembly Cor-
poration; Kimberly P. Barrett, Richard B. Barrett, and
David M. Somers, West Hartford, Connecticut, its their
officers, agents, successors, and assigns, shall take the
action set forth in the Order as modified.
1. Eliminate paragraph 2(i).
2. Substitute the attached notice for that of the ad-
ministrative law judge.
APPENDIX
NOTICE TO EMPLOYEES
POSTED BY ORDER OF THE
NATIONAL LABOR RELATIONS BOARD
An Agency of the United States Government
The National Labor Relations Board has found that we
violated the National Labor Relations Act and has or-
dered us to post and abide by this notice.
Section 7 of the Act gives employees these rights.
To organize
To form, join, or assist any union
1170 DECISIONS OF THE NATIONAL LABOR RELATIONS BOARD
To bargain collectively through representatives
of their own choice
To act together for other mutual aid or protec-
tion
To choose not to engage in any of these pro-
tected concerted activities.
WE WILL NOT fail and refuse to recognize the Inter-
national Union of Electronic, Electrical, Salaried, Ma-
chine and Furniture Workers, Local 281, AFL–CIO as
the exclusive representative of our employees in the
appropriate unit:
All production and maintenance employees em-
ployed at our West Hartford, Connecticut facility
but excluding all office clerical employees, and all
guards, professional employees and supervisors as
defined in the Act.
WE WILL NOT fail and refuse to abide by the terms
and conditions of employment for our unit employees
as set forth in the last collective-bargaining agreement
between the Union and H. P. Townsend Manufactur-
ing Co., Inc., as found in the National Labor Relations
Board Decision and Order in Cases 34–CA–4196, 34–
CA–4913, and 34–CA–5099.
WE WILL NOT coercively interrogate our employees
about their union activities or sympathies.
WE WILL NOT in any like or related manner interfere
with, restrain, or coerce you in the exercise of the
rights guaranteed you by Section 7 of the Act.
WE WILL recognize and, on demand, bargain in
good faith with the Union as the exclusive collective-
bargaining representative of our employees and if
agreement is reached, embody the agreement in a new
collective-bargaining agreement.
WE WILL rescind any unilateral changes made in the
terms and conditions of employment from those set
forth in the last collective-bargaining agreement be-
tween the Union and H. P. Townsend Manufacturing
Co., Inc., and reinstate those terms and conditions of
employment with respect to current unit employees.
WE WILL make whole those unit employees em-
ployed since the operations of TCE Corporation and
MT Assembly Corporation commenced about October
22, 1991, for any losses they may have suffered by our
failure and refusal to abide by the terms of former col-
lective-bargaining agreement.
WE WILL pay to the Union the pension fund obliga-
tion for the involved individuals as set forth in the
compliance specification in National Labor Relations
Board Cases 34–CA–4196, 34–CA–4913, and 34–CA–
5099, with interest.
WE WILL pay to the Board and the Union all costs
and expenses incurred in the investigation, preparation,
presentation, litigation, and conduct of this proceeding.
TCE CORPORATION, MT ASSEMBLY
CORPORATION
William E. O’Connor, Esq., for the General Counsel.
Patricia M. Strong and Elaine Stuhlman, Esqs., of Wethers-
field, Connecticut, for Respondents TCE Corporation, MT
Assembly Corporation, Richard Barrett, and Kimberly Bar-
rett.
Robert Patti, Representative, of Chicopee, Massachusetts, for
the Charging Party.
DECISION
STATEMENT OF THE CASE
WALLACE H. NATIONS, Administrative Law Judge. Based
on charges filed by the International Union of Electronic,
Electrical, Salaried, Machine and Furniture Workers, Local
281, AFL–CIO (the Union) in Cases 34–CA–4196, 34–CA–
4913, and 34–CA–5099 against the H. P. Townsend Manu-
facturing Co., Inc. (Townsend), complaints issued alleging
that Townsend had committed a variety of unfair labor prac-
tices, including, inter alia, failing to make pension fund pay-
ments. A hearing was held on September 23, 1991, and a de-
cision (G.C. Exh. 1(q)) issued on November 1, 1991, finding
against H. P. Townsend on all allegations. On December 16,
1991, the Board issued its Order adopting the administrative
law judge’s findings, conclusions, and recommended Order.
On April 22, 1992, the Union filed a charge in Case 34–
CA–5661 alleging that TCE Corporation (TCE) violated the
Act by, inter alia, refusing to recognize and bargain with the
Union and refusing to recall union members from layoff. On
June 5, 1992, the Union filed an amended charge alleging
that Townsend, TCE, MT Assembly Corporation (MT As-
sembly), Kimberly P. Barrett, and Richard B. Barrett had
violated the Act by, inter alia, refusing to recognize and bar-
gain with the Union, and by unilaterally changing layoff and
recall procedures. On September 21, 1993, the Union filed
a second amended charge that named the same entities and
persons as the first amended charge, and alleged that they
had violated the Act by, inter alia, failing to continue in full
force and effect all the terms and conditions of the most re-
cent collective-bargaining agreement (agreement) between
the Union and Townsend. A complaint and notice of hearing
issued in Case 34–CA–5661 on September 23, 1993, alleg-
ing, inter alia, that MT Assembly and TCE constitute an alter
ego and single employer (TCE/MT). The complaint pled that
TCE/MT was a successor employer to Townsend, and was
unlawfully refusing to recognize and bargain with the Union
as the collective-bargaining representative of their production
and maintenance employees at the Townsend facility (facil-
ity) located in West Hartford, Connecticut.
In the alternative, the complaint pled that Townsend, Rich-
ard Barrett, and Kimberly Barrett established TCE/MT as a
disguised continuance of Townsend and they all collectively
1171H. P. TOWNSEND MFG. CO.
constitute a single employer and alter egos, and violated the
Act by, inter alia, refusing to apply the agreement to their
employees at the facility.
On October 26, 1993, a compliance specification and no-
tice of hearing issued in Cases 34–CA–4196, 34–CA–4913,
and 34–CA–5099 alleging, inter alia, TCE/MT constituted a
single employer and alter ego, and was liable as a successor
for the unfair labor practices of Townsend. In the alternative
the compliance specification alleged that all the parties
named above constitute a single employer and alter egos, and
are jointly and severally liable for the Townsend unfair labor
practices. An order consolidating cases issued on October 26,
1993, which consolidated those cases for hearing. The date
of the hearing was rescheduled three times. On October 21,
1994, the Union filed a third amended charge including
David Somers as an alter ego with the others already named.
Hearing opened on October 24, 1994, and both the complaint
and compliance specifications were orally amended at hear-
ing to name Somers as an alter ego. The hearing was ad-
journed to November 8, 1994, in order to give Somers the
opportunity to prepare his defense, and was then conducted
from November 8 through 11, 1994.
Somers, who acted as attorney for Townsend, TCE/MT,
and the Barretts during most of the history of this proceed-
ing, refused to appear at trial despite the fact that he was
subpoenaed to appear, and despite notice given to him about
the amendments to the complaint and compliance specifica-
tion made at trial to include him as alter ego Respondent. It
is to be noted that not only was he notified in advance of
the October 24, 1994 hearing of the proposed amendments,
but his attorney, Mark Dean, was present at the hearing when
these amendments were allowed. I specifically instructed
Dean to inform Somers of the allowed amendments and di-
rected the counsel for the General Counsel to serve Somers
otherwise. Attorney Dean stated that he would so inform
Somers, but declined to accept service for Somers. Dean was
also notified that Somers’ motion to quash the subpoena di-
recting Somers’ appearance was overruled and Somers was
directed to appear at the continued hearing on November 8,
1994. It was made clear that Somers would be allowed to
reassert the attorney client privilege with respect to the mate-
rial subpoenaed on an item-by-item basis at this hearing.
Since the date of hearing, Somers has attempted to create
a false impression that he was not notified of the amend-
ments, and that the lack of notice was not his fault. In this
regard, he submitted a letter dated December 6, 1994, in
which he notes he has filed a complaint with the State of
Connecticut, judicial department, against National Labor Re-
lations Board Region 34 Regional Director Peter Hoffman,
Regional Attorney Jonathan Kriesberg, and counsel for the
General Counsel William O’Connor. This complaint, dated
November 7, 1994, notes the existence of the charge filed
against him by the Charging Party on October 21, 1994, and
admits he was faxed a copy of the charge by counsel for the
General Counsel on that date. A cover letter included in this
fax clearly states that the complaint would be amended to
name Somers as an individual Respondent. The complaint
also admits Somers knowledge of the events at the hearing
held October 24, 1994, including the amendment of the con-
solidated complaint to name him as an additional Respond-
ent. The complaint further acknowledges that Attorney
O’Connor personally served a copy of the charge on Somers
on November 4, 1994.
Somers, in his December 6, 1994 letter, asserts that he was
given no notice of the continued hearing until November 19,
1994. This is of course contradicted by his own complaint
wherein he admits knowledge of the events of October 24,
1994, and personal service on November 4, 1994, of an Oc-
tober 24, 1994 letter from O’Connor that states:
Please find enclosed a copy of the Third Amended
Charge in Case 34–CA–5661. The hearing in the
above-referenced cases began on October 24, 1994 as
scheduled. The Administrative Law Judge granted by
motion to admit the Third Amended Charge, and to
amend both the Compliance Specification and the Com-
plaint at issue in the above referenced cases to include
you as a named Respondent and alter ego of the other
named Respondents. He also ruled that you should ap-
pear at the hearing, which has been adjourned until No-
vember 8, 1994, at 10 a.m. with the records which had
been subpoenaed from you, and which you failed to
produce on October 24, 1994, as requested.
Although acknowledging personal service of the foregoing,
Somers claims that a copy of this letter that was mailed to
him by O’Connor was not received until November 19,
1994, because it was mailed to the wrong address, asserting
he receives his mail only at a post office box. The certified
envelope that was filed as General Counsel’s Exhibit 96
shows that exact same address and post office box, however,
as the letterhead on Somers’ December 6 letter, and is the
exact same address to which communications to Somers are
always sent. It is to be noted that the subpoena that Somers
acknowledged receiving was also sent to this address.
I find that Somers’ claim that he was not properly notified
of the amendments concerning himself is meritless and that
he willfully let this case against him proceed. See Western
Paper Products, 313 NLRB 94 (1993); Plumbers Local 250
(Murphy Bros.), 311 NLRB 491, 496 (1983).
Somers’ claim that the amendment should be barred be-
cause of Section 10(b) is also meritless. He was a participant
in the investigation of all charges at issue and was plainly
aware of their substance. He was given the opportunity to
defend himself against the charge that he was an alter ego.
He chose not to defend himself. It is well established that
the alter ego need only be given the opportunity to litigate
alter ego status before being held liable for the unlawful acts
of the other alter egos. See Southeastern Envelope Co., 246
NLRB 429 (1979). Furthermore, as will be dealt with in
more detail later, it was Somers’ condoning of and direction
of perjury that hid the facts of his own involvement as alter
ego in the case that caused any delay in naming him as de-
fendant. Such fraudulent concealment tolls Section 10(b). See
O’Neill Ltd., 288 NLRB 1354 (1988).
Briefs were received from the General Counsel and Re-
spondents TCE/MT, Richard Barrett, and Kimberly Barrett
on or about December 16, 1994. Another letter was received
from Respondent David Somers on December 16, 1994. Al-
though no answer was filed to the amended complaint and
compliance specifications by Somers, I accept his letter as
his answer to the these pleadings and his brief on his legal
position in these proceedings. Based on the entire record in
1172 DECISIONS OF THE NATIONAL LABOR RELATIONS BOARD
1 Respondent TCE Corporation and MT Assembly Corporation
have held this status since October 9, 1991.
2 The administrative law judge found that H. P. Townsend and
Comtec, Inc. constituted a single employer.
this proceeding, including my observation of the demeanor of
the witnesses, and after review of the briefs and Somers’ let-
ters, I make the following
FINDINGS OF FACT
I. JURISDICTION
At the hearing, the parties entered into the following stipu-
lations:
(a) During the 12 month period ending August 31,
1993, Respondent TCE Corp., in conducting its busi-
ness operations, sold and shipped from the West Hart-
ford, facility goods valued in excess of $50,000 directly
to points outside the State of Connecticut; (b) During
the 12 month period ending August 31, 1993, Respond-
ent M.T. Assembly Corp., in conducting its business
operations, provided over $50,000 worth of services di-
rectly to TCE Corporation; (c) Respondent M. T. As-
sembly Corp. has provided no services to any customer
other than TCE Corporation; and (d) All the finished
machines sold by TCE Corporation to customers were
assembled by employees of M.T. Assembly Corp.
Based on the Board’s Order of December 16, 1991, adopt-
ing the administrative law judge’s decision of November 1,
1991, I find that at all times material until August 1, 1991,
when it ceased business, Respondent H. P. Townsend, a cor-
poration with an office and place of business in West Hart-
ford, Connecticut, was engaged in the manufacture and non-
retail sale and distribution of riveting machines and related
products, and was an employer engaged in commerce within
the meaning of Section 2(2), (6), and (7) of the Act. Based
on the stipulations set out above and the evidence of record,
I find that Respondents TCE Corporation and MT Assembly
Corporation, both corporations with an office and place of
business in West Hartford, Connecticut, have engaged in the
manufacture and nonretail sale and distribution of riveting
machines and related products, and have at all material times
been employers engaged in commerce within the meaning of
Section 2(2), (6), and (7) of the Act.1
II. THE LABOR ORGANIZATION INVOLVED
The Union is a labor organization within the meaning of
Section 2(5) of the Act.
III. THE ALLEGED UNFAIR LABOR PRACTICES
The allegations of the compliance specification against
H. P. Townsend were denied by the Respondents. No evi-
dence was offered to dispute the accuracy of its calculations,
however, which were based on reports supplied by Richard
Barrett to the Union’s pension funds. I therefore find that
Respondent Townsend owes $36,721.43 plus interest, for its
failure to make the pension fund payments during the period
September 1, 1988, through August 1, 1991. The amounts
payable to individual employee accounts is as set forth in
Appendix A to the compliance specification, which appendix
is incorporated herein by reference. Still in dispute are the
complaint allegations that allege:
1. That Respondents TCE and MT Assembly are alter egos
and a single employer within the meaning of the Act.
2. That Respondents TCE and MT Assembly were estab-
lished as a disguised continuance of Respondent H. P.
Townsend by Townsend, and Respondents, Richard Barrett,
Kimberly Barrett, and David Somers, and that all named Re-
spondents are alter egos and a single employer within the
meaning of the Act.
3. That Respondent and single employer TCE/MT is a suc-
cessor employer to H. P. Townsend.
4. That since about November 1, 1991, Respondents have
failed to recognize and bargain in good faith with the Union
as the representative of their employees in the appropriate
unit, and have failed to continue in force and effect the col-
lective-bargaining agreement between the Union and Town-
send, which agreement was effective from October 26, 1987,
through October 25, 1990.
5. That about June 2, 1992, Respondent TCE/MT, by
Steve Giannini during a telephone conversation, interrogated
its employees regarding their union activities.
A. The History of the Involved Companies as it Relates
to the Issues for Determination
Townsend was engaged in the manufacture and nonretail
sale of riveting machines and related equipment. It was lo-
cated in West Hartford, Connecticut, and was a wholly
owned subsidiary of Comtec,2 which was itself a holding
company wholly owned by Commercial Technology, Inc.,
which is located in Dallas, Texas.
Townsend began in about 1907 and gradually grew until
1952 when it acquired the Cleveland Tapping Machine Com-
pany. In the mid-1960’s Townsend acquired ERCO, the En-
gineering and Research Company. That was the structure of
the company in June 1973, when Richard Barrett was hired
as an employee. He was never an owner of the company. In
1980, Comtec, Inc. was formed, coincident with the acquisi-
tion of an aircraft parts manufacturing company called
Electro Machine and Tool (EMT) located in Bristol, Con-
necticut. At the time Comtec was formed, it also owned the
National Automatic Products Company (NAPCO) located in
Berlin, Connecticut, and the VALCO Manufacturing and En-
gineering Company, located in Bloomfield, Connecticut.
The only one of the Comtec companies that was ever
unionized was Townsend. The Union was the representative
of a unit of Townsend employees since at least 1952. In
1973, when Richard Barrett began working at Townsend,
there were 35–37 members in the bargaining unit, out of a
total employee complement of 50–55.
The Comtec companies, except VALCO, did well until the
1982–1983 period when sales began to decline. VALCO was
always in poor financial condition since it was acquired. In
1987, a products liability case again NAPCO settled for
$950,000, which resulted in a blanket-security agreement in
the amount of $635,000 against all Comtec companies, in-
cluding Townsend. The NAPCO company closed in Novem-
ber 1989 by a court ordered replevin of its assets. Its real
estate in Berlin was abandoned by its creditors and, although
a foreclosure was started by the Town of Berlin, title was
never taken in that case or in any other action by creditors.
1173H. P. TOWNSEND MFG. CO.
3 Although Kimberly Barrett’s position would denote some degree
of authority with respect to Townsend’s operation, there are no facts
to demonstrate that she held any authority with this Respondent
whatsoever.
4 Although CNB had replevied the personal property of the compa-
nies, there remained a very large debt of roughly $1.3 million. In
addition there was the $635,000 lien from the NAPCO judgment.
Unpaid real estate taxes to the various towns also encumbered the
real estate assets remaining to the Comtec companies. The liquida-
tion value of the replevied Townsend machinery and equipment was
approximately $35,000 according to an outside appraiser.
5 All dates hereinafter are in 1991 unless otherwise noted.
6 Hereinafter, Richard Barrett will be referred to as Barrett. All
other Barretts involved will be referred to by their full names.
7 Barrett, as well as Zimmerman, are personally subject to an IRS
lien of approximately $500,000. I would agree that such a lien
makes Barrett an unlikely candidate for an ownership interest in the
new Company, but I believe the decision not to make him an officer
had more to do with disguising his position of control with it. He
was named as a director.
The VALCO company closed on December 1, 1989, in a
peaceful possession agreement with its secured creditor, Con-
necticut National Bank (CNB), then reopened briefly for the
purpose of organizing for an auction of its assets in June
1990. Its real estate in Bloomfield was abandoned similar to
the Berlin property abandoned by NAPCO.
The EMT company’s two buildings in Bristol were sold in
1988 and 1989 to partially satisfy the CNB debt. EMT
moved to West Hartford to share the building with Town-
send, which had compressed its operations into half of the
building after selling some of its machinery and equipment
in 1988. Approximately one-third of Townsend’s property
was sold at auction in June 1990 to partially satisfy the CNB
debt. During the period of time from 1988–1990, every effort
was being made to satisfy CNB to avoid the complete clo-
sure of the companies.
Richard Barrett was controller of Townsend from June
1973 through December 1989. In December 1986 he also be-
came vice president. On December 29, 1989, he became both
president and treasurer of Townsend. His daughter, Kimberly
Barrett, was made corporate secretary of Townsend from
January 1990 through May 26, 1991.3 Townsend’s chairman
of the board was Mort Zimmerman, who was also president
of commercial technologies and owner of all involved com-
panies. Richard Barrett was controller and vice president
when Townsend stopped making pension fund payments. He
was president and treasurer during the period of all the other
unfair labor practices committed by Townsend, which in-
cluded the continuing refusal to make pension fund pay-
ments, unilaterally changing medical plans, and unilaterally
implementing a new collective-bargaining agreement.
In June 1990, while he was refusing to make payments to
the union pension plan, because Townsend allegedly could
not afford to make such payment, Richard Barrett raised his
own salary from about $42,000 per year to $56,000 per year.
During the same period, David Somers was hired to rep-
resent Townsend and Comtec, Inc. Between January 1990
and the closure of Townsend on August 1, 1991, Somers was
paid approximately $125,000 to $150,000 in legal fees.
Somers was advising Barrett and Zimmerman on various
matters, including the debt restructuring negotiations with
CNB and the labor negotiations in the fall of 1990 with the
Union. The collective-bargaining agreement with the Union
expired on October 25, 1990, and the parties failed to reach
an agreement on a new contract. Somers’ integral role in the
bargaining sessions and events involved in the unfair labor
practices previously litigated is apparent from reviewing the
decision.
In the last year of its operation, Townsend had only 10 or
11 employees, 3 of whom were bargaining unit members. It
is undisputed that Townsend and its related sister companies
owned by Comtec were in serious financial difficulties at the
time Richard Barrett became president of each. In early 1991
CNB was putting significant pressure on Townsend to pay
outstanding debts. CNB notified Zimmerman on March 19,
1991, that unless Townsend agreed to its last forbearance
proposal, it would seek liquidation of Townsend’s assets.
Townsend refused. In fact, CNB seized those assets pursuant
to a court order and a sheriff closed the facility on August
1, 1991. At this time all employees were laid off.4
B. The Board’s Decision in Cases 34–CA–4196, 34–
CA–5099, and 34–CA–4913
A hearing was held in these three proceedings against
Townsend and Comtec on September 23, 1991. As noted in
the administrative law judge decision, issued November 1,
1991, no appearance was made by H. P. Townsend or
Comtec. A letter dated September 9, 1991, from Somers stat-
ed that his office withdrew its appearance for the Respond-
ents and that Respondent would not appear at the hearing or
respond to subpoenas. It further stated that all Connecticut
Comtec companies, including Townsend, had ceased oper-
ations involuntarily because of creditors’ actions. Somers fur-
ther noted that Employer Official Sal Barone had resigned
from his corporate position and that Richard Barrett would
be resigning before the hearing.
The administrative law judge decision found that Town-
send was an employer within the meaning of the Act and
Townsend and Comtec were a single employer within the
meaning of the Act. It further found that Respondent violated
the Act, inter alia, by failing to make contributions to the
union pension plan, by changing health benefits, sickness and
accident benefits, and life insurance benefits, and by unlaw-
fully implementing its proposed collective-bargaining agree-
ment and failing to abide by the terms of the expired collec-
tive-bargaining agreement.
No exceptions were filed to this decision and it was adopt-
ed by the Board in an Order dated December 16, 1991. A
default judgment was later entered by the United States
Court of Appeals for the Second Circuit on July 15, 1992.
C. Formation of TCE and MT Assembly
In late January or early February 1991,5 Somers and Rich-
ard Barrett began to discuss how to continue business should
CNB seize the Townsend assets.6 Barrett had earlier sug-
gested to Union Representative Robert Patti during negotia-
tions that he, Somers, and Vice President Sal Barone were
interested in gaining the Townsend operations for them-
selves. Somers suggested that a new corporation could be
formed, but they felt that Barrett should not be listed as an
officer because of his outstanding liabilities.7 Somers first
suggested that Vice President Barone be the president of the
new corporation, but Barone consulted an outside attorney
1174 DECISIONS OF THE NATIONAL LABOR RELATIONS BOARD
8 Kimberly Barrett had just graduated from college and had been
unable to find employment. She had absolutely no experience in the
operation of a business such as the one contemplated and in my
opinion was just used as a tool, though a willing one, to carry out
the scheme devised by Barrett and Somers to continue the business
of Townsend without being held liable for, inter alia, the unremedied
unfair labor practices of Townsend.
9 On brief, Respondents Richard and Kimberly Barrett urge that
the purpose of acquiring the Townsend assets was to insure contin-
ued employment for Richard Barrett, his wife, Silvia, and son
Danny, both former Townsend employees. It would also provide em-
ployment for Kimberly. On the other hand, the brief admits that they
went along with the ‘‘convoluted scheme’’ created by Somers in
order to avoid succeeding to Townsend’s liabilities.
10 The only reason I mention this relationship is because Coudriet
used it as justification for her unquestioning willingness to sign any
document Somers asked her to sign. I believe that she did participate
in the scheme to create TCE and MT simply out of trust for Somers.
Otherwise, I would name her as another alter ego as she did benefit
financially from the scheme.
11 The document, inter alia, states:
TCE Corporation was formed as a machine tool sales and en-
gineering consulting company with the possibility of acquiring
certain assets necessary for the assembly production of various
machine tool product lines. The primary assets required to meet
the goals of TCE Corporation will the intellectual properties of
successful or formerly successful machine tool building compa-
nies in the Northeast. One immediate opportunity for acquisition
appears to be the purchase under replevin of the nonreal prop-
erties of a well-established, proven company in West Hartford,
CT, the H. P. Townsend Manufacturing Co.
who apparently advised him not to participate. When Barone
announced his decision sometime in May, Somers suggested
that they name Barrett’s 11-year-old son as president, but
Barrett suggested they use his 21-year-old daughter Kimberly
Barrett instead.8
Kimberly Barrett resigned as Townsend’s corporate sec-
retary in late May. Somers proposed that the Barretts pur-
chase the Townsend assets through a ‘‘straw person’’ in
order to avoid claims that the new company was responsible
as a successor for Townsend’s debts, including its union ob-
ligations.9 Somers suggested that they use his office manager
and girlfriend, Gigette Coudriet,10 as the straw person, that
she be named as corporate secretary of the new corporation
and be paid $300 per month for that position. During the
same time period, Somers introduced the Barretts to Rhonda
Farrah, who was president of the Small Business Institute
(SBI), and Robert Fradette, who worked with Farrah. SBI
proposed to give a $500,000 loan in foreign funding to the
new corporation in exchange for a $5000 due diligence fee.
SBI required that Farrah and Fradette be named as directors
of, and that Richard Barrett sign an employment contract
with, the new corporation. When Farrah sent a letter dated
May 29, formally making its offer, she apparently thought
the name of the new company would be ‘‘TCE Corpora-
tion.’’ The Barretts chose, however, to use the name
‘‘TECCO, Inc.’’ when Kimberly Barrett returned the applica-
tion to SBI. Somers directed Coudriet in the preparation of
the corporate papers that were filed on an expedited basis on
June 5. The State rejected the corporate application, however,
because the name had apparently been taken, so they pre-
pared new corporation papers using the name TCE Corpora-
tion. TCE was an acronym for the Townsend product lines:
Townsend, Cleveland, and ERCO.
SBI gave the Barretts until June 4 to make their applica-
tion. Richard Barrett asked for, and received from his moth-
er, $4000 in order to apply for the loan. He presumably con-
tributed some money, but both he and Kimberly Barrett were
unable, or unwilling, to state where the additional $1000
came from. No record was ever kept of this debt.
In support of her application to SBI, Kimberly Barrett sub-
mitted on or about July 15, a detailed business plan that
clearly shows that the purpose of the new corporation was
to utilize the Townsend assets though the CNB replevin ac-
tion.11 Although the articles of incorporation stated that TCE
had $1000 in capital, this was not true. Kimberly Barrett in
fact opened a bank account on July 17, and deposited $300
from personal savings.
Meanwhile, CNB continued with its replevin action. In
July a hearing was held on its request for a prejudgment
remedy. Although Somers appeared with Richard Barrett, he
did not offer a defense. The state court granted the replevin
request on July 29, and the facility was closed on August 1.
Although the remaining production and maintenance employ-
ees were laid off, Richard Barrett secured access to the facil-
ity from CNB for himself, a number of Townsend employ-
ees, and David Somers, in order to maintain accounts and
preserve the value of the assets seized by CNB. This is im-
portant because as Barrett and Somers were ostensibly acting
on behalf of their employer Townsend, they were actually
furthering the scheme to acquire the assets for TCE/MT.
In furtherance of their desire to create an aura of an
‘‘arms-length relationship’’ with the straw person, Kimberly
Barrett under Somer’s direction sent a letter, dated July 21,
to Coudriet requesting her ‘‘assistance in locating and acquir-
ing assets for TCE.’’ No mention was made of Townsend’s
assets in the letter, though such assets were clearly her target
as set forth in the July 15 business plan submitted to SBI.
CNB put up the Townsend assets for sealed bid. Because
SBI had not yet produced the loan requested, the parties
needed another source of funds. The Barretts asked Somers
if he wanted direct ownership interest, but he declined.
Somers explained to Coudriet that it was not in his interest
to purchase the assets himself. He did, however, agree to
help fund the purchase through Coudriet. Richard Barrett
once again approached his mother for the remaining funds.
The bid process went through several stages. Coudriet’s first
bid was not enough so Richard Barrett was forced to go back
to his mother for additional funds. Ultimately, Coudriet was
awarded the bid for $70,500. Barbara Barrett, Richard
Barrett’s mother, provided $40,000 while Somers provided
the remaining $30,500.
During the bid process, Mort Zimmerman was also en-
gaged in trying to put together a bid for the Townsend assets
using a company called ‘‘Glauber Management.’’ Although
Richard Barrett was actively, but secretly, conspiring with
Somers to put in a bid for $70,500, Richard advised Zimmer-
man that he thought CNB was looking for $60,000.
On September 9, Somers notified the NLRB that he was
resigning as attorney for Townsend and Comtec. He stated
that Richard Barrett had informed him that he would resign
all his corporate positions prior to the unfair labor practice
trial scheduled for September 23, and that neither would ap-
pear nor respond to the General Counsel’s subpoena. Richard
Barrett admitted that he was aware of the letter sent by
1175H. P. TOWNSEND MFG. CO.
12 Although Richard Barrett tried to claim that they wanted to pro-
tect the proprietary interests from product liability suits, that expla-
nation makes no sense at all. Even if the products sold by TCE were
manufactured by another Company from the TCE proprietary draw-
ing, TCE would be unable to escape product liability. In state court
pleadings, the Barretts have averred:
The Plaintiff Attorney, [Somers], citing his expertise as a
labor lawyer acquired while employed at the NLRB, advised
Barrett and the Defendants, TCE and MT, that the assets must
be purchased through his legal secretary, Gigette Coudriet acting
as ‘‘straw’’ person in order to evade Townsend successorship li-
ability to its employees and other creditors.
After noting all the various leases and notes involved in the
scheme, the pleadings state:
All of the subject documents were drafted solely for the pur-
pose of breaching Townsend’s Union Employee Bargaining
Agreement, all in violation of the National Labor Relations Act.
Because Townsend ceased operations owing substantial sums
of money to its union employees and other creditors, the Plain-
tiff advised me, as president of TCE and MT, to purchase the
Townsend assets through a ‘‘straw person’’ to avoid Townsend
‘‘successorship liability.’’
13 As in the case of TCE, Kimberly did not have the $1000 of cap-
ital as stated in the articles of incorporation for MT Assembly. It
appears that the first deposit placed in MT Assembly’s checking ac-
count was $100 paid by TCE for Danny Barrett’s cleanup work.
Danny had also been a unit employee for Townsend.
14 Shortly before the instant trial, Hartman was taken off the MT
Assembly payroll, while Giannini was taken off the TCE payroll.
15 The spelling of these employees’ names varies throughout the
record. I have relied on their W–2 forms, set out in G.C. Exh. 59.
Somers, a copy of which was sent to him, but not Zimmer-
man. Somers also sent a letter to Zimmerman dated Septem-
ber 9, resigning as counsel for all the Comtec companies.
Richard Barrett did not, however, notify Zimmerman that he
would not attend the hearing on September 23. No one ap-
peared on behalf of Townsend or Comtec at the unfair labor
practice hearing held on that date.
When they learned from CNB that their bid had been suc-
cessful, Kimberly sent another disingenuous letter to
Coudriet dated September 12, offering to use those assets,
with the apparent purpose of supporting the image of an
arm’s-length relationship. In fact, the parties entered into a
new phase in the creation of the alter ego, as Somers sug-
gested that a second Company be formed to protect the Com-
pany from future litigation and to operate in as safe a manner
as possible. Richard Barrett explained that the purpose of
creating a second Company was to protect the proprietary
drawings and other proprietary interests of Townsend, which
had been leased and/or to TCE, from ‘‘frivolous claims.’’ In
other forums the Barretts have acknowledged that the pur-
pose of the second corporation was to avoid liability to the
Union and its employees.12
The Barretts chose the name MT Assembly Corporation
for the second Company. The incorporation papers were pre-
pared in Somers’ office. Kimberly Barrett was named presi-
dent and chairman of the board, while Coudriet was named
as secretary. Richard Barrett, Rhonda Farrah, and Robert
Fradette were named as directors. Somers suggested that
Coudriet be paid $100 per month as corporate secretary of
MT Assembly.13
CNB formally conveyed the former Townsend assets to
Coudriet on October 8. The day before, October 7, Kimberly
and Richard Barrett met a number of former Townsend em-
ployees at the facility to ‘‘interview’’ them for the new com-
panies. The former Townsend Production and Maintenance
Supervisor Stephen Giannini was hired as ‘‘shop super-
intendent,’’ and was placed on both TCE and MT assembly
payrolls. He was called ‘‘inventory supervisor’’ for TCE.
They hired former Townsend employee Robert Hartman as
purchasing and materials manager and customer service rep-
resentative, and he was also put on both payrolls.14 They
hired Joanne Pappas as bookkeeper and office manager, and
Silvia Barrett, Richard’s wife and Kimberly’s mother, as re-
ceptionist. Both performed similar duties for Townsend. Al
Levesque, a former Townsend engineer was hired as engi-
neering manager. Pappas, Silvia Barrett, and Levesque were
each on TCE’s payroll. Only one employee was hired for
TCE/MT initially who had not been on Townsend’s payroll.
That was Donald Dodd, a draftsman employed by TCE.
On October 9, the parties met to complete the deal.
Somers drafted a number of documents that were signed si-
multaneously in Somer’s office. Kimberly and Richard Bar-
rett, Somers, and Coudriet were present. At that time,
Coudriet sold some of the Townsend assets to TCE, and
some to MT Assembly, while leasing certain other assets to
each. Coudriet was to receive $450 per month for the TCE
lease and $200 per month for the MT Assembly lease. In re-
turn for the sale of assets, Kimberly signed, on behalf of
TCE and MT Assembly, two promissory notes for $65,000
and $8000, respectively, to Coudriet. The notes required that
interest be paid at the rate of 12 percent.
At that same meeting, Richard Barrett, acting as president
of Townsend, conveyed rent-free 3-year leases for the use of
the West Hartford facility to both TCE and MT Assembly.
Townsend received no payments of any kind for those leases.
In fact, Townsend remained responsible for the real estate
taxes. Richard Barrett has not informed Zimmerman or any-
one from Commercial Technologies about these leases.
On October 9, Coudriet also executed two promissory
notes, one to Barbara Barrett and one to Somers reflecting
the amount they had put up for the purchase of the Town-
send assets from CNB. Each note called for 12-percent inter-
est payments to be made.
D. TCE and MT Assembly Begin Operations
Operations began almost immediately. Giannini rec-
ommended to Richard Barrett that former Townsend produc-
tion and maintenance employees Anthony Mastan and Jerzy
Mroczek be hired, and they were placed on MT Assembly’s
payroll.15 The Barretts also hired Richard Barrett’s stepson,
Danny Barrett, who is also on the MT Assembly payroll, to
begin immediate cleanup work. He too had been a former
Townsend employee.
The last remaining act to complete the plan was Richard
Barrett’s resignation from Townsend and the other Comtec
companies on October 18. On October 21, Richard and Kim-
berly Barrett signed two business consultant agreements, for
TCE and MT Assembly respectively. Although neither agree-
ment called for a salary figure, it was understood that Rich-
ard Barrett would receive $1185 per week from TCE and
would defer $200 per week from MT Assembly. Richard ex-
plained at trial that Somers advised that it would not be in
1176 DECISIONS OF THE NATIONAL LABOR RELATIONS BOARD
16 Again no rational explanation has been offered to support this
claim, and I find that Richard Barrett was not named an officer sole-
ly to avoid the appearance of successorship.
17 When Kimberly Barrett was questioned about her salary, she
was unable to distinguish one salary from the other, saying that her
TCE wage represented 70 percent of her total salary.
18 The documents finally produced are handwritten and appear to
be nothing but an attempt shortly before trial to show separateness
between the two corporations.
19 Tralongo was not on the payroll in 1991, but was employed in
the first quarter of 1992. He was a former Townsend employee.
20 The records show that electrical worker Jaime Mangiafico, who
was not a former Townsend worker, was employed in 1992. At least
three production employees were hired after that—Gerald Nadeau,
Ralph Giannini, and Ron LaFrance. LaFrance was another former
Townsend employee.
the interest of the Company for him to be an officer because
of his outstanding obligations.16
It is undisputed that all the employees hired by TCE and
MT Assembly in 1991, with the exception of a lone drafts-
man, Donald Dodd, were former Townsend employees. De-
spite the fact that TCE had no assets when it started, Barrett
gave himself, Stephen Giannini, Silvia Barrett, and Joanne
Pappas raises to work for TCE and MT Assembly. Richard
Barrett’s salary for TCE was $100 per week higher than his
salary at Townsend. Kimberly was given a salary of $39,000
per year, collectively from TCE and MT Assembly.17
The production and maintenance employees were paid dif-
ferent wages from what they had been paid under the agree-
ment. Steven Giannini determined what wages they were
paid. The agreement was not followed in any way, including
right of recall, wages, or benefits. Giannini also determined
which production employees would be recalled. The agree-
ment had called for recall of laid-off employees in order of
seniority, provided the employee could perform the job need-
ed. The first production employee recalled was Danny Bar-
rett, whose job was the least skilled as he performed only
general maintenance duties, the kind of duties he had at
Townsend. Danny Barrett was low on the seniority list. Gen-
eral Machinists Jerzy Mroczek and Anthony Mastan were
also recalled in 1991. The production and maintenance em-
ployees received no pension benefits and different medical
benefits requiring higher deductibles and copayments from
employees. Richard Barrett explained that he recalled certain
former Townsend employees because the production area
was in disarray, and that certain employees had specific
knowledge of certain proprietary fixtures and patterns, spe-
cial tools, and gauges, and they would know where to locate
them.
The operations of TCE/MT were identical to those of
Townsend. The machines that had been seized in the replevin
action had never been moved. All the machines that the pro-
duction employees worked on were former Townsend ma-
chines. Inventory was kept in the same place on the produc-
tion floor. Richard Barrett continued to occupy the office he
had as President of Townsend. He distributed ‘‘News Re-
leases’’ to the public informing them that TCE had acquired
the Townsend assets, including the Cleveland and ERCO
lines and described that ‘‘TCE Corporation has the full ca-
pacity to design, build and service and consult with respect
to all of the product lines previously offered.’’ TCE also
published brochures setting forth its product lines, utilizing
the logos of the former Townsend lines, and pledging ‘‘to
continue to service, upgrade and rebuild existing machines in
these lines.’’ It used the same telephone as Townsend. The
Barretts sent out letters to former customers who had con-
tacts with Townsend in the past. It is undisputed that the as-
sembly work of all machines produced by TCE was per-
formed by MT Assembly production employees, and that MT
Assembly performed work for no one but TCE.
Giannini continued in his former role as supervisor of the
production employees. All MT Assembly does is provide
labor for TCE. All materials are supplied by TCE. The pro-
duction employees worked on the same machines they had
for Townsend. The only difference put forth by Respondents
in the working conditions of the former Townsend employ-
ees is that Giannini now expects them to be able to perform
multiple tasks. Richard Barrett admitted, however, that
achieving such flexibility was one of the bargaining propos-
als he put forth in Townsend’s negotiations with the Union,
and in my opinion does not represent a significant change in
their duties. All office work, including receptionist and an-
swering the telephone, was performed by employees on the
TCE payroll. TCE has never been reimbursed by MT Assem-
bly for any services provided, such as clerical employees.
Most utility and service costs in operating the facility have
been paid by TCE. The main exception is that electrical bills
are billed to, and usually paid by, MT Assembly. Neither one
has ever reimbursed the other for such costs. Indeed, up until
the summer of 1994, shortly before a hearing previously
scheduled in this case, no records were kept at all showing
that there was any allocation of shared costs between the two
corporations.18
Even the practice of each corporation paying bills for dif-
ferent accounts was not consistently adhered to. In fact, when
MT Assembly’s bank account was subject to an action by the
IRS, TCE issued a series of checks covering MT Assembly’s
bills. Similarly, TCE once issued cash to MT Assembly to
enable it to pay the production employees salaries.
About November 1991, Machinist and Tool Maker
Carmelo Rivera was informed by Tony Mastan that he had
gone back to work at the facility. Rivera went to the facility
and spoke to Steve Giannini, who told him to fill out an ap-
plication because it was a ‘‘brand new company.’’ In 1992,
Giannini called Rivera and said he had one H. D. forming
machine to be built and asked Rivera to come in to discuss
working if he was interested. At the shop, Giannini informed
Rivera that the job would be temporary, he would get paid
$10 per hour, there were no benefits and there was no union.
Rivera went back to work on March 30, 1992. When Rivera
returned, laborer Danny Barrett and machinists Jerry
Mroczek, Tony Mastan, and Sal Tralongo were working, per-
forming the same jobs they did at Townsend, as did Ri-
vera.19
The record shows that at the time of the Union’s demand
for recognition on March 31, 1992, four machinist were em-
ployed, although one, Rivera, was hired on a temporary
basis, and one other unit employee, Danny Barrett, per-
formed maintenance duties. Since that time TCE/MT has
hired some additional production employees without regard
to seniority rights or the agreement.20 Thus, at the beginning
of operation, all unit employees were former Townsend em-
ployees. In March 1992, at the time of the demand for rec-
ognition, five of six unit employees were former Townsend
1177H. P. TOWNSEND MFG. CO.
21 This conversation is alleged to have violated Sec. 8(a)(1) of the
Act and I so find, as this conversation is coercive. No legitimate rea-
son was advanced for asking the question, and Giannini and Rivera
were not shown to be friendly or otherwise close. Significantly,
since the date of the conversation, Rivera has not be called back for
work, while other production workers, not former Townsend em-
ployees, have been hired. I agree with the General Counsel that the
only logical reason for the call was to determine if Rivera had in-
formed the Union about the new operation. This conversation took
place after the demand for recognition was made and after the first
unfair labor charge had been filed against MT. Rossmore House, 269
NLRB 1176 (1984).
22 In fact, she attended only one corporate meeting and could not
recall whether she prepared the minutes. Any work she did for these
Companies was done in the course of her employment for David
Somers.
23 This letter requests Coudriet’s assistance in locating and acquir-
ing assets for TCE to use in serving the metalworking industries. It
does not mention the Townsend assets by name.
24 In fact, she testified at trial that she never considered herself
owner of the assets, and believed Barbara Barrett and David Somers
were the new owners.
employees and in 1993, five of eight unit employees were
former Townsend employees. The record is devoid of any
evidence to show that any significant expansion in the size
of the unit occurred after the Union’s recognition demand or
such expansion was even planned.
E. The Union Becomes Aware of TCE/MT
Union Representative Patti stopped by the facility in Janu-
ary 1992 and learned that Richard and Kimberly Barrett were
conducting a business known as TCE Corporation. A sign
outside the facility listed the three Townsend product lines,
Townsend, Cleveland, and ERCO. He visited again in Feb-
ruary and, on inspection, found that several people were
working on production in uniforms. As a result of his find-
ings, he sent a letter dated March 31, 1992, to Richard Bar-
rett requesting bargaining with ‘‘H. P. Townsend Mfg.
Co./TCE Corporation.’’ Richard Barrett gave it to Kimberly,
who in turn gave it to Somers. Somers told her not to worry
about it. Somers sent a reply letter to Patti dated April 1,
1992, in which he stated that Richard Barrett was neither a
stockholder nor officer of TCE, claimed that TCE was not
a successor to Townsend, and therefore declined Patti’s re-
quest for bargaining. After he filed the charge in Case 34–
CA–5661, Patti learned through the Board that Carmelo Ri-
vera had been working at the facility. Local Union President
Dennis Hartley visited Rivera at his home in the first week
of June and asked him if he had worked for the Company.
About an hour after Hartley left, Giannini called Rivera and
asked him if the Union knew that he had worked at the
Company. Rivera told Giannini he thought the Union did
know. Giannini then hung up.21
Meanwhile the business continued on, albeit in a troubled
state. SBI never delivered on the promised loan, and Kim-
berly Barrett filed an unsuccessful suit against SBI on behalf
of TCE seeking reimbursement of the due diligence fee. Nei-
ther TCE nor MT Assembly have posted a profit since oper-
ations began. MT Assembly began having IRS problems in
late 1992.
F. A Falling Out Begins Among the Respondents and
the True Nature of the Respondents’ Scheme
Comes to Light
Pursuant to investigative subpoenas, depositions were
taken on February 25, 1993, from Gigette Coudriet and Rich-
ard Barrett; and on March 4, 1993, from Richard and Kim-
berly Barrett. Somers represented each one at the depositions
and, according to each of them, counseled them to lie during
their testimony. Each followed his advice. The thrust of their
perjured testimony was to hide the facts concerning the for-
mation of TCE and MT Assembly. In particular, Coudriet re-
called Somers advising her to testify, falsely, that Richard
Barrett had nothing to do with the formation of the new
company; that the funds to purchase the Townsend assets
were her own and did not come from loans; and that she had
discussed with Kimberly the letter dated July 31, 1991. Re-
viewing the transcripts of her deposition while comparing
them to her testimony at this trial reveals a large number of
perjured statements. In her deposition, she falsely testified,
inter alia:
(1) That as corporate secretary of TCE and MT Assembly
she took care of the minute books, issued stock certificates,
filed reports, and performed other corporate secretary du-
ties.22
(2) That Kimberly had called her about being corporate
secretary because she knew Coudriet was able to do cor-
porate paperwork, and had worked at a corporate law firm
for 4-1/2 years.
(3) That Kimberly did not have the intention of acquiring
the Townsend assets.
(4) That she had no idea what was contemplated for the
new corporation.
(5) That she had no dealings with Richard Barrett regard-
ing the formation of TCE.
(6) That she got together with Kimberly to work on the
bylaws.
(7) That she told Kimberly that she has access to money
for investment purposes.
(8) That she started discussing acquiring the Townsend as-
sets with Kimberly in late July or August and that she had
first raised the subject.
(9) That the money used to purchase the Townsend assets
was all hers and she took out no loans.
(10) That she did not know she would convey the assets
to Kimberly at the time she put in the bid for them to CNB.
(11) That she had requested Kimberly write the July 31,
1991 letter.23
(12) That she had called Kimberly from California to in-
form her that she had won the bid.
(13) That she purchased the assets because she thought
that they were worth a lot of money and if Kimberly could
not successfully use them she would still own them.24
(14) That she and Kimberly had discussed what assets
Kimberly could use for TCE.
(15) That she did not know Kimberly was contemplating
using Richard Barrett when the leases were signed.
Kimberly Barrett also gave numerous perjured statements
in her deposition, including, inter alia:
(1) That TCE did not stand for Townsend, Cleveland, and
ERCO.
(2) That she did not consult with anyone when she named
Richard Barrett, Rhonda Farrah, and Robert Fradette as di-
rectors, or inform them about it.
1178 DECISIONS OF THE NATIONAL LABOR RELATIONS BOARD
25 In fact she met with them at the facility.
26 In fact she had met with Farrah and Fradette in Somer’s office.
27 The manner in which she failed to keep any normal records of
these purported back wages will be examined below. No documents
that predated the payments were produced to justify such payments.
(3) That no one suggested using Coudriet as corporate sec-
retary.
(4) That she first informed Richard Barrett that he was a
director of TCE in October 1991.
(5) That she first informed Richard Barrett about forming
TCE in the summer of 1991.
(6) That she had no discussions with anyone except
Coudriet in May 1991 about going into the engineering busi-
ness.
(7) That her initial discussions with Coudriet were not re-
lated to Townsend.
(8) That she had not spoken to anyone about whether it
was feasible to start an engineering business.
(9) That she never spoke to Richard Barrett or anyone else
besides Coudriet about acquiring assets in the tool industry.
(10) That she had not intended to utilize Townsend ma-
chinery at TCE, but only in September decided to form an-
other company to utilize the machinery herself.
(11) That Richard Barrett did not know he was being
named as a director of MT Assembly until sometime in Oc-
tober 1991.
(13) That she met with various employees on October 7,
1991, at her family home.25
(14) That she had $1000 available in her home when she
incorporated TCE.
(15) That she never had any contact with SBI herself.26
Richard Barrett also gave various perjured statements in
his affidavits, including inter alia:
(1) That he did not know at the time that he had been
named a director of TCE and did not know until he had been
employed by TCE.
(2) That at the time Kimberly resigned as Townsend cor-
porate secretary he did not know she was planning to form
a new corporation.
(3) That he did not know he was named as director of MT
Assembly until he signed the business consulting agreement.
(4) That he did not have discussions with Kimberly about
what role he might have with regard to TCE and MT Assem-
bly prior to the actual passing of title of the assets to TCE
and MT assembly.
(5) That he had not discussed with Kimberly how the
Townsend assets could be utilized prior to the purchase of
those assets by TCE and MT Assembly.
(6) That he did not help in any way finance the purchase
or lease of those assets.
(7) That he did not learn Kimberly was going to utilize
the Townsend assets through TCE and MT Assembly until
the end of September or early October 1991.
(8) That he had never discussed with Kimberly whether or
not she could productively utilize the Townsend real estate
assets until after he leased the Townsend facility to her.
(9) That he was not aware of the terms of the purchase
of the Townsend assets until he signed the business consult-
ing agreement.
(10) That he was unaware how Kimberly was going to fi-
nance the purchase of the Townsend assets.
(11) That he signed the business consulting agreements
without knowledge as to how MT Assembly and TCE would
be operating.
(12) That he had not committed to working for TCE and
MT Assembly before October 9, 1991.
(13) That he did not know where the source of funds for
TCE came from.
(14) That he did not learn until after MT Assembly was
formed that Kimberly was involved with Coudriet in the ac-
quisition.
(15) That he did not contribute any money to TCE.
(16) That he did not know Rhonda Farrah or Robert
Fradette.
(17) That he was not involved in negotiations between
Coudriet and TCE.
(18) That the date he determined to lease the Townsend
facility to Kimberly was October 8, 1991, and there had been
no discussions prior to then.
(19) That he did not learn Kimberly was leasing and pur-
chasing the Townsend assets from Coudriet until October 8,
1991.
(20) That he has no supervisory duties.
Soon after they lied about essential aspects of the scheme,
as counseled by Somers, the parties began to fall out. First,
Coudriet, at Somers’ instruction, sent a demand letter dated
April 19, 1993, to Kimberly demanding partial payoff of the
TCE promissory note. Curiously, right about that time Kim-
berly wrote two substantial personal checks to herself for
back wages that she claimed came from wages she deferred
beginning in June 1992.27 She also wrote two large checks
to herself for accumulated past occasions when she had used
her personal funds to pay for corporate obligations. She also
wrote a $1000 check to her mother at that time.
On June 7, 1993, Coudriet signed all her interests in the
Townsend assets to Somers. On the last Friday of October
1993, Somers terminated Coudriet’s employment with him
because she had broken off her personal relationship with
him. In about October or November 1993, Somers informed
Kimberly that Coudriet was no longer with his law firm, and
that he had asked her to sign over some documents so that
he could maintain control and protect the Barretts’ interests
in the assets.
On January 10, 1994, however, Somers sent two letters to
Kimberly Barrett, shortly before the first scheduled trial in
this case. Somers notified Kimberly that Coudriet had as-
signed her interests to him, and he requested that she be let
go of her positions with TCE/MT or else he would resign
as counsel. Richard Barrett was out of the country at the
time. Kimberly’s reaction to Somers’ action was to plead
with him not to withdraw and to argue that ‘‘having Ms.
Coudriet retained as corporate secretary will lend more credi-
bility to her involvement throughout the histories of MT and
TCE. There is no doubt in my mind that removing her so
close to the hearing will hurt us.’’ Further she noted that
‘‘you have just as much at stake in this as we all do.’’ She
wanted ‘‘to spend 100% of our time preparing our de-
fenses,’’ and implored him to stay on: ‘‘please let me reaf-
firm my opinion that we must all focus on the priority matter
at hand—defense against the NLRB, first and foremost.’’
(G.C. Exh. 3.) Kimberly Barrett at first denied at trial that
she was concerned about maintaining Coudriet’s credibility.
1179H. P. TOWNSEND MFG. CO.
28 Although the document is not in the record, it appears that a
similar demand was made with respect to the MT Assembly lease,
as well as the two promissory notes.
29 This defense is repeated throughout this answer, as well in an-
other answer. (G.C. Exh. 94(b).)
When confronted with the plain language of her letter, how-
ever, she acknowledged that she was concerned that if
Coudriet was no longer employed then the story that Kim-
berly had previously presented, that she had, independently
of Richard Barrett, approached Coudriet and gone into busi-
ness with her, totally independent of any interest in the
Townsend assets, would lose its credibility.
Kimberly Barrett, in a request for postponement of the
hearing scheduled in January notified the NLRB of Somers’
proposed withdrawal if Coudriet was not let go, and asserted
that she was unable to let Coudriet go because ‘‘she had al-
ways performed her duties as asked, and removal would be
without legal justification.’’
Her pleas went unheeded, and Somers withdrew as coun-
sel. On February 14, 1994, Somers, through his own counsel,
notified Kimberly that he was demanding immediate pay-
ment on the TCE lease and return of the property.28 Somers
then filed a lawsuit against TCE and MT Assembly seeking
immediate payment of the promissory notes from TCE and
MT Assembly given to Coudriet on October 9, 1991, as well
as immediate payment on the leases and return of the prop-
erty to Somers. Somers filed another complaint on April 14,
1994, seeking immediate possession of the lease properties.
In response to these complaints, the Barretts decided to, at
least partially, come clean by publicly admitting that they
had engaged, pursuant to Somers’ advice, in a scheme to
avoid outstanding liabilities and the labor laws. The Barretts
and TCE/MT responded to the Somers’ lawsuits with coun-
terclaims of their own. One counterclaim sets forth a clear
history of the case that was directly contradictory to the story
put forth, under oath, by the Barretts in their depositions. It
states that Kimberly incorporated TCE and MT Assembly
pursuant to Somers’ advice, and in anticipation of acquiring
the Townsend assets and that Somers ‘‘citing his expertise as
a labor lawyer acquired while employed at the NLRB, ad-
vised Barrett and the Defendants, TCE and MT, that the as-
sets must be purchased through his legal secretary, Gigette
Coudriet . . . acting as a ‘straw’ person in order to evade
Townsend successorship liability to its employees and other
creditors.’’ (G.C. Exh. 93(c), first count, pars. 6 and 8.) It
went on to admit the role of Somers and Barbara Barrett in
funding the purchase and described how Somers prepared all
the various leases, agreements, and promissory notes. It seeks
to void the leases and promissory notes because they were
drafted by Somers ‘‘during the course of his legal representa-
tion of Barrett, TCE and MT, solely to evade creditors and
were totally unsupported by a valid consideration.’’
One of their answers states explicitly that Somers ‘‘drafted
the subject note for the purpose of evading creditors and em-
ployee Union obligations.’’ (G.C. Exh. 93(b), sixth special
defense.)29 Moreover, Kimberly gave a sworn affidavit sup-
porting their defenses and counterclaims, including that
Somers advised her that ‘‘because Townsend ceased oper-
ations owing substantial sums of money to its union employ-
ees and other creditors,’’ to purchase the Townsend assets
through a straw person to avoid ‘‘successorship liability.’’
She further asserted that ‘‘all the subject documents’’ were
drafted by Somers ‘‘solely to evade successorship liability to
Townsend’s creditors.’’ Moreover, she asserted that it had
never been ‘‘the intention of the parties to create and actual
leasehold in connection with the assets in question.’’
In a complaint against Attorney Somers, which was signed
by Kimberly ‘‘to the best of my knowledge and belief, the
statements made herein are true and correct,’’ Kimberly
again asserted that:
Townsend ceased operations owing substantial sums
of money to its union employees. Somers therefore ad-
vised Kimberly Barrett, TCE and MT to purchase the
Townsend assets through Gigette Coudriet, Somers’
legal secretary, to avoid Townsend ‘‘successorship’’ li-
ability.
She asserted further in this document that Somers had
counseled her to lie under oath in her deposition before the
NLRB.
The object of their counterclaims in state court is to void
the various leases and promissory notes, and for TCE/MT to
take possession of the disputed assets. In statements and doc-
uments filed in those cases, Kimberly appeared to come
clean, and admitted the essentially fraudulent character of the
scheme, and her own conscious participation in it. At trial in
this case, however, she appeared to backtrack from those as-
sertions, and asserted ignorance at the time of Somers’ intent
in forming two corporations. She even claimed she did not
know why Somers wanted her to lie in her deposition. In-
stead, she incredibly attributed to what she had so recently
declared her own knowledge to her new attorney, Elaine
Stuhlman. I do not believe this testimony for a minute. Kim-
berly Barrett can claim some naivety about labor law, but her
father cannot. He was the moving force behind the setting
up of the scheme and knew its purposes. Kimberly Barrett
had no trouble lying during the depositions given herein and
I do not think she would have any trouble lying at the hear-
ing itself if she believed it were in her best interest. I credit
her statement cited above in the complaint against attorney
and find that she had this knowledge throughout the history
of the matters at issue.
G. TCE and MT Assembly Are Operated Without
Regard to Corporate Formalities
The record shows that Kimberly Barrett has continued to
maintain the fiction of separateness between the two compa-
nies. As noted above, shortly before the scheduled trial in
August 1994, after Stuhlman began representing her, she pre-
pared handwritten documents purporting to represent an allo-
cation of shared costs between the two companies. Moreover,
within 2 months of the trial in November 1994, she took
Giannini off the TCE payroll and took Bob Hartman off the
MT Assembly payroll, in another apparent attempt to estab-
lish separateness.
These actions demonstrate that the Barretts are continuing
to maintain the scheme as set up by Somers. As also noted
above, before any separate bank account was established for
TCE, Richard Barrett had importuned his mother for $4000
in order to procure the SBI loan. Kimberly admitted that no
promissory note was given and no record exists to show that
the loan took place. Similarly, there does not appear to be
any record of where the remaining $1000 come from. Rich-
1180 DECISIONS OF THE NATIONAL LABOR RELATIONS BOARD
30 She also listed $900 in accrued compensation, which apparently
reflected Coudriet’s $300-per-month salary.
ard and Kimberly Barrett testified that Richard paid part of
it, but they could not, or would not, state where the rest
came from.
As noted above, Kimberly did not have the $1000 in start-
ing capital at the time TCE’s incorporation, despite her rep-
resentation in those incorporation papers, and in her deposi-
tion, that she did so. When she did establish an account in
July 1991, it was funded with only $300 of her personal
funds. Although she testified that she believed that she had
reimbursed herself for that ‘‘loan,’’ she was unable to state
whether any record exists to show that. Similarly, she did not
have $1000 available when she incorporated MT Assembly,
despite her representations in those incorporation papers, and
in her deposition, that she did so. In fact, when she opened
an account for MT Assembly it was after operations had
commenced and was done with funds from TCE, which com-
menced operations at the same time. Thus, the operating
funds of MT Assembly came from TCE, which itself appears
to get its initial operating funds to a large extent from the
accounts receivable of Townsend that were purchased from
CNB.
It is undisputed that Kimberly regularly utilized her own
credit cards and personal funds to purchase goods and serv-
ices for the Company. Her practice in this regard was to ac-
cumulate receipts on her desk or in her pocketbook or some-
where, and reimburse herself for such accumulated receipts
well over a year after some of the debts were incurred. It is
to be noted that each of the checks at issue for these long-
standing debts were issued in the same time period she began
issuing herself checks for ‘‘accrued wages.’’ One check for
office loan reimbursement was dated March 23, 1993, which
the first check for accrued wages was dated April 8, 1993.
On April 21, 1993, she issued one for each, including a wage
payment for over $2000. This period was shortly after the
depositions were taken. When pressed to explain what
records she had to show that she had deferred wages, she
could point only to the actual payroll sheets. She claimed
that she began to defer $50 per week in June 1992 and
claimed that the accrued wages she paid to herself in Sep-
tember 1993 represented $1000 in wages, 20 weeks at $50
per week, with tax deductions taken out. She also claimed
that the second accrued wage check in April represented 60
weeks of deferred wages of $50 per week with tax deduc-
tions taken out. She further claimed that the two checks rep-
resented 80 weeks of deferred wages at $50 per week, or
$4000. She claimed that she offset this $4000 against the
general ledger, bringing her balance to zero. There is one
basic problem with the account, besides the fact that the so-
called general ledger was prepared in the summer of 1993
in order to prepare tax returns: she claimed she began to
defer the $50 per week in June 1992. Between June 1992
and April 1993 there are fewer than 50 weeks. Thus, not
only was there no record of a wage deferral on which to base
the issuance of accrued wages to herself, even if one existed
she clearly was writing herself checks for more than what
had been purportedly deferred.
Another check that issued on March 23, 1993, went to her
mother, Silvia Barrett, for $1000. Kimberly was unable to
explain what the check was for, although she thought it
might be for a ‘‘lease.’’ She claimed that her mother had
bought two personal computers, one in 1991 and the other
in 1992, which she subsequently leased to the Company.
Kimberly was unable to state what the terms of the lease
were, and described it as a very informal lease agreement in
the form probably of a letter. She could not recall when it
was written, when payments were made on it or where the
lease was. Kimberly admitted that the purpose of the so-
called lease from her mother was so that if something were
to happen to the Company, if the Company were to go out
of business, those computers would not be lost, and that they
would be useful to have at home if the Company were to
go out of business.
The Barretts began to try to create some form of records
in the summer of 1993 in order to justify the first income
tax returns for TCE, which were filed on July 9 and 29, 1993
respectively. The tax returns showed that Kimberly listed
$5940 in deferred wages.30 She claimed that it represented
her salary during the months June through August 1991, a
period during which she acknowledged there were no oper-
ations.
Furthermore, the record showed that she was amortizing
organization costs of $7,839.07. She was unable to articulate
the basis of these costs, and first suggested they represented
her deferred salary, and then suggested the SBI due-diligence
fee might be included. Moreover, she also claimed to have
reimbursed herself for the $5940 in accrued wages. The tax
returns filed for TCE for the fiscal year 1992, the period
being September 1, 1991, through August 31, 1992, show a
deferred compensation figure of $8190. She claimed this rep-
resented the deferred compensation for her father at $100 per
week and for herself at $50 per week, since June 1992 as
well as the deferred wages from January 1991.
She then testified, however, that she had not yet paid her-
self back for the summer of 1991 when asked to explain
what records she had to account for these various deferrals
and payments of wages. She claimed she had ‘‘yellow lined
pieces of paper’’ that were kept on loose sheets in a manila
folder that showed such deferrals. She was unable to locate
these notes, however, before trial. She claimed she used them
to create the general ledger. Despite the claims that such
notes once existed, however, and were used to create the
general ledger in the summer of 1993, she admitted she had
failed to produce such notes pursuant to subpoena at her dep-
osition. Moreover, she admitted that during the summer of
1991, there were no operations, only a ‘‘corporate shell’’ and
she had not determined a salary for herself. She explained
that once operations started in October 1991 she decided that
her salary would be based on what she could pay, and she
decided to pay herself for the period that the Company was
not in operation.
H. TCE and MT Assembly Are Alter Egos of One
Another and Constitute a Single Employer
An alter ego relationship may be found when two nomi-
nally separate entities share substantially identical manage-
ment, business purpose, operation, equipment, customers, su-
pervision, and ownership. Advance Electric, 268 NLRB
1001, 1002 (1984); Crawford Door Sales, 226 NLRB 1144
(1976). Unlawful motivation is an additional factor fre-
quently considered in determining whether alter ego status
1181H. P. TOWNSEND MFG. CO.
31 Richard Barrett is paid substantially more in his role asbusiness
consultant than Kimberly makes as President. He is clearly the de
facto chief operating officer of both Companies.
32 The employees were Kimberly Barrett, Gigette Coudriet, Robert
Hartman, Steve Giannini, Danny Barrett, Jerzy Mroczek, Anthony
Mastan, Joanne Pappas, Silvia Barrett, Richard Barrett, Beverly
Newberg, Alfred Levesque, and Donald Dodd. All but Coudriet
Dodd were former Townsend employees. (G.C. Exh. 59.)
33 In 1993, there were eight employees who appear from the
record to be unit employees, five whom were former Townsend unit
employees.
exists. The Board has also held it is not necessary to have
all such factors present before an alter ego finding is made.
With respect to TCE and MT Assembly, all factors point-
ing to an alter ego relationship are present. Moreover, it is
clear that MT Assembly was created to avoid any succes-
sorship claim that might be made. Respondents have admit-
ted this in pleadings filed in other forums as noted earlier.
Its lame argument that MT Assembly was created to some-
how shield assets of TCE from a products liability lawsuit
does not stand up. TCE sells the product that MT Assembly
makes for TCE alone. Any products liability lawsuit would
sure target TCE and would likely target MT Assembly as
well. The experience of the Comtec Companies on this point
is enlightening. All such Companies were saddled with the
payment of the products liability of one, though the individ-
ual Comtec Companies were not related in any way but own-
ership.
MT Assembly and TCE have common ownership and top
management and shared some employees at lower manage-
ment levels, at least until this trial was scheduled. As MT
assembly produces the product sold by TCE on the same
premises occupied by TCE, they obviously share a common
business purpose and ultimately common customers. The ma-
chinery used is common to both and the little if any attempt
was made, again until the specter of this trial arose, to allo-
cate common expenses between the companies. I find that
TCE and MT Assembly are alter egos of one another.
TCE and MT Assembly also constitute a single employer.
The record contains all the indicia to support a finding of
single employer. In analyzing whether a single-employer re-
lationship exists between two nominally separate entities the
Board considers whether there is an interrelation of oper-
ations, common management, centralized control of labor re-
lations, and common ownership or financial control. Radio
Union Local 1264 v. Broadcast Service, 380 U.S. 255
(1965); Wisconsin Education Assn., 292 NLRB 702, 711
(1989); Thornton Heating Services, 294 NLRB 304, 309
(1989). Moreover, a principle issue is whether the dealings
between two nominally separate companies are done at
‘‘arm’s-length.’’ Ironworkers Local 15, 306 NLRB 309
(1992); Blumenfeld Theaters Circuit, 240 NLRB 206, 215
(1979).
Kimberly Barrett, who is president and chairman of the
board of each corporation, and her father, Richard Barrett,
who is a director and business consultant to each, clearly run
both companies and control labor relations.31 When oper-
ations began they together interviewed and hired the former
Townsend employees. The shop superintendent, Steve
Giannini, supervised the production employees and was a
management person on both payrolls, as was Robert Hart-
man, purchasing and materials manager, up until shortly be-
fore trial. Gigette Coudriet remains corporate secretary for
each Company.
The record is clear that the daily operations of the two
Companies are completely integrated. The only evidence of
separateness produced at trial by Respondents was that in the
summer of 1994, shortly before trial, Kimberly prepared
handwritten documents purporting to show an allocation of
shared cost, although no actual payments for such costs were
made to one another. Moreover, the facts show that when-
ever MT Assembly had troubles, TCE paid its bills.
Given the complete lack of any arm’s-length relationship
between the two corporations, the fact of common manage-
ment and ownership, the functional integration of operations,
and the centralized control of labor relations, the conclusion
is inescapable that TCE and MT Assembly constitute a sin-
gle employer.
I. TCE/MT is a Successor Employer and it Violated
Section 8(a)(5) of the Act by its Refusal to
Bargain with the Union
The current state of successorship law is set forth suc-
cinctly in CitiSteel USA, 312 NLRB 815 (1993), wherein the
Board held:
It has long been settled that an employer succeeds to
the collective-bargaining obligation of another employer
if (1) a majority of its employees had been employed
by the predecessor, and if (2) similarities between those
two operations manifest a ‘‘substantial continuity’’ be-
tween those enterprises. Fall River Dyeing Corp. v.
NLRB, 482 U.S. 27, 41, 43 (1987), citing, inter alia,
NLRB v. Burns Security Services, 406 U.S. 272, 280 fn.
4 (1972).
Here the initial employee complement of single employer
TCE/MT was composed of 13 persons, all but two of which
were previous employees of Townsend.32 All employees fall-
ing within the unit description were former Townsend em-
ployees. By March 31, 1992, the date of demand for recogni-
tion, TCE/MT had 17 employees, all but two of which were
former Townsend employees. Among the employees per-
forming unit duties, five of these six employees had pre-
viously worked in the unit at Townsend. I believe the em-
ployee complement at the date of demand for recognition is
representative as it has not grown appreciably and there are
no plans in place to substantially increase the number of em-
ployees.33 Thus the first requirement for a finding of
successorship has been met.
There remains the question of whether the similarities be-
tween the Townsend operation and the TCE/MT operation
manifest a ‘‘substantial continuity.’’ In CitiSteel USA, supra
at 815, the Board spoke to this issue, holding:
The factors to look to in determining whether there
is substantial continuity were summarized by the Su-
preme Court in Fall River, supra at 43, as follows:
[W]hether the business of both employers is es-
sentially the same; whether the employees of the
new company are doing the same jobs in the same
working conditions under the same supervisors; and
1182 DECISIONS OF THE NATIONAL LABOR RELATIONS BOARD
34 I am really assuming that there was a reduction in the scale of
the operation based on the testimony. No volume figures are avail-
able to demonstrate this as fact, and at the end, Townsend had only
three unit employees remaining, the same number as initially em-
ployed by TCE/MT.
35 The Respondents do not question the Union’s majority status
among the unit employees and the Union is entitled to the presump-
tion of continued majority support.
36 The Respondents argue on brief that they did not acquire ‘‘sub-
stantial assets’’ of Townsend, urging that the assets purchased from
CNB for $70,500 had only a fair market value of $35,000 and that
the real estate held by Townsend had a market value of about $2
million. This argument ignores the fact that whatever the cost, the
$70,500 paid to CNB bought virtually all the assets of Townsend,
except for the real estate. And it ignores the fact that TCE/MT ac-
quired the real estate of Townsend for nothing when Richard Barrett,
in his capacity as President of Townsend, leased it to the Respond-
ents.
whether the new entity has the same production
process, produces the same products, and has basi-
cally the same body of customers.
These factors are to be assessed primarily from the
perspective of the employees. Thus, the question is
‘‘whether those employees who have been retained will
. . . view their job situations as essentially unaltered.’’
Id. quoting Golden State Bottling Co. v. NLRB, 414
U.S. 168, 184 (1973).
There is no question but that the business of both employ-
ers is essentially the same. TCE/MT produces the same prod-
ucts as did Townsend, using the same facility, machinery,
designs, materials, and processes as did Townsend. TCE/MT
has acquired through lease and/or purchase all of the assets
of Townsend, including its real property. TCE/MT serves ex-
actly the same body of customers as did Townsend and even
uses the Townsend trade names for its products. At the out-
set of its operations, it distributed to the public and past cus-
tomers of Townsend advertising that stressed that it was car-
rying on the business of Townsend. The employees of
TCE/MT who previously worked for Townsend perform es-
sentially similar functions at TCE/MT, including the function
of Supervisor Stephen Giannini, who supervised unit employ-
ees at both companies. The production employees at
TCE/MT utilize the same job skills to perform their work as
they did at Townsend, though they are called on to perform
more tasks than previously. On this point, the Board in
CitiSteel USA, supra at 815, held:
This change means that each employee now per-
forms several job functions which had been covered by
separate job classifications at Phoenix. While we find
that this consolidation of function may require employ-
ees to perform some additional tasks, each one also
continues mainly to perform work he had performed for
Phoenix. When employees continued to perform sub-
stantially the same work that they did for the prede-
cessor, the addition of some new job duties is not likely
to change the employees’ attitude towards their job to
such an extent that it will defeat a finding of continuity
of enterprise. [Footnote omitted.]
If one views the successorship issue from a more negative
view, the same result obtains. Although there is no single
factor that will negate a finding of successorship, the Board
has emphasized such combined factors as: (1) a long hiatus
in the resumption of operations; (2) a difference in location
of the resumed operation; (3) a changeover in the supervisory
hierarchy; (4) the absence of a carryover of customers or
markets supplied; and (5) a difference in the scale of the op-
erations and the products produced, and in the methods of
production. There was no long hiatus between the cessation
of Townsend’s operation and the beginning of operations by
TCE/MT. The gap was only 2 or 3 months. The location of
the operation remained the same. The supervisory hierarchy
remained the same. The customers and markets supplied re-
mained the same. There was some reduction in scale of the
operations, but this has been held not to defeat a finding of
successorship. See Roanwell Corp., 293 NLRB 20, 22
(1989).34
Based on the foregoing, I find that TCE/MT was a succes-
sor to Townsend and thus had an obligation to, on demand,
recognize and bargain in good faith with the Union as the
representative of its unit employees.35 By failing and refus-
ing to do so, TCE/MT violated Section 8(a)(5) and (1) of the
Act.
In Golden State Bottling Co. v. NLRB, supra, the Supreme
Court held that an employer who acquires substantial assets
of a predecessor and who continues without substantial
change the predecessor’s business operations, can be required
to remedy the predecessor’s unremedied unfair labor prac-
tices if it is on notice of the predecessor’s unlawful con-
duct.36 There is no question in this case regarding notice as
Richard Barrett, as president of Townsend, actually commit-
ted the unremedied unfair labor practices while David
Somers was Townsend’s attorney and Kimberly Barrett was
Townsend’s corporate secretary. Therefore, I find that
TCE/MT are legally responsible to remedy the unremedied
unfair labor practices committed by Townsend.
J. Should Richard Barrett, Kimberly Barrett, and David
Somers Be Found Alter Egos of TCE/MT and Held
Personally Liable to Remedy the Unfair
Labor Practices?
The most troubling issue in this proceeding is whether
anyone or any entity will be responsible for remedying the
outstanding unfair labor practices. The record makes it clear
that not only is Townsend effectively defunct as a an entity,
but that TCE/MT operates in such a manner that it has no
funds to pay the outstanding pension fund obligation set forth
in the compliance specification or any other monetary liabil-
ity that may result from these proceedings.
The Board will, under certain circumstances, ‘‘pierce the
corporate veil’’ and hold individuals responsible as alter egos
for corporate obligations. In Riley Aeronautics Corp., 178
NLRB 495, 501 (1969), the Board made it clear that, with
respect to cases arising under the National Labor Relations
Act, ‘‘the corporate veil will be pierced whenever it is em-
ployed to perpetuate fraud, evade existing obligations, or cir-
cumvent a statute.’’ Thus, in the field of labor relations, the
courts and Board have looked beyond organizational form
when an individual or corporate employer was in active con-
cert or participation in a scheme or plan of evasion. (NLRB
1183H. P. TOWNSEND MFG. CO.
v. Hopwood Retinning Co., 104 F.2d 302, 304 (2d Cir.
1939); or siphoned off assets for the purpose of rendering in-
solvent and frustrating a monetary obligation such as back-
pay. (NLRB v. Deena Artware, Inc., 361 U.S. 398 (1960));
or so integrated or intermingled his assets and affairs that
‘‘no distinct corporate lines are maintained’’ (Id. at 403).
In Metropolitan Teletronics Corp., 303 NLRB 793 (1991),
the corporate veil was pierced, and the previously unnamed
Respondent owner was held personally liable (at the supple-
mental stage) for the entire backpay liability, based on a
finding that the owner actively engaged in a scheme to evade
complying with the corporation’s backpay liability, as evi-
denced by his sole responsibility for the unfair labor prac-
tices, his intent in creating an alter ego/successor corporation,
and his evasive and uncooperative behavior throughout pro-
ceedings in the face of documentary evidence that he com-
mingled his personal and corporate funds.
It is hard to imagine being more uncooperative than the
Barrett’s conduct during the depositions in which they re-
peatedly perjured themselves, at Somers’ direction, in order
to hide the facts surrounding the formation of TCE/MT. Re-
spondents have admitted in other litigation that their purpose,
inter alia, was to avoid legal obligations to the Union and
employees. Moreover, Richard Barrett was directly involved
in the commission of all the unfair labor practices found in
the underlying case, while Kimberly Barrett was directly in-
volved in the commission of all the unfair labor practices at
issue in Case 34–CA–5661. In O’Neill, Ltd., 288 NLRB
1354 (1988), the Board imposed individual liability on a cor-
porate owner based on his having, with fraudulent intent, es-
tablished various alter ego companies, even though there was
no evidence of commingling of personal and corporate as-
sets, nor any apparent siphoning of corporate assets.
Thus, without more, the Barretts who conspired with
Somers to set up the alter ego, and who were each involved
in the commission of various unfair labor practices at issue,
should be held liable as alter egos to remedy those unfair
labor practices.
There is more, however, to support imposition of personal
liability on the Barretts. In Greater Kansas City Roofing, 305
NLRB 720 (1991), the Board reiterated its willingness to
pierce the corporate veil in appropriate circumstances. Noting
that Section 10(c) of the Act empowers the Board with broad
authority to fashion appropriate remedies to meet the needs
of a particular situation so that ‘‘the victims of discrimina-
tion may be treated fairly’’ (citing Phelps Dodge Corp. v.
NLRB, 313 U.S. 177 (1941)), the Board stated:
As a policy matter, the task for the Board is to deter-
mine the proper balance of the legal rights involved.
When the incentive value of limited liability to corpora-
tions and their owners is outweighed by the competing
value of basic fairness to parties dealing with a corpora-
tion, the Board should look past that corporation’s for-
mal existence and hold controlling individuals liable for
‘‘corporate’’ obligations. [T]he Board is not limited to
piercing the corporate veil only in cases where the cor-
porate status is used to perpetuate fraud. . . . [T]he
Board may pierce the corporate veil, because justice so
requires, where the individual’s personal affairs and the
company’s affairs have been so intermingled that cor-
porate boundaries have been effectively blurred. [Foot-
notes omitted, supra at 720.]
The Board noted the various factors, in addition to fraud,
considered in determining whether to pierce the corporate
veil:
Among the factors to which the Board traditionally
looks in ordering that the corporate veil be pierced
where intermingling of individual and corporate affairs
have occurred are those present in this case, the appar-
ent under capitalization of one-person corporation; the
failure to observe corporate formalities; the non func-
tioning of officers or directors; the absence of corporate
records; and the use of the corporation as a facade for
the operations of the dominant stockholder. Indeed,
faithfulness to corporate formalities is one of the litmus
tests of the extent to which individuals actually view
the corporation as a separate being. Moreover, the
Board may pierce the corporate veil, because justice so
requires, where the individual’s personal affairs and the
company’s affairs have been so intermingled that cor-
porate boundaries have been effectively blurred. Id.
In this case, the Barretts made no serious attempt to ad-
here to corporate formalities. The record shows that two
named directors, Rhonda Farrah and Robert Fradette, had no
function with TCE/MT, and were only a projected source of
funding. In 3 years only one board of directors meeting was
held. Moreover, the record clearly establishes that both TCE
and MT Assembly were inadequately funded at their incep-
tion, and they remained profitless as corporations while the
Barretts took substantial salaries out of the underfunded cor-
porations. Richard Barrett had given himself, his family, and
other management employees raises before operations began.
Meanwhile, Coudriet took her lease money and gave it to
Somers. She did well herself, however, as she received $300
per month to do nothing except fulfill her role as straw per-
son.
The record shows that corporate funds were loosely held,
and negligently accounted for. Kimberly Barrett continually
intermingled her personal assets with the Companies’ in
order to pay expenses. She played games with the corporate
tax records and corporate books, claiming to be owed thou-
sands of dollars for periods in which no work was per-
formed. Moreover, she made out checks for herself for de-
ferred wages, but was unable to give a coherent account for
the basis of these checks. Other family members were also
involved in the sloppy recordkeeping. Kimberly admitted that
TCE owes her grandmother $4000 for her role in seeking the
SBI loan, but that no corporate record exists to show that
debt. Silvia Barrett, in addition to her salary, was given at
least $1000 in a nonpayroll check. Kimberly was unable to
state at trial what it was for, but noted that her mother had
leased certain property to TCE, including a computer pur-
chased before operations began. The purpose of this pur-
ported lease was to avoid losing the machine to creditors.
In Best Roofing, 311 NLRB 224 (1977), the Board pierced
the corporate veil and found that the controlling individuals
of a company who were not the owners, were personally lia-
ble for the corporate unfair labor practice liability where the
individuals dominated corporate affairs, and so intermingled
their affairs with the corporation’s that the corporate bound-
1184 DECISIONS OF THE NATIONAL LABOR RELATIONS BOARD
37 J. P. Stevens & Co., 239 NLRB 738, 770–772 (1978); Schuck
Component Systems, 230 NLRB 838 (1977); Fetzer Broadcasting
aries were effectively blurred. In particular the Board noted
that the individuals failure ‘‘to observe corporate formalities
is evidenced by their failure to keep written corporate records
of the amount of money loaned or borrowed between them-
selves’’ and the corporations. Supra at 226. In this case Kim-
berly Barrett is an owner and Richard Barrett clearly domi-
nated corporate affairs. The entire scheme to set up TCE/MT
to continue Townsend’s operation was his idea initially and
he was not an owner either because of his large IRS liability
and/or to hide his connection with the companies to avoid
the appearance of successorship.
Based on the above factors, I find that Richard and Kim-
berly Barrett should be held liable as alter egos of TCE and
MT Assembly. With regard to David Somers, I believe he
too should be personally liable to remedy the outstanding un-
fair labor practices. He is the author of the scheme to cir-
cumvent the NLRA and allegedly the source of the advice
to Coudriet, Richard Barrett, and Kimberly Barrett to lie
about the scheme to perpetuate it. He is also asserting owner-
ship in the Townsend assets in state court and thus was an
active player in the involved scheme to avoid successorship
and liability from the underlying case, personally profiting
from the operations of TCE/MT.
Specifically, Somers suggested the use of Coudriet as
straw person, as well as the formation of the MT Assembly
alter ego, in order to shield the Barretts from unfair labor
practice liability and the duty to recognize the Union. Once
SBI reneged on its proposed loan, the scheme was dependent
on Somers’ funds. It is undisputed that Somers, through the
straw person, benefited directly from his participation in the
scheme, in addition to the legal fees he charged for authoring
the scheme. As the record reflects, he had Coudriet assign
her interest in the assets and the various notes and leases to
him. As an active and benefiting participant/owner in the in-
volved scheme, he is equally as guilty as the Barretts in the
scheme to defraud the Union and the Board. His direction to
the Barretts and Coudriet to lie to the Board in an attempt
to hide the true facts and perpetuate the scheme adds to his
culpability. I find that he is also an alter ego of TCE/MT and
like the Barretts, jointly and severally liable for the unfair
labor practice liabilities of TCE/MT. Glebe Electric, Inc., 307
NLRB 883, 886 (1967); Evans Plumbing Co., 278 NLRB 67
(1986); Greater Kansas Roofing, supra at 721.
K. Is TCE/MT an Alter Ego of Townsend?
As found above, TCE/MT were formed by Richard and
Kimberly Barrett and David Somers to continue the Town-
send operation, and with the additional purpose of avoiding
Townsend’s liabilities to the Union, and without the obliga-
tion to recognize and bargain with the Union or apply the
terms of the expired union contract to its production and
maintenance employees. Ordinarily, in order to find alter ego
status, there must be a showing of some common ownership
between the entities involved. Here there is no common own-
ership. None of the parties in this proceeding had any owner-
ship interest in Townsend. The General Counsel asserts,
however, that Richard Barrett’s position of control with both
Townsend and TCE/MT satisfies the ownership requirement.
At the time of the creation of TCE/MT Barrett was Presi-
dent of Townsend and controlled its operations. Indeed, he
committed the unfair labor practices found to have been
committed by Townsend. He was the person who with
Somers devised the scheme to create the continuing Com-
pany, declining ownership in the new entity because of his
IRS liabilities and, in my opinion, to avoid the appearance
of control in the new Company. This opinion is supported
by the admissions in their lawsuits, by the creation of the
straw person to acquire the assets, and by their perjury to the
Board. The record reflects Richard Barrett’s true position
with TCE/MT in the testimony that the first person suggested
for the titular control of TCE/MT was Barrett’s 11-year-old
son. Clearly, creation and control of the new entity was to
be in the hands of Richard Barrett. While creating the new
Companies and seeking financing for them, Barrett hid from
Townsend Owner Zimmerman his role in creating the new
Company and his role in seeking to acquire Townsend’s as-
sets. He took all actions necessary, however, to insure the as-
sets would be maintained during the period between Town-
send’s forced shutdown and the startup of new operations
with the assets. He personally leased the Townsend facility
to his new created Companies, without any consideration
being given Townsend. Without the leases, the new Compa-
nies would not have been able to be operational.
He maintained his position with Townsend until every-
thing was in place for a continued operation, then resigned
from Townsend and took his consultant’s position with
TCE/MT, at the highest salary paid by the new Companies.
Although Kimberly held the title of president, she had no ex-
perience in engineering, production, and management. As far
as can be gleaned from the record, she did not manage
TCE/MT, but followed the instructions given her by Richard
Barrett and David Somers. I believe that Richard Barrett’s
control both over the operations and assets of Townsend, and
then his control over the operations of TCE/MT are sufficient
to satisfy the ownership test for alter ego status. See Amer-
ican Pipe Concrete Pipe Co., 262 NLRB 1223 (1982),
wherein the Board found that two employers were alter egos
despite the fact that they did not ‘‘share common ownership;
nor did they, on paper, share common management or super-
vision.’’ There, the Board found that one employer ‘‘exer-
cised a degree of control over [the other] so as to obliterate
any separation between them.’’ See also O’Neill, Ltd., supra;
Alaska Cummins Services, 294 NLRB 1 (1989).
All other indicia of alter ego status are clearly present in
that the TCE/MT operations were identical to Townsend in
business purpose, operations, equipment, facilities, customers,
and supervision of the unit employees. I find that Townsend
and TCE/MT are alter egos of one another. Having so found,
it follows that by disregarding its obligations to maintain the
terms and conditions of employment for Townsend’s unit
employees, and by refusing to recognize and bargain with the
Union, TCE/MT violated Section 8(a)(5) of the Act.
L. Should Attorney’s Fees and Costs Be Awarded?
The General Counsel urges that the Board and the Union
be awarded all costs and expenses incurred in the investiga-
tion, preparation, presentation, litigation, and conduct of this
case in light of Respondent’s frivolous defenses, citing
Tiddee Products, 194 NLRB 1234, 1236–1237 (1972), and
its progeny.37 I believe such an award is proper under the
1185H. P. TOWNSEND MFG. CO.
Co., 227 NLRB 1377 (1977); and Hecks, Inc., 215 NLRB 765
(1974).
circumstances of this case. There are virtually no credibility
issues in this case. The only possible credibility disputes
would have arisen over the question of motivation had the
Barretts not admitted their perjury and had not the parties en-
gaged in other litigation against one another. Once the true
facts were admitted, and they all were in documentation and
pleadings filed in state court before this trial began, there is
no defense to the allegations of the complaint. It is admitted
in various pleadings and averments of fact in this record that
creation TCE/MT and the use of the straw person Coudriet
were all part of a plan to disguise the continuance of the
business of Townsend to avoid the unfair labor practice li-
abilities of Townsend and the obligation to recognize the
Union as the representative of the unit employees.
The disguise might have worked had the Barretts and
Coudriet not admitted their perjury and had the parties not
fallen out and sued one another. To reward such deceit and
such disdain for the Act, the Board, and its processes is not
conscionable in my opinion. The actions of the Respondents
herein go far beyond the merely frivolous. I will recommend
award of costs as requested.
M. David Somers Should Be the Subject of a
Proceeding to Show Cause Why He Should Not Be
Disciplined by the Board
The record reflects that David Somers is a former Board
attorney who is knowledgeable about Board law, procedures,
and ethics. The evidence adduced, if true, demonstrates that
he has used his knowledge to attempt to circumvent the
NLRA and suborn perjury to further that attempt. Having
heard the testimony, I do not question the truthfulness of the
Barretts and Coudriet with respect to their testimony that
they lied at the taking of their sworn depositions at the direc-
tion of Somers. This evidence reflects that Somers holds the
Board and the NLRA in total distain and likewise reflects a
total lack of professional ethics. As Somers willfully chose
not to appear in this proceeding, though subpoenaed to ap-
pear and named as a Respondent, I will defer any rec-
ommendation for discipline to the Board or its designated
representative. I do not believe he was on notice that he
would be accused of, inter alia, suborning perjury before the
Board, and he should be accorded the opportunity to face his
accusers and present evidence in his defense. I recommend
that the Board issue an Order requiring Somers to appear and
show cause why he should not be permanently barred from
practicing law before the Board or otherwise disciplined for
his actions as detailed in this record.
CONCLUSIONS OF LAW
1. Respondents H. P. Townsend Manufacturing Co., Inc.,
TCE Corporation, and MT Assembly Corporation are em-
ployers engaged in commerce within the meaning of Section
2(2), (6), and (7) of the Act.
2. Respondents H. P. Townsend Manufacturing Co., Inc.,
TCE Corporation, and MT Assembly Corporation are alter
egos of one another and TCE Corporation and MT Assembly
Corporation constitute a single employer.
3. Respondents Kimberly P. Barrett, Richard B. Barrett,
and David M. Somers are alter egos of Respondents TCE
Corporation and MT Assembly Corporation.
4. The Union is a labor organization within the meaning
of Section 2(5) of the Act and has at all material times been
the exclusive representative within the meaning of Section
9(a) of the Act of Respondents’ employees in following ap-
propriate unit:
All production and maintenance employees employed
by Respondents at their West Hartford, Connecticut fa-
cility but excluding all office clerical employees, and
all guards, professional employees and supervisors as
defined in the Act.
5. Respondents have violated Section 8(a)(1) and (5) of
the Act by failing and refusing to recognize and bargain in
good faith with the Union as the exclusive representative of
their unit employees since March 31, 1992.
6. Respondents are jointly and severally liable for payment
of the sum of $36,721.43, with interest, as set forth in the
compliance specification, to the Union’s pension funds.
7. Respondents have violated Section 8(a)(1), (3), and (5)
of the Act by failing and refusing to abide by the terms and
conditions of employment for unit employees as set forth in
the last collective-bargaining agreement between the Union
and Townsend, as found in the Decision and Order in Cases
34–CA–4196, 34–CA–4913, and 34–CA–5099.
8. Respondents have violated Section 8(a)(1) by coercively
interrogating employees about their union activities or sym-
pathies.
9. The unfair labor practices found to have been commit-
ted by Respondents are unfair labor practices affecting com-
merce within the meaning of Section 2(6) and (7) of the Act.
THE REMEDY
Having found that Respondents have engaged in unfair
labor practices within the meaning of Section 8(a)(1), (3),
and (5) of the Act, they are ordered to cease and desist there-
from and take the following affirmative action deemed nec-
essary to effectuate the policies of the Act.
Respondents are ordered to, on request, recognize and bar-
gain in good faith with the Union as the exclusive collective-
bargaining representative of their employees in the appro-
priate unit. Respondents are further ordered to make their
employees whole for all losses incurred by them because of
the unilateral changes in wages and other terms and condi-
tions of employment since Respondents TCE Corporation
and MT Assembly Corporation commenced operations, about
October 22, 1991. Backpay should be computed in accord-
ance with the Board’s formula set forth in F. W. Woolworth
Co., 90 NLRB 289 (1950), and interest thereon computed in
the manner set forth in New Horizons for the Retarded, 283
NLRB 1173 (1987). Respondents should make whole the ap-
plicable union funds for its unit employees, with interest, as
prescribed in Merryweather Optical Co., 240 NLRB 1213
(1979).
Respondents are jointly and severally liable for the sums
owed by virtue of the foregoing, and for the moneys owed
the Union’s pension fund as set forth in the compliance spec-
ification, incorporated by reference. Respondents should fur-
ther be ordered to reimburse the Board and the Union for all
1186 DECISIONS OF THE NATIONAL LABOR RELATIONS BOARD
38 If no exceptions are filed as provided by Sec. 102.46 of the
Board’s Rules and Regulations, the findings, conclusions, and rec-
ommended Order shall, as provided by Sec. 102.48 of the Rules, be
adopted by the Board and all objections to them shall be deemed
waived for all purposes.
39 If this Order is enforced by a judgment of a United States court
of appeals, the words in the notice reading ‘‘Posted by Order of the
National Labor Relations Board’’ shall read ‘‘Posted Pursuant to a
Judgment of the United States Court of Appeals Enforcing an Order
of the National Labor Relations Board.’’
costs and expenses incurred in the investigation, preparation,
presentation, litigation, and conduct of this case.
Based on these findings of fact and conclusions of law,
and on the entire record, I issue the following rec-
ommended38
ORDER
The Respondents, H. P. Townsend Manufacturing Co.,
Inc., TCE Corporation, and MT Assembly Corporation, West
Hartford, Connecticut, their officers, agents, successors, and
assigns, and Kimberly P. Barrett, Richard B. Barrett, and
David M. Somers, individuals, shall
1. Cease and desist from
(a) Failing and refusing to recognize the Union as the ex-
clusive representative of their employees in the appropriate
unit:
All production and maintenance employees employed
by Respondents at their West Hartford, Connecticut fa-
cility but excluding all office clerical employees, and
all guards, professional employees and supervisors as
defined in the Act.
(b) Failing and refusing to abide by the terms and condi-
tions of employment for unit employees as set forth in the
last collective-bargaining agreement between the Union and
Townsend, as found in the Decision and Order in Cases 34–
CA–4196, 34–CA–4913, and 34–CA–5099.
(c) Coercively interrogating their employees about their
union activities or sympathies.
(d) In any like or related manner interfering with, restrain-
ing, or coercing employees in the exercise of the rights guar-
anteed them by Section 7 of the Act.
2. Take the following affirmative action deemed necessary
to effectuate the policies of the Act.
(a) Recognize, and on demand, bargain in good faith with
the Union as the exclusive collective-bargaining representa-
tive of the unit employees and, if agreement is reached, em-
body the agreement in a new collective-bargaining agree-
ment.
(b) Rescind any unilateral changes made in the terms and
conditions of employment from those set forth in the last col-
lective-bargaining agreement between the Union and H. P.
Townsend Manufacturing Co., Inc., and reinstate those terms
and conditions of employment with respect to current unit
employees.
(c) Make whole those unit employees employed since the
operations of TCE Corporation and MT Assembly Corpora-
tion commenced about October 22, 1991, for any losses they
may have suffered by the Respondents’ failure and refusal to
abide by the terms of former collective-bargaining agree-
ment, in the manner set forth in the remedy section of this
decision.
(d) Pay to the Union the pension fund obligation for the
involved individuals as set forth in the compliance specifica-
tion in Cases 34–CA–4196, 34–CA–4913, and 34–CA–5099,
with interest.
(e) Pay to the Board and the Union all costs and expenses
incurred in the investigation, preparation, presentation, litiga-
tion, and conduct of this proceeding.
(f) Preserve and, on request, make available to the Board
or its agents for examination and copying, all payroll records,
social security payment records, timecards, personnel records
and reports, and all other records necessary to analyze the
amount of backpay due under the terms of this Order.
(g) Post at their West Hartford, Connecticut facility copies
of the notice required by the Board’s Order in Cases 34–CA–
4196, 34–CA–4913, and 34–CA–5099, and the notice ap-
pended to this Order marked ‘‘Appendix,’’39 Copies of the
notice, on forms provided by the Regional Director for Re-
gion 34, after being duly signed by the Respondents’ author-
ized representative, shall be posted by the Respondents im-
mediately upon receipt thereof, and be maintained by them
for 60 consecutive days in conspicuous places, including all
places where notices to employees are customarily posted.
Reasonable steps shall be taken by the Respondents to ensure
that the notices are not altered, defaced, or covered by any
other material.
(h) Notify the Regional Director in writing, within 20
days, what steps the Respondents have taken to comply with
this Order.
(i) Respondent David M. Somers must show cause, in
writing, within 30 days of the date of this Order why he
should not be permanently barred from the practice of law
before the Board, or otherwise disciplined by the Board for
his conduct in this proceeding.