Painters Local 277 (Polis Wallcovering)

National Labor Relations Board - Board Decisions

Sep 30, 1986

281 N.L.R.B. 890 (N.L.R.B. 1986)

890 DECISIONS OF NATIONAL LABOR RELATIONS BOARD
Local Union No. 277, International Brotherhood of
Painters and Allied Trades (Polis Wallcovering
Co., etc.) and Edward W. Pygatt and Jennings
V. Love. Case 4-CB-4170(E)
SUPPLEMENTAL DECISION AND
ORDER
30 September 1986
BY MEMBERS JOHANSEN, BABSON, AND
STEPHENS
On 25 April 1986 Administrative Law Judge
Joel A. Harmatz issued the attached supplemental
decision.' The applicant filed exceptions and a sup-
porting brief, and the General Counsel filed cross-
exceptions and a supporting brief.
The National Labor Relations Board has delegat-
ed its authority in this proceeding to a three-
member panel.
The Board has considered the supplemental deci-
sion and the record in light of the exceptions,2
cross-exceptions, and briefs and has decided to
affirm the judge's rulings, findings,3 and conclu-
sions4 and to adopt the recommended Order.
ORDER
The recommended Order of the administrative
law judge is adopted and the application of Local
Union No. 277, International Brotherhood of Paint-
ers and Allied Trades, for attorney fees and ex-
penses under the Equal Access to Justice Act is
denied.
' The judge issued an Erratum on 6 May 1986
2 No exceptions were filed to the judge 's findings at Sec 3 (a) of his
supplemental decision
8 In adopting the judge's dismissal of the application , we find it unnec-
essary to rely on his general observation that "it is difficult to imagine
that the General Counsel could ever be faulted under EAJA" when the
evidentiary burden in the underlying proceeding has shifted to the re-
spondent As the Board noted in Jim's Big M, 266 NLRB 665, fn 1
(1983), the presence or absence of a prima facie case is not determinative
of whether or not an applicant is entitled to an EAJA award We agree
with the judge, however, for the reasons set forth in his supplemental de-
cision, that the complaint allegations pertaining to Jennings Love were
substantially justified In doing so, we do not rely on the judge's finding
that the General Counsel 's successful maintenance of allegations pertain-
ing to Edward W Pygatt reflect a "proclivity" toward discrimination by
the applicant
We believe that the definition of "substantially justified" was not al-
tered, but merely clarified, by Congress when it amended EAJA in Pub
L 99-80, 99 Stat. 183 (1985) As stated in the conference report accom-
panying the amendments , "substantially justified" means more than mere
reasonableness H R Conf Rep No 99-120 at 9 As noted, we conclude
that the General Counsel's position met this standard
4 In view of our adoption of the judge 's conclusion that the applicant
is not entitled to an award, we find it unnecessary to pass on the General
Counsel's cross-exceptions opposing the application on additional
grounds
SUPPLEMENTAL DECISION
(Equal Access to Justice Act)
JOEL A. HARMATZ, Administrative Law Judge. This
supplementary proceeding is pursuant to the Equal
Access To Justice Act (EAJA), 5 U.S.C. § 504, Pub. L.
96-481, 94 Stat. 2325 and Section 102.143 et seq. of the
Board's Rules and Regulations, through which Local
Union No. 277, International Brotherhood of Painters
and Allied Trades (the Applicant), seeks attorney fees
and other expenses incurred in defense of certain non-
meritorious unfair labor practice allegations.
By way of background, it is noted that on 27 July
1982 the Board issued a Decision and Order in the above
proceeding, affirming my findings that the Applicant had
engaged in certain unfair labor practices, but not others.
Specifically, the Applicant's operation of an exclusive
hiring hall, without benefit of objective criteria, was
deemed violative of Section 8(b)(1)(A). However, as
there was no specific evidence that administration of the
hiring arrangement in this fashion resulted in actual dis-
crimination , a related 8(b)(2) allegation was dismissed. In
addition, the Board affirmed dismissal of an allegation
that the Applicant violated Section 8(b)(1)(A) and (2) of
the Act by refusing to refer Jennings V. Love, while up-
holding like allegations in the case of Edward W. Pygatt.
See 262 NLRB 1336.
Thereafter, on 24 August 1982, the Applicant filed the
current "Application for Award of Fees and Expenses."
On 24 September 1982 the General Counsel moved for
dismissal on various grounds. The Applicant filed a re-
sponse on 21 October 1982. Subsequently, on 21 January
1983, the General Counsel moved for a stay pending
final disposition of appellate litigation before the United
States Court of Appeals for the Third Circuit. In accord-
ance therewith, by Order dated 27 January 1983, I grant-
ed the stay as requested.
On 19 September 1983 the court of appeals issued its
opinion, enforcing the Board's Order in part and remand-
ing in part. 717 F.2d 805. On 29 June 1984, the Board
issued its supplemental decision on remand. 271 NLRB
58. Finally, on 27 March 1985 the court of appeals en-
forced, affirming en toto my conclusions outlined above.
By letter dated 2 April 1986, the General Counsel in-
formed me of the final action taken by the court and re-
quested immediate ruling on the motion to dismiss
herein.
Having duly considered the matter, it is concluded as
follows:
1. Although a variety of other issues are urged by the
General Counsel, Section 102.144(a) of the Board's Rules
and Regulations is the focal point of the instant disposi-
tion. In material part, it provides as follows:
An eligible applicant may receive an award for fees
and expenses incurred in connection with an adver-
sary adjudication or in connection with a significant
and discrete substantive portion of that proceeding,
unless the position of the General Counsel over
which the applicant has prevailed was substantially
justified. The burden of proof . . . is on the General
281 NLRB No. 119
PAINTERS LOCAL 277 (POLIS WALLCOVERING) 891
Counsel , who may avoid an award by showing that
the General Counsel's position in the proceeding
was substantially justified.
Consistent therewith, by virtue of Section 504(a)(2) of
EAJA, recovery is foreclosed "where the adjudicative
officer finds that the position of the Agency as a party to
the proceeding was substantially justified."
2. The instant application is predicated on the aforede-
scribed unfair labor practice allegations that were dis-
missed by me with Board and court approval.
3. For the reasons stated below , the General Counsel
has met her burden on an established record that demon-
strates inherently that the aforesaid allegations were
maintained reasonably and hence involved a noncompen-
sable act of governmental judgment outside the ambit of
EAJA:
a. The hiring hall. As indicated, the Applicant did pre-
vail partially with respect to allegations challenging the
means by which it operated the hiring hall. Yet, it is not
entirely clear that the Applicant seeks recovery on this
basis . For in contrast with assertions in the original appli-
cation, the response to the motion to dismiss appears to
include a waiver of any claim for reimbursement in that
connection . Thus, the Applicant in its response dated 21
October 1982 , at p. 10, states as follows:
The services for which fees and costs are sought
relate solely to the Union's defense as it related to
Jennings Love. . . . Recovery was not sought for
either of the hiring hall charges , nor was it sought
for costs and expenses attributable to Edward W.
Pygatt.
Nonetheless, out of an abundance of caution , whatever
the nature of the Applicant's current position , it is clear
that the dismissed 8(b)(2) allegation pertaining to the
hiring hall did not constitute "a significant and discrete
substantive portion of that proceeding" as required by
Section 102 . 144(a) of the Board's Rules . As heretofore
indicated , a related 8(b)(1XA) allegation was addressed
to the same conduct and sustained . From all appearances,
the additional 8(b)(2) allegation was advanced on a de-
rivative basis , without need for additional proof, but with
the General Counsel instead relying on the potential for
discrimination arguably inherent in a hiring hall lacking
in objective referral criteria . This view, legally, was not
devoid of support in precedent . For as the General
Counsel , during the unfair labor practice proceeding, had
observed, the Board previously had stated expressly that
both Sections 8(b)(1)(A) and 8(b)(2) are violated "by op-
erating . . . [an] exclusive hiring hall without any objec-
tive criteria or standards for the referral of employees."
See Laborers (Wakil Abdunafi), 247 NLRB 97 fn. 2
(1980).
For these reasons, insofar as this aspect of the claim
remains viable, it fails to relate to a "significant and dis-
crete substantive portion of . . . [the] . . . proceeding,"
and the General Counsel acted reasonably as a matter of
fact and law in litigating the allegation.
b. The refusal to refer Jennings V. Love. Also lacking in
merit is the Applicant's claim derived from rejection of
the General Counsel's position that Section 8(b)(1)(A)
and (2) were violated by the failure to refer Jennings V.
Love. In this connection , it is well established that Con-
gress, through EAJA, did not devise a mechanism to
"chill" good-faith efforts on the part of Government to
pursue reasonable claims .' Thus, the risk of recovery
under that law should not be a factor impeding the ad-
vancement of public remedies where proof available to
the Government is sufficient to impel the party charged
to disprove an act of illegality . See, e .g., Wright Line,
251 NLRB 1083 (1980).
In this connection , it is necessary to note initially that
the record negates the Applicant's claim that "there was
no basis whatsoever upon which the assertion could rea-
sonably be made that the Union 's failure to refer Mr.
Love was improperly motivated ."2 On the contrary, a
strong prima facie case of union -induced discrimination
was presented in that regard . Love, together with
Edward W. Pygatt, in June 1980 participated in rebel-
lious activity toward the Applicant, for which both in-
curred the wrath of union officials . In consequence they
were subjected to internal union charges and, on 24 July,
found guilty and fined . Later, additional charges were
filed against them and additional fines imposed. As had
been true of Pygatt, after Love was deemed guilty of
this last set of internal charges, he was not again referred
for work
The Board has held that the General Counsel is sub-
stantially justified within the meaning of EAJA in pursu-
ing an allegation that, though unsuccessfully maintained,
was supported by prima facie evidence of a violation.
SME Cement, 267 NLRB 763 fn. 1 (1983); Enerhaul, Inc.,
263 NLRB 890 (1982), reversed on other grounds 710
F.2d 748 (11th Cir. 1983). See also Wolf Street Supermar-
kets, 266 NLRB 665 fn . 1 (1983), affd. (unreported) 118
LRRM 2967 (2d Cir. 1984). Consistent with this clear
line of authority, it is difficult to imagine that the Gener-
al Counsel could ever be faulted under EAJA where the
burden has shifted , leaving the outcome to turn on the
substantiality of the defense . To hold otherwise would
require the General Counsel to anticipate and assess, in
advance of any litigation , the verity of evidence support-
ing the defense , even though all relevant components
thereof will seldom be available until the hearing is
closed . Moreover, in such a case, it would be a virtual
impossibility for a litigation strategist to anticipate with
certainty the manner in which a trier of fact will invoke
the inference-drawing process and/or react to critical
issues of credibility.
Here, the General Counsel prevailed with respect to
the 8(b)(1)(A) and (2) allegations pertaining to Pygatt.
The diverse holdings in the cases of Pygatt and Love are
explainable solely because in Pygatt's case , the Applicant
sustained its burden of proving a legitimate motive while
in the case of Love it failed . Indeed, the General Coun-
sel's justification for proceeding on behalf of Love was
later reinforced by successful maintenance of Pygatt's
' S. Rep . 96-253 , at 7; H .R. 96-1418 at 11; Remarks of Rep. Neal
Smith, the author of the Conference Report , 126 Cong . Rec. 10226 (Oct.
1, 1980); Wyandotte Savings Bank P. NLRB, 682 F.2d 119, 120 (6th Cir.
1983).
2 See EAJA application of 24 August 1982, p. 4.
892 DECISIONS OF NATIONAL LABOR RELATIONS BOARD
case and the proclivity toward discrimination reflected
therein. This coupled with a like animus directed toward
Love as reflected in the internal charges against him, to-
gether with the cessation of his job referrals after the im-
position of internal discipline, all served to support a
convincing inference of unlawful discrimination. Indeed,
if unanswered, the 8(b)(2) and (1)(A) allegations in
Love's case would readily have been sustained without
further inquiry. Thus, the success of the defense was by
no means attributable to any crucial flaw within the
General Counsel's affirmative case. Instead, as the litiga-
tion unfolded, the Applicant's evidence as to Love's dis-
qualification for referral was deemed credible. In fact, it
was sufficient, not only to override the inference of dis-
crimination generated by the case in chief, but to with-
stand the suspicion concerning the defense emerging
from Love's repeated referral prior to August 1980, de-
spite his earlier terminations for cause on four different
occasions. In sum, the assigned ground for the action
against Love was upheld in the context of a difficult
question of judgment, which centered on the credibility
of the defense.
Accordingly, the General Counsel acted well within
EAJA's standard of reasonableness in initiating and pur-
suing the 8(b)(2) allegation concerning Love, and hence
the claim for attorney's fees and expenses in this respect
is nonmeritorious .3 Hence, the motion to dismiss shall be
granted and the Application under EAJA shall be dis-
missed.
ORDER4
It is recommended that the Application for attorney's
fees and expenses filed pursuant to the Equal Access to
Justice Act and Section 102.143 et seq. of the Board's
Rules and Regulations is dismissed.
The substantiality of this defense to the EAJA claim makes it unnec-
essary to consider the remaining grounds on which the General Counsel
opposes the Application.
4 If no exceptions are filed as provided by Sec 102.46 of the Board's
Rules and Regulations, the findings , conclusions , and recommended
Order shall , as provided in Sec . 102.48 of the Rules, be adopted by the
Board and all objections to them shall be deemed waived for all pur-
poses.