Pet. Inc.

National Labor Relations Board - Board Decisions

Aug 10, 1979

244 N.L.R.B. 96 (N.L.R.B. 1979)

I)I.(' ISI()NS ()1 NA I()NAI LABO()R RIIA II()NS B()ARI)
I Inited Steelvorkers of America. America -('()- ('II ' ;nd
Pet, Incorlporated. ('Case 14 ('' 1250 1
August 10, 1979
I)DE(ISI()N AND ORDIER
1 ponl ulnfiir labor practice charges filed on No-
vember 4 1977, and amended on November 9 1977.
and lMarch 1 1978. by Pet, Incorporated (herein also
cailed Pet), the General Counsel of the National La-
bor Relations Board, by the Regional Director for
Region 14, issued on March 13, 1978, a complaint
against United Steelworkers of America. AFL ('I)
CLC (herein also called Respondent or the Union)
alleging that Respondent engaged in and was engag-
ing in unfair labor practices affecting commerce
within the meaning of Section 8(b)(4)(ii)(B) and Sec-
tion 2(6) and (7) of the National Labor Relations Act.
as amended. Copies of the complaint and notice of
hearing were served on Respondent and the Charging
Party. Thereafter. Respondent filed a timely answer
denying the commission of any unfair labor practices
and asserting certain affirmative defenses.
On June 2, 1978, the parties jointly moved the
Board to transfer the instant proceeding to the Board
without benefit of hearing before an administrative
law judge and submitted therewith a proposed record
consisting of the formal papers and the parties' stipu-
lation of facts with attached exhibits. On October I
1978, the Executive Secretary of the Board. by direc-
tion of the Board, issued an order granting the mo-
tion, approving the stipulation, and transferring the
proceeding to the Board. Thereafter, the General
Counsel, Respondent. and the Charging Party' filed
briefs. 2
Upon the entire record in the case, the Board
makes the following findings:
I. JRISlIClIO()N
The complaint alleges, the answer admits, and we
find the following:
A. Hussmann Refrigerator Company (herein also
called Hussmann) is a Delaware corporation duly au-
The Charging Party's request for oral argument is hereby denied inas-
much as the record and the briels adequately state the positions of the par-
ties.
2(On ebruary 15. 1979, the (harging Party filed a motion to have the
Board take administrative notice of the f.,:t that as the result of an election
conducted by the Board in Case 14 R( 8801, on January 22. 1979. Respon-
dent no longer represents for purposes of collective bargaining the emploees
of Hussmann Refrigerator ('ompany at that compan)'s Bridgelon Missouri.
plant. Respondent. in opposition. contends that absent some showing of rel-
evance a claim of moolness or some other support for the assertion that the
"Board should be aware" of these Iacts, the Board should decline t) consider
them. We hereby grant the (Charging Party's motion and take administrative
notice of the aforementioned representation proceeding However, we find
that the events therein do not materially ;lteil the issues here.
thorized to do business in the State of Missouri and
maintains a faicility at 12999 St. (Charles Rock Road
in St. ouis ('ounty (hereinafter referred to as Bridge-
ton). Missouri. Hussmann is engaged in the business
of manLlnua cturing relrigeration equipment. During
the 12-month period immediately preceding the issu-
ance of the complaint, Hlussmann has manutlctured
refrigeration equipment valued in excess of $50,000
which was shipped rom its plant in Bridgeton, Mis-
souri, directly to customers located in other States of
the United States. Hussmann is a wholly owned sub-
sidiary of Pet.
B. Pet is a Delaware corporation, doing business
under various names. including: Pet Dairy Products.
under which it manufactures, sells. and distributes
milk and ice cream products: Whitman's Chocolates,
under which it sells candy: Pet Frozen Foods, under
which it manufactures, sells, and distributes Pet-Ritz
Frozen Pies and Pie Shells, [ Downy Flake Frozen
Breakfast Foods, Easy Jacks, Hot 'N Buttery Waffles,
and Pet Frozen Non-Dairy Whipped Topping: Mi-
ladey's. under which it sells frozen blintzes: Reese
Finer Foods, under which it manufactures. distrib-
utes, and sells gourmet and specialty food items: and
Funsten Nuts, under which it manufactures, pro-
cesses, sells, and distributes various nuts. Pet operates
a grocery product group of' divisions which produce,
sell, and distribute Compliment Cooking Sauces.
Heartland Cereal. Heartland Pet Evaporated milk.
Sego I)iet Food. Sego Spoon-Ulp and Musselman
Fruit Products. Pet maintains a main office in the
State of' Missouri and maintains other principal of-
fices and places of business for its various divisions in
the States of Pennsylvania. Michigan West Virginia
Idaho, Illinois. Ohio. Tennessee. Oklahoma. Calif'or-
nia Georgia. Texas, Arizona, and Alabama. During
the course and conduct of' its business. Pet annually
manufactures and sells in interstate commerce prod-
ucts valued in excess of $1 million which are shipped
from one State of the United States directly to other
States of the United States.
C. Stuckey's. Inc. (herein also called Stuckey's) a
Delaware corporation and wholly owned subsidiary
of Pet, with a principal place of business in the State
of' Georgia. is engaged in the manufacture and distri-
bution of food products and souvenirs and the sale of
such food, souvenirs, and gasoline. During the past
year, Stuckey's has sold and distributed goods and
wares valued in excess of $1 million of' which goods
and wares valued in excess of $50,000 were shipped
from the State of Georgia directly to 40 other States
of the United States.
D. Southland Canning and Packing Company.
Inc. (herein also called Southland), and Violet Pack-
ing Company. Inc. (herein also called Violet). are
both l.ouisiana corporations and subsidiaries of Pet,
244 NLRB No. 6
LNITEI) SITElVWORKERS OF AME RICA
doing business as Gulf' Bell and Orleans Canned
Shrimp and Oysters. These companies annually pro-
cess, pack. ship, and deliver products valued in excess
of $50,000 from the State of Louisiana directly to
other States of the United States.
E. Mountain Pass Canning Company (herein also
called Mountain Pass) is a Delaware corporation and
a subsidiary of Pet, engaged in manufacturing, pro-
cessing, and selling Mexican food products under the
name El Paso Mexican Foods. Mountain Pass has a
principal place of business in the State of Texas and
during the past year shipped products valued in ex-
cess of $50,000 from the State of Texas directly to
other States of the United States.3
F. Each of the above corporations. i.e., Hussmann.
Pet, Stuckey's. Southland. Violet, and Mountain Pass.
is now and has been at all times material herein an
employer engaged in commerce within the meaning
of Section 2(2). (6), and (7) of the Act and a person
engaged in commerce or in an industry affecting com-
merce within the meaning of Section 8(b)(4) of the
Act.4
It. T'IH IABOR OR(iANIZAII()N INVO()I Vl )
United Steelworkers of America. AFL CIO- CIC,
is a labor organization within the meaning of Section
2(5) of the Act.
Ill. 1111i NFAIR ILABOR PRA( II(1FS
The issue presented is whether Respondent's hand-
billing and other nonpicketing publicity, urging a to-
tal consumer boycott of products and services of Pet
and its various subsidiaries and divisions, violated
Section 8(b)(4)(ii)(B) of the Act. Based on the follow-
ing facts, and for the reasons set forth below, we find
Respondent's activity to he protected under the see-
ond proviso of Section 8(b)(4) of the Act and there-
fore lawful.
A. Facts
1. Pet's corporate structure and Hussman's
relationship to it
Pet is a large, diversified, billion-dollar conglomer-
ate enterprise with plants and retail stores located
'In its answer. Respondent additionally alleges that Southland and
Mountain Pass are wholly owned subsidiaries of Pet. This allegation is borne
out by the stipulation which also stipulates that Violet is a wholly owned
subsidiary of Southland.
' In its answer. Respondent denies the statements in par. F. above. to the
extent that the complaint alleges that Hussmann Stuckey's. Southland. Vio-
let. and Mountain Pass are employers separate from Pet. As noted nral. we
find it unnecessary to decide whether these employers together combined
constitute a single employer
throughout the United States. It currentl has 27
separate operating divisions, each engaging in sepa-
rate and distinct lines of business. In the mid-19 7 0 's.
most of Pet's divisions were segregated lor adminis-
trative. operational, evaluational, and fiscal account-
ing purposes into ftour "groups." One set of dix isions
remains "ungrouped."
[]ussmlann manuftactures commercial retrigeratinll
equipment. display cases, helving. checkout count-
ers, and other commercial and industrialI eqluipment
in its various facilities in the United States and ('an-
ada. 1L1ussIan was acquired bh Pet in 1966. and
about 10 ears later its facilities were segreated to
form what is now the "'lussmann (roup."'' The
Hussmann Group consists of three divisions: the
Commercial Division, the Industrial [)ivision. and
the Self-Container Products Divisioni. ussmann's
Bridgeton. Missouri. fcility. where at the time of the
stipulation Respondent was the collective-hba ria ning
representative otf 1.500 hourly paid production and
maintenalnce employees. is part of the ('omniercia l
Division.6
The president of' Pet appoints and determines the
compensation of a "Group president" to oversee the
operation of each group.' The group piresideIntts in
turn, appoint presidents for each of their divisions.
Compensation for division presidents is determined
by the respective group president, and compensation
for division operating officials is determined by divi-
sion presidents A corporate policy manuial details
conduct appropriate fir line executives.
The various divisions oft Pet operate essentiall as
independent business entities. No division exercises
any determination, control. or influence over the ad-
ministrationl or operation ot' an\ other division. Each
division m;intains a separate financial sstemn and
hank accoLlunt romi which it pays employees. prepares
its own budget and financial statements, sets its protit
targets, and pays its own bills. including paii mets to
the Pet corporate office fbr reimbursement ot' services
rendered b it. Policies regarding product line. pric-
ing. and advertising, as well as market strategies, are
determined by the divisions. Division president s are
vested with complete authority over the da's-to-da
operation of their respective divisions and are ac-
countable f'or their divisions' profitability. T'he\ have
complete authority over division labor relations and
employment policies for represented and ulnrepresent-
' Several subsequentll acquired companies prodiucing rclated products
including Mslohask ('abinet (mpans: (Chesle Inlui.ries.. Incorporated:
and Ilaig Berberian sere thereafter added to the litumann (;roup
I Respondent does not represent an, olher emploNees it P'et. ilissli,ii
or other Pet subsidiarles
7 Such appointments are suhbjec to a pprsal bh the board ot directiors .1t
Pet.
i These determninaiions are subject to res e and approsal bh Pet' pres-
ident.
DECISIONS OF NATIONAL LABOR RELATIONS BOARD
ed employees and can negotiate, execute, and admin-
ister collective-bargaining agreements without prior
approval from Pet's corporate offices.
However, responsibility for long-range planning.
major capital expenditures, and all other general
management functions rests with Pet's office of the
chief executive, comprised of Pet's president and
three executive vice presidents. Tax policies and pro-
cedures and accounting policies are also centrally
controlled, formulated, or administered by Pet. Pet
has also issued policies on various matters, including
employment practices, quality control, product label-
ing, and spheres of permissible business fir the divi-
sions. Division presidents report directly to their re-
spective group presidents, not to a board of directors.
Group reports analyzing variances in the forecasted
(as compared to actual) sales and earnings, forecast-
ing future earnings, and discussing such items as mar-
ket shares, order backlogs, industry trends, and plant
safety are filed monthly by group presidents with
Pet's prcsident.' Pet's corporate office has formulated
and administers separate benefit programs for divi-
sion executives and salaried employees. The individ-
ual divisions reimburse Pet for their prorated share of
the cost of administering and providing these benefit
programs. '° Pet maintains national business accounts
to enable its divisions to obtain, at discounted prices,
frequently used products and services. Divisions uti-
lizing these accounts reimburse Pet for purchases
made on their behalf. Additionally, attorneys from
Pet's legal department have represented subsidiaries
for various matters, including collective-bargaining
negotiations.
Pet's 1977 annual report to stockholders states that.
of the four Pet product groups, the group including
store environments and distribution services is "a
strong perfoi mer, generating the biggest improvement
of any product group," and lists Hussmann as the
largest business of that group, with high sales and
earnings. The financial review of Pet in the 1977 an-
nual report consolidates the earnings of "Pet, Incor-
porated and the subsidiaries." Property held by Huss-
mann, as well as its capital contributions to Pet. is
also listed in other Pet financial statements.'' Pet's
public image is affected by that of Hussman, a factor
which Pet has attempted to capitalize upon. Thus. an
'The data used to prepare these reports are provided by the division
presidents.
' Some divisions have established and administer additional benefit pro-
grams for their executives and salaried employees.
" In an annual report filed by Pet with the Securities and Exchange Com-
mission (SEC) pursuant to sec. 13 or 15(d) of the Securities and Exchange
Act of 1934. Pet consolidates all of the assets of its "substantial" subsidiaries.
including Hussmann, into its financial statement. which lists such items as
land, buildings, machinery. and inventories.
illustrated booklet entitled "Pet. Incorporated." pub-
lished some time after 1975 and apparently designed
for promotional purposes, gives a "profile" of Pet as a
diversified company with varied operations, lists
Hussmann in Pet's "chronology of growth." and de-
scribes Hussmann as an innovative company from its
independent beginning in 1906 to its modern status as
a Pet subsidiary.
Shortly after acquiring Hussmann, Pet loaned it in
excess of $50 million.' 2 Hussmann used these funds to
purchase land; to construct a new manufacturing
plant in Bridgeton. Missouri: and I)r operating ex-
penses. Other than accounting records, there are no
notes or other documents evidencing the loan, which
is interest free, unsecured, and does not have a spe-
cific payment schedule. As of March 1978, the loan
balance was approximately $16 million.
Commencing in 1972. Pet and Hussmann instituted
a zero-balance disbursement procedure pursuant to
which all Hussmann disbursements are funded by a
Pet general bank account. All HIussmann disburse-
ments are first charged to lussmann's account and
then charged to the Pet general bank account: like-
wise, all Hussmann deposits are credited to luss-
mann's account and then credited to Pet. Disburse-
ments in excess of deposits result in negative cash
flow, whereas deposits in excess of disbursements re-
sult in a positive cash flow. These positive or negative
balances are entered into the books and records of
both Pet and Hussmann. Hussmann has remained in
a cumulative negative cash flow position since the end
of fiscal 1973" and has been charged no interest on
these negative balances by Pet.
On occasion Pet has provided I lussmann with legal
counsel. Thus. a former Hussmann attorney, Burton
Halpern. who transferred to the Pet legal department
some 4 years ago. has thereafter, with Pet's approval.
continued to represent Hussman in labor arbitration
cases concerning grievances pending at the time of his
transfer and certain other grievances which later
arose. Also, subsequent to his transfer. Halpern was
counsel of record foir Hussmann in a fair representa-
tion proceeding in the District Court for the Eastern
District of Missouri and in an unemployment com-
pensation hearing in Missouri.' 4
12 According to the SEC report discussed at In. 11, hupria Pet', whollI
owned subsidiaries re "nl indebted to tiny peron otlher than the parent or
consolidated subsidiaries in an amount which is material in relation to total
consolidated assets."
i' The cumulative negative cash flosw figures bctceen Pet and tiussman as
represented by the interdivisional account balance at the end of the fiscll
year (the annual cumulative total of cash used by )Hussmann In excess of its
deposits) are as follows: 1973 $47,690,0)(: 1974 $50.266.0)0: 1975
$41,979,000; 1976 $30.520.000: 1977 23.987,(XM)t
14 This hearing arose out of the current strike a;1 Ilussmann's Bridgeton,
Missouri, facilt.
98
UNITED STEEI.WORKERS OF AMERICA
2. The alleged unlawful conduct
When the collective-bargaining agreement covering
Hussmann's Bridgeton unit employees expired on
May, 1, 1977. the employees commenced an economic
strike and from time to time thereafter have picketed
other Hussman facilities?5
On October 21. 1977. Union President Lloyd
McBride announced at a press conference in the St.
Louis area that, in support of the strike at the Bridge-
ton plant. he was calling for a "national boycott by
our 1.4 million-member union of Pet, Inc., food prod-
ucts, their retail store outlets, and commercial refrig-
eration equipment." When asked by a television an-
nouncer what the boycott would immediately entail.
McBride replied, inter alia, that the Teamsters had
committed support, that the United Auto Workers
would be asked for support. and that the boycott
would be expanded to Canada if the boycotted prod-
ucts were being exported. McBride also indicated that
"this is a total commitment of a total resource and it
commits us to a long-range, if necessary, many years
of boycott activity that we anticipate will acceler-
ate."16
Beginning on November 9. 1977. Respondent com-
menced placing advertisements in local newspapers.
advising the "general public" of the Union's strike
against the Hussmann Bridgeton plant. noting that
Hussmann is owned by or is a part of Pet, and re-
questing the public to boycott "all retail stores owned
by Pet. Inc.. and refuse to buy any product produced
by Pet. Inc. and its subsidiaries." Specifically, the ad-
vertisements requested the public not to patronize "9
0-5 Liquor Stores."' 7 Or "Stuckey's Roadside
Stores." both of which are Pet divisions not within
Hussmann, and not to purchase any of a list of 17
brand-name food products, all of which are manufac-
tured by divisions of Pet not within Hussmann. Other
advertisements requested the general public not to
buy "Whitman's Chocolates and other Pet food prod-
ucts" or "Pet Dairy Products-(milk, ice cream,
etc.)," all of which are produced by divisions of Pet
outside Hussmann.
In October and November 1977. Respondent com-
menced distributing handbills on public streets in St.
Louis and University City, Missouri, and in O'Fallon.
Illinois. Also, on October 26. 1977, Respondent hand-
billed in the vicinity of the St. Louis plant of Affili-
ated Hospital Products, Inc.. whose employees are
" No charges have been filed concerning this picketing. the legality of
which is not at issue.
, This statement was aired by television station KSD in its October 21.
1977, 6 p.m. news broadcast.
' The General Counsel did not allege that Respondent's handhilling or
other nonpicketing publicity asking consumers not t patronize 9 0 5 I.i-
quor Stores violated Sec. 8(h4\iiXB) of the Act.
represented for collective-bargaining purposes by the
Union. and on November 20. 1977. distributed hand-
bills to members of the public as they left a St. Louis
Cardinals football game at Busch Memorial Stadium
in St. Louis. The handbills were identical in form and
message to the initial newspaper ads. urging the gen-
eral public not to partronize any Pet retail stores and
not to purchase any Pet products. including the 17
brand-name foods. Pursuant to instructions issued by
Respondent. the handbilling was conducted in an or-
derly and peaceful manner. It was not accompanied
by any picketing or patrolling, and it was not con-
ducted in the vicinity of any establishments owned by
Pet or selling Pet products. The parties stipulated that
the above-described publicity did not have the effect
of inducing any individual employed b any person
to refuse. in the course of his employment. to pick up.
deliver. or transport any goods or to perform any ser-
vices.
B. ('ontentios f the Parties
The General Counsel and the Charging Party con-
tend that Respondent violated Section 8(b)(4)(ii)(B)
of the Act by calling for a total consumer boycott of
Pet and its subsidiaries and divisions. They argue that
the handbilling and other publicity used in an at-
tempt to achieve that end constitutes restraint and/,or
coercion within the meaning of subparagraph (ii) of
Section 8(b)(4) of the Act. 8 since it was directed
against Pet and certain specified subsidiaries and divi-
sions which they allege to be "neutral" persons.'l The
General Counsel further argiues that the object of Re-
spondent's conduct was to induce or influence con-
sumers to cease doing business with Pet and its sub-
sidiaries and divisions, with the intended consequence
of causing a diminution of business between Pet's di-
visions and their suppliers and distributors and a ces-
sation of business between the various divisions of
Pet. and that said objective is therefore proscribed by
paragraph (B) of Section 8(b)(4) of the Act. Both the
General Counsel and the Charging Party contend
that because a requisite "producer-distributor" rela-
tionship between Pet and its subsidiaries and divi-
sions and Hussmann does not exist, the publicity pro-
viso offers no immunity to Respondent's conduct.
Finally. they contend that a finding that Respon-
dent's conduct is unprotected by the publicity proviso
would not be an unconstitutional abridgment of free
speech.20
c the (harging Party bases this contention prilmaril? on the tfact lhat
Respondent appealed fir .a iola rather han partial bholcolt
" g. ., 4,Anel,e , ipiJpe (thi. li)* 09. 1 X' ( l 4eles e.rarld-
Etaminner Dor'rr,,l i/ 71' Iearrr ( rprwlr n, et af . I5 N I RB 3)03 (197().
enfd. 443 F.2d 1173 (1th (Cr 19711
20 The iGeneral Counsel's motion ioi strike that portlion ot hi, brief hlich
urges the Board not to address this issue is herehb granted
99
I) ('ISIONS OF NATIONAL LABOR RELATIONS BOARD
Respondent argues that the Board in The Hearst
Corporation, supra, and similar cases applied an im-
proper test to determine the neutrality of an employer
under Section 8(b)(4) of the Act. Respondent urges
that the proper test is whether the supposed neutral
has a direct economic interest in the outcome of the
primary's dispute with the union and contends that
Pet and its subsidiaries and divisions, having such an
economic interest, are not neutrals. Respondent fur-
ther argues that the handbilling and other activities
constitute neither unlawful restraint nor coercion and
that Section 8(b)(4)(B) was not intended to reach the
type of conduct involved herein. Affirmatively, Re-
spondent asserts that the alleged unlawful conduct is
protected by the publicity proviso of Section 8(b)(4),
citing N.L.R.B. v. Servette, Inc.,2" and International
Brotherhood of Teamsters, Chauffeurs, Warehousemen
and Helpers of America, Milk Drivers and Dairy Em-
plqoees Local 537 (Jack M. Lohman, /h/a Lohman
Sales Companv),22 in that Hussmann substantially
contributes to Pet and its subsidiaries and divisions
and vice versa. Respondent also asserts that the first
amendment to the Constitution further protects the
conduct at issue. For these reasons Respondent con-
tends that the complaint should be dismissed in its
entirety.
C. Discussions of Law and (Conclusions
The proscription of Section 8(b)(4)(ii)(B). making it
unlawful to "threaten, coerce, or restrain any person"
where an object thereof is to force such person to
cease doing business with any other person, is limited
in its reach by the publicity proviso of Section 8(b)(4).
That proviso immunizes from statutory proscription:
. . .publicity, other than picketing, for the pur-
pose of truthfully advising the public, including
consumers and members of a labor organization,
that a product or products are produced by an
employer with whom the labor organization has
a primary dispute and are distributed by another
employer, as long as such publicity does not have
an effect of inducing any individual employed by
any person other than the primary employer in
the course of his employment to refuse to pick
up, deliver, or transport any goods, or not to per-
form any services, at the establishment of the
employer engaged in such distribution.
For the reasons set forth below, we find that Re-
spondent's handbilling and other conduct comes un-
der the umbrella of the publicity proviso.23
1 377 U.S. 46 (1964).
22 132 NLRB 901 (1961).
"Thus, assuming, without deciding, that Respondent's conduct falls
within the proscription of Sec. 8(bX4XiiXB) of the Act, it is nevertheless not
A consumer boycott falls outside the protection of
the proviso if (I) it results in refusals by employees,
other than those of the primary employer, to pick up,
deliver, or transport goods or to perform services or
(2) the publicity is untruthful. If either situation ob-
tains, the publicity proviso is inapplicable.
As to ( ), the parties stipulated, and we find, that at
no time did Respondent's alleged unlawful conduct
have the effect of inducing any individual employed
by any persons, other than Hussmann, to refuse, in
the course of his employment, to pick up, deliver, or
transport any goods or not to perform any services.
As to (2), the General Counsel and Respondent en-
tered into a stipulation that Respondent's advertise-
ments and handbills are neither misleading nor un-
truthful. The Charging Party, on the other hand,
refused to join in this stipulation and in its brief to the
Board contends that Respondent's advertisements
and handbills are in fact misleading and untruthful in
that (a) none of the products listed is produced by
Hussmann, the primary employer in the dispute with
Respondent, and (b) Respondent does not have a pri-
mary dispute with the producer of any of the prod-
ucts listed. These contentions, however, are really ad-
dressed to the claim that the products listed by
Respondent are not "produced" by Hussmann within
the meaning of the publicity proviso rather than to
the truthfulness of the advertisements and handbills.
The Charging Party has not established that these
materials were on their face untruthful, i.e., that they
substantially departed from fact or intended to de-
ceive.24 Thus, the materials accurately state that
members of Respondent were "on strike at Hussmann
Refrigerator" and that Hussmann is owned by, or is a
part of, Pet. In view of the above, we find no merit to
the Charging Party's contentions regarding the truth-
fulness of the materials at issue.
The central question for resolution, therefore, is
whether Respondent's conduct falls within the
bounds of the proviso or, more specifically, whether
Hussman constitutes a "producer" within the mean-
ing of the proviso vis-a-vis the products of Pet and its
other subsidiaries and divisions as a result of the di-
versified corporate relationship existent between
Hussmann and Pet and Pet's other subsidiaries and
divisions. The Board and the courts have heretofore
unlawful, because it comes within the purview of the publicity proviso and is
therefore immunized from statutory proscnption. Accordingly, we find that
the complaint should be dismissed whether or not Respondent's conduct
constitutes restraint and/or coercion and even if it was directed against
"neutral" persons. Honolulu Typographiral Union No. 37, AFL C'1O (Hawaii
Press Newspapers, Inc.), 167 NLRB 1030. 1031 (1967): NVLR.B v. Servette
Inc., supra: Great Western Broadcasting Corporation, d/h/a KXTV v.
N L R.B., 356 F.2d 434 (9th Cir. 1966). cert. denied 384 U.S. 1002. We shall
not, therefore. further discuss or pass upon the contentions of the parties
concerning the legality of Respondent's conduct within the context of sub-
par. (ii) or par. (B) of Sec. 8(b)(X4) of the Act.
24 Lohman Sales Company, supra at 906.
100
1, Nt III) SI1 1 X, t I,[2'; (I 1 RS Mt \I ¢ R \
lihberll interpreted tilhe terlls "Iprlodlucts. "pro-
ducel." alld "disttribuled''" s u sed illn the pIro so. Ill
1./io/m Sale.S s ( ompatu. wit raat 9()(6 ))908. te lioa'id
analyzed tile words "produtl" . artd "producedl" as
theN are naturally interpreted and found. li. mir ai(i,.
that product need not he tangible. and that. ince
labor is the prime requisite of one who produces. an
employer who applies his labor in the tirnm ot' "capi-
tall, enterprise, and service"'' to a product. in the initial
or intermediate stages of the marketing of the prod-
uct, is a producer of the product. 2' Whatever notion
thereafter existed that the proviso applies only to situ-
ations where a union's labor dispute is with a manu-
facturer or processor engaged in the physical creation
of goods was laid to rest by the Supreme Court in
N.L.R.B. v. Servette, Inc., sra. Noting that the pro-
viso was an outgrowth of a profound Senate desire to
adequately safequard a union's freedom to appeal to
the public for support of its case, the Court approved
the Board's earlier finding in Lohman Sale.s ('ompanlr ,
supra, that products "produced by an employer" in-
clude products distributed by a wholesaler with
whom the primary dispute exists.26 The Court went
on to say (377 U.S. at 55):
There is nothing in the legislative history which
suggests that the protection of the proviso was
intended to be any narrower in coverage than
the prohibition to which it is an exception, and
we see no basis for attributing such an incongru-
ous purpose to Congress.
Thereafter, the Board, considering Greal H'estlrn
Broadcasting Corporatioln.27 on remand from the
Ninth Circuit, found that Servette sustained the
Board's holding enunciated in Lohman "that 'pro-
ducer.' as used in the proviso, encompasses anyone
who enhances the economic value of the product ulti-
mately sold or consumed; i.e., for the purpose of the
proviso, no distinction is drawn between processors.
distributors, and those supplying services" (150
NLRB at 472). Further. the Board found (150 NL.RB
at 427):
' Similarly. in Local No. 662. Radi and 7ilevison Engincer,. a/fhlialed
with International Brotherhood of Electrical Workers. .4-1. (1) lt(ddIc-
South Broadcas.ing Co.. 133 NLRB 1698, 1705 1961 ). the Board found thall
a radio station. by adding its labor in the form of capital. enterprise. and
service to the automobiles it advertised fr a retail automobile distributolr-
ship, became one of the producers of the automobiles. See also Amerilan
Federation of Television and Radio A4rtists San Franciscer lol. National
Association of Brondcast Emplo ees and Techniciani, local 55 ((Grea 1i eslesrn
Broadcasting Corporation, d/hla K.XTI,. 134 NI.RB 1617 (19611, enforce-
ment denied 310 F.2d 591 9th Cir. 1962).
26 In Lohman Sales Compam, the Board further stated. "[lIhere is no sug-
gestion either in the statute itsell or in the legislative historN that ('Cingress
intended the words 'product' and 'produced' to be vords of special limit.a-
tion" (suprau at 907}
21 150 NL.RB 467 1964).
Silc tilh ( tutll is staltd t11ha Ile plr ctioC n otf
[te pl')isl ISt i ot "'ll, Iilro''r ill t'.c;.igc
tlliaI t11 I h'lib itito To which It is an eceptimo,"
and ince te proilbition ot' Sectioin 8(h)(4)(13)
co}vcrs the peltorl -nlliccs o ' sCI'lceCS 1is '.clI ;ls
pricesCsilg or distribution o1I phl ill prodtucts. it
Ibllows tha t e Ipr. iso likc.ise applies to the
perl't(.or ;nince 1' S hCerices,2
Additionall\ . the Board rcaltli ied the principle.
Oliginall'! enunciated illn Idd1/1 ' Solil/ Br,,al(( l.sling
().. l/qrd at 1705. 1715 17. that the proviso ,~as in-
tenlldel to perilit a; collsumtIer hovcott of the secon-
dary's entire business and nlot nimerel a ho cott of the
product irolvlred il thle primary dispute.2 i
F'rom tile tlregoing it is apparent thlt a union call
lawfuIlls urge, via handbillinig or other noipicketiig
publicit, ia total consulier hocott of nlieeutral ci-
plover so long as the prinmar) employer has at some
stage produced. in the sense of' appling capital. en-
terprise. or service, a product of the neutral enplo\ er.
Applying these principles to the facts herein. we ind
that as aI result of its elationship sith the diersitied
Pet enterprise, Ilussman applies capital. enterprise.
and service to Pet and its other subsidiaries and diIt-
sions. We therefore conclude that Ilussman is a "pro-
ducer" of the products of Pet and its other subsidiar-
ies and divisions as that term is used in the publicit5
proviso and that Respondent's total consumer bhoy-
cott of said prodtucts is thus exempt from the pro-
scriptions of Section 8t(h)(4) o tlhe Act.
Diversified corporations. hb their ver, nature. are
composed of' operations hich provide support for
and contribute to one another. t The conitributions of
each to the others mat \ars considerabl, . However.
all add to the diversification which enables the enter-
prise as ai whole to w;eather econonilc assault oin an\
one of' its operations. All contribute protits, either ac-
tual or potential, which enhance the value of the en-
terprise and foster its econonuic iabilits. All contrib-
ute a measure of goodwill.
Pet perceives itself as just such a diversified corpo-
ration, with its divisions and subsidiaries supporting
each other. Thus. Boyd F. Schenk. chairman of the
board and president of Pet. stated in the document
entitled "Pet. Incorporated." discussed st'lpr:.
2" In suhsequenii, affirming the Board's tindiig. the Ninth ('ircuil hlkeine
emphasized Ithe broad applica.lin glen the pubhie l provis h the Sl
preme Court he court Illind Ihlt "shhuster dilticulies :im .Iailn.Iical dis-
secting i he proslso i 1li rev ae.. Ilies .ar ntl i. sia.nd in the i ,1 gl\ig
thal proiso a cope ciomllcnLIr.lltc lth the C tL1;i1 (l l ushlch It 1 ip
pended" (re t srn Broad-,ilmt,I ( rr,.l,1 i- h , II I \ I R B .
356 1 d 434. 436 437 (1966). cert dci,ed 48l 3 S 15 I)2
2' See a lso ncl ni,l lll ll t ()cri l tt l ', l ti''r 1c, , ., /, t -Ill
('10, ' el ra(oA ('rtti, tii t ... 1,i, , 226 N IR 7q9, 76i 1)'7t 19
> See. gcner.al.. A ( r.Ad. R KnaLiuss. S Siegel. "inlerprisc (rganilz.i-
,ions" (NeS' 'i rk. 72 1 J Wslou "('ongloniale.ac I irimled. h I Ad-
ure ot Regulaion" I indi.lana, 9
7
31
I(ll
I) i('ISI()NS O() NA ()ONAI. IA()BOR Rl.AI IONS BOARI)
Pet is a di'\ersified compan with varied opera-
iolns and businesses serving man' aspects of'
American life .... This diversit allows Pet great
ftlxihililv in keeping pace with constantly chang-
ing economic and social trends and makes us a
stronger. more vital organization.
lussnlann is clearl a major part of this Pet enter-
prisc and as such a producer of Pet products within
the terms of the proviso. Hussmann provides part of
the diversification which contributes to the success of
Pet and its other operations. Hussman's acclaimed
high sales and earnings generate income which inures
to the benefit of Pet"' and to Pet's effort to maintain
its other subsidiaries.12 The goodwill earned by Huss-
mann likewise enhances the reputation of all Pet op-
erations. Consequently, Hussman variously contrib-
utes to the operation of Pet as a whole and to each of
its subsidiaries and divisions and thus is a producer of
all Pet enterprises products in the sense that "pro-
ducer" is used in the proviso as interpreted by the
Supreme Court in S ervette and subsequent Board de-
cisions.
:' As noted ave Pet's financial statements consolidate all of the assets o
its substantial subsidiaries, which include Hussmann.
13 For example. bh participating in the national accounts maintained y
Pet. lussmann obviously cntributes to the likelihood of their perpetuation
and thus to the benefit of other suhsidiaries. Similarly. lussmann's capital
contributions to Pet enable Pet to adhere to its apparent policy of financing
all substantial debts of its subsidiaries. See In. 12. upr
Having fund Hussman to be a producer of all the
products of' Pet and its subsidiaries and divisions, we
find that Respondent's handbilling and other non-
picketing publicity urging a total consumer boycott of
said products and services is protected by the second
proviso of Section 8( b)(4).
Accordingly, we shall dismiss the complaint in its
entirety. 33
ORDER14
It is hereby ordered that the complaint be. and it
hereby is, dismissed in its entirety.
" In Its decision in a related lf )} injunct e proceeding. the nited States
(Court ofr Appeals foir the Eighth (Cirtull stlited that the Board should con-
sider the alidity of Respondent's clailms based on the first amendment iti the
(onstitulion Shen v. LUnited Silarc Slte'/l,,orkier oI Anlril(l, AF. ( 10
(L( [lIlus.nlann Refrigerator ( /, 593 .2d ( 1979). remanding 449 Fr upp
580 D.C.Mo.. 1978).
With all due respect to the court of appeals' suggestion, we find t unnec-
essary to reach or pass upon whether Respondent's conduct is protected hb
the free speech provision of the Constitution Resolution if that issue would
be required only If we fund Respondent's conduct was not protected b the
publicity proislso The Board has cnsistentl taken the position that as an
administrative agency created bh (Congress it will presume the constitutional-
ity iif the Act it is charged with administering. absent binding court decisions
to the cont rar (Great W'estern Brasidisting (rpratin lupra at 472, fn 14.
and cases cited therein urthermore the Supreme ('ourt in V .R B v ilt
and I egetah/e Pa, Aers cv [l('arehouemnien. I.oal 6,, and Jroinr ( o'un i/ N, '2
o/ IB7 /Tree 'uit.l Lhor Rehitionl (onmilee, Incl. 377 LIS. 58 (1964),
demonstrated the propriet) if avoiding the constitutional problem in this
difficult area, If possible. Our interpretatoln of the pros iso does so
U Respondent's motion or litigation expenses is denied as lacking in mer-
it.
102