Plaza Properties of MichiganDownload PDFNational Labor Relations Board - Board DecisionsOct 31, 2003340 N.L.R.B. 983 (N.L.R.B. 2003) Copy Citation PLAZA PROPERTIES OF MICHIGAN, INC. 981 Plaza Properties of Michigan, Inc. a/k/a Plaza Opera- tions, Inc. d/b/a Michigan Inn and Michigan Inn, Incorporated and Plaza Properties, Inc. and J & M Hotel Management Company, L.L.C. d/b/a Clarion Ambassador Hotel a/k/a Michigan Inn and Local 24, Hotel Employees and Restau- rant Employees International Union, AFL–CIO. Case 7–CA–43711 Grand Pacific Finance Corp. and Grand Pacific Holding Corp. and Southfield Hotel Holdings, Inc. d/b/a Ambassador Hotel & Conference Cen- ter and Southfield Hotel Holdings, L.L.C. d/b/a Ambassador Hotel & Conference Center and Global Equities and Loans, Inc. and Local 24, Hotel Employees and Restaurant Employees In- ternational Union, AFL–CIO. Case 7–CA–44205 October 31, 2003 ORDER DENYING MOTION BY CHAIRMAN BATTISTA AND MEMBERS SCHAUMBER AND WALSH The General Counsel seeks a default judgment in this case against certain of the named Respondents on the ground that they have failed to file an answer to the con- solidated complaint. Upon a charge and amended charge filed by the Union in Case 7–CA–43711 on January 31, 2001, and September 25, 2002, respectively, and a charge and amended charge filed by the Union in Case 7–CA–44205 on July 16, 2001, and September 25, 2002, respectively, the General Counsel issued the consolidated complaint on September 30, 2002, alleging that the Re- spondents have violated Section 8(a)(3), (5), and (1) of the Act. Thereafter, answers to the consolidated com- plaint were filed by Respondents Grand Pacific Finance Corp. (GPF), Grand Pacific Holding Corp. (GPH), Southfield Hotel Holding, Inc. d/b/a Ambassador Hotel & Conference Center (SHHI), Southfield Hotel Hold- ings, L.L.C. d/b/a Ambassador Hotel & Conference Cen- ter (SHHLLC), and Global Equities and Loans, Inc. (Global). However, no answers were filed by Respon- dents Plaza Properties of Michigan, Inc. (PPM) a/k/a Plaza Operations, Inc. d/b/a/ Michigan, Inn (POI), Michigan Inn, Inc. (Michigan Inn), Plaza Properties, Inc. (PPI), and J&M Hotel Management Company, L.L.C. d/b/a Clarion Ambassador Hotel a/k/a Michigan Inn (J&M). Accordingly, on February 10, 2003, the General Coun- sel filed a Motion for Partial Default Summary Judgment with the Board with respect to the allegations involving Respondents PPM, POI, Michigan Inn, PPI, and J&M.1 On February 26, 2003, the Board issued an order trans- ferring the proceeding to the Board and a Notice to Show Cause why the motion should not be granted. No re- sponse was filed by any of the Respondents. The allega- tions in the motion are therefore undisputed. The National Labor Relations Board has delegated its authority in this proceeding to a three-member panel. Ruling on Motion for Default Judgment Section 102.20 of the Board’s Rules and Regulations provides that the allegations in the complaint shall be deemed admitted if an answer is not filed within 14 days from service of the complaint, unless good cause is shown. In addition, the consolidated complaint affirma- tively states that unless an answer is filed within 14 days of service, all the allegations therein will be considered admitted. Further, the undisputed allegations in the Gen- eral Counsel’s motion disclose that the Region, by letter dated October 30, 2002, notified Respondents PPM, POI, Michigan Inn, PPI, and J&M that unless an answer was received by November 14, 2002, a motion for default judgment would be filed. We therefore find that Re- spondents PPM, POI, Michigan Inn, PPI, and J&M have not shown good cause for failing to file a timely answer.2 Nevertheless, we decline to grant the General Coun- sel’s motion for partial default judgment. For the reasons discussed below, we find that a substantial portion of the complaint is ambiguous or inconsistent, thereby making it impossible to determine whether it is appropriate to find that some or all of these Respondents have violated the Act as alleged and what the appropriate remedy should be. The Complaint Allegations The consolidated complaint allegations involving Re- spondents PPM, POI, Michigan Inn, PPI, and J&M al- lege, in pertinent part, as follows:3 1 The General Counsel does not seek a default judgment with respect to the allegations against the remaining Respondents, which, as indi- cated, filed answers to the consolidated complaint. Those allegations allege, inter alia, that Respondent GPF is a successor to Respondents PPI, PPM, and POI under Golden State Bottling Co. v. NLRB, 414 U.S. 168 (1973), that Respondents GPF, GPH, SHHI, and SHHLLC are a single employer, that Respondent Global and Respondents SHHI and SHHLLC have been joint employers of the employees since April 17, 2001, and that these Respondents violated the Act in various respects. 2 Copies of the consolidated complaint and October 30 letter served by certified mail on the Respondents were returned indicating that service was refused. However, it is well established that the failure or refusal to accept certified mail or to provide for proper service cannot serve to defeat the purposes of the Act. See, e.g., I.C.E. Electric, Inc., 339 NLRB 247 (2003); Michigan Expediting Service, 282 NLRB 210 fn. 6 (1986). 3 Allegations involving only Respondents GPF, GPH, SHHI, SHHLLC, and Global have been omitted. 340 NLRB No. 115 DECISIONS OF THE NATIONAL LABOR RELATIONS BOARD 982 2(a) At all material times until April 4, 2001, Respon- dents PPM, POI, PPI, and Michigan Inn have been affili- ated business enterprises with common officers, owner- ship, directors, management, and supervision; have for- mulated and administered a common labor policy; have shared common premises and facilities; have provided services for and made sales to each other; have inter- changed personnel with each other; and have held them- selves out to the public as a single integrated business enterprise. (b) Based on their operations described above, Re- spondents PPM, PPI, POI, and Michigan Inn constitute a single-integrated business enterprise and a single em- ployer within the meaning of the Act. (c) At all material times until about April 4, 2001, Re- spondents PPM, POI, PPI, and Michigan Inn, each a cor- poration with its office and place of business located at 16400 J.L. Hudson Dr., Southfield, Michigan, herein called Respondents’ Southfield facility, were engaged in the ownership and operation of a hotel providing food, lodging, a fitness center and pool, and banquet services. (d) During the calendar year ending December 31, 2000, Respondents PPM, POI, PPI, and Michigan Inn, in conducting their business operations described above, collectively realized gross revenues in excess of $500,000; and during that same period of time purchased and caused to be shipped to the Southfield facility goods valued in excess of $50,000, which goods were shipped directly to the Southfield facility from points located outside the State of Michigan. (e) About April 2001, Respondents PPI, PPO, PPM, Michigan Inn, and J&M, by their agents including Bog- gie Harlow, Alicja Harlow, and Jeff Drizin, signed a covenant deed, buyer’s agreement, and deed in lieu of foreclosure for $1, after defaulting on loans in excess of $5 million owed to Respondent GPF, thereby turning over all property interest in the Southfield facility to Re- spondent GPF. (f) About May 9, 2001, Respondents PPI and PPM, by their agent Boggie Harlow, signed a quit claim deed, thereby turning over the deed to the Southfield facility to Respondent SHHLLC. 3(a) At all material times from about May 2000, until about January 31, 2001, Respondent J&M, a corporation with an office in Chicago, Illinois, and a second office and place of business located at the Southfield facility, was engaged in providing management and labor rela- tions and related services involving the operation of the Southfield facility. (b) At all material times from about May 2000, until about January 31, 2001, Respondent J&M possessed and exercised control over the labor relations policy of Re- spondents PPM, POI, PPI, and Michigan Inn with respect to employees employed at the Southfield facility. (c) At all material times from about May 2000, until about January 31, 2001, Respondent J&M and Respon- dents PPM, POI, PPI, and Michigan Inn have been joint employers of the employees employed at the Southfield facility. (d) During the calendar year ending December 31, 2000, Respondent J&M, in conducting its business op- erations described above, derived revenues in excess of $200,000 and, during that same period of time, pur- chased and caused to be shipped to the Southfield facil- ity, goods valued in excess of $50,000, which goods were shipped directly to the Southfield facility from points located outside the State of Michigan. (e) About January 27, 2001, Respondent J&M, by its agent Mort Kouklan, severed its relationship at the Southfield facility and transferred control of the safes, cash, receipts, management and operations of the South- field facility to Respondents PPI, POI, PPM, and Michi- gan Inn. (f) About January 27, 2001, Respondents PPI, PPM, and POI resumed management and operation of the Southfield facility, including the renting of hotel rooms and the servicing of long-term leases to various custom- ers. . . . . 10. The following employees, herein called the unit, constitute a unit appropriate for the purposes of collec- tive-bargaining within the meaning of Section 9(b) of the Act: All full-time and regular part-time kitchen, bar, house- keeping, service, valet parking, laundry, valet depart- ment, health club, dining room, banquet, and clerical employees as set forth in Schedules A through F of the collective bargaining agreement effective October 1, 1998, employed at the Southfield, Michigan, facility; but excluding managerial employees, supervisors, con- fidential employees, guards and all security personnel. 11. Since at least 1995, and at all times material, Lo- cal 24, Hotel Employees and Restaurant Employees In- ternational Union, AFL–CIO, the Union, has been the exclusive collective-bargaining representative of the unit and has been so recognized by Respondents PPI, PPM, POI, Michigan Inn, and J&M. This recognition has been embodied in successive collective-bargaining agree- ments, the most recent of which was effective from Oc- tober 1, 1998, through September 30, 2001, and was ac- knowledged by letter dated October 18, 2000, from Re- spondent J&M to the Union. PLAZA PROPERTIES OF MICHIGAN, INC. 983 12. At all material times, based on Section 9(a) of the Act, the Union has been the exclusive collective- bargaining representative of the unit. 13. Since about October 2000, Respondents have uni- laterally changed wages, hours and other terms and con- ditions of employment, including various provisions of the collective-bargaining agreement described above, without notice to or bargaining with the Union about the changes or the effects, as follows: (a) Refusing to remit union dues deducted from pay- checks of unit employees to the Union. (b) Failing to make payments into the Union’s fringe benefit funds. (c) Failing to provide unit employees with medical in- surance coverage through Blue Cross/Blue Shield. (d) Subcontracting unit work. (e) Laying off all unit employees and closing or par- tially closing the Southfield facility about January 2001. (f) Evading the collective-bargaining agreement, in- cluding the successor clause, and failing to recall laid-off unit employees as provided by the collective-bargaining agreement and past practice. (g) Failing to apply the terms and conditions of the then current collective-bargaining agreement and past practice to unit employees hired after the closing/partial closing of January 2001, including wages and benefits. (h) Failing to pay vacation pay accrued for the calen- dar year 2000 to unit employees, including Marjorey Arrey and Marion Richards. (i) Failing to pay the complete wages owed to unit em- ployee Irene Johnson in her final paycheck. 14. The Respondents, during all times material herein, have failed to recognize, meet and bargain with the Un- ion with respect to wages, hours, and terms and condi- tions of employment of unit employees. 15. The subjects set forth above relate to wages, hours, and other terms and conditions of employment of the unit and are mandatory subjects for the purposes of collective bargaining. 16. The Respondents engaged in the conduct de- scribed in paragraph 13 without notice to and/or without affording the Union an opportunity to bargain with the Respondents with respect to this conduct and/or the ef- fects of this conduct. 17. The Respondents engaged in the conduct de- scribed above in paragraphs 13, 14, and 16 in retaliation for employees’ activities on behalf of and support for the Union; and/or to evade a [May 28, 1999] Board Order [unpublished] and Sixth Circuit U.S. Court of Appeals Enforcement Order [191 F.3d 452 (Table)] in Cases 7– CA–41510(1), 7–CA–41510(2), 7–CA–41650, and 7– CA–41748;4 and/or to evade payment pursuant to the Union’s lawsuit involving unpaid contractual fringe benefits due prior to June 2000; and/or to discourage employees from engaging in union activities and mem- bership. 18. About January 17, 2001, the Union, in writing, to Respondents PPM, PPI, Michigan Inn, and J&M, re- quested information regarding: (a) The announced January 24, 2001, closing of the Southfield facility and the effect on bargaining unit em- ployees. (b) Financial information. 19. About February 5, 2001, the Union, by its attorney, during a telephone conversation with Respondent J&M, requested the following information with respect to the Southfield facility: (a) Financial information. (b) Documents regarding the hotel’s current status, in- cluding who is operating the hotel. (c) The names and addresses of all unit employees. (d) The date that health insurance payments were last made. 20. About February 13, 2001, the Union, by its attor- ney, in writing to Respondents PPI, PPM, POI, Michigan Inn, and J&M, repeated its requests for the information described in paragraphs 18 and 19. 21. About May 15, 2001, the Union, by its attorney, in writing to the attorney for Respondents GPF, GPH, SHHI, and SHHLLC, requested the following informa- tion: (a) Information regarding the ongoing activities at the Southfield facility. (b) Whether new bargaining unit employees had been hired. (c) Information as to the wages, hours and working conditions of any unit employees currently employed. 22. The information requested by the Union as de- scribed in paragraphs 18 through 21 is necessary for, and relevant to, the Union’s performance of its duties as ex- clusive collective-bargaining representative of the unit. 23. Since January 17, 2001, the Respondents have failed to provide the requested information. 24. By the acts described above in paragraph 13, Re- spondents unilaterally and without the consent of the Union, have modified the collective-bargaining agree- ment for unit employees described above in paragraph 11 without having complied with the requirements of Sec- tion 8(d) of the Act. 4 The Board’s May 28, 1999 consent order, issued pursuant to a for- mal settlement, addressed numerous allegations involving the South- field unit, and included, among other things, an affirmative bargaining order. DECISIONS OF THE NATIONAL LABOR RELATIONS BOARD 984 25. By the conduct described in paragraphs 13, 14, 16, and 17, Respondents have been discriminating in regard to the hire, or tenure, or terms, or conditions of employ- ment of its employees, thereby discouraging membership in a labor organization in violation of Section 8(a)(1) and (3) of the Act. 26. By the conduct described above in paragraphs 13, 14, 16, 17, 23, and 24, Respondents have been failing and refusing to bargain collectively and in good faith with the exclusive collective-bargaining representative of its employees including in violation of Section 8(d) of the Act and in violation of Section 8(a)(1) and (5) of the Act. 27. The unfair labor practices of Respondents de- scribed above affect commerce within the meaning of Section 2(6) and (7) of the Act. Analysis As outlined below, we find that a significant number of the foregoing complaint allegations are insufficient to determine whether it is appropriate to find the alleged violations and what the appropriate remedy should be. 1. The complaint fails to specify which Respondents committed which violations The complaint refers to all of the Respondents—not only Respondents PPM, POI, Michigan Inn, PPI, and J&M (hereafter referred to as the “predecessor Respon- dentsâ€), but also Respondents GPF, GPH, SHHI, SHHLLC and Global (hereafter referred to as the alleged “successor Respondentsâ€)—as the “Respondentsâ€. Thus, read literally, paragraphs 13–27 of the complaint allege that all of the Respondents committed all of the alleged violations. This cannot be so. For example, the layoff/closure allegedly occurred in January 2001, i.e., before the successors took over the hotel, and yet they are accused of that conduct. Similarly, a refusal to pro- vide information allegedly occurred on May 15, 2001, i.e., after the predecessors were no longer operating the hotel, and yet they are accused of that conduct. 2. The complaint fails to specify the dates when many of the alleged violations occurred With respect to those allegations that have specific dates, we could reasonably assume that they apply only to the Respondents who were in control on those dates. However, not all of the allegations have specific dates. Complaint paragraph 13 alleges that all of the unilateral changes set forth therein occurred “since October 2000.†As indicated above, it is relatively clear that some of these allegations, including the layoff and closure (which the charge alleges occurred on January 24, 2001, and the complaint alleges occurred about January 2001), began before the alleged successor Respondents assumed con- trol. This may also reasonably be assumed with respect to the failure to remit dues, to make fringe benefit pay- ments, and to provide medical insurance, which were alleged in the Union’s original January 31, 2001 charge. However, no similar assumption can reasonably be made with respect to the allegations involving the sub- contracting of unit work,5 failure to recall laid-off unit employees as provided by the collective-bargaining agreement and past practice, failure to apply the agree- ment and past practice to unit employees hired after the closure/partial closure, failure to pay accrued vacation pay for 2000, and failure to pay complete wages to a unit employee in her final paycheck. These allegations were not specifically alleged in the charges and no specific date is given in the complaint. 3. The complaint contains inconsistent allegations re- garding when the predecessor Respondents ceased man- aging and controlling the facility Complaint paragraphs 2(c) and 2(e) allege that prede- cessor Respondents PPM, POI, and PPI “owned and op- erated†the hotel until April 4, 2001, when they and the other predecessor Respondents turned over all property interest to GPF. However, paragraph 4(g) alleges that GPF assumed “control and management†of the facility on February 1, 2001, by virtue of its position as the first secured creditor of the property.6 The difference in dates may be significant, since, as indicated above, some of the alleged unlawful conduct (failure to recall laid-off em- ployees and to apply the contract and past practice to newly hired employees) clearly occurred after the Janu- ary 2001 layoff and closure. The complaint also alleges conflicting dates when predecessor Respondent J&M (the alleged joint employer management company) severed its relationship with the hotel. Paragraph 3(e) alleges that this occurred on Janu- ary 27, 2001. However, paragraph 3(b) alleges that J&M exercised control over labor relations until January 31. Again, the difference in dates may be significant, de- pending on whether the layoff and closure occurred be- fore January 27.7 Further, regardless of whether J&M 5 Although this allegation is listed before the alleged layoff and clo- sure/partial closure, it is not clear that the allegations are listed in chronological order. 6 Par. 4(g) alleges that: About February 1, 2001, Respondent GPF, by virtue of its position as first secured creditor of the property, assumed control and manage- ment of the Southfield facility due to Respondents PPI, PPM, POI, & J&M’s failure to meet its first mortgage obligations to Respondent GPF; and since then GPF and its affiliated corporations have contin- ued to operate the Southfield facility in basically unchanged form. 7 As discussed infra, fn. 10, it is not clear that the hotel closed prior to January 27, 2001. PLAZA PROPERTIES OF MICHIGAN, INC. 985 severed its relationship with the facility on January 27 or 31, these allegations raise a substantial question whether it would be appropriate to find that J&M committed the alleged violations that occurred after the January 2001 layoff and closure. 4. The complaint allegations are insufficient to find that the predecessor Respondents unlawfully laid off all unit employees and closed or partially closed the facility As indicated above, the complaint alleges that the predecessor Respondents laid off all the unit employees and closed or partially closed the facility about January 2001. The complaint alleges that this conduct violated both Section 8(a)(3) and (5). We find that the complaint allegations are insufficient to determine whether the layoff and closure/partial clo- sure violated the Act as alleged. A decision to cease business entirely is not an unfair labor practice even if motivated by antiunion considerations. Textile Workers v. Darlington Mfg. Co., 380 U.S. 263 (1965). Further, a partial closure is a violation of Section 8(a)(3) only if motivated by a purpose of chilling unionism at the em- ployer’s remaining operations. Id. And an employer’s decision to close part of its business for purely economic reasons is not a mandatory subject of bargaining. First National Maintenance v. NLRB, 452 U.S. 666 (1981). There are a number of recognized exceptions to the above principles. For example, a closure may violate the Act if it resulted from the unlawful subcontracting of unit work. See Westchester Lace, Inc., 326 NLRB 1227 (1998); Carter & Sons Freightways, 325 NLRB 433, 438 (1998); Joy Recovery Technology Corp., 320 NLRB 356 (1995), enfd. 134 F.3d 1307 (7th Cir. 1998); Ferragon Corp., 318 NLRB 359, 360–362 (1995), enfd. 88 F.3d 1278 (D.C. Cir. 1996) mem.; and Lear Siegler, Inc., 295 NLRB 857, 860 (1989). See also Handi-Bag, Inc., 267 NLRB 221 (1983) (default judgment proceeding). The same is true if the closure is only temporary rather than permanent. See Bruce Duncan Co., Inc. v. NLRB, 590 F.2d 1304, 1307 (4th Cir. 1979) (Court’s reasoning in Darlington is only applicable when the closing of the plant is an actual closing and not a temporary suspension of operations); NLRB v. Southern Plasma Corp., 626 F.2d 1287, 1292 (5th Cir. 1980) (Darlington does not permit an employer to close his business temporarily and then reopen it in order to oust the union); see also Gallup, Inc., 334 NLRB 366 (2001), aff’d. mem. 62 Fed. Appx. 557 (5th Cir. 2003). However, it is at best unclear whether these exceptions apply here. Thus, although the complaint alleges that the Respondents subcontracted unit work in violation of Sec- tion 8(a)(3) and (5), it is not clear that the layoff and clo- sure was related to the subcontracting. The complaint sets forth the subcontracting and the layoff/closure alle- gations in separate paragraphs, does not describe the ex- tent of the subcontracting, and does not specifically al- lege that the layoff and closure resulted from the subcon- tracting.8 Further, given that the facility is a hotel, it is doubtful the subcontracting could have led to the com- plete closure of the facility. This is not a situation where the service could be performed offsite. Thus, an em- ployer might layoff all of its hotel employees after sub- contracting the hotel operations, but it would not nor- mally close the hotel itself. If the hotel was closed, it is hard to see how the “work [could be] continued by inde- pendent contractors.†Darlington, supra, 380 U.S. at 272 fn. 16. The complaint alternatively alleges that the Respon- dents only “partially closed†the facility about January 2001. However, it alleges that all of the unit employees were laid off, and the unit description is quite broad.9 With respect to whether the closure was permanent or temporary, it might reasonably be concluded that the hotel reopened after January 2001, given the allegation that the Respondents failed to recall employees in accord with the collective bargaining agreement and past prac- tice and to apply the agreement and past practice to newly hired employees after January 2001.10 However, as indicated above, it is not clear whether this occurred before the hotel was taken over by the alleged successor Respondents. 8 As indicated above, it is not even clear that the subcontracting oc- curred before the predecessor Respondents relinquished management and control of the hotel. 9 As indicated above, the unit includes all full-time and regular part- time kitchen, bar, housekeeping, service, valet parking, laundry, valet department, health club, dining room, banquet, and clerical employees as set forth in schedules A through F of the collective-bargaining agreement effective October 1, 1998. 10 See also par. 3(f) of the complaint, which alleges that, about Janu- ary 27, 2001 [the date Respondent J&M, the alleged joint-employer management company, severed its relationship at the facility], Respon- dents PPI, PPM, and POL “resumed management and operation of the Southfield facility, including the renting of hotel rooms and the servic- ing of long-term leases to various customers.†However, the Respon- dents may have been utilizing its supervisors and other nonunit person- nel to honor previous rentals or leases, rather than resuming operations. See Darlington, supra, 380 U.S. at 273 fn. 17 (noting that Darlington accepted no new orders, and merely continued operations for a time to fill pending orders). Further, as noted earlier, it is not clear that the hotel had closed prior to January 27, 2001. Although the charge alleges that it closed on or about January 24, 2001, and the Union’s January 17, 2001 information request indicates that the closing was announced for January 24, 2001, the complaint alleges only that it closed “about Janu- ary 2001.†Finally, if the closure did occur on January 24, and the closure was only for three days (until January 27), we think it likely that the complaint would have alleged a “temporary shutdown†or “temporary closure,†rather than a closure. DECISIONS OF THE NATIONAL LABOR RELATIONS BOARD 986 Finally, assuming the predecessor Respondents did permanently close the hotel (prior to the transfer of own- ership and control) and that the closure and layoff were unrelated to the subcontracting, the complaint is insuffi- cient to find a violation under Darlington and First Na- tional Maintenance. The complaint does not specifically allege that the facility was closed to chill unionism among other employees or facilities. Further, neither the complaint nor the motion reveal whether the predecessor Respondents even had any other employees or facilities. Thus, it is also not clear whether or not they ceased busi- ness entirely after the Southfield facility was closed. In these circumstances, we find that a default judgment with respect to the alleged 8(a)(3) and (5) layoff and clo- sure/partial closure is inappropriate. See Cannon Valley Woodwork, Inc., 333 NLRB No. 97 (2001) (not reported in Board volumes) (denying default judgment to the ex- tent 8(a)(5) complaint alleged a failure to bargain over decision to close plant, as “the bare assertions of the complaint do not support a cause of action given the Su- preme Court’s decision in First National Maintenanceâ€); Rio Piedras Mfg. Corp., 236 NLRB 1198 (1978) (deny- ing default judgment to the extent complaint alleged 8(a)(3) plant closure since the General Counsel had failed to allege “facts, not disputed by an answer, show- ing that Respondent was continuing operations at other facilities,†as required by Darlington).11 5. The complaint and motion fail to explain the basis for finding that the predecessor Respondents’ other alleged 8(a)(5) conduct also violated Section 8(a)(3) As indicated above, the complaint alleges that all of the Respondents’ other conduct, except for the failure to provide information, also violated both Section 8(a)(3) and (5). Although the predecessor Respondents have not answered the complaint, and the 8(a)(3) allegations are therefore admitted, it would be unusual to find an 8(a)(3) violation for generally refusing to recognize and bargain with the Union and for at least some of the other alleged unilateral conduct, such as failing to remit dues and to make benefit fund contributions. The complaint and motion provide no explanation why it would be appro- priate to find such violations here. 6. The complaint and motion also raise a number of re- medial issues Even if we were to grant a default judgment in this case against the predecessor Respondents, there would be substantial questions about the appropriate remedies. 11 But cf. Atlantic Brands, Inc., 297 NLRB No. 22 (1989) (not re- ported in Board volumes) (granting default judgment and finding 8(a)(5) plant closure/layoff violation). (a) The complaint and motion request a reinstatement order as a remedy for the alleged unlawful January 2001 layoff.12 If we were to impose such a remedy here against the predecessor Respondents, we would, in ef- fect, be ordering them to restore their prior operations. Such a restoration order is normally appropriate where the Board finds a plant closure violation, unless the re- spondent shows that restoration would be unduly burden- some. See, e.g., Westchester Lace, Inc., supra, 326 NLRB at 1245; Carter & Sons Freightways, supra, 325 NLRB at 441; Joy Recovery, supra, 320 NLRB at 356 fn. 4; Ferragon Corp., supra, 318 NLRB at 362–363; Lear Siegler, Inc., supra, 295 NLRB at 861. Here, however, the complaint itself (par. 2(e)) alleges that the predecessor Respondents defaulted on loans in excess of $5 million, and thereafter turned over all prop- erty interest in the facility to Respondent GPF in April 2001. Thus, the complaint itself raises a substantial issue whether these Respondents have either the resources or the independent ability at this time to resume the hotel operations. Cf. Douglas Foods Corp., 251 F.3d 1056 (D.C. Cir. 2001), denying enf. in relevant part of 330 NLRB 821 (2000) (denying enforcement of restoration order given that respondent had sold its trucks and routes). Further, if we did not order the predecessor Respon- dents to resume operations, then this would impact on other remedies. For example, an immediate reinstate- ment order could also not be issued for the alleged fail- ure-to-recall violation. See also the discussion of the subcontracting remedy below. (b) The complaint does not indicate whether any em- ployees were laid off as a result of the unlawful subcon- tracting, and neither the complaint nor the motion indi- cate whether a reinstatement remedy is sought for this alleged violation. Thus, it is not clear whether a rein- statement order would be appropriate. Compare Ther- maglas, 317 NLRB No. 133 (1995) (not reported in Board volumes) (in default judgment proceeding, order- ing recall of employees laid off as a result of transfer of work to alter ego’s facility), with Unique Services, Inc., 309 NLRB No. 126 (1992) (not included in bound vol- ume) (in default judgment proceeding, ordering only a 12 The General Counsel has not requested a limited backpay remedy under Transmarine Navigation Corp., 170 NLRB 389 (1968), for the failure to bargain over the effects of the closure and layoff. Where a restoration and reinstatement order are issued, such a remedy is nor- mally not appropriate. See Westchester Lace, supra, 326 NLRB at 1227 fn. 2 (such relief would be cumulative); see also Ferragon Corp., supra; and Lear Siegler, supra. But cf. Atlantic Brands, supra (includ- ing such a remedy at the General Counsel’s request because it was not clear whether the closure and layoffs were temporary or permanent). PLAZA PROPERTIES OF MICHIGAN, INC. 987 make whole remedy for unlawful relocation of work to another facility). (c) Finally, as indicated above, the complaint appears to contain inconsistent allegations regarding when al- leged successor Respondent GPF assumed management and control of the hotel. Complaint paragraphs 2(c) and (e) indicate that the date was April 4, 2001, while para- graph 4(g) indicates that the date was February 1, 2001. Without any basis to resolve this conflict, we would be unable to determine in our order when the predecessor Respondents’ unlawful unilateral conduct, and make- whole liability therefor, terminated. In sum, we find that a substantial portion of the com- plaint is ambiguous or inconsistent, and that it is there- fore impossible to determine whether some or all of the predecessor Respondents violated the Act as alleged or what the appropriate remedy would be. Thus, notwith- standing the absence of an answer by Respondents PPM, POI, Michigan Inn, PPI, and J&M, under all the circum- stances, including the unusual nature of the alleged viola- tions, and the significant ambiguities, inconsistencies, and remedial issues outlined above, we find that it would not be appropriate at this point to grant the General Counsel’s motion for partial default judgment. Rather, we find that the appropriate course is to remand the en- tire proceeding for further appropriate action. See R. L. Broker & Co., 274 NLRB 709 (1985) (denying General Counsel’s motion for default judgment in its entirety and remanding case to Regional Director for further appro- priate action because a substantial portion of the com- plaint allegations were internally inconsistent and failed to provide sufficient information to determine whether the respondent violated Section 8(a)(1) and (5) and Sec- tion 8(d) of the Act, as alleged). In his dissent, our colleague asserts that the complaint allegations are “well pleaded†and that a remand is there- fore unwarranted. However, the Board has repeatedly held that a complaint is not well pleaded if the allega- tions are too vague or inconsistent to determine if a vio- lation occurred or liability should be imposed. See, e.g., Parks International Corp., 339 NLRB 285 (2003) (Board declined, in default judgment proceeding, to impose li- ability for alleged discharges on alleged joint employer since complaint was at best ambiguous as to whether it sought to impose such liability and the complaint allega- tions failed to allege that the discharged employees were part of the jointly managed work force); St. Regis Hotel, 339 NLRB 143 (2003) (Board denied motion for default judgment and remanded complaint for further appropri- ate action to the extent it alleged that the respondent unlawfully failed to provide the union with requested information relating to “other matters important to the Union,†as neither the complaint nor the motion de- scribed what those “other matters†were); Jet Electric, 334 NLRB 1059 (2001) (Board declined, in default judgment proceeding, to order instatement and backpay as a remedy for the respondent’s refusal-to-hire viola- tions in the absence of an allegation in the complaint that there were sufficient openings available for the discrimi- natees); Cakemasters Corp., 312 NLRB 1150, 1151 fn. 6 (1993) (Board declined to grant default judgment with respect to complaint allegation that the respondent made changes relating to wages, hours and terms and condi- tions of employment, “the exact nature of which are presently unknown to the General Counsel,†because the complaint did not identify the changes that were alleg- edly made); and R. L. Broker, supra. See also In re In- dustrial Diamonds Antitrust Litigation, 119 F.Supp 2d 418, 420 (S.D. N.Y. 2000) (“A fact is not ‘well pleaded’ if it is inconsistent with other allegations of the com- plaint or with facts of which the court can take judicial notice.â€). Our colleague also attempts to trivialize the ambigui- ties and inconsistencies in the General Counsel’s com- plaint. However, he does so by either assuming facts that are unsupported by the complaint, or by ignoring the ambiguities and inconsistencies altogether. For example, our colleague asserts that the General Counsel is obvi- ously not seeking to impose liability on the predecessor Respondents for conduct occurring after they transferred control. However, the General Counsel’s complaint al- leges otherwise, and, in any event, the complaint alleges inconsistent dates with respect to when they transferred control (February 1 and April 4, 2001). Our colleague concedes the inconsistent dates, but assumes that Febru- ary 1 is simply an inadvertent error because April 4 is alleged more often. We decline to speculate as to which is correct, particularly since the choice of dates could affect the determination whether one or more of the Re- spondents violated the Act. Our colleague also notes that the complaint specifi- cally alleges that predecessor Respondents PPI, PPM, and POI resumed management and control of the facility about January 27, 2002 (one of the two alleged dates that predecessor Respondent J&M, the alleged joint-employer management company, severed its relationship with the hotel).13 He further notes that all the predecessor Re- 13 Our colleague makes light of the fact that the discrepancy between the alleged dates (January 27 and 31) is only 4 days, stating that this “does not warrant further comment.†However, as discussed above, the difference in dates could determine whether alleged predecessor Re- spondent J&M violated the Act, as alleged in the complaint, with re- spect to the layoff and closure or partial closure (which allegedly oc- curred “about January 2001â€), as well as the other alleged violations, which are undated. DECISIONS OF THE NATIONAL LABOR RELATIONS BOARD 988 spondents (including J&M, notwithstanding that it was allegedly no longer associated with the facility) allegedly violated the Act at some time after the layoff and closing or partial closing by not recalling laid-off employees and failing to pay employees who were hired contractual wages and benefits. Based on these allegations, our col- league concludes that the complaint “plainly alleges†that the hotel continued to operate and that the so-called clo- sure was nothing more than a sham to evade the applica- tion of the collective-bargaining agreement. However, aside from the aforementioned problems with the above allegations, our colleague ignores the fact, discussed more fully above (see fns. 7 and 10 and accompanying text), that the complaint does not allege whether the clo- sure occurred before or after January 27, 2002. Further, it alleges that the alleged successor Respondents commit- ted all of the same violations. Again, we decline to join our colleague in speculating as to the meaning of these ambiguous and/or inconsistent allegations. Our colleague also argues that our concerns about or- dering the predecessor Respondents to resume operations and reinstate the laid-off employees are mistaken. How- ever, his arguments are premised on his unfounded as- sumptions addressed above. Finally, our colleague expresses concern that our re- mand will further delay a remedy for the employee- victims of the predecessor Respondents’ alleged unfair labor practices. We share our colleague’s concern about delay. However, to paraphrase Judge Posner in NLRB v. Brooke Industries, Inc., 867 F.2d 434, 435-436 (7th Cir. 1989), we are also properly concerned with the “integrity and manageability of the [administrative] process;†we reject our colleague’s suggestion (in the words of Judge Posner) that “we have no choice but to rubber stamp†the General Counsel’s motion for default judgment in these circumstances.14 Moreover, the ambiguities and incon- sistencies we have outlined above may be promptly ad- dressed on remand by issuance of an amended complaint. The General Counsel may thereafter either file a renewed motion for default judgment with the Board,15 or raise 14 In Brooke Industries, Judge Posner declined to enter a consent judgment because the language in the proposed consent judgment was insufficiently clear to permit its enforcement through contempt pro- ceedings. 15 Nothing herein requires a hearing if, in the event of an amendment to the consolidated complaint, the predecessor Respondents again fail to answer, thereby admitting evidence that would permit the Board to find the alleged violations against them and determine the appropriate remedy. In such circumstances, the General Counsel may file with the Board a renewed motion for partial default judgment with respect to the amended consolidated complaint allegations. In that event, however, the General Counsel should clearly set forth in the motion the appropri- ate relief being sought against Respondents PPM, POI, Michigan Inn, the issues with the administrative law judge at a hearing on the consolidated allegations. ORDER It is ordered that the General Counsel’s motion for par- tial default judgment is denied, and that the proceeding be remanded to the Regional Director for Region 7 fur- ther appropriate action. MEMBER WALSH, dissenting. “[R]elief delayed under the Act may be relief de- nied.â€â€”Vincent Industrial Plastics, Inc. v. NLRB, 209 F.3d 727, 739 (D.C. Cir. 2000). In denying the General Counsel’s uncontested motion for partial default judgment and sending this case back to the drawing board, the majority opinion unjustly delays any remedy for the innocent victims of the unfair labor practices committed by multiple wrongdoers three years ago. Contrary to my colleagues, I would grant the Gen- eral Counsel’s motion, which seeks default judgment against only the five Respondents (“the predecessor Re- spondentsâ€) that have failed to answer the complaint, and I would provide the General Counsel the relief he seeks.1 Procedural Background The complaint alleges in substance that four of the predecessor Respondents, a single employer, were en- gaged in the operation of a hotel in Southfield, Michi- gan.2 Despite executing a formal Board settlement agreement in May 1999, which resulted in a Board Order enforced by the Sixth Circuit later that year,3 these Re- spondents are alleged to have violated the Act beginning in October 2000 and continuing until April 2001, when they ceased controlling the facility and the successor Respondents began operations. Specifically, the com- plaint alleges that the predecessor Respondents commit- ted the following numerous and serious unfair labor prac- tices in violation of Section 8(a)(5), (3), and (1): • Refusing to remit dues to the Union; PPI, and J&M, for the violations alleged in the amended consolidated complaint. 1 The General Counsel does not seek default judgment against the remaining five Respondents (“the successor Respondentsâ€) that have answered the complaint. 2 These Respondents are: PPM, POI, Michigan Inn, and PPI. A fifth Respondent, J&M, a corporation engaged in providing management and labor services to the hotel during a 9-month period, is alleged to be a joint employer with the four entities constituting the single employer. 3 Michigan Inn, Case 7–CA–41510 (May 28, 1999) (not reported in Board volumes), enfd. mem. 191 F.3d 452 (6th Cir. 1999). The Board’s court-enforced Order, inter alia, required predecessor Respon- dents PPM, POI, and Michigan Inn to execute and comply with the terms of the collective-bargaining agreement they reached with the Union, to bargain with the Union on request, to make delinquent bene- fit fund contributions, and to make employees whole for their losses. PLAZA PROPERTIES OF MICHIGAN, INC. 989 • Failing to make benefit fund payments; • Failing to provide employees with medical in- surance coverage; • Subcontracting unit work; • Laying off all unit employees and “closing or partially closing†the hotel about January 2001; • Evading the collective-bargaining agreement and failing to recall laid-off employees; • Failing to apply the collective-bargaining agreement to the employees hired after the “closing/partial closing†in January 2001; • Failing to pay employees accrued vacation pay for calendar year 2000; • Failing to pay the complete wages owed to unit employee Irene Johnson. The predecessor Respondents are alleged to have engaged in this conduct in violation of their duty to bargain with the Union, in retaliation for the employees’ activities on behalf of the Union, and in an effort to evade the prior Board and court Orders.4 Although duly served with copies of the complaint and a “reminder letter†from the General Counsel, the prede- cessor Respondents failed to file an answer. Section 102.20 of the Board’s Rules provides that the allegations in the complaint shall be deemed admitted if no timely answer is filed, unless good cause is shown. Accord- ingly, the General Counsel filed a motion for partial de- fault judgment with the Board, requesting that all allega- tions of the complaint be deemed to be admitted to be true with respect to the predecessor Respondents. There- after, the Board issued a notice to show cause why the motion should not be granted, but no response was filed by any of the predecessor (or successor) Respondents. My colleagues concede that the predecessor Respon- dents have not shown good cause for failing to file a timely answer to the complaint. Nevertheless, they deny the General Counsel’s motion for partial default judg- ment on the ground that “a substantial portion of the complaint is ambiguous or inconsistent, and that it is therefore impossible to determine whether some or all of the predecessor Respondents violated the Act as alleged or what the appropriate remedy would be.†As discussed below, my colleagues are mistaken. Legal Framework In Artesia Ready Mix Concrete, 339 NLRB 1224, 1226 (2003), a no-answer case that issued just months ago, the Board summarized the relevant principles, as follows: 4 In addition, the complaint alleges that the predecessor Respondents violated Sec. 8(a)(5) and (1) by failing to provide the Union with rele- vant and necessary information. Section 102.15 of the Board’s Rules and Regulations requires only that a complaint contain “a clear and con- cise description of the acts which are claimed to consti- tute unfair labor practices, including, where known, the approximate dates and places of such acts and the names of respondent’s agents or other representatives by whom committed.†Applying this rule, the Board and the courts have consistently found that an unfair la- bor practice complaint is not judged by the strict stan- dards applicable to certain pleadings in other, different legal contexts. The Board then cited numerous court decisions endorsing this approach. E.g., Davis Supermarkets, Inc. v. NLRB, 2 F.3d 1162, 1169 (D.C. Cir. 1993), cert. denied 511 U.S. 1003 (1994) (complaint need not include legal theory); Cur- tiss-Wright Corp., Wright Aeronautical Division v. NLRB, 347 F.2d 61, 72 (3d Cir. 1965) (complaint “need state only the manner by which the unfair labor practice has been or is being committedâ€); American Newspaper Publishers Assn. v. NLRB, 193 F.2d 782, 800 (7th Cir. 1951), affd. 345 U.S. 100 (1953) (“the accomplishment of the broad purposes of the Act should not be hindered nor prevented by technicali- ties in procedureâ€); NLRB v. Red Arrow Freight Lines, Inc., 180 F.2d 585, 587 (5th Cir. 1950), cert. denied 340 U.S. 823 (1950) (“strictness of common law pleading†inapplicable); Consumers Power Co. v. NLRB, 113 F.2d 38, 43 (6th Cir. 1940) (“[m]atters of evidence need not be recited in the complaintâ€). In sum, as the Sixth Circuit, the circuit in which this case arises, stated over 60 years ago: The sole function of the complaint is to advise the re- spondent of the charges constituting unfair labor prac- tices as defined in the Act, that he may have due notice and a full opportunity for hearing thereon. The Act does not require the particularity of pleading of an in- dictment or information, nor the elements of a cause like a declaration at law or a bill in equity. All that is requisite in a valid complaint before the Board is that there be a plain statement of the things claimed to con- stitute an unfair labor practice that respondent may be put upon his defense. NLRB v. Piqua Munising Wood Products Co., 109 F.2d 552, 557 (6th Cir. 1940). Analysis Measured by these standards, the complaint allegations against the predecessor Respondents are well pleaded, and there is no merit in any of the six objections my col- leagues raise sua sponte. I shall address each objection in turn below. 1. “The complaint fails to specify which Respondents committed which violations.†This objection is a classic red herring. DECISIONS OF THE NATIONAL LABOR RELATIONS BOARD 990 As my colleagues concede, the General Counsel is seeking default judgment against only the predecessor Respondents. By not filing an answer, these Respon- dents have admitted all the violations with which they are charged. The successor Respondents will in no way be prejudiced by a grant of default judgment against the predecessor Respondents, and the successor Respondents do not even oppose the General Counsel’s motion. Fur- thermore, as my colleagues also concede, the General Counsel is obviously not seeking to impose liability on the predecessor Respondents for conduct occurring after they transferred control of the hotel to the successor Re- spondents. Therefore, the fact that the complaint, “read literally,†alleges that “all of the Respondents committed all of the alleged violations†is wholly immaterial to the issue before the Board of whether to grant the General Counsel’s uncontested motion seeking default judgment solely against the predecessor Respondents. 2. “The complaint fails to specify the dates when many of the alleged violations occurred.†The short an- swer to this objection is that Section 102.15 of the Board Rules, quoted above, requires only that a complaint con- tain “approximate†dates “where known.†There is no hard and fast requirement to “specify†dates. 3. “The complaint contains inconsistent allegations regarding when the predecessor Respondents ceased managing and controlling the facility.†Although true, this objection does not warrant denial of the General Counsel’s motion. Ten complaint paragraphs indicate that the successor Respondents began operating the hotel in April 2001.5 One complaint paragraph indicates that the successor Respondents began operating the hotel in February 2001.6 In these circumstances, it appears likely that the February 2001 date is merely an inadvertent er- ror. Even if it is not, the exact date that the transfer of control occurred could be determined at the compliance stage.7 4. “The complaint allegations are insufficient to find that the predecessor Respondents unlawfully laid off all unit employees and closed or partially closed the facil- ity.†This objection is premised on my colleagues’ ex- tensive analysis of Board and court “closure cases,†in- cluding the Supreme Court’s decisions in Textile Work- ers v. Darlington Mfg. Co., 380 U.S. 263 (1965), and First National Maintenance v. NLRB, 452 U.S. 666 (1981). 5 Pars. 2(a), (c), and (e), 4(b), 5(a), (b), and (c), 6(b), (c), and (d). 6 Par. 4(g). 7 The majority also claims that two other complaint paragraphs al- lege “conflicting dates.†The discrepancy amounts to a grand total of four days. This objection does not warrant further comment. However, the Darlington and First National Mainte- nance decisions are inapplicable here because there was no true “closure†of the hotel. Immediately after alleging the January 2001 unlawful layoff of unit employees and the “closing or partial[] closing [of] the Southfield facil- ity,†the complaint further alleges that the predecessor Respondents violated the Act by not recalling the laid-off employees, as provided by the collective-bargaining agreement, and by not paying the employees who were hired in accordance with the collective-bargaining agreement. In addition, the complaint specifically al- leges that about January 27, 2002, predecessor Respon- dents PPI, PPM, and POI “resumed management and operation of the Southfield facility.†Thus, the com- plaint, fairly read as a whole, plainly alleges that the ho- tel continued to operate and that the so-called closure was nothing more than a sham to evade the application of the collective-bargaining agreement, not a genuine ces- sation of operations. In sum, because there was no bona fide “closure†here, neither Darlington, First National Maintenance, nor any of their progeny represent a barrier to granting the General Counsel’s motion. 5. “The complaint and motion fail to explain the basis for finding that the predecessor Respondents’ other al- leged 8(a)(5) conduct also violated 8(a)(3).†As stated above, Section 102.15 of the Board’s Rules requires only that a complaint contain “a clear and concise description of the acts which are claimed to constitute unfair labor practices.†There is no requirement to “explain the ba- sis†for an alleged violation of the Act. Davis Supermar- kets, supra, 2 F.3d at 169 (complaint need not include legal theory relied on). In any event, it is unnecessary to pass on whether the predecessor Respondents’ 8(a)(5) conduct also violated Section 8(a)(3) because the finding of such additional violations would be essentially cumu- lative with no material effect on the remedy. 6. “The complaint and motion also raise a number of remedial issues.†“(a) The complaint and motion request a reinstatement order as a remedy for the alleged unlawful January 2001 layoff. If we were to impose such a remedy here against the predecessor Respondents, we would, in effect, be ordering them to restore their prior operations.†This objection is premised on the majority’s mistaken view, discussed above, that there was a genuine “clos- ing†of the hotel in January 2001. Because there was no such closing, providing a reinstatement order would not be tantamount to ordering the predecessor Respondents “to restore their prior operations.†Indeed, the complaint does not challenge the legality of the predecessor Re- spondents’ decision three months later to transfer control of the hotel to the successor Respondents, so the General PLAZA PROPERTIES OF MICHIGAN, INC. 991 Counsel is clearly not contending that the predecessor Respondents should restore their prior operations. The General Counsel seeks a reinstatement order here for a very different reason; he is contending that the successor Respondents are obligated to remedy the unfair labor practices of the predecessor Respondents and reinstate the unlawfully laid-off employees. The General Coun- sel’s request is consistent with established Board prece- dent. See, e.g., I.C.E. Electric, Inc., 339 NLRB 247 (2003) (respondent that ceased operations ordered to instate three employees unlawfully denied hire in the event the same or similar business operation is resumed); Top Knotch Plumbing, 339 NLRB 102 (2003) (respon- dent that permanently ceased operations ordered to rein- state unlawfully discharged employee in the event the same or similar business operation is resumed). “(b) The complaint does not indicate whether any em- ployees were laid off as a result of the unlawful subcon- tracting, and neither the complaint nor the motion indi- cate whether a reinstatement remedy is sought for this alleged violation.†The answer to this objection is to provide the Board’s “customary [remedy] . . . order[ing] restoration of the status quo ante to the extent feasible,†Detroit News, 319 NLRB 262 fn. 1 (1995), with “the particulars of that status quo determination†left to be resolved at the compliance stage. Dean General Con- tractors, 285 NLRB 573 (1987). “(c) Finally, as indicated above, the complaint appears to contain certain inconsistent allegations regarding when [the] alleged successor Respondent[s] . . . assumed man- agement and control of the hotel.†As stated above, this “inconsistency†may well be nothing more than an inad- vertent error and, in any event, the exact date that the transfer of control occurred could be determined at com- pliance. Conclusion This uncontested case is not half as complicated as my colleagues make it out to be. The predecessor Respon- dents have admitted all the allegations against them in a proper complaint. The General Counsel is entitled to a summary finding of unlawful conduct. The victimized employees are entitled to be made whole. Now. Copy with citationCopy as parenthetical citation