Riley Aeronautics Corp.

National Labor Relations Board - Board Decisions

Sep 18, 1969

178 N.L.R.B. 495 (N.L.R.B. 1969)

RILEY AERONAUTICS CORP. 495
Riley Aeronautics Corporation , Riley International
Corporation , and their Agent , Jack M. Riley,
President and Donald A. Depew and Fred Lee, Jr.
and Wallace J. Nelson and Sigmund R . Nied and
Homer D . Sapp . Cases 12-CA-3055-I,
12-CA-3055-2, 12-CA-3055-3, 12-CA-3055-4, and
12-CA-3055-5
September 18, 1969
SUPPLEMENTAL DECISION AND
ORDER
BY MEMBE RS FANNING, BROWN, AND JENKINS
On August 9, 1965, the National Labor Relations
Board issued a Decision and Order in the
above-entitled proceeding ,' finding, inter alia. that
the Respondent , Riley Aeronautics Corporation, had
discriminatorily discharged Donald A. Depew, Fred
Lee, Jr.. Wallace J. Nelson , Sigmund R . Nied, and
Homer D . Sapp, in violation of Section 8(a)(3) and
(1) of the National Labor Relations Act, as
amended . and directing that Respondent make an
offer of immediate and lull reinstatement to these
discriminatecs to their former or substantially
equivalent positions and to make them whole for
any loss of earnings suffered by reason of the
discrimination against them . On June 28 , 1967, the
Board ' s Order was enforced by the United States
Court of Appeals for the Fifth Circuit.'
A backpav specification and notice of hearing and
an amended backpay specification and notice of
hearing were issued by the Regional Director of
Region 12. and pursuant thereto a hearing was held
February 18 through 20 , 1969, before Trial
Examiner Samuel M . Singer for determination of
the amounts of backpay due to the above-named
discriminatees , and Respondents liability for the
backpay.
On May 23, 1969, the Trial Examiner issued the
attached Supplemental Decision. in which he found
that the discriminatees were entitled to the amounts
of backpay therein set forth; that the Board reserve
the right to modify the backpay and reinstatement
provisions set forth therein if such modifications
became necessary by a change of circumstances; and
that the General Counsel 's claim that Jack M. Riley
is personally liable for the backpay due the
discriminatees be dismissed . Thereafter , the General
Counsel filed exceptions to the Supplemental
Decision and a supporting brief.
Pursuant to the provisions of Section 3(b) of the
Act, the Board has delegated its powers in
connection with this case to a three-member panel
The Board has reviewed the rulings made by the
Trial Examiner at the hearing and finds that no
prejudicial error was committed . The rulings are
'154 NLRB 360
'N L R B , Riley Aeronautics Corporation , 337 F.2d 557
hereby affirmed. The Board has considered the
entire record in this case, including the Trial
Examiner's Supplemental Decision, the exceptions
and brief, and hereby adopts the findings,
conclusions, and recommendations of the Trial
Examiner.
SUPPLEMENTAL ORDER
Pursuant to Section 10(c) of the National Labor
Relations Act, as amended, the National Labor
Relations Board hereby orders that Respondents.
Riley Aeronautics Corporation and Riley
International Corporation, Fort Lauderdale.
Florida, their officers, agents, successors, and
assigns, shall pay to each discriminatee as net
backpay the amounts set forth as the amounts
determined to be due by the Trial Examiner in his
attached Supplemental Decision.
TRIAL EXAMINER'S SUPPLEMENTAL
DECISION
STATEMMLNT OF THE CASE
SAMUEL M . SINGER, Trial Examiner - This is a proceeding
on backpay specifications issued by the National Labor
Relations Board ' s Regional Director for Region 12,
pursuant to Section 102 52, et seq . of the Board's Rules
and Regulations The purpose of the proceeding is to
determine: (a) the amount of backpay , if any, due to five
employees whom the Board found were unlawfully
discharged . and (b ) Respondents ' responsibility for the
backpay. The Board ' s Order, dated August 9, 1965,
adopting Trial Examiner Arthur E. Reyman's Decision
dated May 12, 1965 ( 154 NLRB 360), was enforced on
June 28, 1967 , by a decree of the Court of Appeals for the
Hith Circuit (337 1-.2d 557).
The hearing on the backpay specifications was held
belore me in Miami , Florida, on February 18 through 20,
1969. Only one of the three Respondents . Jack M. Riley,
appeared .' A brief was received from General Counsel and
a "memorandum " from Respondent Jack M. Riley.
Upon the entire record ' and from my observation of the
witnesses , I make the following
FINDINGS AND CONCLUSIONS
I. BACKGROUND: THE ISSUES
The Board found that on October 26, 1964, Riley
Aeronautics Corporation (hereafter called Aeronautics)
discriminatorily discharged five employees for the purpose
of discouraging their union activities. The Board's Order
directs Aeronautics, "its officers, agents, successors, and
assigns," to offer reinstatement to the five discriminatees
to their former or substantially equivalent positions and to
make them whole for any loss of earnings they may have
'Attorney Jenkins, who appeared for Mr Riley , represented all three
Respondents prior to the hearing (he filed answers to the backpay
specifications for the two corporations as well as the individual) At the
hearing, Jenkins stated that "there was no point in making any defense in
this matter for the corporations because they are both defunu as far as I
can tell "
'Transcript corrected by my order on notice dated May 2, 1969
178 NLRB No.76
496 DECISIONS OF NATIONAL LABOR RELATIONS BOARD
suffered by reason of the discrimination against them. In
the backpay specifications, issued on August 23, 1968. the
Regional Director alleged that Respondent Riley
International Corporation (hereafter called International),
"as successor to, and/or alter ego of Aeronautics, is
responsible with Aeronautics and Jack M Riley, jointly
and severally, for remedying the unfair labor practices of
Aeronautics."' In customary fashion, the specifications set
out, by calendar quarters, the gross backpay allegedly due
each employee, the formulae used in determining the
amounts, the expenses for which compensation is claimed,
the discriminatees' interim earnings. and the net backpay
allegedly due them.
Prior to the hearing. General Counsel filed motions to
strike Respondents' answers (or portions thereof) and for
summary judgment on all or portions of the issues, based
upon Respondents' failure to respond as required to the
backpay specifications. On the other hand, Respondents
International and Riley filed motions to dismiss the
backpay specifications insofar as they were concerned. on
the ground that they were not parties to the unfair labor
practice proceeding By orders dated October 22 and
November 18, 1968, Trial Examiner Charles W
Schneider (a) granted in part and denied in part General
Counsel's motion for summary judgment, and (b) denied,
without prejudice to renewal at the hearing, the motions
of International and Riley to dismiss the backpay
specifications Trial Examiner Schneider' s rulings
precluded litigation of the allegations in the backpay
specifications as to the reasonableness of the formulae
used by the Regional Director in determining claimed
backpav and the accuracy of certain computations made.
Respondents were permitted to litigate (a) tact questions
such as the true amount of the discriminatees' interim
earnings, expense items. willful loss (if any) of wages, etc ,
and. (b) responsibility of International and Riley for
remedying the unfair labor practices. At the hearing
before me, the major question litigated was the
responsibility issue. Since the disposition of this issue has
a material bearing on the extent and amount of backpav
due the claimants, it will be treated first.'
11. RESPONI)I-NTS' RI SPONSIBI I iTY FOR REMEDYING
THE LNFAIR LABOR PRA('T1CFS5
A. Aeronautics
1. Its operations and interrelationship with other
Riley enterprises
Although Aeronautics' responsibility to remedy the
unfair labor practices is unquestioned (the discriminatees
were on its payroll when discharged), a description of its
operations and relationship to International and Riley is
essential to determining the issue of International's and
Riley's obligations respecting the remedy
'Unless otherwise indicated , Jack M Riley will hereafter be referred to
as Riley
Only Riley and four of the five discriminatees (made available by
General Counsel ) testified at the hearing One of the live (Lee ) no longer
resides in the Miami area (the locale of the unfair labor practices ), having
moved to Kansas General Counsel produced and made available for
Respondents inspection materials on the basis of which Lee 's (and the
other discriminatees ') earnings were arrived at (e g , social security and
employer reports)
'Practically all (if not all ) the evidence on the responsibility issue consists
of testimony and documentary evidence supplied by Riley
Aeronautics, founded by Riley in 1961 or 1962, was
engaged in the business of general repair, modification,
and maintenance of aircraft until July 1967.° It sometimes
also refurbished and sold used aircraft, rented out aircraft,
and supplied gas and oil services at the Executive Airport
(in Fort Lauderdale, Florida) where it was located prior to
July 1967.' Occasionally it farmed out work. Products
Aeronautics worked on before July 1967 included Dove
conversions, rocket conversions, turbochargers produced
by another Riley owned company (Ralay Corporation,
infra ), and the Dellaviland Heron.
Riley was Aeronautics' president and controlling
stockholder. Although owning only 10 percent of
Aeronautics stock directly, he owned over S0 percent of
the stock of Riley (Kelly) Aircraft, Inc. (a Bahamas
corporation doing business in the United States as Riley
Aircraft, Inc-hereafter referred to as Bahamas) which, in
turn, owned about three-fourths of Aeronautics stock.'
Riley was president of Bahamas as well as of Aeronautics.
Bahamas acquired its interest in Aeronautics several years
ago, apparently before commission of the unfair labor
practices by Aeronautics in 1964 In order "to get
additional dollars into the [Aeronautics] manufacturing,"
Riley at that time "segregated" its manufacturing from
sales operations- i.e., Aeronautics took over Bahamas'
"rights and supplemental type certificates and work and
investment" and Bahamas " in turn took over the sales
rights [on Aeronautics] on a commission basis." As part
of this transaction, Bahamas received "about
three-fourths" of Aeronautics stock, the remaining quarter
being sold to other subscribers It is clear, however, that
at times Aeronautics continued to handle its own sales.
Contracts to be performed by Aeronautics were usually
made directly between Aeronautics and the purchaser of
the product or service,' but some were executed with
Bahamas which in turn passed them on to Aeronautics.
As president and controlling stockholder, Riley had
"the final say" on Aeronautics operations. He was
chairman of its board of directors Although his "prime
function was sales and finance." Riley exercised lull
authority over his managers, having "release[d]" several
of them when circumstances dictated it. He also had final
control over labor policy
Riley also had a controlling interest in Rajay
Corporation (a California Company with which
Aeronautics did business), holding about 69 percent of its
stock.10 Prior to July 1967 Rajay designed, engineered.
and built turbochargers Bahamas, and sometimes
Aeronautics, handled sale, for Rajay In addition,
Aeronautics "at times would work on some turbocharger
systems for Ralay." Rajay did not do any modification
work, although it owned supplemental certificates, some
of which it transferred to Aeronautics." Riley testified
that while Rajay "was making money" prior to July
1967. Aeronautics did not. Riley still ownes Rajay, but,
as hereafter indicated _(section (f, 2), he recently sold its
""Modification " work means work performed pursuant to certificates (or
supplemental type (ertificates) issued by the Federal Aviation Agency
authorizing the certificate holder to perform particular work
'Aeronautics initially operated at the International Airport in Broward
County, Florida
'Riley testified that about 10 individuals owned "possibly" 20 percent of
the remaining Aeronautics stock
'Aeronautics procured its business through advertisements in trade
journals, direct mail, and personal contact with corporations or private
owners of aircraft
"At one point Riley testified , " I own Raiay Corporation " without any
qualification
"These certificates (which as previously noted were issued by a
RILEY AERONAUTICS CORP. 497
"turbocharging manufacturing function " to Tex Star
Corporation , with Rajay apparently retaining royalty
rights.' 2
2. Sale of Aeronautics
As noted, Riley testified that Aeronautics "never
made" money. He claimed that all of its income was
being used to meet payroll and business expenses; that he
lent it money personally or through Bahamas (which he
controlled) to keep it going; that he lost his entire
investment in Aeronautics-aggregating $500,000 over the
years (1961-1967); and that Aeronautics had a $2.5 to S3
million outstanding indebtedness in July 1967-S500.000
owed Riley and $2 5 million to Associates Discount
Corporation on a loan which he personally endorsed.
However, he also indicated that at one time Bahamas
owed Aeronautics $750,000 which Aeronautics never got
back;" and that an account receivable in the amount of
S201,000 was due Aeronautics from Rajay (then
admittedly "making money"), but that he (Riley) could
not tell whether it was "ever realized" by Aeronautics.
On July 6, 1967, Riley "individually"y and as president
of Aeronautics executed an agreement with Home
Builders Acceptance Corporation (HBAC) whereby
Aeronautics agreed to sell to HBAC its assets (machinery
and equipment, tools, fixtures, aircraft, a turbocharger,
automobiles, etc.), supplemental certificates (on Riley
Heron, Riley Dove. etc.), and "corporate goodwill."" As
consideration, HBAC agreed to deliver HBAC capital
stock (1,447,051 shares) to Aeronautics. half of it to be
held in escrow by two individuals (Meriwether and Wade)
to secure payment of outstanding Aeronautics obligations.
The sales contract referred to another agreement by which
Riley was to have obtained from Associates Discount
(Aeronautics' chief creditor) (1) a moratorium on Riley
and Aeronautics obligations for 6 months, and (2) an
agreement canceling the entire $2.5 million indebtedness
to Associates Discount upon payment of $400,000 within
6 months from June 26, 1967.15 Finally, the July 6
contract provided that financial management in the new
enterprise (HBAC) "be placed in the hands" of
Meriwether and Wade and that Riley remain a full-time
employee of HBAC (and its successors and assigns) for 4
years Options to acquire HBAC stock at specified prices
within 5 years were accorded Meriwether, Wade, and
three others, including Richard Prigmore (HBAC's
president).
The above sales contract was finalized by a deed
recorded on July 21, 1967, by which Aeronautics conveyed
governmental agency to authorize particular aircraft work) were
transferrable and could be sold at a fixed price
"rhe record indicates that prior to July 1967 Riley had interests in other
enterprises in the aircraft business , including a facility at Sebring , Flonda,
which worked on turboprop Dove modifications , but this facility operated
for only 1-1/2 years, Riley was not sure whether it was owned by
Aeronautics or Riley Aircraft Engineering (a corporation owned 50 percent
by Riley) which is no longer functioning Riley also had an interest in Air
Components , a corporation owned by Aeronautics which manufactured
modification kits
"According to Riley, Bahamas (like Aeronautics) never made money
and at one time "carried forward" an $800,000 loss
"While certain items (equipment , tools, supplemental certificates, etc.)
were to be free and clear of encumbrances , aircraft and other vehicles were
taken subject to "present liens and encumbrances "
"According to the agreement , Riley was also to cancel Aeronautics'
indebtedness to Riley, except for the $400, 000 he was to pay to Associates
Discount
to HBAC (already known as International)." by separate
instruments, "any and all its machinery and equipment,
tools, furniture and fixtures ... including but not limited
to the items described on ... attached 44 pages"; tooling,
dies, jigs, templates; parts, components, supplies, and
other inventory; aircraft and motor vehicles; lease,
buildings, and improvements; and "any and all
Supplemental Type Certificates."
Riley testified that HBAC (a Colorado corporation)
was a mortgage and loan company, not theretofore
engaged in the aircraft business: that although it had 100
to 300 stockholders, it was nothing more than "a shell,"
raising money through the sale of stock to the public; and
that in consummating the sale, HBAC parted with
three-quarters of its issued stock, a quarter still remaining
among stockholders other than Aeronautics. Although he
could place no money value on the acquired HBAC stock,
he stated that "the purpose of the transaction was to try
to salvage something for Riley Aeronautics' stockholders
and creditors by making . . : possible for ... some outside
funds in the way of stock investments and loans [-] which
Riley Aeronautics because of its defunct position could
not accomplish." No cash money was involved in the
transfer. Apparently, according to Riley, Aeronautics'
accounts receivables were not transferred," nor its
accounts payable. Further, according to Riley, HBAC did
not assume Aeronautics' S2.5 million debt to Associates
Discount. Riley testified that although in his July 6, 1967,
agreement with HBAC (supra) he agreed to obtain
cancellation of that debt on paying $400,000 to this
creditor,1s he was unable to make more than $100.000
payment and, hence, that Aeronautics' debt (and his own
since he personally endorsed the original note) "reverted"
back to $2 million.
B. International
1. Initial operations
As previously noted (footnote 16), soon after acquiring
Aeronautics' assets HBAC assumed the name Riley
International Corporation (International). International,
as Aeronautics, operated in the aircraft industry
assembling and manufacturing kits and performing
modification work-the latter involving major changes and
conversions. It admittedly employed "substantial numbers
of former supervisors and employees of Aeronautics,"
using employees in modification work "for a period of one
year" after taking over Aeronautics ; i.e., until July 1968.
Unlike Aeronautics, however, International did not work
on Rajay turbochargers, "a phase of [Aeronautics]
business . not sold" to it. Like Aeronautics,
International sold its products through Bahamas. At
times, Riley (who was in charge of sales for International
as well as Aeronautics) sold International products
through Aeronautics, which, as we shall see (infra, sec. C,
"The deed shows that by this time HBAC changed its name to Riley
Aeronautics International Corporation , this was shortly afterward changed
to Riley International Corporation
"Riley testified that he could not recall any transfers other than items
listed in the contract and deed, neither of which listed accounts receivable
He specifically recalled that notes receivable were not transferred and
surmised that accounts such as prepaid interests and utility deposits were
later sold to Aeronautics ' successor
"According to Riley, Associates Discount, knowing that it "didn ' t stand
a ghost of a chance" to collect $2 5 million , was willing to "forgive" it if
he personally paid it $400,000 cash, in accordance with an agreed time
schedule
498 DECISIONS OF NATIONAL LABOR RELATIONS BOAR D
3), continued as an entity alter selling its physical assets
to International.
International continued to perform Aeronautics'
business at the latter's location (the Executive Airport),
having taken over Aeronautics' lease there. In January
1968 it moved its operation to Southwest 33d Street, near
the International Airport19 where it manufactured and
assembled kits and worked on aircraft, leasing hangar
facilities from others at the airport.
Riley, as he testified, remained active in International
until July 1968 when he relinquished his position as
International's president. Edith Roberts, Aeronautics'
secretary-treasurer, continued in that position for
International until April or May 1968 Wade, one of the
two men contemplated by the July 6, 1967, sales contract
(supra. section A, 2) to retain financial control over
international. was vice president and treasurer for an
undetermined period-until he left the Company. In the
beginning, Wade signed all International checks along
with one other official, including Riley, but "[f]or a
period after Wade left" the Company, Riley assumed full
financial control.20 As International president, Riley also
possessed final control over managerial and personnel
policies. He was the majority stockholder of International
by virtue of his interest in Aeronautics which received'
three-fourths of International (formerly HBAC) stock on
the sale of Aeronautics' assets.21
2. Financial position
Riley testified that although International continued to
operate substantially the same type of business as
Aeronautics, including aircraft conversion, its "prime
interest" from the start was to become "more or less a
holding company," by subcontracting out its
manufacturing work Implementing this objective towards
the end of 1967,22 International entered into a contract
with Hayes International, an Alabama company, under
which Hayes would do all modification work for
International under supplemental type certificates. To
"induce" Hayes to execute this contract, the Riley owned
Rajay Corporation endorsed and guaranteed
International's performance.
Riley testified that in April or May 1968 International
found itself without sufficient funds to operate. unable to
"Sometime prior to January 1968 International sold the Executive
Airport lease to an independent corporation for $200,000 Riley testified
that he had intended to use this money to construct a new hangar for
International at the International Airport, but because of Internal Revenue
"pressures" used part of it (S94,000) for back taxes The balance
(5106,000 ) was used to pay creditors and to meet business expenses
"Riley could not recall when Wade quit International , stating only that
Wade left "[a]fter there was no money to pay him," probably in March or
April 1968 Explaining why Wade was put in charge of linances in the first
instance, Riley testified, 'Wade was a financial man and a former banker
and supposedly a conservative person that could handle a dollar' and in
whom "future investors" could place trust , in contrast to himself who
"couldn't do any worse."
"Aeronautics apparently retained the same proportionate holdings until
a later foreclosure of the stock, discussed infra, section C, I According to
Riley, International did not issue new stock , or increase its stuck, but a
realignment in the 25 percent stock held by holders other than Aeronautics
took place through transfers and resales At least two individuals accorded
stock options by the July 6 sales contract, exercised them-former HBAC
President Prigmore obtaining (at 50 cents par value) 20,000 shares on
September 27 and 10,000 more on December 31, 1967, of the total 35,000
shares alloted him, and an associate of Pngmore (Lupton) 15,000 of his
alloted 35,000 shares on the same dates
"Riley could not give the particular month, but indicated that it could
have been as late as December
pay taxes and telephone bills. He indicated that he had to
pledge Aeronautics stock even before that time to secure
an International loan of $150,000 from a group of
International stockholders residing in Honolulu, headed
by David Nakano. Actually, however, only 5130,000 of
this loan netted International." According to Riley,
International continued to be in financial straits and
accordingly he decided to use Rajay ("a corporation that I
own") "to salvage something even after this $130,000.. .
was paid ... into Riley International." In April or May
1968 Rajay entered into a licensee agreement with
International to utilize the supplemental type certificates
(STC's) owned by International, Rajay undertaking to pay
a license lee for all modifications and kits requiring
International STC's. Rajay also agreed to pay cash for
parts obtained from International inventory, to lease
International machinery for $300 a month, and to pay
International's rent, "and assume International's
obligation there " Riley testified that under these
arrangements International "would need no employees, it
would need no funds for operating because they would
have no operation," although it would still "need some
funds to pay their liabilities." He further testified that
while the license fees and funds obtained from Rajay
..were used by International to pay some of their
obligations . . . they had so many obligations that it
became necessary for Rajay to even make additional
advances or repay royalties" so that "Rajay is presently
owed" some 5100.000.
C. Current Status of Riley Enterprises
1. International
Although Riley testified that international stopped
doing business and using employees in July 1968, he
conceded that it still has assets at Southwest 33d Street,
near the International Airport It also has stockholders,
the controlling stockholder (David Nakano) residing in
Honolulu. According to Riley, the Honolulu group,
headed by Nakano, acquired control over International by
foreclosing the stock Aeronautics had pledged to secure
the Nakano group's $150,000 loan to International in
April or May 1968 (supra, fn. 23).2a
International's ledger books, produced by Riley at the
hearing, show entries in various accounts subsequent to
July 1968, the time International ceased doing business
according to Riley. August 31, 1968, appears to be the
last entry date for most accounts (payroll, direct labor,
work in progress, telephone, office and general salaries.
withholding and FICA taxes, purchasing and receiving.
etc.). International's "Aeronautics" account appears to
establish active dealings with Aeronautics up to
September 30, 1968, but three later entries (October 29
and November 30, 1968, and January 31, 1969) are also
shown-the last one crediting Aeronautics with S75,000
commission on sales for International'2` The final
(November 30, 1968) entry in International's "Accounts
"The Honolulu group consisted of transferees of stock originally held by
HBAC According to Riley, James M Riley (no relation to Respondent
Jack M Riley), an Illinois resident , was elected International president by
"direction' of the Honolulu group, "one of the requirements for them
making the loan [being] that he be president " As presently shown, this
group subsequently loreclosed the stock
"Riley testified that Nakano now owns 1,300,000 shares plus an
additional ( undisclosed ) amount he previously owned
"A single entry in a 'Raiay" account for January 31, 1969, shows
51 17,503 due Rajay for various bills pd on A; C Payable" - presumably
RILEY AERONAUTICS CORP. 499
Receivables" shows a S28,523 balance. Final bank deposit
account entries show the following balances on the dates
indicated
Fort Lauderdale Natl. Bank-Regular Account 8/31/68
-$49,048
Same Bank-Payroll Account 9/30/68-980
Amer Natl. Bank & Trust-Cash 10/31/68-9256
City Bank, Honolulu (Hawaii) 9/30/68-26.188
Asked to explain why International's books showed
post-July 1968 entries if, as he claimed, the corporation
ceased doing business in July, Riley surmised that these
may have been "closing entries." He also disclaimed
responsibility for these entries, stating that he had
disassociated himself from international in July.
1-urthermore, Riley claimed that the records which he
produced (from storage in Fort Lauderdale) were "not
up-to-date," additional ones being in possession of the
Honolulu stockholders Riley testified that as
representative of Aeronautics he brought suit in Honolulu
to compel production of International's latest records and
that when finally allowed to inspect them, recalled seeing
a balance of only $50 in International 's bank account.36
2 Ralay
In November 1968 Rajay ( which in April or May 1968
began to use International ' s supplemental type certificates
(STC's) under a license agreement with International,
supra, section B, 2). sold its turbocharging manufacturing
operation in California to Tex Star. a conglomerate
About the same time, it arranged that a new corporation
(Turbo Propulsion ) assume the STC licenses on
manufacturing aircraft Turbo Propulsion has taken over
a few Rajav employees , using them in California until
they can be moved to Texas. Turbo',, intended location.
According to Riley. at the time of the hearing Turbo
Propulsion was operating on borrowed moneys. was
incorporated at Riley's request , and as yet issued no
stock He stated that " [ i]t may be that Rajay will be
forced to he an investor because of their royalty"
arrangement . Turbo Propulsion also uses or leases space
in Wichita Falls, Texas, where it intends to perform the
same types of aircraft work that International and
Aeronautics had performed
3. Aeronautics and Bahamas
Although Riley testified that Aeronautics and Bahamas
were "dormant" and had no employees at the time of the
hearing, he stated that they still exist, that he is still
president of both, and that he sometimes takes orders and
sells through these corporations Thus, he indicated that
he would buy and resell a plane in the name of
Aeronautics. as well as farm out work (such as work on a
Rajay turbocharger) to a fixed base operator in the name
for bills Rajay had paid on behalf of International The same figure
appears as the balance in International ' s 'Accounts Payable Trade" on
lanuary 31, 1969
"Riley was unsure of the date when the S50 balance was shown, first
stating that he "didn't notice ' the date and was interested only in the
"final balance," but then added that this was as of November 1968 Asked
which bank account showed the $50 balance, he stated that he saw "the
cancelled checks" of the bank statement of "City National Bank " It is
not clear whether Riley referred to the City Bank of Honolulu which
showed a $26 , 188 balance on September 30, 1968, or the Fort Lauderdale
National Bank with a $49,048 balance on August 31, 1968 Riley did not
produce the court order pursuant to which he allegedly inspected
International 's books
of Aeronautics. As previously noted, International's
Aeronautics account showed active dealings between
international and Aeronautics through Septmeber 30,
1968. Although Riley insisted that Aeronautics was
bankrupt, with a S2 million deficit, he stated that
Aeronautics never attempted to go through formal
insolvency or bankruptcy proceedings
D. Conclusions Concerning Respondents'
Recponsibiltty for Remedying the Unfair Labor
Practicer
1 Aeronautics and International
The Board's August 9, 1965, Order, as enforced on
June 28. 1967, requires Aeronautics, "its officers, agents,
successors, and assigns." to offer reinstatement to the five
discriminatees (discharged on October 26, 1964) to their
former or substantially equivalent positions and to make
them whole for any loss of earnings they may have
suffered by reason of the discrimination against them.
There is no question about Aeronautics' liability for
remedying the unfair labor practices since it committed
them and the order specifically runs against it. See Pertna
Vinyl Corporation, Dade Plastics Co and United States
Pipe and Foundry Company, 164 NLRB No. 119, enfd.
398 F 2d 544 (C..A 5)
Nor is there any serious question concerning
International 's liability to remedy the unfair labor
practices as successor, with knowledge of the unremedied
violations at the time it acquired Aeronautics The
uncontradicted evidence establishes that in July 1967
International took over practically all of Aeronautics'
assets (machinery and equipment, furniture and fixtures,
inventory, buildings, etc ) and "corporate goodwill " It
continued in substantially the same (aircraft) business as
Aeronautics, at the same location, and under Aeronautics'
lease. It employed "substantial numbers" of Aeronautics
supervisors and employees, including employees in jobs
occupied by the discriminatees Riley, president of
Aeronautics (and perpetrator of the unfair labor
practices), became president of International. He was the
controlling stockholder of Aeronautics and retained
controlling interest in International by reason of acquired
International (IIBAC) stock Although for a time after
the transter, financial control rested with another official
(Wade). Riley later assumed complete control in this area
also. Lastly, he retained linal control over managerial and
personnel policies and, as in Aeronautics, was in charge of
sales, employing two other Riley owned corporations
(Bahamas and sometimes Aeronautics itself) to sell
International products
Under these circumstances, it is clear, and I find, that
Aeronautics and International are jointly and severally
liable for remedying the unfair labor practices. See Regal
Knitwear Conipanv v. N.L R B. 324 U.S. 9. Perma
Vinyl Corporation, .supra, 164 NLRB No. 119, enl'd. 398
F.2d 544 (C.A. 5)." The fact that International was not
named respondent in the complaint proceeding is of no
consequence in view of the opportunity here afforded it
(but not availed of) to litigate the question of
responsibility See Pertna Vinyl. supra, 398 F.2d at 546;
Mastro Plastics, supra, 354 I- 2d at 180. '[D]erivative
liability for compliance with a judicially enforced
unfair-labor-practice order may be imposed upon parties
not themselves charged in the initial proceedings."
"See also N L R B v. Tempest Shirt Manufacturing Companv, Inc,
285 F 2d I (C A 5), N L R B v Mastro Plastics Corporation . 354 F 2d
500 DECISIONS OF NATIONAL LABOR RELATIONS BOARD
N.L.R.B. v. C C.C. Associates, Inc , 306 F 2d 534, X39
(C.A 2).
The record establishes, however, that although
Aeronautics still exists and sells for Riley, it no longer
manufactures aircraft and has no employees. The same is
true of International, its successor, which ceased using
employees in July 1968.=" For reasons hereafter indicated,
I find that the two corporations have discontinued their
manufacturing operations for economic reasons and not to
evade remedying the unfair labor practices. In view of the
changed circumstances, therefore, it will be recommended
that Aeronautics and International not be required to
reinstate the five discriminatees as provided in the Board's
August 9, 1965, reinstatement order. The "Board will
naturally not require action now impossible for
respondent[s] to perform." N.L.R B. v Ephraim Haspel,
228 F.2d 155, 156 (C.A. 2)." However, it will also be
recommended that if, in the future, Aeronautics,
International, or their successors and assigns resume
manufacturing each of the ' discriminatees shall be
reinstated as soon as available positions become open, in
the manner provided in the Board's August 9, 1965,
Order.
With respect to backpay, it will be recommended that
the cutoff date be fixed as of the end of the second
quarter of 1968 (June 30, 1968) when the discriminatees
would have lost their employment for nondiscriminatory
reasons. Although Riley contended that neither
International nor Aeronautics was currently able to meet
the backpay obligations, portraying each as hopelessly
insolvent and bankrupt, 30 his testimony on the recent fiscal
positions of the corporations was too general, vague, and
confusine to warrant my crediting it No records were
produced such as balance sheets and profit-and-lots
statements to support Riley's conclusory allegations. On
the other hand, Riley's own testimony indicates that Riley
is currently still using Aeronautics as a sales outlet and
that Aeronautics had retained its account receivables when
it sold its assets to International. According to
International's ledger book, Aeronautics appears to have
actively transacted business with International,
presumably as the latter's sales agent. until October 1968.
One transaction alone (a sale on behalf of International in
January 1969), netted Aeronautics S75,000 in
commissions, more than sufficient to satisfy the backpay
claim of all five discriminatees." Riley could not recall
whether a $201,000 account receivable due Aeronautics
from Ralay (a still functioning and solvent Riley
enterprise) when Aeronautics was still manufacturing was
"ever realized." As to International , it is impossible to
appraise the fiscal solvency of that corporation from the
incomplete records produced at the hearing. (Riley
claimed that some of International's books were in the
custody of the current controlling Honolulu stockholder
170, 179-I80 (C A 2), N L R B v Frontier Guard Patrol, Inc, 399 F.2d
716 (C A. 10)
"Although the record indicates that international changed its method of
operations (shifting from manufacturing to contracting out manufacturing
work to Hayes ) at the end of 1967, Riley conceded that it continued to use
employees in modification work until July 1968, when he disassociated
himself with International Since absence of available jobs is an affirmative
defense which the offending employer must prove, a finding here that there
was insufficient work for the discruninatees prior to July 1968 is
unwarranted See N L R B v. Mastro Plastics Corporation . 354 F.2d 170,
175-176 (C A 2). N L R B v Interurban Gas Corporation , 354 F 2d 76,
77 (C A 6).
"See also Southport Petroleum Company v N L R B 3 t5 U S 100,
106, N L R B v. Talladega Cotton Factory . Inc, 213 F 2d 208, 217-218
(C A 5). N L R B. v Acme Mattress Co. 192 F 2d 524, 528 (C.A. 7)
Nakano ). Even so, International ' s accounts showed
substantial cash balances in four banks as much as
$49,048 in one on August 31, 1968. Furthermore,
International admittedly still has assets at its location in
Fort Lauderdale, Florida -part or all of which can be
liquidated to meet backpay obligations.
In any event , even if the two corporations were shown
to be insolvent , this would not justify withholding a
backpay order . To begin with , " impossibility [of
performance ] may be raised by respondent [s] as a defense
if a contempt action is brought against [them] by the
Board '" N.L.R.B. v Kostilnik , d/b/a Pacific Banking
Company, 405 F.2d 733, 735 (C.A. 3): N. L.R.B v
Somerset Classics, Inc, 193 F.2d 613, 616 (C.A. 2).
Moreover , the Board is entitled to file a claim in
bankruptcy to recover part or all "owed the Board as
agent for the injured employees ." Nathanson v.
NL.R.B., 344 U.S. 25, 27; see also Utah Plumbing and
Heating Contractors Association , 142 NLRB 379.
However, as already stated, the record developed in this
proceeding is too meager and incomplete for passing on
the question of the corporations ' present ability to meet
backpay "Of course, the Board [could have had] access"
to additional records on International and Aeronautics,
"but it is the employer who kept the records" and who
must produce them "to explain them and to interpret any
ambiguities they may contain . [T]his factor [is] a
persuasive reason for requiring the employer to come
forward with proof" in support of an affirmative defense.
NL.R B v. Mastro Plastics Corporation . 354 F.2d 170,
176 (C.A. 2).
2. James M. Riley
General Counsel seeks to hold Riley personally
answerable for the unfair labor practices on the theories:
(a) that he was Aeronautics president, its principal
stockholder, and perpetrator of the unfair labor practices:
and (b) that he was part of "a single intergrated
employer" comprising Aeronautics, International. and
Riley. At the outset it should be noted that Riley's alleged
liability is not based on a successorship theory Cf. Regal
Knitwear Co v. N.L.R.B, 324 U.S. 9: Perma Vinyl
Corporation, supra, 164 NLRB No. 119. In any event, it
has not been shown that Riley obtained or succeeded to
the assets and business of Aeronautics and International.
Nor was Riley named individually or as employer in the
unfair labor practice charge and complaint. He was
named for the first time in the backpay specifications, but
only in the representative capacity of "agent" and
"president" of the two corporations. Cf. Darlington
Manufacturing Company; Roger Milliken, Deering.
Milliken & Co, Inc, 139 NLRB 241, 259-260, remanded
on other grounds 380 U.S. 263.32 In issue here is the
nature and extent of Riley's liability for remedying the
unfair labor practices, particularly the backpay award.
"Thus, Riley explained that international was in the hands of the
Honolulu group as the result of a stock foreclosure and that it had only a
$50 bank balance in January 1969; and that Aeronautics had a S2 million
deficit
"The record does not disclose how the $75,000 income was disposed of,
i e , whether Riley pocketed it or used it to pay off corporate debts or
expenses Riley did not produce Aeronautics ' records
"Cf Industrial Fabricating . etc and Frank M Afackneish . 119 NLRB
162, cnfd 272 F 2d 184 (C.A. 6), Bon Hennings Logging Co. a
corporation , and Clanton Knowles. 132 NLRB 97, enfd 308 F 2d 548
(C.A 9); Ogle Protection Service, Inc, and James L Ogle, 149 NLRB
545, modified on other grounds 375 F 2d 497 (C A. 8), The L. B Hosiery
RILEY AERONAUTICS CORP.
"[E]asily the most distinctive attribute of the
corporation is its existence in the eye of the law as a legal
entity and artificial personality distinct and separate from
the stockholders and officers who compose it." Wormser,
Disregard of the Corporate Fiction and Allied
Corporation Problems (Baker, Voorhis and Company,
1927). p. 11. "The insulation of a stockholder from the
debts and obligations of his corporation is the norm, not
the exception." AT.L.R.B. v. Deena Artware, Inc , 361
U.S. 398, 402-403. Nevertheless, the corporate veil will be
pierced whenever it is employed to perpetrate fraud, evade
existing obligations, or circumvent a statute. Isaac
Schieber, et al, individually , and Allen Hat Co., 26
NLRB 937, 964, enfd. 116 F.2d (C.A. 8).J3 Thus, in the
field of labor relations, the courts and Board have looked
beyond organizational form where an individual or
corporate employer was no more than an alter ego or a
"disguised continuance of the old employer" (Southport
Petroleum Co v. N L R.B., 315 U.S. 100, 106). or was
in active concert or participation in a scheme or plan of
evasion (N L.R.B. v. (Hopwood Retinning Co., 104 F.2d
302, 304 (C.A. 2): or siphoned off assets for the purpose
of rendering insolvent and frustrating a monetary
obligation such as backpay (N.L.R.B. v. Deena Artware.
Inc., supra, 361 U.S. 398); or so integrated or
intermingled his assets and affairs that "no distinct
corporate lines are maintained" (Id at 403).
Applying these legal principles to this case, I cannot
find that Riley is personally liable for the backpay due the
discriminatees. The record does not support General
Counsel's suggestion that he had embarked upon a scheme
to deplete or divert to himself the assets of the offending
Employer (Aeronautics) in order to thwart that
Employer's backpay obligations. Nor has it been shown
that the successor corporation (International) was only a
front for the predecessor. There is no substantial credible
evidence supporting a finding that Riley willingly
concealed or secreted Aeronautics and International
assets, or that he engaged in other chicanery. To be sure,
the evidence tends to support General Counsel's allegation
that he had "a penchant" for setting up corporations,
involving one in the affairs of another, reorganizing
corporate functions and activities (e.g., confining
Aeronautics to manufacturing and the Bahamas to sales),
and using one corporation to assist or rescue another (e.g.,
Rajay advancing money and supplying work to
International), but no fraud, concealment, or purpose to
defeat backpay obligation has been established. There is
ample evidence (documentary as well as testimonial) that
Aeronautics was in financial straits prior to its July 1967
sale to International (HBAC). In so far as appears, the
sale was bona fide and at arms length. involving strangers
to Riley. The coincidence of time (within a month after
the court handed down its decision enforcing the Board
Order) is suspicious, but not fatal. The interrelationship
between Aeronautics and International appears to be
substantially a business or fiscal one - the common
denominator in the two and other affiliated corporations
Co. Incorporated and Lee Maisel, ere, 88 NLRB 1000, enfd 187 F.2d
335 (C A 3); New Madrid Manufacturing Company, a corporation, and
Harold Jones, 215 F 2d 908, 915 (C A 8)
"As stated in Schieber, quoting from United States v. Milwaukee
Refrigerator Transit Co , 142 Fed 247, 255 (E D Wise ), "when the notion
of legal entities is used to defeat public convenience, justify wrong, protect
fraud, or defend crime, the law will regard the corporation as an
association of persons."
501
(e.g Bahamas and Rajay) being ownership and business
control by Riley - factors in themselves insufficient to
establisha single employer status. See_V".L.R.B v. Jordan
Bus Company and Denco Bus Lines, Inc., 380 F.2d 219,
221-222 (C.A. 10).3° Indeed, the close functional
integration and fiscal dealings between Aeronautics on the
one hand and Bahamas and Rajay on the other -together
with common ownership by Riley - provide stronger
support for a single (Aeronautics - Bahamas -- Rajay)
enterprise finding, but General Counsel has requested no
such finding and Bahamas and Rajay have not been
named respondents for remedial or other purposes. The
same may be said for the relationship between
International (after it took over Aeronautics) and other
Riley enterprises.
As I see it, absent the special circumstances already
referred to (e.g., where the corporate officer is the
disguised continuance of the corporation, or dissipates
corporate assets, or intermingles personal and corporate
affairs, or attempts to evade backpay obligation), the
corporate officer is responsible only for taking necessary
steps to effectuate the Board order. See Isaac Schieber,
supra, 26 NLRB at 968. This is particularly so where, as
here, he is named only "in his representative capacity as
president [and agent]" and not "as an employer separate
and apart from his position as president." Cf. Darlington
Manufacturing Company, Roger Milliken, Deering.
Milliken & Co.. Inc., 139 NLRB 241, 259-260, remanded
on other grounds 380 U.S. 263. If he refuses to discharge
his duty as officer to satisfy a court-enforced order,
including disbursing corporate funds to meet the corporate
backpay obligation, he risks punishment for contempt.
N.L.R.B. s. Hopwood Retaining Co, 104 F.2d 302,
304-305 (C.A. 2); NL.R.B v. West Texas Utilities Co.,
206 F.2d 442, 445 (C.A.D.C.). To require him to make
good the corporation's backpay liability out of his
personal funds would operate to defeat the very purpose
of his incorporating the business to escape individual
liability. If the corporate funds are insufficient to meet the
backpay obligation, the Board's recourse is that of a
"creditor," which includes enforcing the claim in
insolvency or bankruptcy proceedings. Nathanson v.
N.L.R.B., 344 U.S. 25, 27.35
I conclude that Riley is not personally liable for the
backpay due to the employees discriminated against
"Factors which the Board weighs in determining whether a single
employer enterprise exists (in addition to common ownership and financial
control ) include interrelationship of operations , centralized labor relations,
common supervisory personnel , employee interchange or transfer,
uniformity of working conditions, geographical proximity, and centralized
recordkeeping See Twenty-First Annual Report of the NLRB (1956), pp
14-15, N L.R B v Calcasieu Paper Co., 203 F.2d 12, 13 (C.A. 5), Sakrete
of Northern California, Inc . 332 F 2d 902, 905 (C A 9), Darlington
Manufacturing Company. supra . 139 NLRB at 255-258 Not all of these
factors need be present , of course , to justify a finding of single employer
status.
"For the reasons already indicated , I cannot accept General Counsel's
contention (br p. 26) that Riley must be made personally liable because
he, more than Aeronautics and International, "is the one who is able to
take the remedial action " I am also forced to reject his argument (ibid )
that "equity and justice" dictate that Riley pay the price, since it was he
who committed the unfair labor practice and delayed complying with the
Board Order until the corporate respondents got into financial difficulties
To begin with , the backpay specifications fixing the amount of liability was
not issued until August 23, 1968. Furthermore , General Counsel has not
shown that he was unable to take appropriate legal measures to attach the
corporate assets pending determination of backpay liability
502 DECISIONS OF NATIONAL LABOR RELATIONS BOARD
III. BACKPAY CALCULATIONS
A. Donald A Depew. Fred Lee, Jr, and Homer D
Sapp
The backpay specifications. as amended, allege that
these three discriminatees are entitled to the following
backpay (plus interest) from October 26, 1964 (the date of
discrimination) through September 30, 1968 (the date to
which computations were made). Depew $6.438.32; Lee
$2,457.80; Sapp S15,765.04. Respondents did not dispute
the correctness of these computations.
Since I have found that the corporate Respondents are
liable for backpav only up to the time International
(successor to Aeronautics) discontinued business in Jul),
1968, 1 find that the backpay (exclusive of interest), due
each of the three employees up to July 1968 is as follows."
Depew- $6,045.16
Lee - $2,457 80
Sapp - $14,986 81
B Wallace J Nelson and Sigmund R Nied
The specifications, as amended, give the following net
backpay for these two discrimmatees for October 26, 1964
- September 30, 1968. Nelson - $16,747 50: Nied-
$8,334.87. At the hearing Respondents claimed that these
amounts should be offset or reduced in the lollowing
respects
1. Value of assets remaining after discontinuance of a
!Nelson-:'Vied partnership operated during the period of
discrimination In the third quarter of 1965 (July) Nelson
and Nied opened an aircraft repair business (Aircraft
Engine Service) which they operated until about October
1966. According to the backpay specifications, each drew
$125 or $150 per week "out of profits"-a total of $7,700
by each partner from the 1965 third quarter through the
1966 third quarter. These drawings were deducted from
the gross pay each would have earned during the period in
question to arrive at net backpay due each At the hearing
Respondents contended that a further deduction should be
made for the value of leftover parts and equipment
divided between the partners when they wound up the
business. Although the value of these assets is not clear,
"final" entries in the partnership books give evaluations of
S3,530.24 for "Parts Inventory" and S913.18 for "Shop
Equipment "
I reject the contention that the value of the remaining
partnership assets should be offset against backpay.
Absent evidence to the contrary, it must be presumed that
these assets were realized from initial investment of the
partners and not partnership earnings or profits. The
burden of proof to establish an offset against gross
backpay rests upon Respondents. The "burden is placed
on the respondent to establish that its liability be reduced
and, if so, to what extent." N L R.B v. Interurban Gas
Corporation, 354 F.2d 76, 77 (C.A. 6). See also N.L R.B.
v. Moonei Aircraft, Inc , 366 F 2d 809. 812-813 (C.A. 5)
2. Nelson's $967 50 claim for work prior to discharge.
In addition to listing gross backpay due for the first
quarter after his discharge (fourth quarter of 1964), the
specifications alleged a S967 50 "balance due" Nelson on
"These amounts represent the total net backpay set forth in the backpay
specifications , as amended , less backpay ( if any ) claimed for them for the
third quarter of 1968
"contract work for Riley." Nelson testified that prior to
his discharge he agreed to do a job for Aeronautics at a
fixed price He completed it on his own (after
working) hours and hired tyro employees to assist him,
however, Nelson used company facilities, tools, and
materials. Objecting to inclusion of this item in the
specifications since it pertained to predischarge earnings
("prior to any period in dispute or in question"),
Respondents contended at the hearing that it was not the
function of a backpay proceeding "to collect bills." In his
brief (p. 2), Gerieral Counsel suggests that these earnings
represented wages rather than contract earnings. likening
them "to other earned fringe wage" allowances (such as
vacations, insurance benefits, . profit-sharing bonus)
recoverable after discharge.
I do not agree. Whether considered as wages or
contractor earnings, it is clear that the $967.50 claim is
based upon work completed before Nelson's unlawful
discharge, that the claim is not attributable to the unfair
labor practices committed by the Employer, and that it
represents nothing more than a debt "irrelevant to these
backpay proceedings ",Cf. P's L.R.B. v. Mooney Aircraft,
Inc , 366 F.2d 809, 811 (C.A. 5). Accordingly, Nelson's
net backpay is subject to a $967 50 deduction.
3 iNied's reduced interim earnings due to accidental
injury. During his interim employment at Sunny South in
1967 Nied sustained an injury which required
hospitalization and therapeutic treatment. On his
physician's advice, Nied procured "lighter work" at
McLeod International Corp, resulting in lower interim
earnings there than at Sunny South.
Although eliciting these facts at the hearing,
Respondents apparently did not claim that Nied's backpay
he adjusted to reflect lower earning, during the disability
period" In any event, I find that his backpay should not
he reduced to reflect the lower interim earnings due to
disability. To begin with. one cannot assume that Nied
would have suffered the disability at Aeronautics,
particularly since he was performing heavier work at
Sunny South (where he suffered the injury) Cf American
Manufacturing Company of Texas, 167 NLRB No. 71.
Furthermore, Nied's credited testimony indicates that he
could have satisfactorily performed his former (lighter) job
at Aeronautics even with his impairments
In view of the foregoing, I find that Nied and Nelson
are entitled to backpay in the following amounts (or the
period October 26, 1964--June 30. 1968 (plus 6-percent
interest as hereafter indicated) 'e
Nied -$7,957.46
Nelson - $14,857 38
CONCLUSIONS
1 Aeronautics (as the offending Employer) and
international (as successor to Aeronautics) are jointly and
severally responsible for remedying the unfair labor
practices, including loss of earnings incurred by the live
discrim inatees.
"Respondents' memorandum to the Trial Examiner is confined to the
issue of responsibility for remedying the untair labor practices
"These amounts reflect deductions (5377 41 for Nicd and $922 62 for
Nelson ) for the 1968 third quarter improperly included in the backpay
specifications (supra fn 36) and the additional $967 50 improperly
credited to Nelson for work prior to his discharge
RILEY AERONAUTICS CORP.
2. The five discriminatees are entitled to be made whole
for the period beginning October 26, 1964 (the date of
their discriminatory discharge ) until July 1, 1968, when
International ceased using employees.
3. In view of the discontinuance of their manufacturing
operations , Aeronautics and International are not required
to reinstate the five discriminatees to their former or
substantially equivalent positions at Aeronautics , unless
and until either or both resume such operations , in which
event they shall offer the discriminatees reinstatement as
soon as appropriate positions become available, in the
manner provided in the Board ' s August 9 , 1965, Order.
4. Riley is not responsible out of his own personal
lunds for the backpay due the discriminatees
RECOMMENDED SUPPLEMENTAL ORDER
Upon the foregoing landings and conclusions and the
entire record , and pursuant to Section 10(c) of the Act, it
is recommended that Riley Aeronautics Corporation and
Riley International Corporation , their officers , agents,
successors , and assigns , shall pay to each discriminatee the
503
amounts set forth below opposite their names, with
interest at the rate of 6 percent per annum on each of the
quarterly sums set forth in the backpay specifications (as
herein modified ), less lawfully required tax withholdings:
Donald A Dcpew-$6,045.16
Fred Lee, Jr-$2,457.80
Wallace J. Nelson-$14 , 857.38
Sigmund R Nicd-$7,9 7.46
Homer D. Sapp-$14.986.81
IT IS ALSO RECOMMENDED that the Board reserve the right
to modify the backpay and reinstatement provisions herein
if such modifications become necessary by a change of
circumstances.
IT IS FURTHER RE, COMMi- Ni ) l I) that General Counsel ' s claim
that Jack M Riley is personally liable for the backpay
due the discriminatees he dismissed.