SK USA Cleaners, Inc.

National Labor Relations Board - Board Decisions

Jan 25, 2017

365 NLRB No. 20 (N.L.R.B. 2017)

365 NLRB No. 20
NOTICE: This opinion is subject to formal revision before publication in the
bound volumes of NLRB decisions. Readers are requested to notify the Ex-
ecutive Secretary, National Labor Relations Board, Washington, D.C.
20570, of any typographical or other formal errors so that corrections can
be included in the bound volumes.
SK USA Cleaners, Inc. a/k/a SK USA Shirts, Inc. and
Yi Jae Cho and Local 947, International Union
of Journeymen and Allied Trades. Cases 22–
CA–026959 and 22–CA–087198
January 25, 2017
SUPPLEMENTAL DECISION AND ORDER
BY ACTING CHAIRMAN MISCIMARRA AND MEMBERS
PEARCE AND MCFERRAN
The General Counsel seeks a default judgment in this
case on the ground that the Respondents have failed to
file an answer to the consolidated amended compliance
specification.
On March 22, 2006, the Board issued a Decision and
Order in Case 22–CA–0269591 finding that Respondent
SK USA Cleaners, Inc. (Respondent SK USA Cleaners)
violated Section 8(a)(3) and (1) of the Act, and ordering
it to, among other things, make whole all employees who
were discharged on June 15, 2005. On June 28, 2006,
the Court of Appeals for the Third Circuit entered its
Judgment enforcing the Board’s Order in full.2
A controversy having arisen over the amount due un-
der the Board’s Order in Case 22–CA–026959, as en-
forced, on October 30, 2006, the Regional Director for
Region 22 issued a compliance specification and notice
of hearing, alleging the amount due under the Board’s
2006 Order. On January 30, 2009, Respondent SK USA
Cleaners and its president, Yi Jae Cho, signed a stipulat-
ed compliance agreement, requiring Respondent SK
USA Cleaners to pay $105,105.39 to make the dis-
charged employees whole; Cho agreed that in case of
noncompliance, he would be jointly and severally liable
for the total unpaid balance of the amounts owed, less
any payments already made, plus interest.3
On March 8, 2013, the Board issued a Decision and
Order in Case 22–CA–0871984 finding that Respondent
SK USA Shirts, Inc. (Respondent SK USA Shirts) vio-
lated Section 8(a)(5) and (1) of the Act, and ordering it,
among other things, to remit to Local 947, International
Union of Journeymen and Allied Trades (the Union) all
dues since February 2012 that have not been remitted as

1 346 NLRB No. 63.
2 No. 06–2585.
3 Respondent SK USA Cleaners paid $53,449.32 under the stipulat-
ed compliance agreement, but still owes $25,820.68 in backpay,
$16,280.35 in interest, and surcharge fees of $9,555.04, for a total of
$51,656.07.
4 359 NLRB No. 74.
required by the parties’ 2007–2013 collective-bargaining
agreement. On December 5, 2013, the Court of Appeals
for the Third Circuit entered its judgment enforcing the
Board’s Order in full.5
A controversy having arisen over the amount due un-
der the Board’s Order in Case 22–CA–087198, as en-
forced, on February 27, 2015, the Regional Director is-
sued a compliance specification and notice of hearing,
alleging the amount due under the Board’s 2013 Order,
and alleging that Cho is jointly and severally liable with
Respondent SK USA Shirts to fulfill the remedial obliga-
tions of the Board’s Order.
On April 1, 2015, the Regional Director issued a sup-
plemental compliance specification in Case 22–CA–
026959 against Respondent SK USA Cleaners and Re-
spondent Yi Jae Cho, alleging that pursuant to the stipu-
lated compliance agreement and by Respondent Cho’s
misconduct in his failure to adhere to corporate formali-
ties, Respondent Cho is jointly and severally liable with
Respondent SK USA Cleaners for the remedial obliga-
tions of the Board’s 2006 Order, and further alleging the
amount due under the Board’s 2006 Order, the adminis-
trative law judge’s 2007 decision, and the 2009 stipulat-
ed compliance agreement.6
On April 1, 2015, the Regional Director also issued an
amended compliance specification in Case 22–CA–
087198 against Respondent SK USA Shirts and Re-
spondent Yi Jae Cho, alleging that pursuant to Respond-
ent Cho’s misconduct in his failure to adhere to corporate
formalities, Respondent Cho is jointly and severally lia-
ble with Respondent SK USA Shirts for the remedial
obligations of the Board’s 2013 Order.
On January 11, 2016, the Regional Director issued an
Order amending and consolidating cases, consolidated
amended compliance specification and notice of hearing
(the consolidated amended compliance specification).7
The consolidated amended compliance specification al-
leges that Respondent Cho is jointly and severally liable
with Respondent SK USA Cleaners and Respondent SK
USA Shirts for fulfilling the obligations of the Board’s
Orders in Cases 22–CA–026959 and 22–CA–087198,
and its caption lists the Respondents in both cases as SK
USA Cleaners, Inc. a/k/a SK USA Shirts, Inc. and Yi Jae

5 No. 13–2359.
6 An amended compliance specification and notice of hearing had
been issued on February 27, 2015, which was superseded by the April
1, 2015 document.
7 The Regional Director had also issued a consolidated amended
compliance specification on August 20, 2015. With the exception of
the dates specified for the filing of an answer and the scheduled hear-
ing, the consolidated amended compliance specifications appear to be
identical. Therefore, this decision refers only to the more recent con-
solidated amended compliance specification dated January 11, 2016.
DECISIONS OF THE NATIONAL LABOR RELATIONS BOARD2
Cho (collectively the Respondents). In addition, it sets
forth the amounts owed under the stipulated compliance
agreement and the Board’s Order in Case 22–CA–
026959, as well as the amount owed under the Board’s
Order in Case 22–CA–087198, notifying the Respond-
ents that they must file a timely answer complying with
the Board’s Rules and Regulations. About January 26,
2016, the Respondents provided the Region with an an-
swer to the consolidated amended compliance specifica-
tion.8
By letter dated February 10, 2016, the Regional Direc-
tor informed the Respondents that their answer did not
satisfy the specificity requirements set forth in Sec-
tion 102.56(b) of the Board’s Rules and Regulations and
stated that failure to file an appropriate amended answer
by February 17, 2016, would prompt a motion for de-
fault judgment. In particular, the Regional Director ad-
vised that the Respondents’ answer provided only gen-
eral denials and “failed to respond with specificity to the
allegations in the Specification,” and that “it is not clear
from your Answer whether you denied the bases for the
amounts alleged in the Specification and whether you
provided alternative calculations.” At the Respondents’

8 The purported answer consists of a document signed by Yi Jae
Cho, which refers to SK USA Cleaners, Inc., lists an incorrect case
number, and is titled: “Counter-Claim to the Complaint,” as well as
several partially legible attachments, including a handwritten document
in Korean and pages that appear to be handwritten work schedules or
timesheets. The document signed by Cho describes his “limited capaci-
ty” due to a medical condition and states that he “would like to suspend
all the related legal process until he recovers.” In a second section
titled “Background of Labor Union Action,” the document states, in
part:
I believe that there is nothing under-complied against the terms and
conditions with Local 947. All those employees in the matter have
left the SK USA at that time. Those who demanded “NO TAX, NO
CHECK” from June 16, 2005 were solicited by Local 947 to initiate
the strike. However, 2 of them have returned to work 2 years later,
who are still employees of the SK USA.
I believe that SK USA has been a victim suffered from the ongoing
tremendous damage by the Local 947 Union for nothing but only its
own rights and profits.
I dare to say Local 947 Union being a fraud organization who wants to
collect membership fee from each worker as well as from each small
business entity, and demand a fair/impartial investigation and/or a trial
to reveal the truth of the entire process behind the Labor Union with
the grounds as follows:
The document then lists several “Grounds,” enumerating various
stated transgressions by the Union, and requesting that a Korean inter-
preter, a cardiologist, and US and Korean media reporters be present at
the hearing. In addition, “Ground E” appears to assert financial diffi-
culty, stating “[t]he unstable status of the SK USA finance due to the
back deposit order of $25,000.00 by the Labor Board, which SK USA
could not afford, which resulted in collection seizure as of January
2009 through then SK USA vendors. Therefore, all those existing
vendors suspended the business transaction with SK USA since then.”
request, the Region had the February 10, 2016 letter
translated into Korean. Although properly served with
the translation of the Regional Director’s letter, the Re-
spondents failed to file an amended answer.
On October 28, 2016, the General Counsel filed with
the Board a Motion for Default Judgment, with exhibits
attached. On November 2, 2016, the Board issued an
order transferring the proceeding to the Board and a No-
tice to Show Cause why the motion should not be grant-
ed. The Respondents again filed no response. The alle-
gations in the motion are therefore undisputed.
Ruling on the Motion for Default Judgment
Section 102.56(b) and (c) of the Board’s Rules and
Regulations states, in relevant part:
(b) Contents of answer to specification. The answer
shall specifically admit, deny, or explain each and eve-
ry allegation of the specification, unless the respondent
is without knowledge, in which case the respondent
shall so state, such statement operating as a denial.
Denials shall fairly meet the substance of the allega-
tions of the specification at issue. When a respondent
intends to deny only a part of an allegation, the re-
spondent shall specify so much of it as is true and shall
deny only the remainder. As to all matters within the
knowledge of the respondent, including but not limited
to the various factors entering into the computation of
gross backpay, a general denial shall not suffice. As to
such matters, if the respondent disputes either the accu-
racy of the figures in the specification or the premises
on which they are based, the answer shall specifically
state the basis for such disagreement, setting forth in
detail the respondent’s position as to the applicable
premises and furnishing the appropriate supporting fig-
ures.
(c) Effect of failure to answer or to plead specifically
and in detail to backpay allegations of specification . . .
. If the respondent files an answer to the specification
but fails to deny any allegation of the specification in
the manner required by paragraph (b) of this section,
and the failure so to deny is not adequately explained,
such allegation shall be deemed to be admitted to be
true, and may be so found by the Board without the
taking of evidence supporting such allegation, and the
respondent shall be precluded from introducing any ev-
idence controverting the allegation.
The undisputed allegations of the General Counsel’s
Motion for Default Judgment establish that the Regional
Director, by letter dated February 10, 2016, notified the
Respondents that their answer did not satisfy the speci-
SK USA CLEANERS, INC. A/K/A SK USA SHIRTS, INC. 3
ficity requirements set forth in Section 102.56(b) of the
Board’s Rules and Regulations and unless an appropriate
amended answer was filed by February 17, 2016, a mo-
tion for default judgment would be filed. Further, ac-
cording to the undisputed allegations in the motion for
default judgment, as described above, the Regional Di-
rector translated the February 10, 2016 letter into Korean
at the Respondents’ request and properly served a copy
of the translation on the Respondents but, to date, the
Respondents have not filed an amended answer.
We note that the Respondents’ answer was filed pro
se.9 In determining whether to grant a motion for default
judgment on the basis of a respondent’s failure to file a
sufficient or timely answer, the Board typically shows
some leniency toward respondents who proceed without
benefit of counsel. See, e.g., Clearwater Sprinkler Sys-
tem, 340 NLRB 435, 435 (2003). Indeed, the Board gen-
erally will not preclude a determination on the merits of a
complaint if it finds that a pro se respondent has filed a
timely answer that can reasonably be construed as deny-
ing the substance of the complaint. Id.
Here, however, the Respondents’ answer cannot rea-
sonably be construed as denying the substance of the
factual allegations in the consolidated amended compli-
ance specification. None of the answer’s statements cor-
responded with any of the numbered paragraphs in the
consolidated amended compliance specification, nor did
the answer include any specific admissions or denials of
any of the allegations in the consolidated amended com-
pliance specification. The substance of the Respondents’
answer fails to address any of the factual or legal allega-
tions concerning the Respondents’ backpay liability, and
the answer asserts facts that are not responsive to the
allegations in the consolidated amended compliance
specification. In addition, the Respondents do not set
forth the basis of their disagreement with the amounts of
backpay or union dues set forth in the consolidated
amended compliance specification, and they have failed
to offer any alternative formula or figures for computing
these amounts. See, e.g., M. D. Miller Trucking & Top-
soil, 363 NLRB No. 49, slip op. at 3 (2015), and cases
cited therein. See also United States Service Industries,
325 NLRB 485, 486 (1998) (general denial is not suffi-
cient to refute allegations pertaining to backpay). Ac-

9 The Board, unlike the federal courts, permits respondent corpora-
tions to appear without counsel. See Rowland v. California Men’s
Colony, Unit II Men’s Advisory Council, 506 U.S. 194, 201–202 (1993)
(“It has been the law for the better part of two centuries . . . that a cor-
poration may appear in the federal courts only through licensed coun-
sel.”); Palazzo v. Gulf Oil Corp., 764 F.2d 1381, 1385 (11th Cir. 1985)
(“The rule is well established that a corporation is an artificial entity
that can act only through agents, cannot appear pro se, and must be
represented by counsel.”), cert. denied 474 U.S. 1058 (1986).
cordingly, we find that the Respondents did not answer
the allegations in the consolidated amended compliance
specification with sufficient specificity under Section
102.56(b) and (c) of the Board’s Rules and Regulations.
In the absence of good cause for the Respondents’
failure to file a legally sufficient answer, we deem the
allegations in the consolidated amended compliance
specification to be admitted as true, and we grant the
General Counsel’s Motion for Default Judgment. Ac-
cordingly, we conclude that the net backpay due the dis-
criminatees is as stated in the consolidated amended
compliance specification, and we will order the Re-
spondents to pay those amounts, plus interest accrued to
the date of payment. We also conclude that the dues to
be remitted to the Union are as stated in the consolidated
amended compliance specification, and we will order the
Respondents to pay those amounts, plus interest accrued
to the date of payment.
ORDER
The National Labor Relations Board orders that the
Respondents, SK USA Cleaners, Inc. a/k/a SK USA
Shirts, Inc., Garfield, New Jersey, their officers, agents,
successors, and assigns, and the Respondent Yi Jae Cho,
his agents, successors, and assigns, shall make whole the
discriminatees by paying them the remaining principal,
interest, and surcharge still owed to each under the stipu-
lated compliance agreement, as specified in the consoli-
dated amended compliance specification, plus interest
accrued to the date of payment, as prescribed in New
Horizons, 283 NLRB 1173 (1987), compounded daily as
set forth in Kentucky River Medical Center, 356 NLRB 6
(2010), minus tax withholdings required by Federal and
State laws. We shall also order the Respondents to remit
to the Union dues that have not been remitted since Feb-
ruary 2012, as specified in the consolidated amended
compliance specification, plus interest accrued to the
date of payment, as prescribed in New Horizons, supra,
compounded daily as set forth in Kentucky River Medical
Center, supra.
DECISIONS OF THE NATIONAL LABOR RELATIONS BOARD4
TOTAL AMOUNT OF BACKPAY DUE TO
DISCRIMINATEES: $51,656.0710
TOTAL AMOUNT OF DUES TO BE REMITTED
TO UNION: $28,224.0011
Dated, Washington, D.C. January 25, 2017
______________________________________
Philip A. Miscimarra, Acting Chairman
______________________________________
Mark Gaston Pearce Member
______________________________________
Lauren McFerran, Member
(SEAL) NATIONAL LABOR RELATIONS BOARD

10 This total represents the remaining $25,820.68 due the discrimi-
natees for monetary losses under the Board’s 2006 Order, as enforced;
$16,280.35 in interest; and the $9,555.04 surcharge (pars. 7–9 of con-
solidated amended compliance specification).
11 We have corrected the calculation in par. 23 of the consolidated
amended compliance specification, which listed an amount of $24,864
but specified that the total represents $672 (the representative amount
of dues for 1 month) “multiplied by the number of months, to date, that
Respondent has failed to remit dues, which is 42 months (Feb. 2012
through Aug. 2015).” Based on this formula ($672 x 42), $28,224 is
the amount of dues payments owed. The $24,864 figure is apparently
an inadvertent carryover from the original compliance specification in
Case 22–CA–087198, which covered a 37-month period ($672 x 37 =
$24,864).