Stucco Stone Products

National Labor Relations Board - Board Decisions

Jun 14, 1984

270 N.L.R.B. 1195 (N.L.R.B. 1984)

STUCCO STONE PRODUCTS
Stucco Stone Products, Inc. and Western Graphic
Arts Union No. 14, International Printing and
Graphic Communications Union, AFL-CIO; and
Teamsters Local 490, International Brotherhood
of Teamsters, Chauffeurs, Warehousemen and
Helpers of America. Cases 20-CA-16128(E),
20-CA-16257(E), 20-CA-16465(E), 20-CA-
16682(E), and 20-RC-15277(E)
14 June 1984
SUPPLEMENTAL DECISION AND
ORDER
BY CHAIRMAN DOTSON AND MEMBERS
ZIMMERMAN AND HUNTER
On 18 November 1983 Administrative Law
Judge Gerald A. Wacknov issued the attached sup-
plemental decision. The Respondent filed excep-
tions and a supporting brief and the General Coun-
sel filed cross-exceptions and a supporting brief.
The National Labor Relations Board has delegat-
ed its authority in this proceeding to a three-
member panel.
The Board has considered the decision and the
record in light of the exceptions and briefs and has
decided to affirm the judge's rulings, findings,I and
conclusions and to adopt the recommended Order.
ORDER
The recommended Order of the administrative
law judge is adopted and the application of Stucco
Stone Products, Inc. for attorney fees and expenses
under the Equal Access to Justice Act is hereby
denied, and the confidential financial statement at-
tached to and incorporated in the Respondent's ap-
plication for fees shall be sealed and withheld from
public disclosure, under the provisions of 29 CFR
102.147(g).
L In accordance with our recent decision in W C. McQuaide, Inc., 270
NLRB 1197 (1984), we agree with the judge that in determining an appli-
cant's net worth, assets are properly valued at their acquisition cost and
not at their depreciated value.
SUPPLEMENTAL DECISION
(Equal Access To Justice Act)
GERALD A. WACKNOV, Administrative Law Judge.
These consolidated cases were litigated before me during
26 days between December 1, 1981, and June 3, 1982. In
my decision, which issued on February 8, 1983, I found
that Stucco Stone Products, Inc. (herein the Applicant),
had committed certain isolated and relatively innocuous
unfair labor practices. However, I dismissed the remain-
der of the allegations which comprised the overwhelm-
ing substance, both in terms of importance and quantity,
of the consolidated complaints. I further recommended
that the Board refer to the United States Department of
270 NLRB No. 178
Justice the Applicant's request for criminal prosecution
of a key witness for the General Counsel because of pur-
ported "false testimony."
Exceptions to the decision were filed by both the Gen-
eral Counsel and the Charging Parties. Thereafter, on
April 13, 1983, the General Counsel filed a motion to
withdraw complaint, submitting that the Charging Par-
ties requested that the charges and objections filed in the
representation proceeding be withdrawn. On June 22,
1983, the Board granted, over the Applicant's objection,
the General Counsel's motion to dismiss complaint.
On July 22, 1983, in an "Application for an Award of
Fees and Expenses Under the Equal Access to Justice
Act" (EAJA), Pub. L 96-481, 94 Stat 2325, and Section
102.143 of the Board's Rules and Regulations, the Appli-
cant applied to the Board seeking an award of attorney's
fees and expenses, and also filed a motion to withhold
confidential information from public disclosure. By order
dated July 26, 1983, the Board referred the matter to me
for appropriate action.
Thereafter, on September 19, 1983, the General Coun-
sel timely filed a motion to dismiss the application to-
gether with a supporting brief, and on October 18, 1983,
the Applicant filed its opposition thereto.
This decision is issued pursuant to Section 102.153(a)
of the Board's Rules and Regulations.
Issue
The threshold issue is whether an applicant for attor-
ney's fees and expenses under EAJA and the applicable
related Rules and Regulations of the Board may deduct
accumulated depreciation in arriving at its "net worth."
I. FINDINGS
The instant case squarely presents the foregoing issue.
The comparative balance sheet submitted by the Appli-
cant shows that as of October 29, 1981, the Applicant
had total net assets of S3,441,173 (total assets minus total
liabilities). However, in arriving at that figure, the Appli-
cant used the amount of $1,371,370 for the net value of
its leasehold improvements and machinery and equip-
ment, having arrived at this figure by deducting accumu-
lated depreciation for such leasehold improvements and
machinery and equipment in the amount of $1,613,878.
If, as the General Counsel contends, it is inappropriate to
deduct accumulated depreciation, the Applicant's net
worth of October 29, 1981, was $5,055,051, thus disquali-
fying it from the recovery of attorney's fees and ex-
penses under EAJA.
The identical issue has been presented in at least four
decisions of administrative law judges,' and in each in-
stance it was determined from a review of the legislative
history of EAJA that assets, whether comprised of real
property or machinery and equipment, are to be valued
for purposes of EAJA at their acquisition cost rather
W. C. McQuaide. Inc.. JD-235-83 (June 7, 1983); Molcomb Boring
Co.. Inc., JD-(SF)-80-82; Senile Trucking Corporation, JD-54-83; Glen-
mar Cinestare. Inc., JD-171-83 (Apr. 22, 1983). Apparently the foregoing
recommended orders were adopted by the Board in the absence of excep-
tions.
1195
DECISIONS OF NATIONAL LABOR RELATIONS BOARD
than, as the Applicant herein contends, at their fair
market value, and that neither appreciation nor deprecia-
tion of property should be considered for purposes of
computation of net worth under EAJA.
The rationale for such a determination is not that ac-
quisition cost constitutes the most accurate or even an
arguably realistic indication of an asset's current value,
but rather is simply premised on the principle of expedi-
ency in order to preclude complex collateral litigation in-
volving the propriety of particular accounting methods
and valuations. As Judge Schlesinger summarized in W.
C. McQuaide, Inc., supra, in reviewing the foregoing rec-
ommended decisions:
These decisions concluded that Congress' failure to
refer to depreciation was purposeful; that Congress
meant what it said; that Congress opted for a simple
and readily verifiable method to compute the value
of an organization attempting to utilize EAJA; and
that Congress did not desire that EAJA applications
become bogged down either with contested apprais-
als of the fair market value of property or with de-
termination of the propriety of different methods of
depreciation, such as straight line, declining balance,
double declining balance, or sum-of-the-year's
digits.
Accordingly, in the absence of any contrary authority,
I concur with the reasoning and conclusions embodied in
the foregoing decisions governing the calculations of net
worth. 2
On the foregoing findings and conclusions and on the
entire record I issue the following recommended3
ORDER
The General Counsel's motion to dismiss the applica-
tion of Stucco Stone Products, Inc. for attorney's fees
and expenses under the Equal Access to Justice Act is
hereby granted. Further, the confidential financial state-
ment attached to and incorporated in Respondent's appli-
cation for fees shall be sealed and withheld from public
disclosure, under the provisions of 29 CFR 102.147(g).
' In view of this determination, I deem it unnecessary to discuss the
General Counael's numerous additional contentions in support of the
motion to dismiss. Further, I deny the Applicant's request to file an
amended financial statement reflecting net worth as of the date the initial
complaint here was issued, as Respondent has not contended that its net
worth, as defined herein, would be less than S5 million on that date,
namely, April 29, 1981.
3 If this Order is enforced by a Judgment of a United States Court of
Appeals, the words in the notice reading "Posted by Order of the Na-
tional Labor Relations Board" shall read "Posted Pursuant to a Judgment
of the United States Court of Appeals Enforcing an Order of the Nation-
al Labor Relations Board."
1196