Feld & Sons, Inc. t/a Today's Man

National Labor Relations Board - Board Decisions

Aug 18, 1982

263 N.L.R.B. 332 (N.L.R.B. 1982)

DECISIONS OF NATIONAL LABOR RELATIONS BOARD
Feld & Sons, Inc. t/a Today's Man and Philadelphia
Joint Board, Amalgamated Clothing and Textile
Workers Union, AFL-CIO. Cases 4-CA-9490-
1, 4-CA-9490-2, and 4-CA-9426
August 12, 1982
DECISION
BY CHAIRMAN VAN DE WATER AND
MEMBERS FANNING AND HUNTER
On September 24, 1981, Administrative Law
Judge Peter E. Donnelly issued the attached Deci-
sion in this proceeding. Thereafter, Respondent
filed exceptions and a supporting brief, the General
Counsel filed cross-exceptions, and a brief in sup-
port thereof and in opposition to Respondent's ex-
ceptions, and counsel for the law firm of Pechner,
Dorfman, Wolffe, Rounick & Cabot, a Pennsylva-
nia Partnership, and Leonard Schaeffer, Stephen J.
Cabot, Martin J. Sobol, Jerome Cureton, Robert J.
Simmons, and Kenneth M. Jarin, individual attor-
neys, hereinafter called counsel for the Pechner
firm, filed cross-exceptions and a brief in support
thereof and a brief in opposition to Respondent's
exceptions.
Pursuant to the provisions of Section 3(b) of the
National Labor Relations Act, as amended, the Na-
tional Labor Relations Board has delegated its au-
thority in this proceeding to a three-member panel.
The Board has considered the record and the at-
tached Decision in light of the exceptions and
briefs and has decided to affirm the rulings, find-
ings,1 and conclusions of the Administrative Law
Judge and to adopt his recommendations. 2
Respondent excepts to the Administrative Law
Judge's Order granting the motion of counsel for
the Pechner firm, which was joined by the General
Counsel, the Union, and separate counsel for attor-
neys Steiner and Dabrow, to strike the entire testi-
mony of Respondent's president, David Feld, be-
cause of his defiance of the Administrative Law
Judge's Order to respond to questions on cross-ex-
amination. The relevant facts and circumstances
which led to this ruling are set forth in the Admin-
I Respondent and the Pechner's attorneys has excepted to certain
credibility findings made by the Administrative Law Judge. It is the
Board's established policy not to overrule an administrative law judge's
resolutions with respect to credibility unless the clear preponderance of
all of the relevant evidence convinces us that the resolutions are incor-
rect. Standard Dry Wall Products, Inc., 91 NLRB 544 (1950), enfd. 188
F.2d 362 (3d Cir. 1951). We have carefully examined the record and find
no basis for reversing his findings. We have also considered Respondent's
contention that the Administrative Law Judge has evidenced bias and
prejudice against Respondent, as manifested by his evidentiary rulings
and factual findings. We have carefully considered the record and the at-
tached Decision and hereby reject these charges.
' By motion filed with the Board on November 2, 1981, Respondent
requested oral argument. This motion is hereby denied as the record, ex-
ceptions, and briefs adequately present the issues and positions of the par-
ties.
263 NLRB No. 41
istrative Law Judge's Order, which is attached
hereto as the Appendix. We find, in agreement
with the Administrative Law Judge, that, although
Feld's conversations with Respondent's counsel,
Paul Rosen, are protected by the attorney-client
privilege, Feld may not assert this privilege in the
circumstances herein. Respondent petitioned the
Board to set aside its settlement agreement with the
Union, contending, inter alia, that Feld executed
this agreement in reliance upon self-serving advice
of the Pechner attorneys. The Board can not rea-
sonably evaluate this contention without knowing
whether Feld also received advice on the subject
from other counsel. Thus, the Administrative Law
Judge's direction to Feld to respond to the ques-
tion and his Order striking Feld's testimony upon
his failure to answer were proper. See Sections
102.35(0 and 102.44(c), Board's Rules and Regula-
tions, Series 8, as amended.
Respondent contends that the General Counsel's
failure to seek Federal court enforcement of the
subpoena duces tecum demanding Respondent to
produce documentary evidence of Feld's conversa-
tion with Rosen somehow excuses Feld's defiance
of the Administrative Law Judge's direction to
answer questions on this issue at the hearing. We
find this argument to be without merit. The Gener-
al Counsel may not be forced to seek enforcement
of a validly issued subpoena at the whim of the
party that refuses to comply with it. Hedison Man-
ufacturing Company v. N.L.R.B., 643 F.2d 32, 34
(lst Cir. 1981). International Union, United Auto-
mobile, Aerospace and Agricultural Implement Work-
ers of America (UA W) [Gyrodyne Co. of America] v.
N.L.R.B., 459 F.2d 1329, 1343 (D.C. Cir. 1972).
Moreover, Respondent's defiance of Board authori-
ty in one instance does not justify its failure to co-
operate in another.
Respondent also excepts to the Administrative
Law Judge's ruling overruling Respondent's objec-
tion to cross-examination testimony by several at-
torneys from the Pechner firm recounting certain
statements and threats allegedly made to them by
Rosen at a Philadelphia restaurant in March 1979.
Respondent now contends that this testimony
should have been excluded on the grounds that it
was hearsay evidence as well as beyond the scope
of direct examination and irrelevant. At the hearing
Respondent only objected on the grounds that this
line of questioning was beyond the scope of direct
examination as well as irrelevant. We find that
since Respondent did not then object on the
grounds that it was hearsay, it may not now claim
to have a meritorious exception to this ruling on
hearsay grounds. See "McCormick's Handbook of
the Law of Evidence" § 52 (E. Cleary ed. 1972).
332
TODAY'S MAN
We further find that the Administrative Law Judge
correctly ruled that this line of questioning related
to issues raised on direct examination, and was rele-
vant to the issue of Feld's motivation for executing
the settlement agreement. Accordingly, we find no
merit to this exception.3
The General Counsel filed a motion to strike cer-
tain portions of Respondent's brief and exhibits at-
tached thereto. The Pechner attorneys filed a
joinder to this motion. These parties request that
we strike all references to Exhibits A and B from
Respondent's brief. Exhibit A is the stenographic
transcript from the change of plea hearing of Re-
spondent's president, David Feld, in a criminal case
stemming from the circumstances involved in the
instant case. Exhibit B is a document entitled
"Brief on Behalf of the General Counsel to Admin-
istrative Law Judge Walter J. Maloney, Jr., in the
cases of W.C. McQuaide, Inc., 6-CA-7509 and 6-
CA-7770." These exhibits attempt to impeach the
credibility of certain witnesses whose testimony
was unfavorable to Respondent. The moving par-
ties further request us to strike all references in Re-
spondent's brief to a letter dated March 13, 1979,
from Respondent's counsel to counsel for the
Pechner firm requesting, essentially, that counsel
seek enforcement in Federal court of a subpoena
duces tecum issued against Respondent. We find
that these exhibits and references were not ad-
mitted into evidence at the hearing, and, therefore,
are not part of the record in this proceeding. We
note that consideration of these documents would
deny the parties the opportunity for voir dire and
cross-examination, and would violate the Board's
Rules. See Section 102.45(b) of the Board's Rules
and Regulations, Series 8, as amended; S. Freedman
Electric, Inc., 256 NLRB 484, fn. 1 (1981); Southern
Florida Hotel & Motel Association, and its employer-
members The Estate of Alfred Kaskell d/b/a Caril-
s By letter dated December 31, 1981, Respondent's counsel. Paul R.
Rosen, requested the Administrative Law Judge to delete language from
his Decision concerning Rosen's activities at the restaurant. The Adminis-
trative Law Judge referred this letter to the Board's Executive Secretary,
who determined that it constituted an ex parte communication under Sec.
102.128(e) of the Board's Rules and Regulations, Series 8, as amended.
Accordingly, pursuant to Sec. 102.132 of the Board's Rules, the Execu-
tive Secretary caused Rosen's letter to be placed on the public record of
the proceedings and permitted all parties to file with the Board a state-
ment setting forth facts or contentions to rebut those contained in
Rosen's letter. Thereafter, statements were filed by the General Counsel,
counsel for the Pechner firm, counsel for attorneys Julius M. Steiner and
Allan M. Dabrow, counsel for the Philadelphia Joint Board of the Amal-
gamated Clothing and Textile Workers Union, and counsel for Mr.
Rosen. The General Counsel, in addition to responding to the statements
contained in Mr. Rosen's letter, suggested that the Board consider invok-
ing penalties against Mr. Rosen pursuant to Sec. 102.133(b) of the Board's
Rules, in order to discourage parties and their counsel from engaging in
prohibited ex parte communication.
We are of the opinion the relief requested by Mr. Rosen should not be
granted. Furthermore, the circumstances herein do not require that we
institute proceedings against Mr. Rosen pursuant to Sec. 102 133(b) of the
Board's Rules.
Ion Motel,' The Estate of Alfred Kaskell d/b/a Doral
Hotel and Country Club; The Estate of Alfred Kas-
kell d/b/a Doral Beach Hotel, 245 NLRB 561, fn. 6
(1979).
The moving parties also ask us to strike all refer-
ences in the briefs to David Feld's testimony, con-
tending that, since the Administrative Law Judge
struck all of Feld's testimony, it is not properly a
basis for argument in the brief. As we herein affirm
the Administrative Law Judge's ruling in this
regard, we find merit to this contention. Accord-
ingly, we hereby grant the motion to strike the
portions of Respondent's brief requested by the
moving parties.
DECISION
STATEMENT OF THE CASE
PETER E. DONNELLY, Administrative Law Judge: The
original charge in the unfair labor practice case in this
matter was filed by Philadelphia Joint Board, Amalga-
mated Clothing and Textile Workers Union, AFL-CIO,
herein called the Union, on July 3, 1978.' Additional
unfair labor practice charges were filed on August 11
and September 13. In addition, the Union also sought
10(j) injunctive relief.2 On October 6, a complaint issued
alleging that Feld & Sons, Inc., t/a Today's Man, herein
called Respondent, violated Section 8(a)(1), (3), (4), and
(5) of the Act. The complaint came to hearing before
Administrative Law Judge Morton Friedman on October
23. After the hearing opened, the complaint was settled
by formal settlement agreement between the General
Counsel and Respondent. The Union declined to join.
The settlement was approved by the administrative law
judge, and subsequently approved by the Board which
issued its order on January 19, 1979. Application for en-
forcement of the Board's order was made to the United
States Circuit Court of Appeals for the Third Circuit on
March 1, 1979, and opposed by Respondent. In this pos-
ture, the Board and the Employer stipulated to the re-
manding of the case to the Board for the purpose of
taking evidence regarding the circumstances surrounding
the execution of the settlement agreement. On February
11, 1980, pursuant to a petition filed by Respondent on
November 14, 1979, the Board issued an Order Remand-
ing Proceeding to the Regional Director, directing that a
hearing be held before an administrative law judge "for
All dates refer to 1978 unless otherwise indicated.
2 Sec 10(j) provides:
(j) The Board shall have power, upon issuance of a complaint as
provided in subsection (b) charging that any person has engaged in
or is engaging in an unfair labor practice, to petition any district
court of the United States (including the District Court of the United
States for the District of Columbia), within any district wherein the
unfair labor practice in question is alleged to have occurred or
wherein such person resides or transacts business, for appropriate
temporary relief or restraining order Upon the filing of any such pe-
tition the court shall cause notice thereof to be served upon such
person, and thereupon shall have jurisdiction to grant to the Board
such temporary relief or restraining order as it deems just and
proper
333
DECISIONS OF NATIONAL LABOR RELATIONS BOARD
the purpose of receiving evidence concerning the cir-
cumstances surrounding the execution of the Formal Set-
tlement Stipulation entered into, on October 27, 1978, be-
tween the Respondent and the General Counsel of the
National Labor Relations Board."
A hearing was held on this matter before the Adminis-
trative Law Judge on various dates between May 6,
1980, and April 21, 1981. Briefs have been duly filed by
General Counsel, Respondent, and counsel for the
Pechner firm. The Pechner firm's brief was joined by
counsel for Steiner and Dabrow. All briefs have been
duly considered.
I. THE FACTS
A. Representation Case (Case 4-RC-13254)
The circumstances leading to the remand and hearing
in this case involve related representation and unfair
labor practice cases.
The petition in the representation case was filed on
June 23, seeking to represent a unit of warehousemen at
one of Respondent's locations. A hearing was held on
various dates in July, August, and September 1978 to de-
termine the eligibility of certain employees, including
Larry Feld, Jacob Jacobson, and David Klein, whom
Respondent was contending were eligible to vote as
warehouse employees. The hearing officer conducting
the hearing on behalf of the Board was Stephen Suflas,
field attorney with Region 4. Respondent was represent-
ed by attorneys Julius M. Steiner and Allan M. Dabrow
of the Pechner firm. The Union was represented by at-
torney Robert Tim Brown. During the course of the
hearing, on August 23, certain documentary evidence
was introduced concerning wages which contradicted
certain testimony adduced from Jacobson, Klein, David
Feld, and Allan Becker, all witnesses for Respondent.3
Suflas, suspecting perjury, brought this matter to the at-
tention of certain supervisory employees in Region 4, in-
cluding Regional Director Peter W. Hirsch.
In early October 1978, Hirsch, having determined that
the evidence suggested that perjury had been committed
by the four above-named individuals, decided to refer
the matter to the office of the General Counsel in Wash-
ington, D.C. In a memorandum dated October 18,
Hirsch recommended referral of the perjury matter to
the Department of Justice. While Hirsch, Suflas, and
others had discussed the possible involvement of the at-
torneys and David Feld in suborning the perjury, this
matter was not raised in Hirsch's memo because these
suspicions had not been substantiated.
B. Unfair Labor Practice Case and Formal Settlement
Stipulation4
The first unfair labor practice charges were filed on
July 3, shortly after the filing of the petition, and the
3 David Feld and Larry Feld are brothers.
' It is conflicting testimony regarding some of the matters raised at the
hearing. In resolving these conflicts I have taken into consideration the
apparent interests of the witnesses. In addition, I have considered the ap-
parent probabilities; the probabilities in light of other events; corrobora-
tion or lack of it; and consistencies or inconsistencies within the testimo-
ny of each witness and between the testimony of each and that of other
case was assigned to Suflas for investigation. After the
investigation, a determination was made that the case
had merit and efforts were made to settle the case prior
to the issuance of complaint. Martin Sobol, a lawyer in
the Pechner firm, who had become involved with
Steiner in the case, held a settlement discussion on
August 22 at the Regional Office with Suflas. Also in at-
tendance were Bernard Dinkin, education director of the
Union, as well as union attorneys Jerome Markovitz and
Robert Tim Brown. Various terms of a prospective set-
tlement were discussed without resolution.
On the following day, August 23, Suflas reported to
Hirsch and Charles Cohen, deputy regional attorney,
concerning the prior day's settlement discussion. Suflas
was told to make it clear to Sobol that any settlement of
the unfair labor practice case would not dispose of any
other outstanding matters involving other violations of
Federal law. On the following day, August 24, Sobol
called Suflas to discuss settlement, and, during the course
of this conversation, Suflas told Sobol that any settle-
ment would not affect the disposition of any other Fed-
eral law violations. Sobol asked what this meant, and
Suflas told him that he was referring to the prejury mat-
ters arising out of testimony at the representation case
hearing. Sobol relayed this information to Steiner who
called Suflas on August 25. Steiner, while not referring
to the perjury matter, told Suflas that he was withdraw-
ing his representation case contention that Jacobson,
Klein, and Larry Feld were employees in the warehouse
unit.
As noted above, complaint issued in the unfair labor
practice case on October 6. On this same day the Re-
gional Office requested authorization to seek 10ij) injunc-
tive relief against Respondent. The unfair labor practice
hearing was scheduled for October 23.
On Saturday, October 21, a warehouse employee
named Tyrone Evans, who had been served by Suflas
with a Board subpoena to appear at the unfair labor
practice hearing, was asked by David Feld to attend the
meeting at which David Feld and Steiner were present,
among others. After the meeting, Evans complained to
Dinkin about the conduct of Feld and his lawyers at the
meeting. Dinkin relayed this information to Suflas who
interviewed Evans. He was told by Evans that an at-
tempt had been made to induce him not to honor the
subpoena previously served on him by Suflas.
On the morning of the hearing, Monday, October 23,
before the hearing was to begin, Suflas brought this "Sat-
urday incident" to the attention of Hirsch and a decision
was made to treat and investigate it as an unfair labor
practice allegation. While it is clear that there was a dis-
cussion about the possibility that Section 12 of the Act 5
witnesses with similar apparent interests. In evaluating the testimony of
witnesses, I rely specifically upon their demeanor and have made my
findings accordingly. While apart from considerations of demeanor I
have taken into account the above-noted credibility considerations, my
failure to detail each of these is not to be deemed a failure on my part to
fully consider it. Bishop and Malco, Inc., d/b/a Walker's, 159 NLRB 1159,
1161 (1966). 1 also note that the record is void of any admissible testimo-
ny from David Feld since his testimony was striken when he failed to
respond to relevant inquiry on cross-examination.
Sec. 12 reads:
Continued
334
TODAY'S MAN
had been violated, there was no action taken to under-
take any investigation of the Section 12 aspect of the
matter. Hirsch credibly testified that he was not consid-
ering the possibility of pursuing any possible Section 12
violation.
Later on the morning of October 23, but still prior to
the opening of the hearing, Suflas advised Steiner of the
decision to treat the "Saturday incident" as an additional
unfair labor practice charge, and arrangements were
made to interview the participants at the offices of the
Pechner firm that evening. This was done. Suflas and
Barbara Allen, another Board attorney assigned to assist
Sufias at the hearing, conducted the investigation. David
Feld attended the entire session. Attorneys Stein and
Sobol were also present, as well as Barry Bevacqua, an-
other Pechner attorney who had participated in the "Sat-
urday incident." On Tuesday morning, Suflas reported to
Hirsch on the matter, and a decision was made to amend
the complaint to allege an 8(a)(l) violation in that both
Feld and Steiner had made promises to Evans to unlaw-
fully induce him not to honor a Board subpoena.
The information that a decision had been made to
amend the complaint to add these violations was con-
veyed by Suflas to Bevacqua on the afternoon of Tues-
day, October 24, after the hearing had adjourned for the
day.
On Wednesday morning, Stein and Bevacqua entered
into a discussion concerning a settlement with Suflas and
Allen. Stein and Bevacqua expressed a desire to settle
the 8(aXl) "Saturday incident" allegation separately, in
an informal settlement agreement, but this proposal was
rejected by Suflas after consultation with Hirsch, consist-
ent with the Region's policy of not settling cases on a
"piece meal" basis.
Having failed in his attempt to settle the "Saturday in-
cident" separately, Steiner requested the Administrative
Law Judge to adjourn the hearing in order to enable him
to prepare a defense to the allegation and to consider
whether he should continue as counsel for Respondent in
view of conflict-of-interest considerations because of his
involvement in the "Saturday incident" allegation. This
request was opposed by both Cohen and Suflas, on the
record, as a possible delaying tactic and on the ground
that there were other attorneys in the Pechner firm who
were able to handle the hearing on behalf of Respondent.
By way of compromise, it was determined to continue
the hearing without amending the complaint to add the
Saturday incident, and the General Counsel would rest
subject to a resolution of that matter.
At the start of the hearing on Wednesday, October 25,
while David Feld was in attendance, Steiner expressed
reservations about his continued participation in the case
as Feld's counsel "due to ethical considerations," and
again requested a postponement, however, in conformity
to the agreement previously reached off the record, the
hearing proceeded.
Any person who shall willfully resist, prevent, impede, or interfere
with any member of the Board or any of its agents or agencies in the
performance of duties pursuant to this Act shall be punished by a
fine of not more than S5,000 or by imprisonment for not more than
one year, or both.
Later in the course of the hearing on Wednesday,
Steiner, becoming concerned about the possibility of a
conflict of interest in his continued participation in the
case, and that the matter was getting out of control,
called his office to solicit the assistance of Sobol who
came to the hearing. He was filled in by Steiner as to
what had transpired earlier in the day.
At this point, Sobol sought out Cohen in the hallway
and upon inquiry was advised by Cohen that 10(j) relief
has also been recommended, that the Saturday incident
raised the possibility of a Section 12 violation, and that
the Region had requested authorization from the General
Counsel in Washington to refer the perjury matter to the
Department of Justice.
After this conversation with Cohen, Sobol returned to
Steiner and Feld. He explained to them the nature of the
10(j), perjury, and possible Section 12 violations. Sobol
specifically explained to Feld that Section 12 included in-
terference with Board processes and possible criminal
implications. He also expressed a pessimistic view as to
winning the unfair labor practice case, and told him that
the Board would likely be successful in obtaining 10(j)
injunctive relief which would require Respondent to bar-
gain with the Union anyway. Sobol suggested arranging
a meeting to discuss settlement with the Regional Direc-
tor. He also told Feld that he might want to discuss the
matter with Paul Rosen.6 A meeting was arranged for
the following morning with Hirsch, and the hearing was
temporarily adjourned to accommodate the settlement
effort.
Feld was asked by Sobol if he wanted to attend the
meeting, and Feld rejected this invitation saying, "I'm
not going to talk to those ass holes, that's what I am
paying you for."
The meeting was held on the morning of Thursday,
October 26, in Hirsch's office. It was attended by
Steiner, Sobol, Bevacqua, and Stephen Cabot, head of
the labor department of the Pechner firm. Also in attend-
ance, representing the Region, were Hirsch, Cohen,
Suflas, Allen, and at various times, Frances Hoeber, as-
sistant to the Regional Director. A discussion of the
unfair labor practice allegations ensued, including the
Region's intention to seek relief under 10(j) of the Act,
as well as the Saturday incident. Cabot suggested that
the "Saturday incident" be settled separately, but, as he
had done previously, Hirsch rejected this approach.
While it appears that there may have been some discus-
sion concerning the criminal aspects of Section 12, it was
insignificant, and clearly no decision made to pursue the
Saturday incident as a Section 12 violation. The matter
of the representation case perjury was raised by Hirsch,
who advised the Pechner attorneys that the matter had
been referred by memo to Washington with a recommen-
dation to refer the matter to the Justice Department and
naming David Feld, Klein, Jacobson, and Becker as
those involved.
With respect to the matter of settlement, Hirsch was
still insisting on a full settlement providing for reinstate-
ment, backpay, and a bargaining order, adding that he
6Paul Rosen was corporate counsel for Respondent.
335
DECISIONS OF NATIONAL LABOR RELATIONS BOARD
would be willing to discuss "any settlement." The
Pechner's attorneys left Hirsch's office to caucus, where-
upon Cohen, Suflas, and Allen expressed surprise that
Hirsch had agreed to discuss "any settlement," since this
appeared to include the possibility of a settlement of the
perjury matter. Hirsch told them that this had not been
his intention. When Sobol returned, alone, to Hirsch's
office it was made clear to him by Cohen that, as far as
he was concerned, he would advise Sobol to prepare his
client for a referral of the perjury matter. Hirsch nodded
his head in assent to the statement. Sobol remarked that
he would try and settle the case and left.
On the afternoon of this same day, Thursday, October
26, a meeting was held between David Feld and Pechner
firm attorneys Cabot, Steiner, and Sobol. The purpose of
the meeting was to apprise Feld of the developments. It
was explained to Feld by Cabot that 10(j) relief was
being pursued and that the Board would likely prevail.
In discussing the "Saturday incident," Feld was told that
the matter might involve Section 12 violations, but also
that the settlement would dispose of the entire Saturday
incident. Apparently this evaluation of the settlement
prospects to include any possible Section 12 violations
were based on interpretations gleaned from earlier settle-
ment discussions with the Region about the "Saturday
incident." Feld was also expressly advised that the settle-
ment did not include settlement of the perjury allega-
tions. While Feld was concerned that the perjury matter
would not be resolved by any settlement, he nonetheless
authorized Sobol to settle the case on the best terms he
could get.
Sometime later, on the same Thursday afternoon, Oc-
tober 26, Sobol telephoned Hirsch in his office. Suflas,
Cohen, Allen, and at times Hoeber were present during
this conversation. Sobol asked if there were any way to
resolve the perjury matter. Hirsch replied that he did not
know of any. Sobol pleaded with Hirsch for enlighten-
ment, and after some prodding, Hirsch told Sobol that, if
the Union and the Employer were to sign a contract, the
Union might be persuaded to bring this to the attention
of the General Counsel in Washington who might con-
clude that, in the interest of industrial harmony, it would
be better not to pursue the perjury matter. Hirsch told
him that any decision would be made by the General
Counsel in Washington, and not him. Sobol's recollection
varies to the extent that he recalls Hirsch saying that
upon reaching an agreement on a contract, the Union
could intercede directly with Hirsch, rather than the
General Counsel, with the understanding that Hirsch
would seriously reconsider his recommendation, but
without guarantees. In view of the corroboration of
Hirsch's version by Cohen, Suflas, and Allen, I conclude
that Hirsch's version is more accurate and I credit it.
Following this suggestion, Sobol indicated that he would
meet and attempt to negotiate a contract with the Union.
Shortly thereafter Sobol called Hirsch again to inquire if
the perjury referral memo, then with the General Coun-
sel in Washington, contained anything about subornation
of perjury. Hirsch told him that it did not; that they had
no evidence of subornation of perjury.
On the evening of Thursday, October 26, a meeting
was held at the union hall attended by various union offi-
cials. Respondent was represented by David Feld, Sobol,
Steiner, and Bevacqua. Outside the union hall, before
going in, Sobol, in the presence of Steiner and Bevacqua,
told Feld that Hirsch had agreed to reconsider his perju-
ry recommendation if Respondent and the Union agreed
on a contract, and the Union interceded with him, but
without guarantees. 7 At the meeting Sobol explained to
the Union what had happened and that it needed the
Union's help in its effort to get Hirsch to reconsider the
perjury recommendation. The Union offered Respondent
its standard area contract and also made a demand for
recognition of the employees in Respondent's retail
stores. This proposal generated considerable disagree-
ment. Sobol explained several alternatives, with a view
toward obtaining a contract, but the parties could not
agree and negotiations broke down. In reviewing the ne-
gotiations with Feld, Sobol asked him to continue be-
cause the perjury charges were serious and a contract
was a possible way out. Feld however was disinclined to
continue and left, remarking, "I don't want to deal with
these ass holes, fuck it, the perjury is bullshit, I'll take
my chances with the Justice Department."
As Feld was leaving, Sobol approached him in the
parking lot, and again, with a view to pursuing negotia-
tions with the Union, tried to reason with Feld. Sobol
testified, "I kept saying, do you realize what's at stake
here? He said, "I don't give a shit . . .' referring to the
Justice Department problem and the referral. He said, 'I
don't give a shit, these guys are pigs, they're whores, I
don't want to deal with them, I don't want a contract
with them, don't ever want a contract with them.' That's
what he kept saying."
With the respect to the execution of a settlement
agreement, Sobol testified, "I said, David you still want
me to settle as we talked about this afternoon, do I have
the authority to do that. He said, 'Yes, go ahead.' I said,
I don't think you should leave here, as I told you up-
stairs. How much could it possibly cost you to get a con-
tract with the Union and the warehouse? I said, 'It's a
chance you can get rid of the perjury.' I told him that
there was no guarantee about it but there's a chance. He
said, 'The perjury is bullshit. I'm gonna to take my
chances with it. It ain't no big deal. I've been through
worse.' That's what he said to me. I said, are you sure.
He said, 'Yeah."'
Thus armed with the authority to settle the case, the
Pechner attorneys, i.e., Sobol, Steiner, and Bevacqua,
met on Friday morning, October 27, with Hirsch, Suflas,
Allen, and Cohen. The Region had already drafted a
formal settlement agreement and discussions ensued over
certain provisions of the agreement. Some changes were
made, including the granting of nonadmission clause, a
compromise to 80 percent of the full backpay liability,
and an installment plan for the disbursement of backpay.
The settlement discussion included the matter of
Steiner's liability in the "Saturday incident." He objected
to being named individually in the formal settlement and
sought various other ways to mitigate the professional
damage to himself. Hirsch acceded to removing Steiner's
I This represents Sobol's inaccurate recollection of Hirsch's suggestion.
336
rODAY'S MAN
name from the caption of the settlement, and deleting the
word "Esquire" after Steiner's name.
Another meeting on the settlement agreement took
place in the afternoon, on the same day, Friday, October
27. It was at this meeting that Hirsch advised Sobol,
Steiner, and Bevacqua that the settlement effectively re-
medied the Saturday incident and that it was not his in-
tention to pursue Section 12 criminal proceedings involv-
ing the Saturday incident. Steiner suggested that this un-
derstanding be reduced to writing, but Sobol and Hirsch
did not feel any written documentation was necessary,
and this forebearance as to Section 12 was not written
into the formal settlement agreement.
Since Steiner himself was to be a signatory to the
agreement, Cohen suggested that Feld also sign the set-
tlement. It was also a policy of the Pechner firm to have
clients sign settlement agreements, and, so when Feld ar-
rived, he was given a copy of the settlement agreement
by Bevacqua and asked to read it. He did, thereafter sug-
gesting certain changes, including reducing of numbers
posting locations, which matter was later compromised.
Prior to signing the settlement agreement, Feld con-
ferred with both Bevacqua and Steiner. Bevacqua testi-
fied, "Well, Mr. Feld made the statement to Jules
[Steiner] that, quote, and these are his words, I recall
them 'This doesn't clean everything does it, the perjury
is still out there.' I think he said that. And I said, even
though he spoke to Jules, I said, 'No it doesn't, this just
settles the unfair labor practice cases."' Feld responded
to this observation by saying something to the effect,
'"fuck them, I'll take my chances with the Justice De-
partment."
The settlement agreement was signed by Feld and
Steiner for Respondent and by Suflas and Allen on
behalf of the General Counsel. It was approved by the
Administrative Law Judge. The Union declined to join
the settlement agreement.
On November 1, after the execution of the settlement
agreement, Hirsch received authority from the General
Counsel to refer the perjury matter to the Justice De-
partment pursuant to the Regional Director's recommen-
dation. Steiner who had asked Hirsch to be notified
whenever such referral was made was notified. On De-
cember 1, the matter was referred to the U.S. Attorney's
Office. Sometime thereafter, Hirsch had a meeting with
the U.S. Attorney, wherein Hirsch voiced his suspicion
that subornation of perjury had taken place, but Hirsch
could not recall whether or not he referred specifically
to any of the Pechner attorneys.
About a week after the settlement agreement was ex-
ecuted, Dabrow, in a meeting with Feld, suggested to
him that he retain a criminal lawyer because of the out-
standing perjury charges. Kenneth Jarin another Pechner
attorney, met with David Feld, Klein, Jacobson, and
Becker in early 1979 to confer with them about the Fed-
eral perjury investigation. Feld did not in either of these
discussions express the view that he understand the pcr-
jury matter to have been disposed of as a part of the set-
tlement agreement.
As the perjury matter proceeded, Feld met on various
occasions with members of the Pechner firm including
Dabrow, Sobol, and Cabot. He told Sobol that he
wanted them to testify that Hirsch had agreed that the
perjury matter was included in and resolved by the set-
tlement. He acknowledged that this was not true, but he
felt that this was his only chance to avoid the perjury
charges. Sobol told him that these were not the facts,
and that he would not lie for Feld.
Rosen made a similar effort in March 1979, in a meet-
ing at a local restuarant when he proposed to a group of
Pechner attorneys, including Sobol, Steiner, Bevacqua,
and Leonard Schaeffer, a scenario of events to defend
the perjury case, which included testimony by the
Pechner attorneys to the effect that Hirsch had agreed to
include the perjury matter in the settlement agreement.
Sobol told him that it did not happen that way, where-
upon Rosen told him that he controlled certain witnesses
and that, if the attorneys did not cooperate, Steiner and
Dabrow were going to jail.8
Feld made another attempt to secure the cooperation
of the Pechner attorneys in his defense to the perjury
matter. In July 1979, in a meeting at another Philadel-
phia restaurant with Cabot, Feld asked Cabot to make an
effort to persuade Sobol to testify that Hirsch had in-
cluded the perjury in the unfair labor practice settlement.
When Cabot told him that he would not lie for him,
Feld told Cabot that he (Feld) controlled the witnesses,
and that, if he went "down the tubes," the lawyers were
going with him.
The perjury investigation by the Justice Department
resulted in two indictments, the first indictment was re-
turned against Jacobson, Klein, and Becker charging
them with perjury. A second indictment charged David
Feld, Steiner, Dabrow, Becker, Jacobson, and Klein with
conspiracy, subornation of perjury, obstruction of pro-
ceedings before a Federal agency, and interference with
a Board agent. Feld pleaded nolo contendere to one count
of violating Section 12 of the Act. Klein. Becker, and Ja-
cobson plead guilty to one count each of interference
with a Board agent in violation of Section 12 of the Act.
Steiner and Dabrow were acquitted after a jury trial on
subornation of perjury charges.
Later, a civil malpractice suit was filed by Feld against
the Pechner attorneys, which was dismissed, on the
pleadings, in the Court of Common Pleas of Philadelphia
County on July 2, 1981. Judge Kaliashr concluded, inter
alia, "The client [David Feld] knowingly lied under
oath; knowingly falsified time and payroll records;
knowingly used corporate funds to bribe a witness to
ignore a subpoena. It is difficult to conceive of a situa-
tion of greater outrageous conduct designed to thwart
the administration of justice." 9
11. DISCUSSION AND ANAL YSIS
As noted above, this case was remanded by the Board
on a petition filed by Respondent, "for the purpose of
taking testimony concerning the circumstances surround-
ing the execution of the Settlement Agreement." The
sole issue for resolution was whether or not those cir-
8 Apparently. this was a reference to the criminal subornation of perju-
ry issue arising from the repres~entation case hearing
9 These conclusions were based on factual averments made by Re-
spondent in the complaint
337
DECISIONS OF NATIONAL LABOR RELATIONS BOARD
cumstances describe a sufficient basis to warrant setting
aside the formal settlement agreement.
Respondent contends that both the Pechner attorneys
and the Regional Director engaged in misconduct suffi-
cient to warrant setting the settlement agreement aside.
First, Respondent claims that Feld was not aware that
the settlement agreement signed by him on October 27
did not include disposition of the perjury matter. In ex-
amining this contention, a review of the Region's han-
dling the perjury matter is in order. Suflas' suspicions of
perjury were brought to the attention of the Regional
hierarchy. In early October, Hirsch decided that the evi-
dence suggested that perjury had been committed, and
on October 18 sent a memo to the General Counsel out-
lining the facts and recommending referral of the matter
to the U.S. Attorney's Office for prosecution. Thereafter,
as set forth in more detail above, the matter was re-
turned by the General Counsel to Hirsch, authorizing re-
ferral by Hirsch to the U.S. Attorney's Office for investi-
gation and possible prosecution. The U.S. Attorney's
Office proceeded with indictments and prosecutions, re-
sulting in the outcomes noted above. At no time was any
suggestion made to any of the Pechner attorneys that the
settlement of the unfair labor practices would include
settlement of the perjury matter. Indeed, it would appear
that at the time of the settlement, on October 27, Hirsch
could not have done this since the matter was beyond his
control, to the extent that it had already been referred
to, and was awaiting action by, the General Counsel. In
addition, the record makes it clear that the Pechner at-
torneys were advised in clear and unmistakable fashion
that the perjury matter would not be included in the
unfair labor practice settlement, despite an initial ambigu-
ous representation made by Hirsch, which was corrected
by Cohen and Hirsch immediately thereafter in conversa-
tion with Sobol.
Having concluded that the perjury allegations were
never represented by Hirsch to have been disposed of in
the settlement agreement, was it possible that Feld none-
theless was not aware of this and regarded the perjury
matter as having been disposed of by the settlement? I
think not.
The overwhelming mass of the probative evidence
suggests that Feld was aware, at every significant step,
of precisely what the terms of the settlement agreement
were, and nevertheless authorized negotiation of the set-
tlement, and executed it with a full understanding of its
terms. For example, the evidence discloses that on the
afternoon of October 26, Feld met with the Pechner at-
torneys and was told about settlement discussions earlier
in the day at the Board offices. He was told by Cabot,
inter alia, that the perjury matter could not be settled.
Feld, although concerned, authorized Sobol to settle the
case anyway.
On the evening of October 26, as they went into the
union hall, Sobol explained to Feld that the purpose of
meeting the Union was to reach agreement on a contract
so that the Union might agree to intercede with Hirsch
to reconsider his perjury recommendation. Obviously if
the settlement agreement were to include the perjury
matter, this evening negotiating session with the Union
would have been unnecessary, and Feld must have
known this.
Again, as negotiations were faltering, Sobol tried to
get Feld to continue with the negotiations, since getting
a contract would at least give Feld a chance to rid him-
self of the perjury matter, but Feld replied that he would
take his chances with the Justice Department and that
the perjury charges were "bullshit." He also told Sobol
that he still wanted to settle the case.
On the next day, October 27, after reading the settle-
ment agreement, and just before signing it, Feld told Be-
vacqua that he knew that the "perjury is still out there."
When Bevacqua affirmed this evaluation, Feld said,
"Fuck them, I'll take my chances with the Justice De-
partment," then proceeded to sign the settlement agree-
ment.
After the settlement had been executed, in discussion
with certain Pechner attorneys, Feld and Rosen attempt-
ed to induce the Pechner attorneys to fabricate testimony
to the effect that Hirsch had agreed to include the perju-
ry allegations in settlement. During these conversations
Feld acknowledged the falsity of such testimony, but felt
that it was his only chance on the perjury matter. Apart
from this as a reprehensible attempt to subvert justice, it
also constitutes an acknowledgement by Feld that he
was aware that the settlement did not dispose of the per-
jury matter.
This record leaves no doubt whatever that Feld was
fully and properly advised as to all of the terms of the
settlement. He knew what the settlement included, and
what it did not include. He specifically knew that it did
not encompass the perjury charges, and that it did re-
solve all of the unfair labor practice charges, as well as
any possible Section 12 violations arising from the "Sat-
urday incident."
Another contention raised by Respondent is that the
settlement should be set aside because Feld and the
Board were operating under a "mutual mistake of fact"
as to a material element of the settlement agreement.
Hirsch's suggestion was as I have concluded, that if Re-
spondent and the Union were to agree on a contract, the
Union might be willing to intercede with the General
Counsel. Sobol's version is the same, except that he had
the erroneous understanding that any possible union in-
tercession would be made to Hirsch. Thus, while it is
true that Feld may have been misinformed as to this
aspect of Hirsch's suggestion, it is pure sophistry to con-
tend that this misinformation involved any material ele-
ment of the settlement agreement. There is no evidence
to suggest that this misunderstanding by Feld was a
factor in his decision to settle the case, particularly since
step one, the execution of a contract with the Union, was
never realized, and subsequent steps regarding any inter-
cession by the Union became academic, and Feld was
aware of this when he signed the settlement.
Another thesis advanced by Respondent for setting
aside the settlement is based on its contention that the
Board had failed "to ensure that Respondent was proper-
ly and adequately represented in the settlement negotia-
tions." Respondent contends that Steiner's involvement
in the Saturday incident produced a "conflict of inter-
338
TODAY'S MAN
est," of which the Region was aware, and apparently
that the Region should have consulted directly with
David Feld instead of his attorneys thereafter. I do not
agree.
It is a well-established principle of legal ethics that, so
long as an attorney-client relationship exists, attorneys
dealing with the matter are prohibited from communicat-
ing directly with the client. This policy has been accept-
ed and is followed by the National Labor Relations
Board in its dealings with respondent.10 This being the
case, unless extraordinary circumstances present them-
selves to justify direct contact with a client, the Region
is obliged to deal exclusively with the party's attorney.
No such extraordinary circumstances existed in this case.
First, Feld was aware of any possible conflict. Feld was
himself a participant in this "Saturday incident" and must
therefore have been aware of the extent to which Steiner
had been involved. Both were present at the Pechner
firm offices on Monday evening, October 23, when
Board attorneys interviewed the participants in the "Sat-
urday incident" and thus Feld must have been aware
that attorney misconduct, as well as his own, was being
investigated. Feld was present in the courtroom when
Steiner raised, on the record before the Administrative
Law Judge, the issue of conflicting interests in seeking a
postponement of the unfair labor practice case. On
Thursday afternoon, in a meeting between the Pechner
attorneys and Feld, the "Saturday incident" was dis-
cussed. On Friday morning, prior to signing the settle-
ment agreement, Feld read it. Since it contained a sepa-
rate "cease and desist" paragraph as to Steiner's miscon-
duct in the Saturday incident, Feld must have known the
extent to which any conflict existed between his interests
and Steiner's, yet he signed it without even raising any
conflict considerations. Furthermore, at no time during
the course of the proceedings did Feld indicate to the
Region that he was in anyway dissatisfied with the rep-
resentation he was receiving from the Pechner attorneys.
In these circumstances I am convinced that Feld was
in fact aware of whatever conflict may have existed and
nonetheless continued to employ Steiner as his attorney
with full authority to represent him. In these circum-
stances, if Hirsch had dealt directly with Feld he would
have violated the strictures of the Cannons of Profession-
al Ethics and the expressed policy of the National Labor
Relations Board.
Respondent contends that yet another basis exists
which warrants setting aside the settlement agreement in
that Hirsch violated the Board's Casehandling Manual
policies by failing to report to the Assistant General
Counsel the possibility of a Section 12 violation in con-
nection with the "Saturday incident." Respondent con-
tends that public policy requires setting aside the settle-
ment agreement because Hirsch's failure to so report vio-
io Disciplinary Rule 7-104(A)(1) of the Code of Professional Responsi-
bility reads:
(A) Dunng the course of his representation of a client a lawyer
shall not:
(I) Communicate or cause another to communicate on the subiect
of the representation with the party he knows to be represented by a
lawyer in that matter unless he has the prior consent of the lawyer
representing such party or is authorized by law to do so.
lates section 10054.4 of the Board's Casehandling
Manual. t I do not agree.
Essentially the procedure outlined in the manual pro-
vides assistance to Agency personnel in processing mat-
ters which come before the Agency. These guidelines do
not have the force of law and failure to follow them
does not, ipso facto, invalidate subsequent action taken by
a Regional Office.12
Applied to the instant case, even assuming that section
10054.5 can be construed as directing the Region to
report the "Saturday incident" as a possible Section 12
violation, Hirsch's failure to do so does not invalidate the
settlement. Nor does public policy require such result,
especially where, as here, the failure to report it was a
matter totally unrelated to the only issue under examina-
tion, to wit, whether or not misconduct existed in the
circumstances surrounding the execution of the settle-
ment agreement requiring that it be set aside. Certainly
Hirsch's failure to notify the General Counsel of a possi-
ble Section 12 violation involving Feld himself cannot be
viewed as having played any part in Feld's decision to
execute the settlement agreement.
CONCLUSION OF LAW
It is my conclusion that no basis exists, in fact or law,
for setting aside the settlement agreement executed on
October 27, 1978, and further that the settlement agree-
ment is valid and should be complied with forthwith.
Recommendation
Accordingly, it is my recommendation that compli-
ance with the terms of the settlement agreement be ob-
tained and that absent voluntary compliance, enforce-
ment be sought, pursuant to its terms, in the United
States Court of Appeals for the Third Circuit, where this
matter was pending at the time it was remanded. 13
1 Sec. 10054.5 (Part One) of the National Labor Relations Board
Casehandling Manual Unfair Labor Practice Proceedings reads:
10054.5 Obstruction of Justice and Perjury Allegations: Regional
Office personnel should be sensitive to acts of obstruction of justice
or perjury on the part of individuals involved in Board proceedings.
Report immediately any acts of alleged obstruction of justice or per-
jury to your Assistant General Counsel. Appropriate cases will be
referred by the Division of Operations Management to the Depart-
ment of Justice for its consideration.
i As stated in the "Purpose of Manual" section:
This manual has been prepared by' he General Counsel of the Na-
tional Labor Relations Board pursuant to his authority under Section
3(d) of the Act. It is designed only to provide procedural and oper-
ational guidance for the Agency's staff in administering the National
Labor Relations Act, and is not intended to be a compendium of
substantive or procedural law, nor a substitute for a knowledge of
the law. The guides are not General Counsel or Board rulings or dir-
ectives and are not a form of authority binding upon the General
Counsel or upon the Board.
iJ In the event no exceptions are filed as provided by Sec. 102.46 of
the Rules and Regulations of the National Labor Relations Board, the
findings, conclusions, and recommended Order herein shall, as provided
in Sec. 102.48 of the Rules and Regulations, be adopted by the Board and
become its findings, conclusions, and Order, and all objections thereto
shall be deemed waived for all purposes.
339
DECISIONS OF NATIONAL LABOR RELATIONS BOARD
APPENDIX
ORDER
On February 5, 1981, David Feld, president of Re-
spondent, was called by counsel for Respondent, Paul
Rosen, to testify with the understanding that Rosen
could assert the attorney-client privilege as to communi-
cations between himself and Feld. However, during
cross-examination, counsel for Pechner attorneys in-
quired concerning a telephone conversation between
Rosen and Feld just prior to the execution of the Settle-
ment Agreement, and contested Feld's refusal to answer,
thereby abrogating the understanding. After argument by
the parties, it was decided by the Administrative Law
Judge that the question was relevant and not privileged
under the attorney-client rule, in the circumstances of
this matter.
Thereafter, before having been directed to respond to
the question, Rosen withdrew Feld from the witness
stand. Feld was ordered by the Administrative Law
Judge to resume the witness stand for further cross-ex-
amination, and refused to do so upon advice of Rosen.
A motion to dismiss and to strike Feld's testimony was
made by counsel for the Pechner attorneys, and joined
by counsel for Julius Steiner and Allan M. Dabrow, the
Union, and the General Counsel. Memoranda in support
of these motions have been filed by counsel for the Re-
spondent and counsel for the Pechner attorneys, which
have been fully considered.
I conclude that Feld's refusal to resume the stand,
when ordered to do so by the Administrative Law
Judge, for a continuation of cross-examination, is tanta-
mount to a refusal to respond to the relevant unprivi-
leged pending inquiry on cross-examination.
The instant case was remanded by the Board upon pe-
tition of Respondent, to receive testimony concerning
the circumstances surrounding the execution of the Set-
tlement Agreement, to determine whether or not the Set-
tlement Agreement should be set aside because of, inter
alia, misrepresentations made to Feld by his prior attor-
neys which induced him to execute it. The question in
issue is clearly and directly related to the circumstances
surrounding the execution of the Settlement Agreement.
Respondent may not preclude relevant inquiry into mat-
ters essential to the purpose for which the case was, on
its petition, remanded by invoking such privilege.
Respondent's argument that it has been prejudiced in
calling Feld pursuant to the understanding is denied as
without merit, since Respondent is, testimonially, in the
same position it would have been in had Feld never been
called.
According, it is hereby ordered that the motion to
strike the entire testimony of David Feld, the president
of Respondent, is hereby granted.
IT IS FURTHER ORDERED that the motion to dismiss
herein, be, and hereby is, denied.
/s/ Peter E. Donnelly
Administrative Law Judge
Dated, April 2, 1981
340