Magnani Media, Inc.

National Labor Relations Board - Administrative Judge Opinions

Sep 8, 2003

34-RC-002035 (N.L.R.B. Sep. 8, 2003)

JD(NY)–47-03
Hartford CT
UNITED STATES OF AMERICA
BEFORE THE NATIONAL LABOR RELATIONS BOARD
DIVISION OF JUDGES
NEW YORK BRANCH OFFICE

MAGNANI MEDIA INC.

AND CASE 34-RC-2035

GRAPHIC COMMUNICATIONS
INTERNATIONAL UNION,
LOCAL 74-M, AFL-CIO

DECISION ON CHALLENGES

I Statement of the Case
The petition was filed on May 21, 2003 and pursuant to a Stipulated Election Agreement
approved on June 3, 2003, a secret ballot election was conducted on July 3, 2003. The Tally of
Ballots showed that of approximately 66 eligible voters, 28 cast ballots for the Union, 29 cast
ballots against unionization, and 5 cast challenged ballots. The Regional Director issued a
notice of hearing on July 18, 2003.

Based on the record as a whole, including my observation of the demeanor of the
witnesses and after considering the arguments of counsel, I hereby make the following:

II Findings and Conclusions

The ballots of Donald Seuss, Jose Leano, William Wilson, Scott Lepage and Russell
Willis were challenged by the Board agent conducting the election because their names were
not listed, by the Employer, on the voter eligibility list. In this respect, it is noted that when the
parties entered into the Stipulated Election Agreement, they also agreed to defer any decision
regarding the unit placement of these five employees who were employed by a separate
corporation called MagnaPrint Suburban LLC. I suspect that the agreement was made with the
expectation that their votes would not be determinative and that the election could therefore be
conducted expeditiously.

The Company’s position is that these five employees are employed by a separate
employer and therefore, are not part of the unit. The Union’s view is that MagnaPrint Suburban
and Magnani Media constitute a single employer and that the employees of both constitute a
single appropriate bargaining unit.

Apart from these five employees, the bargaining unit described in the Stipulated Election
Agreement included all full-time and regular part-time production and maintenance employees,
including bindery, stripping, pre-press, shipping, sheet feed press and web press employees,
employed by the Employer at its 199 Moody Road and 5 Pearson Way, Enfield Connecticut
facilities, but excluding office clerical employees, guards, professional employees and
supervisors as defined in the Act. It should be noted that although some of the employees in
this unit are highly skilled and have undergone years of training, this was not intended to be a
printer’s craft unit. Rather, it is a production and maintenance unit consisting of some very
highly skilled workers and other employees with considerably less skills and training.

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Magnani Media, which operates under the trademark of MagnaPrint, is a printing
company that has been existence for about 40 plus years. One of its founders was John M.
Magnani, who in the late 1990s purchased the shares of his partner and became the sole
stockholder. Thereafter, his son John P. Magnani and his daughter Margaret Iancu, who had
been employed in the business, were issued shares. At the present time, the shareholders of
Magnani Media are John M. Magnani with 60%; John P. Magnani with 27% and Margaret Iancu
with 13%. John M. Magnani is the CEO of the Company, John P. Magnani is the President and
Margaret Iancu is the Secretary/Treasurer. These three are the sole stockholders and officers
of Magnani Media. And although there are several other siblings, Iancu and John P. are the
only members of the family who receive dividends from the corporation. (Ianco’s husband is
employed as a salesman).

According to Margaret Iancu, her father, although semi-retired, still advices her and her
brother. She testified that if a major decision had to be made, such as the purchase of a press,
her father’s opinion would be decisive.

Magnani Media has and is now engaged in the high end printing business which
encompasses such products as annual reports, corporate or collegiate brochures etc.
Typically, the type of work it has done has been high quality, multi-color printing.

Magnani Media has several four color sheet fed presses located at its headquarter
building at 199 Moody Road and one web press which is so large that it requires its own
building at 5 Pearson Way. In addition, it has a bindery department, a pre-press department,
and a shipping and receiving department. (It also employs office clerical, sales, and
administrative employees who are not involved in this case).

As of the time of the election, the printing by Magna Media was almost completely done
with electronic or computer aided processes by pre-press and press room employees who
utilized digital files which eliminated some of the steps previously required by the old fashioned
offset printing method of using a camera to make negatives which were in turn used to make
plates and which were then used in an offset press or duplicator to turn out printed pieces of
paper. At the time of the election, Magnani Media employed about 64 employees in the various
job categories described above.

In 1999, John P. Magnani and Margaret Iancu, decided, against the advice of their
father, to buy out a small printing business in South Windsor, Connecticut called Suburban
Printing. This was owned by a man named Ralph Harris. To do this, they set up a separate
corporation called MagnaPrint Suburban LLC, which bought the assets of Suburban including
the land, building and equipment. It also retained all of the employees. Mr. Harris, stayed on
for six months as a consultant.

Suburban continued to do printing the old fashioned way, utilizing a couple of duplicators
and one offset printing press. At the time of the takeover in 1999, it had about 13 employees
including strippers, bindery workers and printing press operators. It specialized in one or two
color printed products that were not particularly complicated such as newsletters, business
cards, printed envelopes and the like.1 In this regard, although Suburban was engaged in the
business of printing, its product and processes were considerably different from those of
1 A two-color press is capable of three or four color printing. It does, however, require that the printed
material go through the press two times in order to get all the colors. Similarly, it is possible to print two
colors by using a duplicator, but it is more time consuming and less accurate.

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Magnani Media.

After the purchase, the stockholders and officers of Suburban were Margaret Iancu and
John P. Magnani. (The father did not participate in the corporation as a stockholder or officer).
While being ultimately responsible for the operations of Suburban, Iancu and John P. Magnani
still performed their jobs at Magnani Media and left the day to day operations of Suburban to the
supervisors and employees of that entity. These employees continued to work at Strong Road
in Windsor, Connecticut.

I should note that after the purchase, the employees of Suburban were given the
Magnani Media employee handbook, and were told that with some exceptions, the terms of that
document applied to them. The exceptions were that the employees of Suburban were not
offered the 401(k) plan, the profit sharing plan or the health insurance options that the
employees of Magnani Media had. But in all other respects, it appears that the Suburban
employees were covered by the same conditions that Magnani Media’s employees as
represented in the Employee Policy Handbook. (By the way, the cover of the handbook has
photographs of the three facilities, including Suburban’s facility at 388 Strong Road). It is also
noted that Margaret Iancu and John P. Magnani made the decisions as to what benefits and
conditions the employees of Suburban were to work under after the purchase was concluded.
That is, they decided to change some of the terms and benefits, (such as health insurance
benefits), that these employees had worked under before the purchase.

The evidence also shows that after the purchase of Suburban, the two companies were
held out to the public as related entities. Thus Union exhibit 3 is a piece of advertising put out
by Magna Print/Suburban, which states inter alia;

As part of the MagnaPrint family, we are complemented by our parent
company’s sophisticated pre-press, digital production, sheeted printing, web
printing, high-speed binding and finishing capabilities. As a subsidiary of
MagnaPrint, we can bring you the cost efficiencies of MagnaPrint’s buying
power and resources. We also share MagnaPrint’s work ethic, commitment to
professionalism, attention to detail, and honest business practices. And even
though we are part of a larger company, we have still kept our small shop
feeling and dedication to personal service.

Although we are known for small format work in one or two colors, as
part of Magnani Media, Inc., MagnaPrint/Suburban is now in position to offer
you a full spectrum of services. When you bring us your one or two color work,
consider us for four color, longer run work as well. By partnering with
MagnaPrint/Suburban, you can realize significant time and money savings by
managing a variety of printing projects through one vendor. You can avoid
having to constantly evaluate new vendors, schedule multiple meetings and
make numerous follow up calls and a variety of contacts. We can be your
single source for all your printing projects.

Unfortunately, due to the downturn in the overall economy, Suburban became
unprofitable. As a consequence, Iancu and John P. Magnani decided to lay off some of the
employees and to sell the building and property of Suburban. They also decided to move the
equipment and remaining employees into 199 Moody Road, which is the main facility of
Magnani Media. Therefore, the land was sold, the money put into the bank and the employees,
presses and other printing equipment were moved to Moody Road. In this regard, a five-year
lease was executed on September 15, 2002 whereby MagnaPrint Suburban leased 7000

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square feet of space from Magnani Media for $3208 per month. The lease was signed by John
M. Magnani as CEO for Magnani Media Inc. and by John P. Magnani and Margaret M. Iancu as
shareholders of MagnaPrint Suburban LLC.

The testimony of the witnesses in this proceeding shows that Suburban, after 2002, has
continued to do one or two color printing work on the same equipment that it used when it was
at its South Windsor location. Of its total of seven employees, it has five employees who are
involved in the printing process in one way or another. The Suburban employees who are
directly involved in the pre-press or printing operations do not have the training to operate the
types of printing equipment that are used by Magnani Media and in this respect there is no
interchange of these types of employees.

On the other hand, the evidence shows that from time to time, employees of Suburban
will be assigned to work in Magnani’s bindery when needed or to make deliveries in either
company’s vans when necessary. On such occasions, an accounting is made of the
employee’s time so that the work, if done at Magnani Media, is credited to
MagnaPrint/Suburban. Additionally, the evidence shows that some of the shipping and
receiving functions done for Suburban are carried out by the employees of Magnani Media.
There was some dispute about the extent of this, but by either account it was anywhere from
30% to 70%.

If a potential customer were to call a sales representative of Magnani Media with the
prospect of a job which could be done in part by Magna Media and in part by Suburban, the
representative would refer that prospect to Suburban so that a proper estimate could be made
as to the portion of the work that would more efficiently be done by Suburban. Obviously the
potential customer would not be referred to an unrelated competitor.

The bottom line here is that although their methods, machinery and employee skill sets
are somewhat different, both corporations are engaged in the business of printing. Moreover,
since 2002, the employees of Suburban have worked in the same building and have worked
side by side with the employees of Magnani Media. While there exists separate corporate
identities, the ownership and management of both corporations overlaps substantially. With the
father in semi-retirement, it is clear to me that the decision making process for both
corporations, including decision making with respect to employee and labor relations, will
increasingly reside in the hands of John P. Magnani and Margaret Iancu. Finally, the evidence
shows that Suburban is held out to the public as a subsidiary of Magnani Media, with the ability
to provide its customers with all of the services that it has traditionally provided along with the
services of its larger parent, Magnani Media.

CONCLUSION
The phrase "single employer'' applies to those situations where apparently separate
entities, such as separate corporations, operate as an integrated enterprise in such a way that
"for all purposes, there is in fact only a single employer.'' NLRB v. Browning-Ferris Industries,
691 F.2d 1117, 1122 (3d. Cir. 1982). The principal factors that are considered by the Board are
the extent of (1) interrelation of operations; (2) centralized control of labor relations; (3)
common management; and (4) common ownership or financial control. Radio Union v.
Broadcast Service of Mobile, 380 U.S. 255 (1965); South Prairie Construction Co. v. Operating
Engineers Local 627, 425 U.S. 800, 802 (1976); Centurion Auto Transport, 329 NLRB 394
(1999); Denart Coal Co., 315 NLRB 350 (1994); Blumenfeld Theatres Circuit, 240 NLRB 206,
215 (1979); Hydrolines, Inc., 305 NLRB 416 (1991), and Alexander Bistrikzky, 323 NLRB 524
(1997). The most critical of these factors is centralized control over labor relations. Common

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ownership, while normally necessary, is not determinative in the absence of such a centralized
policy. Western Union Corp., 224 NLRB 274, 276 (1976); Alabama Metal Products, 280 NLRB
1090, 1095 (1986).

In Centurion Auto Transport Inc., 329 NLRB 394 (1999), a union sought a unit of drivers
and loaders employed in Jacksonville Florida by four companies that it claimed constituted a
single employer. Centurion was in the business of transportating vehicles while SED and Eagle
were in the business of leasing drivers many of who worked for Centurion. The fourth company,
ATC was involved in brokering of car transport to dealerships. All had common ownership and
management and there was a high degree of functional integration among the four companies,
all of which operated out of the same address, albeit one of the companies had employees at
another location in Georgia. In finding that the four companies constituted a single employer
and that their combined work force in Jacksonville Florida, constituted a single bargaining unit,
the Board, stated:

A single employer relationship exists when two or more employing entities
are in reality part of a single integrated enterprise. Four criteria determine whether
a single employer relationship exists: (1) common ownership; (2 common
management: (3) functional interrelationship of operations and (4) centralized
control of labor relations. Not all of these criteria need to be present to establish
single employer status.
Single employer status ultimately depends on “all the circumstances of a
case” and is characterized by the absence of the “arms’ length relationship found
among unintegrated companies. It is well settled that the fundamental inquiry is
whether there exists overall control of critical matters at the policy level. (footnotes
omitted).

However, with respect to the employees located 300 miles away in Georgia, the Board
found that its presumption that a single location unit is appropriate was not overcome by the
other factors cited by the Petitioner in favor of a multi-facility unit.

In my opinion, the Company’s reliance on Edenwald Construction Co., Inc., 294 NLRB
No. 22 (1989), is distinguishable. In that case, while agreeing that Edenwald and Belt
constituted a single employer, the Board disagreed with the Judge’s conclusion that they
constituted a single bargaining unit. Accordingly, the Board found that the employees of Belt
were not encompassed into an existing unit of Edenwald employees and that the Employer was
under no obligation to cover them under the collective bargaining agreement that it maintained
with the Union. Citing Land Equipment, 248 NLRB 685, 688 (1980), the Board stated that a
finding that two corporations constitute a single employer is “not conclusively determinate as to
whether an employer wide unit is appropriate…” The Board noted that there was a distinction in
the nature of the work done by both sets of employees, with Edenwald’s employees doing the
more complicated work. But of most significance was the Board’s reliance on the separate
bargaining history of both companies. In this regard, the Board noted that it was significant that
Belt was in existence for 2 ½ years prior to the institution of the present proceeding and that the
Union had not sought, in that time, to represent the employees of Belt. In this regard, the Board
stated that such “separate bargaining history, which resulted in the Belt employees not being
covered by the bargaining agreement, strongly supports the Respondents’ claim that the Belt
employees possess a separate community of interest.”

We find, therefore, that the separate bargaining history for Edenwald’s
employees to the exclusion of Belt’s employees, coupled with the difference in
the skills and types of work performed by the two groups of employees, are

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determinative of the unit issues presented in this case. These factors clearly
outweigh the evidence that Belt employees performed repair and maintenance
services necessary for Edenwald’s operations and had a significant degree of
contact with Edenwald employees and that Ortiz and Paletta worked in close
cooperation in order to coordinate the work of the Edenwald and Belt
employees.

Nor am I persuaded by the Company’s reliance on United Operations Inc., 338 NLRB
No. 18 (2002). In that case, the Board agreed with the Union’s position that the Company’s
HVAC technicians should comprise a separate appropriate unit within the larger workforce of
other field service employees. It did so on the evidence that the HVAC people constituted a
separate department of skilled and governmentally certified employees who had little contact or
interchange with the other less skilled group of employees.

But United Operations did not involve a question as to whether two companies
comprised a single employer. More significantly, the petition here, (as opposed to the petition in
United Operations), did not seek to represent a limited unit of highly skilled workers and the
stipulated unit here is not so limited. Rather, the unit agreed to by the parties, encompasses all
of the production and maintenance employee, which in this case, involves employees with a
wide range of skills even within the framework of Magnani Media.

On the basis of the record as a whole, I conclude that for purposes of the National Labor
Relations Act, Magnani Media and MagnaPrint/Suburban LLC constitute a single employer.
Also, as the employees of both companies are engaged in the printing industry and as they are
physically located on the same premises, they constitute a single appropriate bargaining unit.
Therefore, it is my conclusion that the challenges to the ballots of Donald Seuss, Jose Leano,
William Wilson, Scott Lepage and Russell Willis should be overruled and that their ballots
should be opened and counted. 2

Dated, Washington, D.C.

________________________
Raymond P. Green
Administrative Law Judge

2 Any party may, within fourteen (14) days from the date of issuance of this recommended Decision,
file with the Board in Washington, DC, an original and seven (7) copies of exceptions thereto.
Immediately upon the filing of such exceptions, the party filing the same shall serve a copy thereof on the
other parties and shall file a copy with the Regional Director of Region 22. If no exceptions are filed, the
Board will adopt the recommendations set forth herein.