National Labor Relations Board v. Better Building Supply Corp., and Its Alter Egos, Evergreen Roofing Inc., and Besco Roofing, Inc.
Opinion
Opinion
Wright, J.
This case presents us with a novel question involving principles of bankruptcy, labor, and corporate law. The question is whether a corporation’s liability for NLRB damages survives Chapter 7 bankruptcy proceedings and attaches to its alter ego formed after bankruptcy. We conclude that it does and enforce the order of the NLRB.
BACKGROUND
The Mylans have conducted a roofing business through several different corporations for ten years. In 1977, they were doing business through Better Building Supply Corp. The NLRB found that BBSC engaged in unfair labor practices and assessed backpay damages.
The Mylans ceased doing business through BBSC and formed Evergreen Roofing, Inc. to conduct essentially the same business. This company, ERI, did not recognize the union or the collective bargaining agreement. The Board found BBSC and ERI to be alter egos because the Mylans controlled, financed, and managed both corporations, which conducted similar business, using the same equipment, employing many of the same workers, and operating in the same location. The Board ordered ERI to pay damages under the NLRA.
The Mylans quit doing business through ERI in 1982 and formed a new entity, Bes-co…