Universal Camera Corp. v. NLRB
340 U.S. 474 (1951)

  • Universal fired an employee for filing a grievance against the company and testifying in a National Labor Relations Act (NLRA) proceeding.
    • Universal argued that the employee was fired for punching his boss, and it had nothing to do with the grievance.
  • After an Administrative Proceeding, the National Labor Relations Board (NLRB) ordered Universal to rehire the employee and pay him lost wages. Universal appealed.
    • NLRB made this ruling even though their own Administrative Law Judge agreed with Universal and recommended that the charges be dismissed.
  • The Appellate Court affirmed. Universal appealed.
    • The Appellate Court found that NLRB’s findings of fact were “supported by substantial evidence on the record considered as a whole” within the meaning of NLRA §10(e).
    • The Appellate Court only looked at evidence that supported the Agency’s position, and did not consider the report of the NLRB’s examiner when making their decision.
    • The Appellate Court found that they could only reverse the NLRB’s decision if it was clearly erroneous.
  • The US Supreme Court reversed.
    • The US Supreme Court found that courts should defer to a Federal Agency’s findings of fact if supported by “substantial evidence on the record considered as a whole.”
      • Administrative Procedures Act §706(2)(e) says that substantial evidence is the standard of review for adjudicative proceedings.
        • Substantial evidence is not necessarily a preponderance of evidence. It is evidence that would “appeal to a reasonable mind.”
        • Substantial evidence does not mean that a court would reach the same decision. The Agency is permitted to go with a minority view, as long as it is reasonable to someone who has heard both sides.
          • Basically, it is a decision that is not ‘off the wall’, but something that someone could believe in.
          • The Agency should keep a good record of their decision-making process.
    • The Court found that courts have the ability to set aside an Administrative Agency’s decision if they do not find that the evidence supporting the decision is substantial, when viewed in light of all the evidence in the record.
      • That means you have to look at the evidence that supports the Agency as well as evidence that goes against the Agency.
    • In this case, the Court found that when they looked at the evidence as a whole, the NLRB’s decision did not support the evidence. Therefore they overturned NLRB’s ruling.
    • The Court analogized the job of the court in reviewing an Agency decision to that of an Appellate Court reviewing the decision of a special master.
  • This case was one of the first cases to come to the Supreme Court after the passage of the Administrative Procedures Act.