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🗞️ Due Process Blocks Default Judgment in Signature Room Labor Case

The NLRB denied a default judgment against the dissolved operator of Chicago's iconic Signature Room, ruling that a named party in interest's timely answer entitled him to a hearing before any order could bind him.

onthelaborfront

onthelaborfront

— 3 min read
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🗞️ Due Process Blocks Default Judgment in Signature Room Labor Case

Nearly three years after the closure of The Signature Room at the 95th and The Signature Lounge at the 96th atop Chicago's former John Hancock Center, the legal fallout from that September 2023 shutdown continues to move through the federal labor system. On June 1, 2026, the National Labor Relations Board issued a procedural ruling that illustrates how due process protections can complicate otherwise routine enforcement actions.

The case began when UNITE HERE Local 1 filed an unfair labor practice charge in October 2023, alleging that Infusion Management Group, the restaurant's operator, violated the National Labor Relations Act by shutting its doors and laying off more than 130 union employees without first bargaining over the effects of that decision. Management announced the closure to workers via a 6 a.m. email on the day it took effect, according to employees who spoke publicly at the time.

The General Counsel issued a complaint and moved for default judgment after Infusion failed to file an answer, a standard enforcement mechanism when a respondent does not respond to a complaint. The complication arose because of how the complaint was structured. Infusion had been dissolved by the Illinois Secretary of State in January 2025, and co-owner Nick Pyknis had died while the case was pending. The General Counsel named Richard J. Roman and the Estate of Nick N. Pyknis as parties in interest, a procedural designation used when a potential remedy could affect entities beyond the named respondent.

Roman filed an answer in his own capacity, contesting the Board's jurisdiction, denying he was an owner of Infusion, and challenging the backpay calculations put forward by the General Counsel. In his subsequent response to the Board's Notice to Show Cause, however, Roman took a different posture, maintaining that he had served as an officer of Infusion and that, in that capacity, he could be required to take steps to satisfy any Board order issued against the company, including the disbursement of corporate funds to meet backpay obligations. Failure to do so, he argued, could expose him to contempt liability.

The Board, chaired by James R. Murphy and joined by Members David M. Prouty and Scott A. Mayer, agreed that Roman's potential exposure was sufficient to warrant due process protection. Drawing on precedent from cases involving alleged single employers and alter egos, the Board held that where a named party in interest could bear derivative responsibility for compliance with a Board order, entering default judgment without a hearing would subject that party to legal obligations without affording the opportunity to contest them. The General Counsel herself conceded in her reply that a judgment against Infusion would "impact" Roman in his capacity as an officer.

The ruling did not resolve the underlying question of whether Infusion violated federal labor law. It also declined to dismiss Roman from the proceedings, preserving his right to participate fully in any subsequent hearing. The case was remanded to the NLRB's Region 13 in Chicago for further action.

Key Points

  • The Signature Room at the 95th and Signature Lounge at the 96th closed on September 28, 2023, with workers notified by email that morning, affecting 132 union employees represented by UNITE HERE Local 1.
  • UNITE HERE Local 1 filed an unfair labor practice charge on October 16, 2023, alleging Infusion Management Group violated Section 8(a)(5) and (1) of the National Labor Relations Act by failing to bargain over the effects of its closure.
  • The General Counsel sought default judgment against Infusion after the dissolved company failed to file an answer to the amended complaint and compliance specification.
  • Richard J. Roman, named as a party in interest, filed an answer in his own capacity denying ownership of Infusion, contesting jurisdiction, and challenging the General Counsel's backpay calculations.
  • In response to the Notice to Show Cause, Roman maintained he had served as an officer of Infusion and argued that a default judgment against the company could expose him to compliance obligations and contempt liability without a hearing.
  • The NLRB ruled that Roman's status as a named party in interest, and his potential exposure under any Board order, entitled him to due process protections including the right to appear before an administrative law judge, call witnesses, and introduce evidence.
  • Infusion was dissolved by the Illinois Secretary of State in January 2025; co-owner Nick Pyknis died while the case was pending, and Roman stated no estate exists for Pyknis.
  • The Board denied the motion for default judgment and remanded the case to NLRB Region 13 for further proceedings.

Primary Source Author: Chairman James R. Murphy, with Members David M. Prouty and Scott A. Mayer

Primary Source: Infusion Management Group d/b/a The Signature Room at the 95th and The Signature Lounge at the 96th, 374 NLRB No. 125 (June 1, 2026)

Primary Source Link: 374 NLRB No. 125 (NLRB, June 1, 2026)

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