of the company's standby expense to the work stoppage resulting from the strike in that case, the court stated:
'Overhead expense is the necessary cost incurred by a company in its operations which cannot be easily identified with any individual product and which by accepted cost accounting procedures is spread over or allocated to the productive labor, which is labor performed in the processing of the company's products. Such expenses do not fluctuate directly with plant operations. They are expenses necessary to keep the company on a going concern basis and are based upon the company's production which is planned for a year in advance. They are constant regardless of fluctuations in plant operations. When productive labor in a plant is reduced for any period to less than the normal, the company sustains a loss in the expenditure of necessary overhead for which it receives no production.' Id. 205 F.2d at page 387.
See also, as to the subject of overhead cost accounting in comparable damage actions, Gordon Form Lathe Co. v. Ford Motor Co., 6 Cir., 1943, 133 F.2d 487, 500, affirmed 320 U.S. 714, 64 S. Ct. 257, 88 L. Ed. 419; and Pacific Portland Cement Co. v. Food Machinery & Chemical Corp., 9 Cir., 1949, 178 F.2d 541.
Company computed its overhead by adding together $ 291,692.59, the total general and administrative expenses of the company for the first nine months of the year 1958, and $ 279,418.08, the total operating expenses for the same period. Dividing this sum by 160 (the number of working days during the nine months' period) gave a quotient of $ 3,570 as the daily overhead. Included in the general and administrative expenses are items of $ 10,000 for contributions, $ 8,408.71 for travel and entertainment, and $ 2,535.29 representing miscellaneous. These I disallow, thus reducing the general and administrative expense chargeable here to $ 270,748.59. Likewise, I disallow a figure of $ 2,640.24, representing miscellaneous, from operating expenses, thus reducing that total to $ 276,777.84. Dividing the sum of these two figures by 160 gives a figure of $ 3,422.04 daily overhead, which multiplied by one and one-half days yields a total of $ 5,133.06. I award the latter amount to the plaintiff company as damages against the Union.
This opinion shall constitute my findings of fact and conclusions of law as required in this case by the provisions of Fed.Rules Civ.Proc. Rule 52, 28 U.S.C.A. An order may be presented in accordance with the views hereinabove expressed.
In my opinion in this case, filed April 16, 1959, for the purpose of computing the plaintiff's loss with respect to the item of overhead, I used as a divisor the figure of 160 as the number of working days during the period January 1 through September 30, 1958. This figure was taken from the testimony of the witness Schacht. Since the filing of my opinion counsel has brought to my attention that the witness McHugh testified that during the same period there were 189 working days in addition to several Saturdays upon which work was performed. For the purpose of reflecting this variance, and by stipulation of counsel, the figure 180 will be adopted as the divisor for the purpose of the calculation aforesaid, which requires a modification of my calculated daily overhead of $ 3,422.04 to a daily overhead of $ 3,041.80, thereby yielding a total item of damage on account of the claim based upon overhead of $ 4,562.70. My opinion of April 16, 1959 is therefore amended accordingly and judgment will be entered in the amount last mentioned.
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