Thursday, October 4, 2007

BE&K Remand

Nlrb It’s only taken five years, but the NLRB has finally issued a decision in the remand from the Supreme Court’s 2002 decision in BE&K Constr. Co. (325 N.L.R.B. No. 29 (Sept. 29, 2007)). In originial BE&K, the Court stuck down the Board’s previous interpretation of Bill Johnson’s—that all reasonably based, yet unsuccessful, lawsuits filed in retaliation against union activity violated the NLRA. However, the Court explicitly left open “whether the Board may declare unlawful any unsuccessful but reasonable based suits that would not have been filed but for a motive to impose the costs of the litigation process, regardless of the outcome, in retaliation for NLRA protected activity.” 

On remand, the 3-member Board majority closed this door, concluding that "the filing and maintenance of a reasonably based lawsuit does not violate the [NLRA], regardless of whether the lawsuit is ongoing or completed, and regardless of the motive for initiating the lawsuit."  The rationale for this conclusion was that

[The Supreme Court’s decision in] Bill Johnson’s held that an ongoing, reasonably based lawsuit could not be enjoined as an unfair labor practice even if the lawsuit had a retaliatory motive. The Court deemed this holding to be necessary to safeguard the fundamental First Amendment right to petition. . . . Th[is] principle[], in our view, [is] equally applicable to both completed and ongoing lawsuits.  When a plaintiff files a lawsuit, he does not know whether his claim will prevail.  His lawsuit—even if reasonably based—may not succeed.  As the Supreme Court found in this case, declaring a reasonably based, unsuccessful lawsuit to be an unfair labor practice burdens the First Amendment right to petition.  . . . Consequently, the prospect of liability for an unfair labor practice would reasonably tend to chill a prospective plaintiff from exercising the fundamental First Amendment right to petition. This chilling effect on the right to petition exists whether the Board burdens a lawsuit in its initial phase or after its conclusion[.]

The dissenters (Members Liebman and Walsh) objected that the majority fully closed a door that the Court purposely left open. They also disagreed with the majority’s argument that there is no difference between an ongoing and a completed lawsuit. In a completed suit, according to the dissent, the First Amendment rights have already been vindicated and should not stand in the way of the ULP finding. The dissent accepted the view that some meritless retaliatory suits will be protected under the balance between First Amendment and Section 7. However, they objected to the majority’s categorical rule that none of these types of suits will constitute a ULP. 

It is worth noting the basis for lawsuit that the majority found was “reasonably based” (a finding confirmed by the Supreme Court and conceded by the NLRB’s General Counsel). This dispute arose from various trade unions' attempts delay the modernization of a steel mill by nonunion BE&K. The union used lobbying, handbilling, picketing, and the filing a state health and safety violations complaints. As summarized by the BNA’s Daily Labor Report (subscription required), BE&K and the mill operator 

“sued the unions in federal court, initially alleging violation of Section 303 of the Labor-Management Relations Act for an illegal secondary boycott and later adding an antitrust claim. The district court granted summary judgment to the union on some of the boycott allegations, twice dismissed amended complaints, imposed sanctions under Federal Rule of Civil Procedure 11, and granted summary judgment to the unions on the antitrust claim. The mill operator dropped its claims.”

I agree with the dissenter’s objection to categorically declaring that no retaliatory suits with merit will ever constitute a ULP. These cases involve employers who have been found to have used a lawsuit as a means to interfere with protected activity under the NLRA. Given that “meritorious” is broad definition, it seems more appropriate to keep open the possibility that, for example, a barely meritorious case filed as part of a widespread pattern of interference with collective rights might be considered a ULP.


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BE & K was one of those cases that gave me a headache whenever I had to deal with it as a Board agent - it was always so obvious that there was no "good faith" argument being advanced by the employer and it was all about vexatious litigation as a tool to thwart an organizing drive. Given the Board's sweeping pronouncement, what I'm wondering now is whether unions could start successfully counterclaiming in the state proceeding for "abuse of process" (or some similar cause) on the theory that the underlying conduct is obviously protected by the NLRA.

Posted by: Michael Duff | Oct 5, 2007 2:20:27 PM

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