According to the 25-page document, federal employees side with the UAW and said that the U.S. District Court for the Eastern District of Tennessee should dismiss the lawsuit.
Original Title
STATEMENT OF INTEREST OF THE UNITED STATES re: lawsuit against VW/UAW
According to the 25-page document, federal employees side with the UAW and said that the U.S. District Court for the Eastern District of Tennessee should dismiss the lawsuit.
According to the 25-page document, federal employees side with the UAW and said that the U.S. District Court for the Eastern District of Tennessee should dismiss the lawsuit.
MICHAEL BURTON, MICHAEL J ARVIS, ) and DAVID REED, ) ) Plaintiffs, ) ) v. ) ) Case No. 1:14-CV-76 INTERNATIONAL UNION, UNITED ) AUTOMOBILE, AEROSPACE & ) AGRICULTURAL IMPLEMENT ) WORKERS OF AMERICA, UAW; ) VOLKSWAGEN GROUP OF AMERICA, ) INC.; and VOLKSWAGEN GROUP ) OF AMERICA CHATTANOOGA ) OPERATIONS, LLC, ) ) Defendants. ) ______________
STATEMENT OF INTEREST OF THE UNITED STATES
______________
M. PATRICIA SMITH Solicitor of Labor
ERIC C. HALLSTROM Special Counsel
WILLIAM J . STONE Senior Attorney U.S. Department of Labor 200 Constitution Ave., N.W. Washington, D.C. 20210
RICHARD F. GRIFFIN, J R. General Counsel National Labor Relations Board Washington, D.C. 20570 DAVID A. ONEIL Acting Assistant Attorney General
DAVID M. BITKOWER Deputy Assistant Attorney General
J OHN M. PELLETTIERI Attorney, Appellate Section Criminal Division U.S. Department of J ustice 950 Pennsylvania Ave., N.W., Rm. 1260 Washington, D.C. 20530 (202) 307-3766 john.pellettieri@usdoj.gov
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TABLE OF CONTENTS TABLE OF AUTHORITIES ........................................................................................................... i
STATEMENT OF INTEREST ....................................................................................................... 1
STATEMENT OF THE ISSUES.................................................................................................... 1
I. Ground-Rules Agreements for Union Recognition ...................................................... 1 II. Section 302 of the Labor-Management Relations Act .................................................. 4 III. The Procedural and Factual History of this Case .......................................................... 6 ARGUMENT .................................................................................................................................. 9 I. Section 302 Does Not Create a Private Right of Action ............................................... 9 II. Section 302 Does Not Prohibit the Terms of the Ground-Rules Agreement Challenged by the Plaintiffs ........................................................................................ 14
A. The Text of Section 302 Does Not J ustify the Plaintiffs Proposed Interpretation ......................................................................................................... 15
B. The Statutory Context Does Not Support the Plaintiffs Proposed Interpretation of Section 302 ................................................................................ 17
C. The Legislative History of Section 302 Does Not Support the Plaintiffs Proposed Interpretation ......................................................................................... 22
AK Steel Corp. v. United Steelworkers of Am., 163 F.3d 403 (6th Cir. 1998) ............................................................................................ 21
Alexander v. Sandoval, 532 U.S. 275 (2001) ...................................................................................................... 9, 13
Am. Premier Underwriters, Inc. v. Nat'l R.R. Passenger Corp., 709 F.3d 584 (6th Cir. 2013) ............................................................................................ 10
Amalgamated Clothing & Textile Workers Union v. Facetglas, Inc., 845 F.2d 1250 (4th Cir. 1988) ...................................................................................... 4, 20
Amalgamated Clothing Workers of Am. v. Richman Bros.Co., 348 U.S. 511 (1955) .......................................................................................................... 12
Arroyo v. United States, 359 U.S. 419 (1959) ................................................................................................ 5, 11, 22
Bakerstown Container Corp. v. Int'l Bhd. of Teamsters, 884 F.2d 105 (3d Cir. 1989).............................................................................................. 13
BASF Wyandotte Corp. v. Local 227, Int'l Chem. Workers Union, 791 F.2d 1046 (2d Cir. 1986)............................................................................................ 24
Bowling Green v. Martin Land Dev. Co., 561 F.3d 556 (6th Cir. 2009) ............................................................................................ 10
Bullock v. Bank-Champaign, N.A., 133 S. Ct. 1754 (2013) ...................................................................................................... 16
Burlington N.R. Co. v. Bhd. of Maint. of Way Emps., 481 U.S. 429 (1987) .......................................................................................................... 13
California v. Sierra Club, 451 U.S. 287 (1981) .......................................................................................................... 11
Cannon v. Univ. of Chicago, 441 U.S. 677 (1979) .................................................................................................... 10, 11
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Caswell v. City of Detroit Hous. Comm'n, 418 F.3d 615 (6th Cir. 2005) ............................................................................................ 11
Chamber of Commerce v. Brown, 554 U.S. 60 (2008) ............................................................................................................ 21
Cort v. Ash, 422 U.S. 66 (1975) ............................................................................................................ 10
Credit Suisse Sec. (USA) LLC v. Billing, 551 U.S. 264 (2007) .......................................................................................................... 14
Dana Corp., 356 N.L.R.B. No. 49 (2010) ............................................................................................. 19
Gonzaga Univ. v. Doe, 536 U.S. 273 (2002) .......................................................................................................... 11
Green v. Bock Laundry Mach. Co., 490 U.S. 504 (1989) .......................................................................................................... 22
Hosp. Emps. Div. of Local 79 v. Mercy-Memorial Hosp. Corp., 862 F.2d 606 (6th Cir. 1988), vacated on other grounds, 492 U.S. 914 (1989) ............... 13
Hotel & Rest. Emps. Union Local 217 v. J.P. Morgan Hotel, 996 F.2d 561 (2d Cir. 1993)...................................................................................... 3, 4, 18
Hotel Emps. & Rest. Emps. Union, Local 57 v. Sage Hospitality Res., LLC, 390 F.3d 206 (3d Cir. 2004), cert. denied 544 U.S. 1010 (2005) ....................... 5, 6, 16, 18
Hotel Emps., Rest. Emps. Union, Local 2 v. Marriott Corp., 961 F.2d 1464 (9th Cir. 1992) ............................................................................................ 4
Int'l Union v. Dana Corp., 278 F.3d 548 (2002) .......................................................................................................... 21
Johnson v. City of Detroit, 446 F.3d 614 (6th Cir. 2006) ............................................................................................ 15
Linden Lumber Div., Summer & Co. v. NLRB, 419 U.S. 301 (1974) ............................................................................................................ 3
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Local 357, Int'l Bhd. of Teamsters v. NLRB, 365 U.S. 667 (1961) .......................................................................................................... 23
Mik v. Fed. Home Loan Mortg. Corp., 743 F.3d 149 (6th Cir. 2014) ........................................................................................ 9, 10
Mulhall v. Unite Here Local 355, 667 F.3d 1211 (11th Cir. 2012) ............................................................................... 5, 6, 15
Muniz v. Hoffman, 422 U.S. 454 (1975) .......................................................................................................... 13
New Process Steel, L.P. v. NLRB, 560 U.S. 674 (2010) .......................................................................................................... 15
NLRB v. American Nat'l Ins. Co., 343 U.S. 395 (1952) ............................................................................................................ 2
NLRB v. Gissel Packing Co., 395 U.S. 575 (1969) ............................................................................................................ 3
NLRB v. L. Ronney & Sons Furniture Mfg. Co., 206 F.2d 730 (9th Cir. 1953) ............................................................................................ 18
NLRB v. Virginia Elec. & Power Co., 314 U.S. 469 (1941) ............................................................................................................ 3
NLRB v. Waterman S.S. Corp., 309 U.S. 206 (1940) .......................................................................................................... 18
Radio Officers Union v. NLRB, 347 U.S. 17 (1954) ............................................................................................................ 23
Scheidler v. Nat'l Org. for Women, Inc., 547 U.S. 9 (2006) .............................................................................................................. 22
Sinclair Refining Co. v. Atkinson, 370 U.S. 195 (1962) .......................................................................................................... 13
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Textile Workers Union of Am. v. Lincoln Mills, 353 U.S. 448 (1957) .......................................................................................................... 17
Touche Ross & Co. v. Redington, 442 U.S. 560 (1979) .......................................................................................................... 11
Unite Here Local 355 v. Mulhall, 134 S. Ct. 594 (2013) ................................................................................................ 6, 7, 13
United States v. Boffa, 688 F.2d 919 (3d Cir. 1982).............................................................................................. 16
United States v. Burge, 990 F.2d 244 (6th Cir. 1992) ............................................................................................ 16
United States v. Douglas, 634 F.3d 852 (6th Cir. 2011) ............................................................................................ 16
United States v. Jeter, 775 F.2d 670 (6th Cir. 1985) ............................................................................................ 15
United States v. Marmolejo, 89 F.3d 1185 (5th Cir. 1996) ............................................................................................ 15
United States v. Nilsen, 967 F.2d 539 (11th Cir. 1992) .......................................................................................... 15
United States v. Palumbo Bros., 145 F.3d 850 (7th Cir. 1998) .............................................................................................. 2
United States v. Roth, 333 F.2d 450 (2d Cir. 1963).............................................................................................. 11
United States v. Ryan, 350 U.S. 299 (1956) .......................................................................................................... 22
United States v. Schiffman, 552 F.2d 1124 (5th Cir. 1977) .......................................................................................... 16
United States v. Townsend, 630 F.3d 1003 (11th Cir. 2011) ........................................................................................ 15
Ventimiglia v. United States, 242 F.2d 620 (4th Cir. 1957) ............................................................................................ 24
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Adrienne E. Eaton & J ill Kriesky, Union Organizing Under Neutrality and Card Check Agreements, 55 Indus. & Lab. Rel. Rev. 42 (2001)................................. 4
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Collective Bargaining Contracts: Techniques of Negotiation and Administration with Topical Classification of Clauses (BNA 1941) .......................................................... 3
Harry A. Millis & Emily Clark Brown, From the Wagner Act to Taft-Hartley, A Study of National Labor Policy and Labor Relations (1950)........................................ 17
Ninth Annual Report of the National Labor Relations Board for the Fiscal Year Ended June 30, 1944 (1944)................................................................................. 3, 17
Press Release, UAW, UAW Withdraws Volkswagen Election Objections (Apr. 21, 2014), available at http://uaw.org/articles/uaw-withdraws- volkswagen-election-objections (last visited May 20, 2014) ............................................. 8
Union Contract and Collective Bargaining, 4 Labor Equipment (PH) (1948) .......................... 3, 4
Websters Third New International Dictionary (1993) ................................................................ 16
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STATEMENT OF INTEREST The United States of America respectfully submits this statement of interest in accordance with 28 U.S.C. 517. The plaintiffs in this case seek injunctive and declaratory relief under Section 302 of the Labor-Management Relations Act of 1947 (LMRA), 29 U.S.C. 186, alleging that a voluntary agreement between an employer and a labor union establishing ground rules for potential union recognition violates the statute. The Department of J ustice enforces the statutes criminal prohibition. The National Labor Relations Board (NLRB) is responsible for administering the National Labor Relations Act, 29 U.S.C. 151 et seq., which includes resolving labor disputes and encouraging voluntary labor-management agreements. The United States therefore has a significant interest in the Courts disposition of this case. STATEMENT OF THE ISSUES The United States will address the following issues: 1. Whether Section 302(e) of the Labor-Management Relations Act of 1947, 29 U.S.C. 186(e), creates a private right of action to seek injunctive and declaratory relief for alleged violations of Sections 302(a) and (b) of the Act, 29 U.S.C. 186(a) & (b). 2. Whether Section 302 prohibits a voluntary agreement between a union and employer setting the ground rules for a union organizing campaign in which the employer agrees to (1) hold meetings with employees at which the union is present, (2) allow union access to the employers property for organizing purposes, and (3) remain neutral with respect to unionization. BACKGROUND I. Ground-Rules Agreements for Union Recognition Federal law regulates labor-management relations to minimize industrial strife. 29 U.S.C. 141 & 151. Consistent with that goal, employers and unions may enter into voluntary Case 1:14-cv-00076-CLC-SKL Document 41 Filed 05/21/14 Page 10 of 34 PageID #: 445 2
agreements establishing procedures for organizing campaigns and union recognition. These agreements have long been recognized as lawful by the NLRB and enforced by the courts. 1. The National Labor Relations Act (NLRA), 29 U.S.C. 151 et seq., enacted in 1935, create[d] a national, uniform body of labor law and policy in order to protect the stability of the collective bargaining process and maintain peaceful industrial relations. United States v. Palumbo Bros., 145 F.3d 850, 861 (7th Cir. 1998). Congress established a centralized administrative agency, the National Labor Relations Board, to administer the NLRA and to resolve labor disputes. See 29 U.S.C. 153-156, 160-162. The NLRA sets out an integrated scheme governing employees, employers, and unions during organizing campaigns, representation elections, and collective bargaining. Section 7 first sets forth the fundamental rights of employees to self-organization; to form, join, or assist labor organizations; to bargain collectively; and to engage in other concerted activities; as well as the right to refrain from any or all of such activities. 29 U.S.C. 157. The NLRA then prohibits certain union and employer unfair labor practices that interfere with the rights of employees. 29 U.S.C. 158. It sets out procedures for union recognition, 29 U.S.C. 159, and makes clear that, once a union is recognized, both the employer and the union have an obligation to bargain collectively, 29 U.S.C. 158(a)(5), (b)(3) & (d). 2. Voluntary resolution of labor-management disputes is at the core of the NLRA. See NLRB v. American Natl Ins. Co., 343 U.S. 395, 401-02 (1952). The NLRA is designed to promote industrial peace by encouraging the making of voluntary agreements governing relations between unions and employers. Id. a. Voluntary agreement is particularly important in the context of union recognition. Although the NLRA entitles an employer to request a secret-ballot election overseen by the Case 1:14-cv-00076-CLC-SKL Document 41 Filed 05/21/14 Page 11 of 34 PageID #: 446 3
NLRB, 29 U.S.C. 159(c)(1) & (e); see Linden Lumber Div., Summer & Co. v. NLRB, 419 U.S. 301, 305-06 (1974), an employer may agree to recognize a union as the exclusive bargaining representative if the union demonstrates majority support through other means, see, e.g., NLRB v. Gissel Packing Co., 395 U.S. 575, 597 (1969) (card-check procedure). Even in elections overseen by the NLRB, it has long been common for employers and unionswith encouragement from the NLRBto reach agreement about such vital issues as the scope of the unit in which the election will be held and the identity of eligible voters. See Otis Hospital, 219 N.L.R.B. 164, 164-65 (1975); Ninth Annual Report of the National Labor Relations Board for the Fiscal Year Ended June 30, 1944, at 8-11 (1944). Voluntary agreement with respect to the procedures for recognition benefits both employers and unions by providing a path for peaceful resolution of those tensions inevitably flowing from a union organizing effort. Hotel & Rest. Emps. Union Local 217 v. J.P. Morgan Hotel, 996 F.2d 561, 566 (2d Cir. 1993). b. In addition to voluntary agreement with respect to elections, it has also long been common for employers and unions to agree on ground rules for a union organizing campaign. Since the NLRAs beginning, for example, employers have agreed to provide unions with access to their propertyincluding bulletin boards and the employers facilitiesand lists of employees for purposes of organizing. See Collective Bargaining Contracts: Techniques of Negotiation and Administration with Topical Classification of Clauses 149, 586 (BNA 1941); Union Contract and Collective Bargaining, 4 Labor Equipment (PH) 53,280 (Mar. 15, 1948), 56,754.6 (Apr. 26, 1948). Similarly, after the Supreme Court clarified in 1941 that employers had the right to speak for or against unionization so long as their speech was not unduly coercive, see NLRB v. Virginia Elec. & Power Co., 314 U.S. 469, 477 (1941), some employers chose to Case 1:14-cv-00076-CLC-SKL Document 41 Filed 05/21/14 Page 12 of 34 PageID #: 447 4
exercise their speech rights by agreeing not to engage in antagonistic propaganda, Union Contracts and Collective Bargaining 53,352 (Apr. 15, 1946). Agreements setting the grounds rules for union organizing campaigns have become prevalent. See Adrienne E. Eaton & J ill Kriesky, Union Organizing Under Neutrality and Card Check Agreements, 55 Indus. & Lab. Rel. Rev. 42, 46-48 (2001). The terms in these agreements vary, but typical terms have included the employers agreement to refrain from expressing its views about union representation and to provide the union with access to the employers facilities and with a list of names and addresses of employees. Id.; see also, e.g., Hotel Emps., Rest. Emps. Union, Local 2 v. Marriott Corp., 961 F.2d 1464, 1467-68, 1470 (9th Cir. 1992). The NLRB has approved such agreements and respected their terms, see, e.g., Verizon Info. Sys., 335 N.L.R.B. 558, 558-60 & n.7 (2001), and courts have routinely enforced ground-rules agreements containing similar provisions under 29 U.S.C. 185, which permits suits for violation of contracts between an employer and a labor organization, see, e.g., J.P. Morgan Hotel, 996 F.2d at 563, 566-68; Marriott Corp., 961 F.2d at 1467-70; Amalgamated Clothing & Textile Workers Union v. Facetglas, Inc., 845 F.2d 1250, 1252-53 (4th Cir. 1988). II. Section 302 of the Labor-Management Relations Act 1. Section 302 of the Labor-Management Relations Act of 1947, 29 U.S.C. 186, makes it a crime for any employer . . . to pay, lend, or deliver, or agree to pay, lend, or deliver, any money or other thing of value . . . to any labor organization, or officer or employee of such an organization, that represents or seeks to represent the employers employees. 29 U.S.C. 186(a)(2). The statute also makes it a crime for a labor union to request, demand, receive, or accept, or agree to receive or accept, any payment, loan, or delivery of any money or other thing Case 1:14-cv-00076-CLC-SKL Document 41 Filed 05/21/14 Page 13 of 34 PageID #: 448 5
of value prohibited by subsection (a). 29 U.S.C. 186(b)(1). These prohibitions have several exceptions that are not at issue in this case. See 29 U.S.C. 186(c). Section 302s purpose is to stop corruption of collective bargaining through bribery of employee representatives by employers, extortion by employee representatives, and abuse [of power] by union officers. Arroyo v. United States, 359 U.S. 419, 425-26 (1959). 2. The courts of appeals have expressed different views on whether an agreement to establish ground rules for an organizing campaign, such as an employers agreement to remain neutral and provide union access to company property, may violate Section 302. The Third and Fourth Circuits have held that agreements containing these or similar terms fall outside the scope of Section 302. See Adcock v. Freightliner LLC, 550 F.3d 369 (4th Cir. 2008), cert. denied, 558 U.S. 932 (2009); Hotel Emps. & Rest. Emps. Union, Local 57 v. Sage Hospitality Res., LLC, 390 F.3d 206 (3d Cir. 2004), cert. denied, 544 U.S. 1010 (2005). Those courts explained that the statutory text and the overall structure and purposes of the federal labor laws counsel against making voluntary ground-rules agreements criminal under Section 302. See Adcock, 550 F.3d at 375-76; Sage, 390 F.3d at 218-19. In Mulhall v. Unite Here Local 355, 667 F.3d 1211 (11th Cir. 2012), a divided panel of the Eleventh Circuit concluded that under some circumstances, Section 302 could reach such an agreement. The employer and union had entered into an agreement in which the employer agreed to remain neutral during the unions organizing campaign, to give the union access to its property for organizing purposes, and to provide the union with the names and contact information of employees. Id. at 1213. The Eleventh Circuit held that these types of organizing assistance can be a thing of value that, if demanded or given as payment, could constitute a violation of 302. Id. at 1213. The court acknowledged that [e]mployers and unions may set ground rules for an Case 1:14-cv-00076-CLC-SKL Document 41 Filed 05/21/14 Page 14 of 34 PageID #: 449 6
organizing campaign, but in the courts view, these innocuous ground rules can become illegal payments if used as valuable consideration in a scheme to corrupt a union or to extort a benefit from an employer. Id. at 1215. The Supreme Court granted a writ of certiorari in Mulhall, but after briefing and oral argument, the Court dismissed the writ as improvidently granted. Unite Here Local 355 v. Mulhall, 134 S. Ct. 594 (2013). J ustice Breyer, joined by J ustices Sotomayor and Kagan, dissented from the decision to dismiss the writ. Id. at 594-95. [I]n considering the briefs and argument, J ustice Breyer stated, the Court became aware of two logically antecedent questions that could have prevented it from reaching the question of the correct interpretation of 302. Id. at 595. Specifically, J ustice Breyer observed that the case was potentially moot, because the agreement between the union and employer had expired, and that Mulhall, the sole plaintiff in the case, arguably lacked Article III standing. Id. J ustice Breyer would have asked for additional briefs on standing and mootness, rather than dismiss the writ of certiorari. Id. at 595. He also would have directed briefing on a third question, namely whether 302 authorizes a private right of action. Id. at 595. III. The Procedural and Factual History of this Case 1. The defendant United Autoworkers Union (UAW) is a union that sought to become the exclusive bargaining representative for employees of defendants Volkswagen Group of America and Volkswagen Group of America Chattanooga Operations, collectively Volkswagen, which manufacture automobiles at a plant in Chattanooga, Tennessee. Compl. 3-7. On J anuary 27, 2014, UAW and Volkswagen entered into a voluntary agreement that, among other things, set ground rules for an organizing campaign by UAW. Compl., Ex. A (Agreement). Case 1:14-cv-00076-CLC-SKL Document 41 Filed 05/21/14 Page 15 of 34 PageID #: 450 7
In the agreement, UAW and Volkswagen agreed to jointly petition the NLRB for an expedited secret-ballot election overseen by the NLRB on February 12 to 14, 2014. Compl. 11. UAW agreed not to visit employees at their homes and not to make negative comments about Volkswagen during the organizing campaign. Id. 12(d). UAW also agreed that if elected exclusive bargaining representative it would delegate many of its responsibilities and functions to a Works Council populated by individuals selected by Volkswagen employees, including employees not represented by UAW, id. at 12(a); it would not engage in picketing or strikes while the parties negotiated an initial collective bargaining agreement, id. at 12(c); and it would, when negotiating a collective bargaining agreement, endeavor to maintain[] and where possible enhanc[e] the cost advantages and other competitive advantages that [Volkswagen] enjoys relative to its competitors in the United States and North America, id. at 12(b). For its part, Volkswagen agreed that during the organizational campaign it would conduct meetings with all its employees, during work time, where it would voice support for a Works Council and allow UAW to solicit support from employees. Id. 11(a). Volkswagen also agreed to allow UAW use of company property for organizing activities and not to take a position opposed to UAW or union representation. Id. 11(b) & (c). The parties complied with the agreement and, in February 2014, an election was held. Compl. 15-19. The employees voted 712 to 626 against representation by UAW. Id. 19. As a result, Volkswagen does not have any further obligations under the agreement, Agreement 8, and UAW may not conduct an organizing campaign and seek recognition at Volkswagen for one year, unless during that period another union commences a serious, concerted and legitimate effort to organize Volkswagen employees, Agreement 6(c). Case 1:14-cv-00076-CLC-SKL Document 41 Filed 05/21/14 Page 16 of 34 PageID #: 451 8
UAW then filed objections with the NLRB seeking to invalidate the results of the election and require that it be redone. Compl. 20. 2. On March 12, 2014, three employees of VolkswagenMichael Burton, Michael J arvis, and David Reedfiled the present suit. Compl. 6. The complaint alleges that there is imminent risk that Volkswagen will violate Section 302(a)(2) by providing what plaintiffs call organizing assistancethe all-employee meetings, use of company property, and neutrality promised in the ground-rules agreement in the event of a rerun election. Id. 21, 31. The complaint also asserts an imminent danger that UAW will violate Section 302(b)(1) by requesting this assistance in the event of a rerun election. Id. 32-33. The complaint also alleges that Volkswagen presently is violating Section 302(a)(2) because it agreed to pay, lend, or deliver these three types of organizing assistance to UAW, Compl. 30, and that UAW is violating Section 302(b)(1) because it agreed to accept the organizing assistance from Volkswagen. Id. 32-33. Plaintiffs seek injunctive relief prohibiting Volkswagen from providing, and UAW from requesting, the allegedly unlawful organizing assistance promised in the agreement. Compl. pp. 11 (Prayer for Relief). Plaintiffs also seek a declaratory judgment that Volkswagen and UAW have violated and will violate Section 302 by providing and requesting the organizing assistance. Id. at 11-12. 3. After the plaintiffs filed their complaint, UAW chose to withdraw the objections to the election it had filed with the NLRB. See Press Release, UAW, UAW Withdraws Volkswagen Election Objections (Apr. 21, 2014), available at http://uaw.org/articles/uaw- withdraws-volkswagen-election-objections (last visited May 20, 2014). On April 21, 2014, the NLRB certified the results of the election. Case 1:14-cv-00076-CLC-SKL Document 41 Filed 05/21/14 Page 17 of 34 PageID #: 452 9
ARGUMENT This statement of interest addresses two questions about the scope of Section 302 that are of specific interest to the United States: whether Section 302 creates a private right of action and whether Section 302 applies to the ground-rules agreement at issue here. Section 302 does not create a private right of action to enforce its prohibitions, and it does not, as alleged by plaintiffs, prohibit employers from agreeing to provide, in a ground-rules agreement for resolving questions concerning representation, organizing assistance of the type challenged in this case. There is a substantial danger that if construed in the manner urged by plaintiffs Section 302 will disturb the finely-wrought balance of the federal labor laws. 1
I. Section 302 Does Not Create a Private Right of Action Section 302 does not create a right of action for private parties to seek relief for alleged violations of the statute. The language, structure, and legislative history of Section 302 evince no intent on the part of Congress to create a private right of action. The statute establishes criminal prohibitions, to be enforced by the government, and authorizes the governmentand only the governmentto seek injunctive relief. 1. [P]rivate rights of action to enforce federal law must be created by Congress. Alexander v. Sandoval, 532 U.S. 275, 286 (2001). Congress may create a private right of action expressly or by implication. Mik v. Fed. Home Loan Mortg. Corp., 743 F.3d 149, 158 (6th Cir. 2014). But the mere fact that a federal statute has been violated and some person harmed does
1 There also appear to be substantial questions of standing and mootness in this case. The results of the election, upon their certification by the NLRB, appear to extinguish Volkswagens contractual obligations to provide organizing assistance to UAW. Although the complaint alleges that UAWs challenge to the results of the election creates an imminent risk of future violations of Section 302, UAW withdrew that challenge. The United States confines its brief to questions regarding the scope of Section 302.
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not automatically give rise to a private cause of action in favor of that person. Cannon v. Univ. of Chicago, 441 U.S. 677, 688 (1979). The judicial task is to interpret the statute Congress has passed to determine whether it displays an intent to create not just a private right but also a private remedy. Sandoval, 532 U.S. at 286 (emphasis added). Congressional intent is the lodestar, see Bowling Green v. Martin Land Dev. Co., 561 F.3d 556, 559 (6th Cir. 2009), and to discern that intent, courts consider (1) whether the statute create[s] a federal right in favor of the plaintiff, (2) whether there is any indication of legislative intent, explicit or implicit, either to create or to deny a remedy for the plaintiff, (3) whether it is consistent with the underlying purposes of the legislative scheme to imply such a remedy for the plaintiff, and (4) whether the cause of action [is] one traditionally relegated to state law, so that it would be inappropriate to infer a cause of action based solely on federal law, Cort v. Ash, 422 U.S. 66, 78 (1975); see generally Am. Premier Underwriters, Inc. v. Natl R.R. Passenger Corp., 709 F.3d 584, 593 (6th Cir. 2013) (finding no private right of action after considering the four Cort factors); Bowling Green, 561 F.3d at 559-61 (same); Mik, 743 F.3d at 158-60 (same). 2. The text and history of Section 302, considered in light of these factors, establish that Congress did not intend to create a private right of action. Section 302(a) and Section 302(b) define prohibited transactions involving employers, unions, employees, and their agents. 29 U.S.C. 186(a) & (b). Section 302(c) enumerates exceptions to these prohibitions. 29 U.S.C. 186(c). Section 302(d) creates criminal penalties for willful violations. 29 U.S.C. 186(d). And Section 302(e) provides that federal district courts shall have jurisdiction . . . to restrain violations of Section 302, without limitations that apply in other contexts. 29 U.S.C. 186(e). These provisions create a mechanism for government, not private, enforcement of rules intended to root out and prevent corruption and bribery in the labor context. Case 1:14-cv-00076-CLC-SKL Document 41 Filed 05/21/14 Page 19 of 34 PageID #: 454 11
a. In order for a statute to create a private right, its text must be phrased in terms of the persons benefited. Gonzaga Univ. v. Doe, 536 U.S. 273, 283-84 (2002) (quoting Cannon, 441 U.S. at 692 n.13). Congress must confer the right in clear and unambiguous terms. Caswell v. City of Detroit Hous. Commn, 418 F.3d 615, 619 (6th Cir. 2005) (quoting Gonzaga, 536 U.S. at 290). Statutes that focus on the person regulated rather than the individuals protected create no implication of an intent to confer rights on a particular class of persons. Sandoval, 532 U.S. at 289 (quoting California v. Sierra Club, 451 U.S. 287, 294 (1981)). Section 302 does not create any private right. The text of Section 302 describes in detail the prohibited conduct of employers, unions, and employeesprohibiting employers from delivering things of value to labor organizations, for example, and labor organizations from accepting such things of value from employers. The text does not, however, contain any language conferring rights on a particular class or identifying a particular class as an intended beneficiary. As a result, [t]he question whether Congress . . . intended to create a private right of action [is] definitively answered in the negative. Gonzaga, 536 U.S. at 283-84 (quoting Touche Ross & Co. v. Redington, 442 U.S. 560, 576 (1979)) (alterations in Gonzaga). b. There is no indication of legislative intent to create a remedy for private parties for violations of Section 302. Section 302 was enacted to prevent bribery and corruption in the labor context. Arroyo, 359 U.S. at 425-26; accord United States v. Roth, 333 F.2d 450, 453 (2d Cir. 1963). Consistent with that purpose, the statute establishes criminal penalties to be pursued by the government. 29 U.S.C. 186(d). Although Section 302 also creates federal district court jurisdiction to restrain violations of the statute, 29 U.S.C. 186(e), that provision is best understood as establishing jurisdiction for injunctive relief sought by the government. Case 1:14-cv-00076-CLC-SKL Document 41 Filed 05/21/14 Page 20 of 34 PageID #: 455 12
The legislative history supports this conclusion. In the early 1980s, Congress considered but rejected amendments to Section 302(e) that would have given the United States explicit standing to enjoin violations of Section 302 where the criminal intent required for criminal prosecution was lacking, see S. Rep. No. 98-83, 98th Cong., 1st Sess. 13 (1983); and that would have explicitly provided a right of action for suits brought by any person directly affected by the alleged violation, id. The Senate Labor Committee explained that the amendments would have specified jurisdiction for suits to restrain violations of [Section 302] brought by any person directly affected by the alleged violation. Id. at 12-13. These proposals were eliminated in the Senate when the legislation was ultimately enacted in 1984. See H.R.J . Res. 648, 98th Cong., 2d Sess. 585-86 (1984); H.R. Rep. No. 98-1159, at 416 (1984) (Conf. Rep.) (Amendment No. 136), reprinted in 1984 U.S.C.C.A.N. 3712. Plainly there would have been no need to amend Section 302(e) to create a private right of action if such a right of action had been created when the statute was enacted or previously amended. c. It would also be inconsistent with the legislative scheme to imply a private right of action in Section 302. Section 302 is but one component of an integrated scheme governing employees, employers, and unions during organizing campaigns, representation elections, and collective bargaining. See supra pp. 2-5. The NLRA allows private parties to file charges with the NLRB alleging unfair labor practices by employers and unions, including charges based on conduct that could also violate Section 302, and the NLRB may petition courts to enjoin conduct it deems unlawful. See 29 U.S.C. 158(a)(2), 158(b)(6), 160(e), (j) & (l). It is well established that the right to seek an order enjoining unfair labor practices is exclusively within the authority of the Board. See, e.g., Amalgamated Clothing Workers of Am. v. Richman Bros. Co., 348 U.S. 511, 516-17 (1955). Allowing private parties to bring suits for injunctions under Section 302 Case 1:14-cv-00076-CLC-SKL Document 41 Filed 05/21/14 Page 21 of 34 PageID #: 456 13
would intrude into the governments administration of the federal labor laws and be inconsistent with the basic policy of federal labor law that injunctive relief is prohibited in all but the narrowest of circumstances. See, e.g., Burlington N.R. Co. v. Bhd. of Maint. of Way Emps., 481 U.S. 429, 437 (1987); 29 U.S.C. 101. Consistent with that basic policy, the same Congress that enacted Section 302 in 1947 also rejected a proposal that would have allowed private parties to seek injunctive relief in federal court for certain unfair labor practices. See Muniz v. Hoffman, 422 U.S. 454, 465-67 (1975) (discussing legislative history of Taft-Hartley Amendments). 3. In 1962, in Sinclair Refining Co. v. Atkinson, 370 U.S. 195 (1962), the Supreme Court suggested in dictum that Section 302(e) permits private litigants to obtain injunctive relief. Id. at 204-05 & n.19. Courts have relied on Sinclair in holding that Section 302(e) allows for a private cause of action for injunctive relief but not damages. See Bakerstown Container Corp. v. Intl Bhd. of Teamsters, 884 F.2d 105, 107 (3d Cir. 1989) (citing cases). Those cases are not controlling. The basis for the dictum in Sinclair has since been severely undermined. See Unite Here Local 355 v. Mulhall, 134 S. Ct. at 595 (Breyer, J ., dissenting from dismissal) ([I]n light of the Courts more restrictive views on private rights of action in recent decades, the legal status of Sinclair Refinings dictum is uncertain.) (internal citation omitted). The understanding of private cause of action that held sway 40 years ago, at the time that Sinclair was decided, has been abandoned. Sandoval, 532 U.S. at 286-87; see Johnson v. City of Detroit, 446 F.3d 614, 621 (6th Cir. 2006) (describing recent Supreme Court cases that altered the landscape of the law in this area). 2 Section 302 must be considered in
2 The Sixth Circuit assumed that Section 302 creates a private right of action in Hosp. Emps. Div. of Local 79 v. Mercy-Memorial Hosp. Corp., 862 F.2d 606, 608 (6th Cir. 1988), vacated on other grounds, 492 U.S. 914 (1989), but the issue apparently was undisputed in that case. Case 1:14-cv-00076-CLC-SKL Document 41 Filed 05/21/14 Page 22 of 34 PageID #: 457 14
light of the Supreme Courts modern private-right-of-action cases, and as discussed above, those cases make clear that Section 302 does not create a private right of action. II. Section 302 Does Not Prohibit the Terms of the Ground-Rules Agreement Challenged by the Plaintiffs
The plaintiffs allege that the defendants are violating or will violate Section 302 by way of Volkswagen providing, and UAW requesting, three discrete forms of organizing assistance: (1) employee meetings with UAW during work time; (2) UAW access to Volkswagen property for purposes of organizing; and (3) Volkswagen neutrality with respect to UAW and union representation. See Compl. 10, 29-33. Those routine ground-rules provisions in an organizing campaign do not violate Section 302. The treatment of these terms as per se prohibited fits poorly with the statutory language of Section 302. Equally important, construing Section 302 to prohibit these types of provisions creates insurmountable tensions within the overall structure of the labor lawsthreatening to substitute a regime of injunctions and per se prohibitions under Section 302 for the nuanced and detailed administrative process overseen by the NLRB. The legislative history is inconsistent with any claim that Congress intended to criminalize the provision of organizing assistance of the type challenged by plaintiffs. Under these circumstances, Section 302 cannot be read to invalidate ground-rules agreements of the form at issue here. When particular conduct might be regulated under different statutory provisions, courts endeavor to reconcile those provisions, paying particular attention to whether the conduct is regulated by a specialized administrative scheme. See, e.g., Credit Suisse Sec. (USA) LLC v. Billing, 551 U.S. 264, 275-76 (2007) (finding that securities laws and SEC, rather than antitrust laws and district courts, exclusively regulate certain conduct in public offerings). Even when a reading of a statute might be textually permissible in a narrow sense, it may be structurally implausible, because it would render other statutory provisions Case 1:14-cv-00076-CLC-SKL Document 41 Filed 05/21/14 Page 23 of 34 PageID #: 458 15
functionally void. New Process Steel, L.P. v. NLRB, 560 U.S. 674, 681 (2010). That is the case here: Section 302 should not be interpreted to criminalize agreements that have long been considered lawful under the NLRA as incidental to the process of resolving disputes about union representation. The plaintiffs claims therefore must fail. A. The Text of Section 302 Does Not Justify the Plaintiffs Proposed Interpretation
The key text plaintiffs rely on is the statutes prohibition on an employers pay[ing], lend[ing], or deliver[ing] any money or other thing of value to a labor union or union official or employee. 29 U.S.C. 186(a)(2). The broad phrase thing of value has been used in dozens of provisions throughout the United States Code, including several criminal provisions. Congress[s] frequent use of thing of value in various criminal statutes has evolved the phrase into a term of art which the courts generally construe to envelop[] both tangibles and intangibles. United States v. Nilsen, 967 F.2d 539, 542 (11th Cir. 1992) (citing cases); see Mulhall, 667 F.3d at 1214-15. This broad interpretation is based upon a recognition that monetary worth is not the sole measure of value. Nilsen, 967 F.2d at 542-43; see United States v. Jeter, 775 F.2d 670, 680 (6th Cir. 1985) (Congress[s] very use of the more expansive thing of value rather than property strongly implies coverage beyond mere tangible entities.). Courts have found a wide variety of goods, services, and benefits to be things of value within the meaning of the criminal laws. 3
But several features of Section 302s text make this statute uniqueand a poor fit for the contractual provisions challenged here. Section 302 applies only when an employer pay[s], lend[s], or deliver[s] money or a thing of value to a labor union or union officer or employee, or
3 See, e.g., United States v. Townsend, 630 F.3d 1003, 1010-11 (11th Cir. 2011) (relaxed conditions of pretrial detention); United States v. Marmolejo, 89 F.3d 1185, 1191 (5th Cir. 1996) (conjugal visits). Case 1:14-cv-00076-CLC-SKL Document 41 Filed 05/21/14 Page 24 of 34 PageID #: 459 16
the union or its officer or employee requests such a payment, loan, or delivery. 29 U.S.C. 186(a)(2) & (b)(1). The verbs pay, lend, and deliver capture transactions with a corrupting potentialbut are inapt to describe an employers compliance with the terms of a negotiated ground-rules agreement. See Sage, 390 F.3d at 219 (a ground-rules agreement for organizing involves no payment, loan, or delivery of anything). Pay naturally refers to compensation with money. E.g., Websters Third New International Dictionary 1659 (1993). Lend typically refers to providing money or an item for temporary use on the condition it will be returned. Id. at 1293. Deliver does have a more general meaning of give, transfer, or yield possession or control of a thing. Id. at 597. But the canon of noscitur a sociis, see Bullock v. Bank-Champaign, N.A., 133 S. Ct. 1754, 1760 (2013), suggests a financial-transfer focus for this term as wellfor example, delivery of free tickets to a sporting event. See, e.g., United States v. Douglas, 634 F.3d 852, 859 (6th Cir. 2011) (Section 302 applied to wage and benefit payments to friends and relatives of union officials); United States v. Burge, 990 F.2d 244, 249- 50 (6th Cir. 1992) (sham consulting fees); United States v. Boffa, 688 F.2d 919, 935-36 (3d Cir. 1982) (use of an automobile); United States v. Schiffman, 552 F.2d 1124, 1126 (5th Cir. 1977) (preferentially-low rates at a hotel). 4 The statutory text therefore would not naturally encompass the ground-rules agreement at issue here. 5
4 Other parts of Section 302 similarly suggest a focus on financial transfers. See Adcock, 550 F.3d at 375 (penalty provision, Section 302(d), shows that Congress clearly intended 302s thing of value to have at least some ascertainable value); see also 29 U.S.C. 186(c) (exemptions pertaining to monetary and financial transactions). 5 Volkswagen correctly states (Br. in Supp. of Mot. to Dismiss 25) that the Department of Labor has not interpreted the disclosure provision in the Labor-Management Reporting and Disclosure Act, 29 U.S.C. 433, to require employers to report promises of the types at issue in this case. While the language of that provision may be read in the manner suggested by Volkswagen, i.e., to require reporting only of items with ascertainable value, DOLs guidance on the provision expressly states: [T]his guidance does not interpret the provisions of section 302(c), and conclusions reached by the Department regarding payments of the kind referred to in section Case 1:14-cv-00076-CLC-SKL Document 41 Filed 05/21/14 Page 25 of 34 PageID #: 460 17
B. The Statutory Context Does Not Support the Plaintiffs Proposed Interpretation of Section 302
To the extent that the literal meaning of pay[ing], lend[ing], or deliver[ing] any money or other thing of value could be construed to reach components of negotiated agreements over ground rules for potential representation, Section 302 should be read not in a vacuum, but in light of its origins, the surrounding body of labor law, and the disruptive effects of the plaintiffs proposed approach. Reading Section 302 in that context makes clear that the plaintiffs view is fundamentally at odds with the accepted premises and core goals of the federal labor laws. Their proposed construction of Section 302 would upset settled understanding of the law by employers and unions and would undermine Congresss goal of promoting industrial peace through voluntary employer-union agreements. 1. As the Supreme Court has recognized, the NLRA expresses a federal policy that industrial peace can be best obtained when employers and unions voluntarily reach agreement and the federal courts . . . enforce these agreements. Textile Workers Union of Am. v. Lincoln Mills, 353 U.S. 448, 455 (1957). Employers and unions have accordingly long entered into, and the NLRB has sanctioned, so-called consent election agreements in which the parties themselves resolve such potentially outcome-determinative election issues as voting eligibility, the scope of the unit in which the election will be conducted, and the date of the election. See NLRB, Ninth Annual Report of the National Labor Relations Board for the Fiscal Year Ended June 30, 1944, at 8, 11 (1944); see also Harry A. Millis & Emily Clark Brown, From the Wagner Act to Taft-Hartley, A Study of National Labor Policy and Labor Relations 87 (1950) (over a 12-
302(c) would not bind the Department of J ustice in carrying out its criminal enforcement responsibilities. See http://www.dol.gov/olms/regs/compliance/LM10_FAQ.htm (FAQs 18 & 19) (last visited May 20, 2014).
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year period nearly half [of the representation petitions] were reported as adjusted without formal action). Employers have also long provided unions with access to employers premises and supplied employee lists during organizing campaigns. See supra pp. 3-4. The NLRB and courts have long sanctioned these practices, so long as employers provided the same opportunities to rival unions. See, e.g., NLRB v. Waterman S.S. Corp., 309 U.S. 206, 209-10 & n.4, 225-26 (1940) (access); Kimbrell v. NLRB, 290 F.2d 799, 802 (4th Cir. 1961) (access); NLRB v. L. Ronney & Sons Furniture Mfg. Co., 206 F.2d 730, 735 (9th Cir. 1953) (employee names and addresses). And as noted, the NLRB has recognized as lawful, and courts have enforced, ground-rules agreements for the conduct of union organizing campaigns. See, e.g., J.P. Morgan Hotel, 996 F.2d at 566 (2d Cir. 1993); Verizon Info. Sys., 335 N.L.R.B. at 558-60 & n.7. Section 302 must be read against this backdrop. Plaintiffs contention that an employer would commit a federal crime by complying with the terms of an agreement for the resolution of representational disputes cannot be reconciled with the longstanding and settled body of law allowing such agreements, including the particular provisions challenged here. These provisions are useful in the process leading to voluntary recognition and are useful only for that purpose. Such a procedural agreement (unlike plaintiffs hypothetical direct payment of cash) implicates none of the concerns animating Section 302. These voluntary agreements do not involve bribery or other corrupt practices and do not provide personal[] benefit[s] to union officials; instead, they eliminate the potential for hostile organizing campaigns in the workplace. Adcock, 550 F.3d at 375; see Sage, 390 F.3d at 219. Reading the statute to criminalize such voluntary agreements would penalize the friendly adjustment of industrial disputes, despite Congresss longstanding policy of encouraging such cooperation as a way of avoiding industrial strife. 29 U.S.C. 151. Case 1:14-cv-00076-CLC-SKL Document 41 Filed 05/21/14 Page 27 of 34 PageID #: 462 19
2. Criminalizing agreements to provide assistance during an organizing campaign would also intrude upon the jurisdiction of the NLRB. The NLRB has been delegated responsibility for resolving labor disputes, including disputes regarding union elections and recognition. 29 U.S.C. 159. The Sixth Circuit accordingly has deferred to the primacy of the NLRB in determining the legality of agreements between a union and employer that precede the unions recognition as exclusive bargaining representative. See Montague v. NLRB, 698 F.3d 307, 314-16 (6th Cir. 2012), denying petition for review, Dana Corp., 356 N.L.R.B. No. 49 (2010). The court has recognized that Congress has given the Board the power to make industrial policy as long as it is doing so within the confines of the statutory language and that the balancing of conflicting legitimate interests in pursuit of the national policy of promoting labor peace through strengthened collective bargaining is precisely the kind of judgment that . . . should be left to the Board. Id. (internal citation and quotation marks omitted). If a voluntary agreement between a union and employer results in unfair labor practices, to the detriment of employees, the NLRB may seek to enjoin the offending conduct. In Adcock, for example, although the court of appeals concluded that the agreement did not violate Section 302, the NLRB pursued unfair labor practice charges against the union and employer because the union agreed not to seek wage increases for employees if elected the exclusive bargaining representative. See 550 F.3d at 374-77. The plaintiffs in this case contend that UAW made similar concessions. Compl. 9. They allege that through the ground-rules agreement UAW is under the contractual control of Volkswagen, and Volkswagen can require UAW to delegate its responsibilities to a company-funded Work Council, not strike or picket in support of better wages or working conditions, and not seek wages or benefits for Plaintiffs and other Employees that erode Volkswagens cost advantages vis--vis other automakers in North America. Compl. Case 1:14-cv-00076-CLC-SKL Document 41 Filed 05/21/14 Page 28 of 34 PageID #: 463 20
24(b). These allegations are conclusory, but in any event, the proper recourse for the plaintiffs to seek relief is to file unfair labor practice charges with the NLRB, not a private suit for injunctive and declaratory relief under Section 302. 6 The availability of such adequate remedies, namely unfair labor practice proceedings before the NLRB, severely undermines attempts to stretch 302 beyond its limits Adcock, 550 F.3d at 377; see also Facetglas, 845 F.2d at 1253 (enforcing a neutrality agreement that contained terms to be included in the parties collective bargaining agreement if the union became recognized as bargaining representative). 3. Plaintiffs theory is also untenable because it would cast doubt on a host of other voluntary agreements outside of the union-recognition context that play a key role in effectuating the purposes of the NLRA, including some terms common in collective-bargaining agreements. The fundamental policy of the labor laws is to encourage voluntary agreements that reduce labor strife, and plaintiffs broad construction of Section 302 would invalidate innumerable such agreementsmost or all of which provide a thing of value to a union that, plaintiffs would maintain, is paid or delivered. The interpretation of Section 302 urged by the plaintiffs, for example, would criminalize an employers agreement to allow union access to a plant or employer bulletin board, yet as the Sixth Circuit has held, bargained-for access provisions
6 The plaintiffs appear to contend that these supposed concessions demonstrate the improper effects of the organizing assistance that Volkswagen provided to UAW. The plaintiffs do not, because they cannot, allege that UAWs agreement to these concessions alone violates Section 302. Section 302 does not prohibit a union from providing things of value to an employer; it only prevents employers from delivering (and the union or union representatives from accepting or receiving) thing[s] of value. Adcock, 550 F.3d at 376. Although the plaintiffs allege that Volkswagen agreed to fund the Works Council, Compl. 12(a) & 24(b), they do not allege that in doing so Volkswagen agreed to a payment that violates Section 302. See Compl. 10, 30-33 (specifying as things of value three forms of pre-election organizing assistance Volkswagen agreed to provide UAW); see also 29 U.S.C. 186(c)(9) (exempting from Section 302s prohibitions money or other things of value paid by an employer to a plant, area or industrywide labor management committee established for one or more of the purposes set forth in section 5(b) of the Labor Management Cooperation Act of 1978). Case 1:14-cv-00076-CLC-SKL Document 41 Filed 05/21/14 Page 29 of 34 PageID #: 464 21
implement the employees own undisputed 7 right to negotiate and benefit from a collective bargaining agreement which allows union access for purposes of investigating the premises and interviewing employees on-site. Wolgast Corp. v. NLRB, 349 F.3d 250, 256 (6th Cir. 2003), enforcing 334 N.L.R.B. 203 (2001). Similarly, while plaintiffs would construe Section 302 to criminalize promises of neutrality during an organizing campaign, the Sixth Circuit has enforced collective-bargaining agreements between a union and employer in which the employer agreed to remain neutral if the union sought to mount an organizing campaign at unrepresented facilities owned by the employer. See Intl Union v. Dana Corp., 278 F.3d 548 (2002); AK Steel Corp. v. United Steelworkers of Am., 163 F.3d 403, 408 (6th Cir. 1998). Plaintiffs expansive reading of Section 302 has the potential to criminalize virtually any term in a collective bargaining agreement, which, by reinforcing the unions ability to win valuable concessions for its members, allegedly would pay or deliver a thing of valueenhanced prestige and influenceto the union. A system of peaceful adjustment of grievances or economic disputes would thus become subservient to Section 302 and its exceptions. Collective bargaining is the cornerstone of the NLRA. A theory of Section 302 that could sweep in all employer agreements to provide a union with things it believes valuable and finds objectively useful would subvert the statutes core provisions. Rather than upset the careful balance Congress struck in the labor context between protection, prohibition, and laissez-faire in respect to union organization, collective bargaining, and labor disputes, Chamber of Commerce v. Brown, 554 U.S. 60, 65 (2008) (internal citations and quotation marks omitted), this Court should reject the expansive and unwarranted interpretation of Section 302 advanced by the plaintiffs.
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C. The Legislative History of Section 302 Does Not Support the Plaintiffs Proposed Interpretation
A party contending that legislative action changed settled law has the burden of showing that the legislature intended such a change. Green v. Bock Laundry Mach. Co., 490 U.S. 504, 521 (1989). A statute should not be construed to work a fundamental change in established law absent a clear expression of congressional intent. See, e.g., Scheidler v. Natl Org. for Women, Inc., 547 U.S. 9, 20 (2006). The legislative record provides no support for the conclusion that Congress intended to criminalize ground-rules agreements affording union access and employer neutrality when it enacted Section 302. 1. Section 302 resulted from congressional concern about corruption of collective bargaining through bribery of employee representatives by employers, extortion [of employers] by employee representatives, and abuse by union officers of the power which they might achieve if welfare funds were left to their sole control. Arroyo, 359 U.S. at 425-26. The statute reacted to a demand by the president of the United Mine Workers that a tax of 10 cents a ton on coal be paid to the union for an indiscriminate use for so-called welfare purposes. S. Rep. No. 105, 80th Cong., 1st Sess. 52 (1947) (Senate Report); see, e.g., United States v. Ryan, 350 U.S. 299, 304-05 (1956). Members of Congress believed that if any such huge sums were to be paid to the union, their use must be strictly safeguarded so that the funds would be used for the benefit of employees rather than union officials. Senate Report 52; see Arroyo, 359 U.S. at 426. More generally, the congressional debate reflects concern that if union officials could demand that employers pay royalties on production, they might take[] advantage of the positions which they occupy . . . to fill their own pockets. 92 Cong. Rec. 5180, 5181 (1946) (statement of Sen. Overton); see, e.g., 92 Cong. Rec. 4900 (1946) (statement of Sen. Byrd) (provisions purpose is Case 1:14-cv-00076-CLC-SKL Document 41 Filed 05/21/14 Page 31 of 34 PageID #: 466 23
to prevent the payment of a royalty to the representatives of a union); 92 Cong. Rec. 4746 (1947) (statement of Sen. Taft) (provision was intended to address extortion or a case where the union representative is shaking down the employer). Congress therefore barred employers from making payments to unions and union officials, and unions and union officials from demanding such payments, except under certain circumstances. See LMRA 302, 61 Stat. 157. 2. Nothing in the legislative record suggests that Congress intended to criminalize compliance with ground-rules agreements like the one at issue in this case. To the contrary, at the same time Congress enacted Section 302, it enacted several other provisions that acknowledged the validity of labor agreements that provided benefits to unions. For example, Congress provided that an employer and union may mak[e] an agreement that requires employees to become union members as a condition of employment. LMRA 101, 61 Stat. 140-141 (enacting 29 U.S.C. 158(a)(3) & (b)). As a result employers may agree to require employees to pay union membership dues as a condition of employment, see Radio Officers Union v. NLRB, 347 U.S. 17, 39-42 (1954). Congress also permitted agreements making union-run hiring-halls the exclusive source of hiring referrals. See Local 357, Intl Bhd. of Teamsters v. NLRB, 365 U.S. 667, 672-76 (1961). Congress underscored its commitment to voluntary resolution of disputes by authorizing the federal courts to enforce contracts between an employer and a labor organization. LMRA 301(a), 61 Stat. 156-157 (enacting 29 U.S.C. 185). These congressional actions permitting agreements that give valuable benefits to unions and making these agreements enforceable in federal court are at odds with any inference that it intended to criminalize agreements setting procedures for an organizing campaign. Further, in 1947 Congress enacted 29 U.S.C. 158(c) to insure both to employers and labor organizations full freedom to express their views to employees on labor matters. Senate Case 1:14-cv-00076-CLC-SKL Document 41 Filed 05/21/14 Page 32 of 34 PageID #: 467 24
Report 23-24; see LMRA 101, 61 Stat. 142. And Members of Congress acknowledged, without disturbing, the settled understanding that an employer can permit forms of union access to employer property beyond what the NLRA requires. At the time of the 1947 amendments, the NLRA provided that it was an unfair labor practice for an employer to dominate or interfere with the formation or administration of any labor organization or contribute financial or other support to it, but also stated that an employer was not prohibited from permitting employees to confer with him during working hours without loss of time or pay. 29 U.S.C. 158(2) (1940). While considering possible amendments to that provision, the House Report accepted as a commonplace truth that an employer can do more for the union of his employees than the act, by its terms, permits such as provid[ing] . . . bulletin boards for the unions use and allow[ing] representatives of the union to confer not only with the employer but as well with employees on company property. H.R. Rep. No. 245, 80th Cong., 1st Sess. 28-29 (1947); see BASF Wyandotte Corp. v. Local 227, Intl Chem. Workers Union, 791 F.2d 1046, 1051-52 (2d Cir. 1986). The Congress that expressly recognized employer free speech and took for granted that employers may allow union access to employees and property would not have silently outlawed voluntary employer-union agreements encompassing the very same elements. 3. The 1959 amendments to Section 302 likewise evidence no congressional intent to criminalize voluntary agreements for organizing campaigns. As originally enacted, Section 302 provided that an employer could not pay or deliver any money or thing of value to any representative of any of his employees who are employed in an industry affecting commerce. 61 Stat. 157. That language was interpreted to apply only to payments made to incumbent unions and union representatives and not to unions seeking to become the collective bargaining representative. See Ventimiglia v. United States, 242 F.2d 620, 623-24 (4th Cir. 1957). Case 1:14-cv-00076-CLC-SKL Document 41 Filed 05/21/14 Page 33 of 34 PageID #: 468 25
To close this gap, Congress extended Section 302s reach to any labor organization, or any officer or employee thereof, which represents, seeks to represent, or would admit to membership, any of the employees of the employer. Pub. L. No. 86-257, 505, 73 Stat. 537 (emphasis added); see S. Rep. No. 187, 86th Cong., 1st Sess. 13 (1959). Although Congress expressly extended Section 302 so that it would apply during the organizing process, no one suggested that the statute would criminalize voluntary ground-rules agreements for organizing. To the contrary, the one Member of Congress who mentioned such agreements found it obvious that Section 302 would not prohibit card-check agreements and other similar agreements that are part of normal and legitimate labor relations. 104 Cong. Rec. 16,464 (1958) (statement of Rep. McGovern). Rather, he reaffirmed that the statute prohibits improper payments to union officials, employees or middlemenin a word, it forbids bribes or pay-offs. Id. CONCLUSION If the Court does not dismiss the complaint for mootness or lack of standing, it should nonetheless dismiss the complaint for the reasons stated above. Respectfully submitted, M. PATRICIA SMITH Solicitor of Labor
ERIC C. HALLSTROM Special Counsel
WILLIAM J . STONE Senior Attorney U.S. Department of Labor 200 Constitution Ave., N.W. Washington, D.C. 20210
RICHARD F. GRIFFIN, J R. General Counsel National Labor Relations Board Washington D.C. 20570 DAVID A. ONEIL Acting Assistant Attorney General
DAVID M. BITKOWER Deputy Assistant Attorney General
/s/J ohn M. Pellettieri J OHN M. PELLETTIERI Attorney, Appellate Section Criminal Division U.S. Department of J ustice 950 Pennsylvania Ave., N.W., Rm. 1260 Washington, D.C. 20530 (202) 307-3766
Dated: May 21, 2014 Case 1:14-cv-00076-CLC-SKL Document 41 Filed 05/21/14 Page 34 of 34 PageID #: 469