On Tuesday, August 20th, in an opinion that follows in the wake of Noel Canning, United States District Judge Benjamin H. Settle dismissed an injunction petition filed by Ronald Hooks, a Regional Director  of the National Labor Relations Board, on the grounds that he was “without power” to issue the underlying unfair labor practice complaint.

The Regional Director had initially filed the petition with the District Court in June in an effort to obtain a temporary injunction that would, among other things, have prevented Kitsap Tenant Support Services, a home healthcare provider, from disciplining or terminating employees pending the resolution of complaint alleging a host of unfair labor practices.

The Court however, dismissed the Regional Director’s petition, ruling that the NLRB had no legal power to issue the underlying complaint alleging violations of the NLRA.  Not only did the Judge follow Noel Canning and its progeny by ruling the Board (as constituted at the time) lacked a properly constituted quorum but Judge Settle went even further by ruling the Board lacked a properly authorized General Counsel.

In a ruling which could potentially paralyze the NLRB, Judge Settle held that Acting General Counsel Lafe Solomon’s appointment to the post had been invalid, and consequently, that he could not have lawfully delegated the authority to request a temporary injunction to the Regional Director.  Specifically, Solomon was never confirmed by the Senate but was serving in the “Acting” capacity pursuant to President Obama’s appointment under the Federal Vacancies Reform Act (FVRA).  The Judge ruled, however, that this appointment was invalid because Solomon failed to meet the very specific requirements which would permit an appointment under the FVRA – namely he was not a first assistant to the departing General Counsel.

The decision is an exciting one because it raises interesting procedural questions affecting the operations of the Board. It remains to be seen what the administrative law judge tasked with adjudicating the dispute will do. Will he or she acknowledge that Regional Director Hooks lacked authority to issue the Complaint as dismiss it on such grounds? Or will the adjudication proceed as though Judge Settle’s decision does not affect agency operations? This issue is further complicated by the fact that the Board had already denied a motion to dismiss filed by Kitsap earlier this year on grounds similar to those relied upon by Judge Settle. If the administrative law judge refuses to proceed however, then it would seem that he or she would have no choice but to refuse to hear any complaints issued by the Regional Director during the period in which the Board lacked a valid quorum let alone all complaints issued under the authority of Solomon who has served as the Acting General Counsel since June 2010.

Beyond this case, the theory advanced in Kitsap could have wide-ranging implications that render the recent compromise to confirm a five member Board virtually meaningless.  Without a properly appointed General Counsel can the Agency continue to issue complaints?  Are the complaints issued under Solomon all invalid?  What about appeals authorized or being responded to under the direction of Solomon?  What about the appointment of Regional Directors – were those appointed under Solomon invalid and are the actions of such Regional Director’s similarly without authority?

Likewise, where does these leave the General Counsel’s office?  As noted here the President has appointed Robert Griffin to replace Solomon but Griffin likely would face stiff opposition in the Senate.  The prior conventional wisdom was Obama could use the FVRA to make Griffin the Acting General Counsel but under Kitsap Griffin also would not be qualified for such an interim appointment.  This could leave the Agency without “authority to act” until the Senate confirms a new General Counsel or the President appoints an Acting General Counsel that meets the FVRA criteria.

Certainly, this groundbreaking decision leaves many more questions than it provides answers.

And lest we forget, like every other decision which has relied upon Noel Canning, the impact of Judge Settle’s ruling may hang in the balance until the Supreme Court hears Noel Canning next term. Until that time however, rest assured that attorneys will be citing Kitsap at Board hearings and in court rooms across the country.

Management Missives

  • Employers facing unfair labor practice charges should consider preserving the issue that the NLRB is without authority to issue a complaint (seek an injunction or take other action which requires the General Counsel’s approval).