As we previously reported in this Blog, one of the more expansionist – and controversial – NLRB decisions of 2012 was D.R. Horton, 357 NLRB No. 184, in which the Board held that employers may not require as a condition of employment that employees agree to a blanket waiver of rights to pursue their employment claims by means of class actions. The Board permitted waiver of class and collective actions in employment arbitrations only where the employer permitted employees to bring these actions in court.

Needless to say, D.R. Horton is of great concern to the employers and has caused a wave of litigation. Leading the charge is D.R. Horton’s own challenge to the Board’s decision in the 5th Circuit Court of Appeals (New Orleans). D.R. Horton, Inc. v. NLRB, No. 12-60031. Oral argument was heard in February. The employer contended (among other things) that the NLRB decision was inconsistent with federal law and Supreme Court precedent. Further, D.R. Horton argued that in the 13 months since the Board’s decision was rendered, no less than 26 different courts expressly rejected the Board’s reasoning.

According to D.R. Horton, six more courts have rejected the Board’s decision in the month since argument was heard. These courts include a state court and two federal courts in California, two federal courts in New York, and one in Tennessee. 

Adding to D.R. Horton’s case against the Board is the D.C. Circuit’s decision in Noel Canning v. NLRB, 2013 WL276024 (D.C. Cir. Jan. 25, 2013). The D.C. Court found President Barack Obama’s recess appointments to the Board to be unconstitutional, indicating its actions depend upon the presence of those appointees, including the decision in D.R. Horton, to be ineffective. D.R. Horton has urged the 5th Circuit to adopt the Noel Canning rationale and thus find the Board lacked a quorum to even issue the decision in its case.

D.R. Horton’s prohibition of most collective action waivers and the recess appointment/NLRB quorum controversy are often mentioned by commentators as examples of overreaching by the White House and the current Board. Regardless of your views, it makes this case one of extraordinary interest.