NATIONAL LABOR RELATIONS BOARD AND ROSEMARY M. COLLYER, GENERAL COUNSEL, NATIONAL LABOR RELATIONS BOARD, PETITIONERS V. UNITED FOOD AND COMMERCIAL WORKERS UNION, LOCAL 23, AFL-CIO No. 86-594 In the Supreme Court of the United States October Term, 1986 On Petition for a Writ of Certiorari to the United States Court of Appeals for the Third Circuit Reply Memorandum for the Petitioners 1. Respondent asserts (Br. in Opp. 3, 6) that the courts of appeals have not reached conflicting conclusions with respect to the first issue presented in our petition -- whether a charging party may obtain judicial review of the General Counsel's decision to enter into an informal settlement and withdraw an unfair labor practice complaint prior to commencement of the administrative hearing. /1/ Respondent is simply wrong. The Third Circuit, reaffirming its decision in Leeds & Northrup Co. v. NLRB, 357 F.2d 527, 533 (1966), held in the present case that the General Counsel's decision is subject to judicial review. See also ILGWU v. NLRB, 501 F.2d 823 (D.C. Cir. 1974) (adopting the same rule). The Sixth Circuit concluded in Jackman v. NLRB, 784 F.2d 759, 763 (1986), that the General Counsel's decision to settle a case informally prior to hearing is not reviewable. These courts both acknowledged that their decisions are in conflict. See Pet. App. 12a n.8; Jackman, 784 F.2d at 764 n.13. Respondent attempts to reconcile the opposing results reached by the courts of appeals by distinguishing between "adjudicatory" settlements and "prosecutorial" settlements. In respondent's view (Br. in Opp. 9) the Third Circuit rule may be limited to situations in which the withdrawal of the complaint is "adjudicatory" in that it is based on the decision that "the informal settlement provides adequate relief." The Sixth Circuit rule, on the other hand, supposedly applies to "prosecutorial" judgments, in which the General Counsel accepts a settlement because a claim is "meritless" (id. at 8). It is not clear, according to respondent (id. at 9), that the Third Circuit would assert jurisdiction over "prosecutorial settlements or that the Sixth Circuit would deny jurisdiction over "adjudicatory" settlements. Respondent's distinction between "prosecutorial" and "adjudicatory" settlements is wholly illusory. In both the present case (Pet. App. 6a-8a) and Jackman (784 F.2d at 761), the charged party agreed to some, but not all, of the relief sought by the charging party. And in both cases the General Counsel found that the charging party was not entitled to certain relief (Pet. App. 6a-7a; 784 F.2d at 761). Indeed, every decision whether to accept a settlement requires consideration of both the strength of the case on the merits and the adequacy of the remedy to be provided under the settlement. Thus, it may serve the policies of the Act to accept a settlement with a relatively lenient remedy when the evidence of a violation is weak; on the other hand, the General Counsel might insist upon more severe sanctions when the evidence on the merits is stronger. Respondent has thus failed to identify any meaningful distinction between the two cases. Moreover, neither of the courts of appeals relied upon the distinction proffered by respondent. Each court stated that it was adopting a rule governing all withdrawals of complaints prior to the administrative hearing. And the reasoning of the courts of appeals does not allow for the distinction created by respondent. Thus, the Third and District of Columbia Circuits concluded that the issuance of the complaint transformed the proceeding into one in which the settlement is subject to judicial review. Pet. App. 10a-11a; Leeds & Northrup v. NLRB, 501 F.2d at 831. The Sixth Circuit also rested its decision on the general nature of the decision to enter into a settlement (Jackman, 784 F.2d at 762-764). /2/ Indeed, respondent itself, in its discussion addressing the merits of this issue (Br. in Opp. 9-12), does not advance a construction of the National Labor Relations Act that allows for a distinction between "prosecutorial" and "adjudicatory" settlements. Respondent argues that because Section 3(d) of the Act, 29 U.S.C. 153(d), states that the General Counsel exercises her authority "on behalf of the Board," any action by the General Counsel which resolves a case is a "final order of the Board" subject to judicial review under Section 10(f) of the Act, 29 U.S.C. 160(f). We have already shown that this argument is legally erroneous (Pet. 15 n.7, 17-19); what is noteworthy here is that under respondent's own argument Section 10(f) would not be limited to "adjudicatory" settlements, but would encompass all decisions by the General Counsel approving informal settlements and withdrawing complaints. Respondent's own view of the statute therefore confirms both the spuriousness of its purported distinction and the existence of a conflict among the courts of appeals regarding this issue. 2. Nor is there merit to respondent's contention (Br. in Opp. 3-5) that the issues presented in the petition are not appropriate for review by this Court because relatively few charging parties have sought judicial review of informal settlements. First, as we discuss in the petition (at 23-24), informal settlements are an important enforcement mechanism. To avoid confusion, and possible disruption of the Board's procedures, the rules governing informal settlements should be clear. Review is appropriate here because the decisions of the Third and District of Columbia Circuits raise significant questions about the availability of judicial review. Second, respondent totally ignores the second question raised in the petition -- whether the court of appeals correctly held that a charging party who objects to a settlement is entitled to an evidentiary hearing on its objections. As we have discussed (Pet. 20-21), the Third Circuit stands alone in its view that the charging party must always be accorded an evidentiary hearing when it objects to a settlement. That holding is not limited to informal settlements by the General Counsel, but extends to formal settlements approved by the Board. Thus, the Third Circuit's decision does more than subject a limited category of informal settlements to judicial scrutiny. It requires the Board to establish a hearing procedure for the resolution of a charging party's objections to any settlement proposed by the Board or the General Counsel; such a procedure is not only unnecessary under the Act, it would discourage charged parties from entering into settlements (see Pet. 22-23). Third, the present state of the law, under which a charging party in the Third and District of Columbia Circuits is entitled to judicial review of its objections to an informal settlement but charging parties in other parts of the country have no such right, flies in the face of this Court's repeated admonition that in enacting the National Labor Relations Act Congress intended that there be "uniform application" of statutory rules and procedures (Garner v. Teamsters Local Union No. 776, 346 U.S. 485, 490 (1953)). Effectuation of a uniform national labor policy requires the clarification by this Court of the procedures governing informal settlements. For the foregoing reasons, and the reasons set forth in the petition, it is respectfully submitted that the petition for a writ of certiorari should be granted. CHARLES FRIED Solicitor General ROSEMARY M. COLLYER General Counsel National Labor Relations Board DECEMBER 1986 /1/ We note that respondent does not contest our showing of a conflict as to the second issue presented for review -- whether the Board must hold an evidentiary hearing whenever a charging party challenges a settlement. /2/ Insofar as respondent finds (Br. in Opp. 6-7) support for its distinction in George Banta Co. v. NLRB, 626 F.2d 354 (4th Cir. 1980), that fact merely shows a further division among the courts of appeals concerning the reviewability of informal settlements. Indeed, the fact that neither the court below nor the Jackman court referred to that decision confirms those courts did not adopt the narrow rules devised by respondent.