No. 04-1144
IN THE UNITED STATES COURT OF APPEALS FOR THE FIRST
CIRCUIT
THOMAS J. HARRINGTON, ET AL., Plaintiffs-Appellees,
v.
ELAINE L. CHAO, Secretary of Labor, Defendant-Appellant.
ON APPEAL FROM THE UNITED STATES DISTRICT COURT FOR THE
DISTRICT OF MASSACHUSETTS
BRIEF FOR APPELLANT
OF COUNSEL: |
PETER D. KEISLER |
|
Assistant Attorney General |
HOWARD M. RADZELY |
|
Solicitor of Labor |
MICHAEL J. SULLIVAN |
|
United States Attorney |
ALLEN H. FELDMAN |
|
Associate Solicitor |
WILLIAM KANTER |
|
(202) 514-4575 |
NATHANIEL I. SPILLER |
JOHN S. KOPPEL |
Deputy Associate Solicitor |
(202) 514-2495 |
|
Attorneys, Appellate Staff |
GARY K. STEARMAN |
Civil Division, Room 9120 |
Senior Appellate Attorney |
Department of Justice |
Department of Labor |
601 D Street, N.W. |
Suite N-2700 |
Washington, D.C. 20530 |
Washington, D.C. 20210 |
|
TABLE OF CONTENTS
JURISDICTIONAL STATEMENT
STATEMENT OF THE ISSUES PRESENTED FOR REVIEW
STATEMENT OF THE CASE
STATEMENT OF FACTS
1. Statutory and Regulatory Framework
2. The Instant Litigation
SUMMARY OF ARGUMENT
STANDARD OF REVIEW
ARGUMENT
I. THE
SUPPLEMENTAL STATEMENT OF REASONS FULLY ADDRESSES THIS COURT'S PREVIOUS
CONCERNS AND RATIONALLY EXPLAINS THE SECRETARY'S
CONCLUSION THAT THE NERCC IS NOT A "LOCAL LABOR ORGANIZATION" UNDER 29
U.S.C. § 481(b)
A.
This Court Expressed No Opinion On The Merits Of The Secretary's Decision That
The NERCC Is Not A Local Union, But Remanded For The Secretary To Provide A
Fuller Explanation Of the Decision
B.
The District Court Erroneously Believed That This Court Opined On The
Merits Of The Secretary's Test
C.
The Secretary's Statement Of Reasons Fully Addresses The Concerns Raised
By This Court In The First Appeal.
D.
The Secretary Has Adequately Explained The Reasons For Her Position As Applied
To The Novel Facts Of This Case.
II. ASSUMING
ARGUENDO THAT THE COURT AFFIRMS THE DISTRICT COURT'S ORDER OF OCTOBER 8, 2003,
IT SHOULD MODIFY THE RELIEF ORDER OF NOVEMBER 25, 2003
CONCLUSION
CERTIFICATE OF COMPLIANCE
CERTIFICATE OF SERVICE
ADDENDUM
TABLE OF AUTHORITIES
Cases:
Auer v. Robbins, 519 U.S. 452 (1997)
Bowles v. Seminole Rock & Sand
Co., 325 U.S. 410 (1945)
Chevron U.S.A. Inc. v. Natural Res. Def.
Council, Inc.,467 U.S. 837 (1984)
Donovan v. National Transient Div.,
Int'lBhd. of Boilermakers, Iron Ship Builders,Blacksmiths, Forgers &
Helpers, 736 F.2d 618 (10th Cir. 1984), cert.
denied, 469 U.S. 1107 (1985)
Dunlop v. Bachowski, 421 U.S. 560
(1975)
Harrington v. Chao, 280 F.3d 50 (1st
Cir. 2002)
Harrington v. Chao, 286 F. Supp. 2d
80 (D. Mass. 2003)
Harrington v. Herman, 138 F. Supp. 2d
232 (D. Mass. 2001)
Hodel v. Irving, 481 U.S. 704 (1987)
Hodgson v. Local Union 6799, United
Steelworkers, 403 U.S. 333 (1971)
In re Lane Wells Co., 79 N.L.R.B. 252
(1948)
Local No. 82, Furniture & Piano Moving
v. Crowley, 467 U.S. 526 (1984)
North Carolina v. Rice, 404 U.S. 244
(1971)
Penobscot Air Servs., Ltd. v. FAA,
164 F.3d 713 (1st Cir. 1999)
Rankin v. Allstate Ins. Co., 336 F.3d
8 (1st Cir. 2003)
Schultz v. Employees' Fed'n of the Humble
Oil & Refining Co., 74 L.R.R.M. (BNA) 2140 (S.D. Tex. 1970)
Smiley v. Citibank (South Dakota),
N.A., 517 U.S. 735 (1996)
South Shore Hosp., Inc. v. Thompson,
308 F.3d 91 (1st Cir. 2002)
Thomas Jefferson Univ. Hosp. v.
Shalala, 512 U.S. 504 (1994)
Trbovich v. United Mine Workers, 404
U.S. 528 (1972)
Udall v. Tallman, 380 U.S. 1 (1965)
Wirtz v. Local 153, Glass Bottle Blowers
Ass'n, 389 U.S. 463 (1968)
Constitution:
Article III
Statutes:
Labor-Management Reporting and Disclosure Act of
1959 ("LMRDA" or "Act"):
29 U.S.C. §
401 et seq
29 U.S.C. §
402(i) 29 U.S.C. § 402(j)
29 U.S.C. §
481
29 U.S.C. §
481(a)
29 U.S.C. §
481(b)
29 U.S.C. §
481(d)
29 U.S.C. §
482
29 U.S.C. §
482(d)
29 U.S.C. §
483
5 U.S.C. § 702
5 U.S.C. §
704
5 U.S.C. §
706(2)(A)
28 U.S.C. §
1291
28 U.S.C. §
1331
28 U.S.C. §
1337
28 U.S.C. §
2107(b)
Regulations:
29 C.F.R. §
451.4(f)
29 C.F.R. §
451.4(f)(4)
29 C.F.R. §
452.11
38 Fed. Reg. 18,324 (1973)
Legislative Materials:
S. Rep. No. 86-187 (1959), reprinted in 1959
U.S.C.C.A.N. 2318
Miscellaneous:
2A Sutherland
Statutes and Statutory Construction § 48.03 (6th ed. 2000)
Webster's
Ninth New Collegiate Dictionary (1990)
IN THE UNITED STATES COURT OF APPEALS FOR THE FIRST
CIRCUIT
No. 04-1144
THOMAS J. HARRINGTON, ET AL., Plaintiffs-Appellees,
v.
ELAINE L. CHAO, Secretary of Labor, Defendant-Appellant.
ON APPEAL FROM THE UNITED STATES DISTRICT COURT FOR THE
DISTRICT OF MASSACHUSETTS
BRIEF FOR APPELLANT
JURISDICTIONAL STATEMENT
The district court had subject matter jurisdiction under 28 U.S.C. §§
1331 and 1337 to review the determination of the Secretary of Labor
("Secretary") not to file suit against the New England Regional Council of
Carpenters ("NERCC"), United Brotherhood of Carpenters and Joiners ("UBC"). See
Dunlop v. Bachowski, 421 U.S. 560, 566 (1975). The Secretary's determination was
issued in response to an administrative complaint filed under the
Labor-Management Reporting and Disclosure Act of 1959 ("LMRDA" or "Act"), 29
U.S.C. 401 et seq.
Under
28 U.S.C. § 1291, the Court of Appeals has jurisdiction to review the final
decision of the district court, if the notice of appeal is filed within sixty
(60) days of entry of the district court's final decision. See 28 U.S.C. §
2107(b). The district court's order granting summary judgment to
plaintiffs was entered on the docket on October 8, 2003, and the court's final
order was entered on November 25, 2003. The notice of appeal was filed on
January 20, 2004, in timely fashion under 28 U.S.C. § 2107(b).
STATEMENT OF THE ISSUES PRESENTED FOR REVIEW
After investigating a complaint
that the NERCC violated the LMRDA's election rules requiring a local union to
conduct officer elections by direct vote of its members every three years, the
Secretary concluded that the NERCC did not violate the LMRDA because it is an
"intermediate" labor organization entitled to conduct elections of its officers
every four years by a vote of delegates from its member locals. The questions
presented are:
1. Whether the Secretary's
supplemental statement of reasons announcing and explaining the decision not to
sue the NERCC to conduct a local union election was arbitrary and capricious.
2. Assuming arguendo that
Question 1 is answered in the affirmative, whether the district court erred as a
matter of law in requiring the Secretary to "take appropriate action" prior to
exhausting her appeal rights.
STATEMENT OF THE CASE
Thomas J. Harrington -- a
member in good standing of a local union that is a member of the NERCC – and
seven other members filed timely complaints with the UBC alleging that the NERCC
failed to elect its officers directly by the membership in violation of Title IV
of the LMRDA, 29 U.S.C. §§ 481-483.
[1] After
the UBC failed to respond to their complaints, Harrington filed an
administrative complaint with the Secretary of Labor. In April 2000, the
Secretary issued a Statement of Reasons explaining that the NERCC is an
"intermediate bod[y]" within the meaning of Section 401(d) of the Act, 29 U.S.C.
§ 481(d), and may therefore elect its officers every four years either by secret
ballot among the members in good standing or by a vote of delegates who have
been elected by secret ballot by the members in good standing of the NERCC's
subordinate locals.
The complainants
challenged this determination in United States District Court. On the
Secretary's motion, the district court dismissed the suit. Harrington v.
Herman,
138 F. Supp. 2d 232 (D. Mass. 2001).
The complainants appealed to this Court, which vacated the Secretary's
Statement of Reasons and remanded to the district court with instructions to
remand to the Secretary to provide an opportunity "to better explain" the Secretary's determination that the NERCC
is an intermediate body within the meaning of Section 401(d) of the Act.
Harrington v. Chao, 280 F.3d 50, 60 (1st Cir. 2002).
On January 31, 2003, having reaffirmed her view of the case, the Secretary
issued a lengthy Supplemental Statement of Reasons explaining her determination
that the NERCC is an intermediate body under the LMRDA and therefore is not
required to follow the election rules applicable to a local labor
organization. Dissatisfied with this determination, the complainants filed
a motion for summary judgment in the district court, and the Secretary responded
with a cross-motion.
On October 8, 2003, the district court ruled for complainants.
Harrington v. Chao, 286 F. Supp. 2d 80 (D. Mass. 2003), reproduced in Joint Appendix ("JA") at
19-25. On November 25, 2003, the district court ordered the Secretary "to take
appropriate action within thirty (30) days of the date of this Order, consistent
with the determination of this Court that the Secretary's failure to treat the
New England Council of Carpenters as a statutory 'local labor organization' is
arbitrary and capricious." JA 26. By order of December 16, 2003, JA 27, this
deadline was extended by an additional thirty (30) days.
On January 20, 2004, the Secretary filed a timely notice of appeal. JA 29. On February 20, 2004, this Court stayed the district court's
decision pending this appeal.
STATEMENT OF FACTS
1.
Statutory and Regulatory Framework
Title IV of the LMRDA establishes base standards for the election of union
officers. Different election criteria and intervals apply to different types of
labor organizations. 29 U.S.C. § 481(a), (b), (d). For "intermediate bodies," section 401(d) of the
Act identifies two lawful methods for electing officers:
Officers of intermediate bodies, such as general committees, system boards,
joint boards, or joint councils, shall be elected not less often than once every
four years by secret ballot among the members in good standing or by labor
organization officers representative of such members who have been elected by
secret ballot.
29 U.S.C. § 481(d). In contrast, Section 401(b) of the Act requires "[e]very
local labor organization" to "elect its officers not less often than once every
three years by secret ballot among the members in good standing." 29 U.S.C. §
481(b).
The Act provides a definition of "[l]abor organization," but the terms "local
labor organization" and "intermediate bodies" are not defined in the
Act.
[2]
Reflecting the statute, the Secretary's regulations identify -- but do not separately define -- three
types of labor organizations that fall within Title IV's election provisions:
"national and international labor organizations, except federations of such
organizations"; "intermediate bodies such as general committees, conferences,
system boards, joint boards, or joint councils, certain districts, district
councils and similar organizations"; and "local labor organizations." 29 C.F.R.
§ 452.11; 38 Fed. Reg. 18,324 (1973); cf. 29 C.F.R. pt. 451 (scope of "labor
organizations"); 29 U.S.C. §§ 402(j), 481(a), (b), (d). The same regulation
states the Secretary's view that "[t]he characterization of a particular
organizational unit as a 'local,' 'intermediate,' etc., is determined by its
functions and purposes rather than the formal title by which it is known or how it
classifies itself." 29 C.F.R. § 452.11.
[3]
The Act grants exclusive enforcement authority over Title IV to the Secretary
of Labor. 29 U.S.C. § 483; Trbovich v. United Mine Workers, 404 U.S. 528, 536
(1972). The Secretary investigates a union member's complaint, 29 U.S.C. § 482,
and if she determines that there is probable cause to believe that a violation
of the LMRDA occurred that may have affected the outcome of a union election,
the Secretary will file suit in the appropriate district court to set aside the
election. 29 U.S.C. § 482; Wirtz v. Local 153, Glass Bottle Blowers Ass'n, 389
U.S. 463, 472 (1968).
If, as here, the Secretary determines that no Title IV violation
occurred or that it had no effect on the election's outcome, the complaining
union member is entitled to a Statement of Reasons from the Secretary, stating
her reasons for declining to file suit. Dunlop v. Bachowski, 421 U.S. 560, 568,
571-572 (1975). The Secretary's decision not to sue, as embodied in the Statement of Reasons, is subject to judicial review pursuant to 5 U.S.C. §§ 702 and 704, under the "arbitrary and capricious" standard set forth
in 5 U.S.C. 706(2)(A). Bachowski, 421 U.S. at 566. The statement of reasons
accordingly must inform the court and the complaining union member of the
grounds of the decision and the essential facts supporting these grounds;
detailed findings of fact are not required so long as the findings are
sufficient to enable the reviewing court to determine whether the Secretary's
decision was reached for an impermissible reason. Id. at 573-74.
The Secretary's determinations, and any subsequent judicial review, must
effectuate the LMRDA's twin purposes of remedying abuses in union elections and
avoiding unnecessary interference in internal union affairs. See
Hodgson v. Local Union 6799, United Steelworkers, 403 U.S. 333, 339 (1971);
see also Local No. 82, Furniture & Piano Moving v. Crowley, 467 U.S. 526, 539
(1984); S. Rep. No. 86-187, at 5 (1959), reprinted in 1959 U.S.C.C.A.N. 2318,
2322 ("[i]n providing remedies for existing evils the Senate should be careful
neither to undermine self- government within the labor movement nor to weaken
unions in their role as the bargaining representatives of employees").
2.
The Instant Litigation
a. In 1996, the United Brotherhood of Carpenters and Joiners
implemented an organizational restructuring in which state and district
councils, as well as independent local unions, were combined to form larger
regional councils. Supplemental Statement of Reasons ("Supp. Stm't") 1, JA
9.
[4]
In New England, the restructuring resulted in the creation
of the NERCC, a single, regional council overseeing 27 pre-existing local
unions, which together have over 25,000 members. Id. As a result of this
reorganization, the NERCC performs a number of important responsibilities, some
of which may have been traditionally performed by or associated with local
unions. Id. at 9, JA 17.
The NERCC negotiates collective bargaining agreements within the New England
region, to which the local unions are parties. The agreements must then be
approved through ratification votes held by the affected locals among local
members. Id. at 8-10, JA 16-18. The NERCC, through its Executive
Secretary-Treasurer, hires, directs, supervises, disciplines, promotes, and
fires organizers and business representatives and appoints all trial committees.
Id. at 9-10, JA 17-18. The NERCC representative appoints local union stewards,
who report job site problems to the NERCC representative and serve at the
representative's discretion. Id. at 9, JA 17. The NERCC determines and levies a portion of the
members' dues not determined and levied by the locals, and approves monthly dues
levied by the local unions. Id. at 9-10, JA 17-18.
Separate from and subordinate to the NERCC, the union locals are
independently chartered labor organizations, which have identifiable memberships
and elect their own officers. Id. at 7, JA 15. The locals pass their own bylaws,
which must comport with the UBC constitution and bylaws. Id. The locals
hold meetings periodically where the membership is informed of union activities
and business. Id. In addition, the locals maintain their own offices,
have clerical employees and budgets, and manage separate bank accounts.
Id. The locals also determine and collect monthly dues, and they charge
and collect all fines for working dues or fees that are in arrears to "'any
other Local Union, District Council, Industrial Council or Regional Council.'"
Id. at 8.
A worker joins the UBC by becoming a member of a local union, and the worker
can withdraw or sever connection with the union only "'by submitting a clear and
unequivocal resignation in writing to the Local Union.'" Id. at 7. Local
stewards, although appointed by a NERCC representative, are local members, and
they resolve most grievances without the participation of or input from the
NERCC representative. Id. at 8, JA 16.
Disciplinary matters are first referred to the local's executive board for an
informal hearing with the goal of an informal resolution. Id. If
unsuccessful, charges are then filed with the NERCC. Id. Each local union
is also responsible for the carelessness or negligence of its officers and must
procure bonds to protect against such action. Id. at 7, JA 15. As
mentioned on p.9 supra, the locals hold ratification votes among local members
to approve collective bargaining agreements. Finally, the locals engage in
voluntary organizing drives and lobbying, and administer scholarship and
disability funds. Id. at 8, JA 16.
b. Complainant Harrington filed a complaint with the Secretary concerning the
failure of the NERCC to comply with the direct election and secret ballot
requirements of 29 U.S.C. § 482(d). Following an investigation, the Secretary
issued a Statement of Reasons that explained her determination that the NERCC is
an "intermediate labor organization," which therefore is not required to follow
the election rules established for a "local labor
organization."
[5]
In so deciding, the Secretary concluded that,
although the NERCC possessed some of the powers and functions previously held by
the union's locals, nothing in the LMRDA or its legislative history permitted
her to treat the NERCC as a local rather than an intermediate labor organization.
Accordingly, the Secretary found no violation of law in the NERCC's election of
its officers and no cause to bring suit against it.
c. Complainants then brought this action challenging the Secretary's
determination in the United States District Court for the District of
Massachusetts. The district court dismissed the case. Harrington v. Herman, 138
F. Supp. 2d 232 (D. Mass. 2001). Complainants contended that the
Secretary's ruling was arbitrary and capricious because it relied on the NERCC's
structure and failed to distinguish Donovan v. National Transient Div., Int'l Bhd. of Boilermakers, Iron Ship Builders, Blacksmiths, Forgers & Helpers,
736 F.2d 618 (10th Cir. 1984) ("Boilermakers"), cert. denied, 469 U.S. 1107
(1985), and Schultz v. Employees' Fed'n of the Humble Oil & Refining Co., 74 L.R.R.M. (BNA) 2140 (S.D. Tex. 1970) ("Humble Oil"). The court rejected this
contention.
The district court determined that
Boilermakers was not controlling because
the challenged union there, lacking any subordinate locals, could not be an
intermediate or national labor organization. 138 F. Supp. 2d at 236. The court
further found that complainants had "unfairly characterize[d]" the Department's
Statement of Reasons as focusing exclusively on the structure of the union,
because -- unlike the situation in Boilermakers -- the Department found that the NERCC's subordinate locals were not "mere titular appendages of the Regional Council but
performed at least some of the traditional functions of local unions." Id. at
236 n.9.
By contrast, the district court further noted that the subordinate divisions
in Humble Oil performed "no functions at all." Id. at 236. The court also
rejected the argument that the Secretary's decision was arbitrary and capricious
because her Statement of Reasons failed to discuss the Boilermakers and
Humble
Oil decisions; the court stated that Bachowski does not require a discussion of
the relevant case law. Id. at 236 n.10. Thus, the district court concluded
that it had no authority to substitute its own judgment for that of the
Secretary. Id.
d. Complainants appealed to this Court, which vacated the district court's
dismissal because it found the Secretary's Statement of Reasons "insufficient to
permit meaningful judicial review." Harrington v. Chao, 280 F.3d 50, 52 (1st
Cir. 2002). The Court concluded that the Secretary's Statement of Reasons
left two questions unanswered: whether the Secretary disavowed a "functional"
analysis in determining whether a local labor organization is a local or an
intermediate labor organization, and whether the Secretary's approach was
consistent with the Department's position in relevant prior cases. Id. at 57-58,
citing Boilermakers and Humble Oil. The Court directed that, if the Secretary
again chose to close the case without filing suit, she must supplement her Statement of Reasons to address specifically the
functions and purposes test of 29 C.F.R. § 452.11, and to explain how her
decision is consistent with the position the Department of Labor took in
Boilermakers and Humble Oil. 280 F.3d at 60-61.
e. On remand to the agency, the Secretary reaffirmed her decision not to sue.
Issuing an extensive Supplemental Statement of Reasons on January 31, 2003, she
explained in detail her view that the NERCC was properly characterized as an
intermediate body under the LMRDA, and thus not subject to the LMRDA's
requirements for local union elections.
First, the Secretary addressed the Department's regulations, specifically 29
C.F.R. § 452.11, which expressly provides that whether an entity is a local or
intermediate body is dependent upon its "functions and purposes" as opposed to
"'the formal title by which it is known or how it classifies itself.'" Supp.
Stm't 3, JA 11 (quoting 29 C.F.R. § 452.11). In construing this language, the
Secretary reasoned, "the critical inquiry in determining whether an entity
designated by the union as an intermediate body should instead be considered a
local body is whether the intermediate body has taken on so many of the
traditional functions of a local union that it must in actuality itself be
considered a local union." Id.
The Secretary explained that Congress expected intermediate organizations and
local unions alike to perform important functions and further elaborated:
If the subordinate organizations in fact continue to perform functions and
exist for purposes traditionally associated with local labor unions, the union's
characterization of an entity placed structurally between such organizations and
the international union as an "intermediate body" will be upheld even though the
intermediate body also performs some other functions traditionally associated
with local unions.
Id. at 4, JA 12.
Second, the Secretary analyzed the legislative history of the LMRDA, the
actual practices of unions when the LMRDA was enacted, and National Labor
Relations Board cases bearing on the collective-bargaining powers of
intermediate, national, and international labor organizations at that time. This
history reveals that such labor organizations at that time engaged in important
representational activity both in conjunction with, and in lieu of, subordinate
local organizations, and makes it clear that Congress expected intermediate
bodies to wield "'responsible governing power'" within a labor union without
being considered local unions under the LMRDA. Id. (citation omitted).
Third, the Secretary looked to the statutory text for guidance to conclude
that the organization's placement within the structure of a union is "highly
relevant in determining whether it is a 'local' or 'intermediate' union." Id. at
5, JA 13. The statute itself identifies intermediate bodies by their structural placement
within the union hierarchy, or by a name historically associated with a
particular tier within the union. The very term Congress used to denominate
these entities -– "intermediate" bodies -– suggests the relevance of an
organization's placement within the overall structure of the union. Id. (citing
29 U.S.C. § 481(d)). Indeed, the Secretary observed, the statute identifies
"joint councils," like the NERCC, as "intermediate bodies," and joint councils
have historically appeared at the middle tier of the union hierarchy. Id.
(citing 29 U.S.C. § 402(i)). The Secretary thus construed the language of the
statute as authorizing her to take into account the entity's structural
placement in making the determination whether it is an intermediate body or a
local union. Id.
Fourth, the Secretary reviewed the case law for consistency with the analysis
of the regulation, legislative history, and statute. Id. at 5-8, JA 13-16.
Responding to this Court's concerns, she concluded (parallel with the district
court's original ruling) that her predecessors previously employed similar
analyses in Boilermakers and Humble Oil, and that the dispositions in those
cases were fully consistent with her analysis in this case.
Boilermakers is readily distinguishable, the Secretary explained,
because there were simply no labor organizations subordinate to the defendant union, National Transient Division ("NTD"); the
issue thus was whether the NTD was a local or a national labor organization, and
not whether it was an intermediate organization. Id. at 6, JA 14. In resolving
this question, it was relevant that the NTD engaged in negotiations, enforcement
of collective bargaining agreements, and the handling of grievances, which the
court deemed the "functions of a local." Id. But neither the court
nor the Secretary in that case purported to delineate a litmus test of the
respective functions of local and intermediate bodies.
Boilermakers thus provided no direct guidance concerning the application of
the "functions and purposes" test to the instant case. Id. On the other
hand, the Secretary found support for her consideration of structure in applying
the "functions and purposes" test in Boilermakers' holding that the NTD, which
had no subordinate labor organizations, was both "'functionally and structurally
a local labor organization.'" Id. (emphasis added; citation omitted). In
contrast to the NTD, the Secretary noted that the NERCC is clearly structurally
intermediate within the overall union. Id.
The Secretary similarly distinguished
Humble Oil on the basis that the
Employees Federation, determined there to be the local labor organization, was
also structurally closest to the union members. Id. The divisions that
the union argued were locals had no charters, bank accounts, offices, membership records, among
other attributes; thus, at most they were "'merely administrative arms'" of the
Employees Federation itself. Id. (citation omitted). Here, by
contrast, the NERCC locals, which are indisputably distinct labor organizations,
are independently chartered, have separate offices, bank accounts, and budgets,
and determine and collect monthly dues, among numerous other attributes that
were lacking in the divisions at issue in Humble Oil. Id. at 7-8, JA
15-16.
Accordingly, the Secretary found ample legal justification to adhere to her
original determination that the NERCC is an intermediate labor organization. "To
be sure," she concluded, "the NERCC performs a number of important
responsibilities, some of which may be traditionally associated with local
unions," such as negotiation of collective bargaining agreements, hiring and
firing authority over organizers and business representatives, and appointment
of stewards, among other functions. Id. at 9-10, JA 17-18. But because the NERCC
locals themselves perform numerous functions and have distinct identities, the
Secretary found that they are not "merely administrative arms" of the NERCC, but
rather play a significant role in dealing with their members. Id. at 10, JA 18.
The Secretary listed the important functions performed by the NERCC locals,
including the levying of dues, the disciplining of members, and the ratifying of collective bargaining
agreements by local members. Id.
The Secretary thus ruled that under these circumstances the NERCC, as
an intermediate labor organization, was not required to hold direct elections
and adhere to the three-year election cycle. Given this ruling, the Secretary
again declined to bring suit against the NERCC to force it to conduct a direct
election of its officers. Id.
f. The parties returned to district court and filed cross- motions for
summary judgment; on October 8, 2003, the district court issued a Memorandum and
Order granting plaintiffs' motion and holding the Secretary's Supplemental
Statement of Reasons to be arbitrary and capricious. Harrington v. Chao, 286 F.
Supp. 2d 80, 86 (D. Mass. 2003). The court rejected the Secretary's explanation
of her own "functions and purposes test of section 452.11," because the court
believed the test had been previously "defined" by this Court in its Harrington
decision as permitting analysis only of the entity in question and whether that
entity, i.e., an intermediate body like the NERCC, had "taken on so many of the
traditional functions of a local union that it must in actuality itself be
considered a local union." Id. at 85 (quoting Supp. Stm't 3, JA 11).
The district court thus ruled that the Secretary's construction of the test,
which considered the role of subordinate local unions in addition to the intermediate body at issue, was
inconsistent with and constituted an unexplained departure from what it
understood to be this Court's test. Id. at 85-86. It further concluded in
a footnote that the two cases, Boilermakers and Humble Oil, could not be
reconciled with the Secretary's approach of considering the overall union
structure (which includes the local unions), because when those cases considered
structure they were "referring to the structure of the challenged entity itself
and not the union as a whole." Id. at 86 n.9.
[6]
The court
accordingly granted plaintiffs' motion for summary judgment, although it made no
finding that the NERCC is a local labor organization.
Plaintiffs then moved for an entry of judgment directing the Secretary to
"order, direct, and if necessary, require" the NERCC to conduct a direct
election of its officers. See Pl. Mot., Docket Entry ("DE") 41; Proposed Order,
DE 42. In response, the Secretary, relying upon Bachowski, 421 U.S. at 574-75,
raised both statutory and constitutional concerns regarding a court order
directing the Secretary to institute suit. Secretary's Opp., DE 45.
After considering these filings, the district court ordered the Secretary "to
take appropriate action, within thirty (30) days of the date of this Order,
consistent with the determination of this Court that the Secretary's failure to
treat the New England Council of Carpenters as a statutory 'local labor
organization' is arbitrary and capricious." November 25, 2003 Order, JA 26. The
court subsequently extended the prescribed period by an additional thirty (30)
days. Order of December 16, 2003, JA 27.
[7]
SUMMARY OF ARGUMENT
The district court fundamentally misunderstood both this Court's prior ruling
in the instant case, and the very limited scope of judicial review in actions
under the LMRDA. Accordingly, its orders of October 8, 2003, and November
25, 2003, should be reversed, and the case remanded for entry of summary
judgment in favor of the Secretary. Moreover, in the unlikely event that the
Court were to affirm the order of October 8, 2003, the order of November 25,
2003, should nonetheless be modified, to avoid serious constitutional and
practical concerns.
1. Contrary to the district court's assumptions, this Court did not
previously adjudicate the merits of the Secretary's interpretation of the
"functions and purposes" test of 29 C.F.R. § 452.11, and the Secretary was not
bound to adopt on remand the construction of the test that the district court
erroneously imputed to this Court. Rather, the Secretary's task on remand was
simply to explain her application of the "functions and purposes" regulation,
and to explain how that application is consistent with (or deviates from) the
prior case law (the Boilermakers and Humble Oil decisions). It was not her task,
as the district court believed, to fit her decision into an already- decided
legal construction that excluded any consideration of "structure" (other than
the internal structure of the entity in question) from the analysis.
Thus, the sole question that the district court was to decide -- and that
this Court must now decide on appeal -- is whether the Secretary's reasoning set
forth in her Supplemental Statement of Reasons "evinces that the Secretary's
decision is so irrational as to constitute the decision arbitrary and
capricious." Dunlop v. Bachowski, 421 U.S. 560, 573 (1975); Harrington v.
Chao,
280 F.3d 50, 56 (1st Cir. 2002). In light of the thorough explanation of the
basis for the Secretary's decision in the Supplemental Statement of Reasons, the
answer to that question must be no. The Supplemental Statement painstakingly
details the plain language of the Act, its legislative history, the Department's
regulations, judicial precedent, and the historical evolution of labor
organizations in general, and reaches the reasonable conclusion that the NERCC's
exercise of some functions of a local did not render it a local union under
Title IV of the LMRDA. See 29 U.S.C. § 481(d).
The Secretary's conclusion is based on the eminently reasonable and
common sense view that in considering an entity's functions and purposes (as
required by 29 C.F.R. § 452.11) to determine whether an entity is a local or an
intermediate labor organization, she may also consider that entity's placement
within the overall structure of the labor organization. The regulation does not
by its terms exclude such a vertical structural analysis, and the statute
virtually compels it, inasmuch as the term used in the statute -– "intermediate"
bodies -– denotes an entity whose defining characteristic is its middle- tier
existence in a hierarchy.
It is thus neither surprising nor unreasonable for the Secretary, when
examining a middle-tier entity such as the NERCC, to permit the union to treat
such entities as "intermediate" bodies under the statute when its subordinate
entities perform some meaningful functions that are traditionally carried out by
local unions. That is particularly true since the legislative history
demonstrates Congress's expectation that intermediate bodies would perform significant governing powers. In those circumstances,
there is nothing in the text, history, or purposes of the Act or the regulations
that requires the Secretary to reclassify the NERCC as a local union because it
performs functions formerly associated with the UBC local unions, where the
local unions involved also continue to perform meaningful functions.
The Secretary's position also is not a departure
from prior practice. The Boilermakers and Humble Oil decisions simply did not
involve middle-tier organizations -- like the NERCC – that had subordinate
unions with their own autonomy and significant and distinct functions.
Significantly, the Secretary explained that an enforcement action in this case
"would be unprecedented." Supp. Stm't 9 n.2, JA 16. "In the 44-year
history of the LMRDA, the Department has never brought suit contending that an
intermediate body that supervised other entities that were indisputably labor
organizations was itself a local labor organization subject to the direct
election requirements." Id. at 8, JA 16. Thus, at most, the position
taken by the Secretary here is merely an articulation of her policy as applied
to facts that have not heretofore confronted the Secretary, and the Supplemental
Statement more than adequately explains this policy application to current
facts.
2. Furthermore, assuming
arguendo that the Court nonetheless overturns
the Secretary's determination, the Court should also rule that in cases where
the Secretary's decision not to sue has been found to be arbitrary and
capricious, she need not execute on the judgment or obtain a stay of the order
while she pursues further judicial review. Such a holding is consistent with the
Supreme Court's ruling in Bachowski, and is essential to avoid the manifest
constitutional concerns that would arise if the Secretary were required to take
action prior to fully exhausting her right to seek further review.
STANDARD OF REVIEW
This Court reviews a grant of summary judgment
de novo. Rankin v.
Allstate Ins. Co., 336 F.3d 8, 11 (1st Cir. 2003). De novo review in this
context means that the Court must decide for itself whether the Secretary's
Supplemental Statement of Reasons "is so irrational as to constitute the
decision arbitrary and capricious," without giving any deference to the district
court's decision that it was. Dunlop v. Bachowski, 421 U.S. 560, 572-573 (1975);
Harrington v. Chao, 280 F.3d 50, 56 (1st Cir. 2002).
The scope of review of such a Statement is exceedingly narrow: "since the
statute relies upon the special knowledge and discretion of the Secretary for
the determination of both the probable violation and the probable effect,
clearly the reviewing court is not authorized to substitute its judgment for the
decision of the Secretary not to bring suit." Bachowski, 421 U.S. at 571;
see also id. at 573 ("it is not the function of the Court to determine whether or
not the case should be brought" (citation omitted)), 574 ("[if] the district
court determines that the Secretary's statement of reasons adequately
demonstrates that [the] decision not to sue is not contrary to law, the
complaining union member's suit fails and should be dismissed"). The scope
of review set forth by Bachowski is thus "much narrower than applies . . . in
most other administrative areas." Id. at 590 (Burger, C.J., concurring).
Moreover, to the extent that the Supplemental Statement of Reasons includes an
interpretation of the Secretary's own regulation, 29 C.F.R. § 452.11, that
interpretation is entitled to "substantial deference." Thomas Jefferson Univ.
Hosp. v. Shalala, 512 U.S. 504, 511 (1994); see also Udall v.
Tallman, 380 U.S.
1, 16 (1965) ("[w]hen the construction of an administrative regulation rather
than a statute is in issue, deference is even more clearly in order"). The
agency's interpretation must be upheld unless it is "'plainly erroneous or
inconsistent with the regulation.'" Auer v. Robbins, 519 U.S. 452, 461 (1997);
Bowles v. Seminole Rock & Sand Co., 325 U.S. 410, 413-14 (1945). And such
deference is particularly compelling where the matter, as here, is bound up in
the agency's expertise and policymaking power. Thomas Jefferson Univ. Hosp., 512
U.S. at 511.
ARGUMENT
I. THE SUPPLEMENTAL STATEMENT OF REASONS FULLY ADDRESSES THIS COURT'S
PREVIOUS CONCERNS AND RATIONALLY EXPLAINS THE SECRETARY'S CONCLUSION THAT
THE NERCC IS NOT A "LOCAL LABOR ORGANIZATION" UNDER 29 U.S.C. § 481(b).
The district court misunderstood both this Court's prior decision remanding
the case to the Secretary, and the narrow scope of judicial review of decisions
of the Secretary under the LMRDA. The Secretary's Supplemental Statement of
Reasons satisfies both this Court's ruling and the requirements of the LMRDA.
Accordingly, the district court's orders of October 8, 2003, and November 25,
2003, must be reversed.
A. This Court Expressed No Opinion On The Merits Of The Secretary's Decision
That The NERCC Is Not A Local Union, But Remanded For The Secretary To Provide A
Fuller Explanation Of the Decision.
In the first appeal, this Court expressed concern with the Secretary's
assertion in her initial Statement of Reasons that there was no basis in either
the statute or its legislative history for concluding that if an intermediate
body possesses certain powers and functions, it must directly elect its
officers. The Court considered the Statement to be "seemingly inconsistent" with
the functions and purposes test of 29 C.F.R. § 452.11, which the Statement did
not address. Harrington v. Chao, 280 F.3d 50, 57 (1st Cir. 2002).
The Court was also concerned that the Statement failed to discuss and
distinguish two cases, Donovan v. National Transient Div., Int'l Bhd. of
Boilermakers, Iron Shipbuilders, Blacksmiths, Forgers & Helpers, 736 F.2d
618 (10th Cir. 1984) ("Boilermakers"), cert. denied, 469 U.S. 1107 (1985) and
Schultz v. Employees' Federation of the Humble Oil & Refining Co., 74 L.R.R.M. (BNA) 2140 (S.D. Tex. 1970) ("Humble
Oil"). Harrington, 280 F.3d at
57-58. Accordingly, this Court found "substantial questions" raised by the case
and left unanswered by the initial Statement. The Court therefore regarded the
Statement as "inadequate" for judicial review -- and thus "arbitrary" in that
sense alone. Id. at 58.
The opinion emphasized this precise point at the outset: "[w]e do not
now decide whether any refusal by the Secretary to bring suit as sought by
Harrington would be arbitrary or capricious." Id. at 52. The Court then
explicitly stated it was not rejecting the Secretary's analysis:
Decisions about the proper meaning of LMRDA statutory terms, and the proper application of the Act's mandate, are for the Secretary to make, so long as they do not contravene the Act. These decisions are not up to the courts;
thus, it is more appropriate for us to refrain from taking any judicial view at this point on the underlying interpretive issues in this case. Respect for her authority requires a remand, rather than final court resolution of the issue now. Moreover,
a finding that the Secretary has acted arbitrarily and capriciously as to the ultimate issue would be premature, as it is not clear on this record that the Secretary is in fact repudiating her prior interpretations here.
Id. at 59-60 (emphasis added). Consequently, the Court remanded for the
Secretary to "file a sufficient Statement of Reasons, which addresses both the
application of the functions and purposes test of 29 C.F.R. 452.11, and whether
her decision is consistent with her precedents," should she again decide against
filing suit. Harrington, 280 F.3d at 60-61.
B. The District Court Erroneously Believed That This
Court Opined On The
Merits Of The Secretary's Test.
Despite this Court's express admonition that it
was "refrain[ing] from taking any judicial view at this point on the underlying
interpretive issues in this case," id. at 59-60, the district court's decision
is permeated with the mistaken belief that the Court had ruled that the
Secretary's interpretation contravened 29 C.F.R. § 452.11. The district court
thus stated that the "[structural analysis] is precisely the rationale that the
Court of Appeals found wanting"; and it referred to "the traditional test, as
defined by the Court of Appeals," as mandating an inquiry into the functions of
only "'the entity in question.'" Harrington v. Chao, 286 F. Supp. 2d 80, 85 (D.
Mass. 2003) (citing Harrington, 280 F.3d at 57). Due to its misinterpretation of
the nature of the remand, the district court's decision was fundamentally
flawed.
[8]
C. The Secretary's Statement Of Reasons Fully Addresses The Concerns Raised
By This Court In The First Appeal.
Notwithstanding the district court's confusion, the Secretary in fact did
precisely what the remand required. Her Supplemental Statement of Reasons
presents a voluminous, detailed and thorough analysis that considers the plain
language of the Act, its legislative history, the Department's regulations,
judicial precedent, and the historical evolution of labor organizations in
general. In particular, it addresses the import of 29 C.F.R. § 452.11 and the
Boilermakers and Humble Oil decisions. In doing so, the Supplemental Statement
of Reasons fully and specifically responds to this Court's concerns raised in
its initial decision and is rationally supported. Therefore, it clearly
satisfies the highly deferential standard of review applicable here. See Bachowski, 421 U.S. at 572-73 (Secretary's decision must be upheld unless
statement of reasons "is so irrational as to constitute the decision arbitrary
and capricious"); accord, Harrington, 280 F.3d at 56.
1. In response to the Court's concern that the Secretary had disavowed the
interpretative regulation at 29 C.F.R. § 452.11, the Secretary's Supplemental
Statement of Reasons closely analyzed that regulation. Supp. Stm't 3, JA 11. The Supplemental
Statement of Reasons first observes (as the regulation itself makes clear) that
an entity's "formal title or nominal placement" in the union is not
determinative of its status as a local or intermediate. Id. Rather, a
labor organization's status will be determined based on its "functions and
purposes." Id.
Interpreting this language, the Supplemental Statement of Reasons explains
that "the critical inquiry . . . is whether the intermediate body has taken on
so many of the traditional functions of a local union that it must in actuality
itself be considered a local union." Id.
[9]
It also sets
forth an essential corollary of this test, i.e., consideration must also be
given to whether the subordinate organization retains such functions and
purposes to "continue to play a meaningful role." Id. at 4, JA 12; see also id.
at 7-8, JA 15-16; id. at 9-10, JA 17-18 (describing functions and purposes of
NERCC and locals).
In interpreting the statutory distinction between intermediates and locals,
the Supplemental Statement of Reasons reasonably relies on the LMRDA's actual
statutory text, its legislative history, and the common historical practice at
the time of the LMRDA's passage. Id. at 2-5, JA 10-13.
[10]
It notes
that the LMRDA identifies labor organizations according to their placement in
the union hierarchy, see 29 U.S.C. §§ 402(i), 481(d), suggesting in addition to
functions and purposes, the relevance of "the structure of [the] union."
Supplemental Stm't 5, JA 13. Indeed, the most common meaning of the adjective
"intermediate," 29 U.S.C. § 481(d), is "being or occurring at the middle place .
. . or between extremes." Webster's Ninth New Collegiate Dictionary 632
(1990).
Only with a vertical structural analysis, encompassing the entire hierarchy,
can one ascertain whether an entity "sits in the middle place" within the larger
organization. The "functions and purposes" test thus incorporates a structural
component.
As further support for the Secretary's construction, the Supplemental
Statement of Reasons explains that the statute and regulations contain no
definition whatsoever of a local labor organization. Supp. Stm't 2, JA 10. Moreover, the regulations provide a
"description of typical intermediate bodies," one of which is "joint councils"
that include "councils of building and construction trades labor organizations,"
but do not define them by functions or purposes. See 29 C.F.R. § 451.4(f).
In fact, in the history of the LMRDA, the Secretary has never attempted to
devise a list of functions unique to each tier of a labor organization. Rather,
as the Supplemental Statement explains, "[w]hen the LMRDA was enacted, as today,
unions varied in the manner in which representational activities were carried
out," and the division of responsibilities "was, and is, a matter of internal
union organization." Supp. Stm't 4, JA 12; see also id. at 9, JA 17 (detailing
agreement among commentators that line between local and intermediate bodies is
not fixed or immutable). Thus, the absence of fixed attributes for each
type of labor organization in the LMRDA or its regulations strongly supports the
flexible comparative analysis employed by the Secretary.
[11]
Moreover, the Supplemental Statement appropriately takes into account
Congress' stated intent to refrain from unnecessary interference with internal
union affairs. Id. at 4, JA 12; see S. Rep. No. 86-187, at 5 (1959), reprinted
in 1959 U.S.C.C.A.N. 2318, 2322;
see also Hodgson v. Local Union 6799, United Steelworkers, 403 U.S. 333, 339
(1971); In re Lane Wells Co., 79 N.L.R.B. 252, 254-255 (1948) (describing "not an uncommon practice" of some
international unions to seek certification, to contract, and to assume
responsibility for collective bargaining and observation of agreements, but
refusing to consider the wisdom of such procedures "lest Government intrude too
deeply into the affairs of labor organizations"). In fact, as the Supplemental
Statement explains, Supp. Stm't 4, JA 12, when the LMRDA was enacted, Congress
was well aware of the common practice of investing intermediate bodies with
"responsible governing power," S. Rep. No. 86-187, at 20 (1959), reprinted in
1959 U.S.C.C.A.N. 2336, yet it explicitly allowed intermediate bodies holding such
power to elect their officers indirectly every four years by delegate. 29 U.S.C.
§ 481. Mandating direct, triennial elections for intermediate bodies simply
because they employ such power would therefore be directly contrary to congressional intent and
understanding.
2. Finally, the Supplemental Statement explains that the Secretary's analysis
is consistent with the positions the Department took in Boilermakers and
Humble
Oil. Supp. Stm't 6, JA 14. This explanation amplifies the conclusion that the
district court reached in its first decision, but abandoned (without
explanation) in its second decision. Compare Harrington v.
Herman, 138 F. Supp. 2d at 236 & n.9, with Harrington v. Chao,
286 F. Supp. 2d at 86 n.9.
a. In Boilermakers, the NTD had no subordinate locals, and the
question before the Eighth Circuit was whether the NTD was a national
organization, as the trial court found, or a local organization, as the
Secretary contended. 736 F.2d at 622.
[12]
The court of appeals agreed
with the Secretary that it "must focus on NTD's function and structure." Id. at
623.
In looking at structure, the court made two distinct findings: first, it
observed that the "NTD is subordinate to the International and has no
subordinate organizational units"; and second, it noted that NTD itself had a
"relatively simple organizational structure." Id. Thus, the court
indisputably examined both the NTD's placement within the union hierarchy and the NTD's
own organizational structure.
[13]
To be sure, the
Boilermakers court found "[m]ost
important" the fact that the "NTD perform[ed] the functions of a local."
736 F.2d at 623. But this emphasis on function is generally consistent with the
Secretary's approach, Supp. Stm't 3, JA 11, and specifically comports with the
Secretary's comparative analysis of the functions and structure of the NERCC
vis-a-vis the functions and structure of the local, because in Boilermakers
there were no structurally-distinct subordinate bodies with which to make any
comparison functional or otherwise.
The primary difference between
Boilermakers and the instant case is that here
ongoing subordinate locals exist, mandating this comparative analysis of
functions and structure. In Boilermakers, by contrast, the NTD, unlike four
other divisions of the international union, had no such subordinate bodies, and
hence no functions and purposes to compare. Id. at 619, 623.
Significantly, however, the
Boilermakers court in
fact employed a structural component in its analysis (as urged by the Secretary) when it found no such subordinate bodies to exist. If structure
plays no role in distinguishing intermediate unions from locals, as urged by
plaintiffs, then there would have been no reason for the Boilermakers court's
agreement with the Secretary that it must also "focus" on structure along with
functions and purposes. Thus, the emphasis of Boilermakers on function in no way
diminishes the court's consideration and reliance on structure as well. Its
conclusion plainly bears this out: "We therefore find that NTD is functionally
and structurally a local labor organization." 736 F.2d at 623 (emphasis added).
b. The only other relevant decision,
Humble Oil, likewise utilized a
structural component in its analysis. There, the union claimed it had
subordinate locals, but the district court agreed with the Secretary that these
divisions were not separate labor organizations, but "merely administrative
arms" of the union. 74 L.R.R.M. (BNA) at 2143.
In so ruling -- and in finding that the divisions at issue did not possess
even the most rudimentary characteristics of distinct labor organizations, such
as charters, offices, bank accounts, or dues or membership records, and
performed only minimal representational functions, id. -- the Humble Oil court
actually foreshadowed the Secretary's comparative analysis in the instant case.
The court found that those attributes of a local were held by the defendant union, which additionally performed "the basic
local union functions." Id.
The court therefore ruled the defendant union was properly characterized as a
local. Thus, Humble Oil, rather than undermining the Secretary's comparative
analysis, clearly supports it: like Boilermakers, Humble Oil considered and
applied a structural element first, then considered function.
In light of
Humble Oil, the district court below found "puzzling" the
Secretary's statement that the Department had "never before found an
organization at the middle of a union's structure to be a 'local' labor
organization." Harrington, 286 F. Supp. 2d at 84 & n.6 (citing Supp. Stm't
3, JA 11). The court's confusion, however, is more semantic than real.
The Secretary alleged and the district court found in
Humble Oil that the
divisions of the defendant union were merely its "administrative arms," and not
separate, subordinate bodies subject to the LMRDA. See 74 L.R.R.M. (BNA) at
2140, 2143 (union has not "chartered any subordinate labor organization or
subordinate affiliate"); id. at 2141 ("[d]efendant is subdivided into 26
geographical divisions which have no separate autonomy"); id. at 2142 (union's
constitution does not provide for "chartering of any subordinate bodies"); id.
at 2143 (divisions are "merely administrative arms" of union). Thus, the
Secretary's view of Humble Oil is that the defendant union there simply was not
(and never had been) an intermediate body with subordinate locals under it. See
Supp. Stm't 6, JA 14 ("no labor organization" under defendant union).
Consequently, the comment in the Supplemental Statement that the district court
found "puzzling" accurately reflects the holding of Humble Oil.
Finally, we note the district court below mischaracterized
Humble Oil in
restricting the divisions' lack of "autonomy" to collective bargaining.
Harrington, 286 F. Supp. 2d at 84 n.6. The Humble Oil court ruled without
limitation that the divisions lacked separate autonomy in any area.
3. Plaintiffs and amicus Association for Union Democracy, Inc. ("AUD") have
also suggested mistakenly that the treatment of the International Union of
Security Officers in 1991 by an area administrator in the Department's Office of
Labor-Management Standards is inconsistent with the position here. See,
e.g.,
Response of AUD to Motion for Stay Pending Appeal (lodged in this Court on or
about Feb. 2, 2004). First, that decision is not binding on the Department and
would not reflect the Secretary's official views if inconsistent. See, e.g.,
Smiley v. Citibank (South Dakota), N.A., 517 U.S. 735, 742-43 (1996);
see also South Shore Hosp., Inc. v. Thompson, 308 F.3d 91, 103 n.7 (1st Cir. 2002), and
cases cited therein.
In any event, however, the decision is not inconsistent. Rather, it
makes clear that the Department will consider, among other factors, "[t]he relationship to subordinate and superior bodies" and
"[w]hat sort of hierarchy exists." See 1991 Letter from Office Labor-Management
Standards (attached to AUD Response, supra).
In that particular case, the international union's constitution made the
international union the "local" for all members who were not within the
jurisdiction of a local, and the facts revealed that 87% of the international
union's members were not in a local. Thus, the international constituted the
local and accordingly performed local functions for the overwhelming majority of
its membership. Certainly it was appropriate under those circumstances to view
the international as a local and require direct elections.
Conversely, to characterize the international as an intermediate simply
because 13% of its membership belonged to a local would be a case of the tail
wagging the dog. This example, if anything, points to the great variety in union
organization and practices, as well as the need for the flexible comparative
approach and respect for the union's own organizational choices that the
Secretary advocates here.
* * *
*
In sum, the Secretary faithfully complied with this Court's
instructions remanding the case to better explain her position.
Harrington, 280 F.3d at 60-61. Her ten-page, single-spaced statement comprehensively and more than adequately explains her approach to
the "functions and purposes" test, which incorporates a structural component. At
a minimum, her legal test and the underlying reasoning easily satisfy the
applicable, highly deferential standard of review, given that they plainly are
not "so irrational as to constitute the decision arbitrary and capricious."
Bachowski, 421 U.S. at 573; Harrington v. Chao, 280 F.3d at 56. Indeed, as shown
above, her determination is eminently reasonable.
D. The Secretary Has Adequately Explained The Reasons For Her Position As
Applied To The Novel Facts Of This Case.
As the foregoing discussion of the relevant precedent makes clear, the
Secretary's position here represents a legitimate articulation of a policy as
applied to facts not confronted before. In particular, the agency had previously
considered remotely similar circumstances on only two occasions, and had never
previously applied the "functions and purposes" test to an organization truly at
the middle tier of a union hierarchy, i.e., one that includes subordinate labor
organizations. The Secretary's position here is therefore not a departure from
past interpretation or practice, but rather an elaboration of it as necessary to
apply the general principles to new facts. See Harrington, 280 F.3d at 59
("[i]t is up to the agency in the first instance to interpret the statute and apply those interpretations to
the facts").
Because the district court incorrectly ruled that the Secretary employed an
incorrect analysis in her decision not to sue, and erroneously held that the
Secretary's position was altered "without explanation," Harrington, 286 F. Supp.
2d at 86, it did not reach her application of the test.
[14]
However,
this Court's de novo review of the Supplemental Statement of Reasons, permits it
to review fully the Secretary's findings. Such review, pursuant to the highly
deferential standard required by Bachowski, leads inexorably to the conclusion
that the Secretary's affirmation of the NERCC's status as an intermediate labor
organization is rational, and certainly is not arbitrary and capricious.
In applying the test in the Supplemental Statement of Reasons, the Secretary
recognized that on the one hand, "the NERCC performs a number of important
responsibilities, some of which may be traditionally associated with local unions," such as negotiating
collective bargaining agreements, hiring and firing authority over organizers
and business representatives, appointing stewards, levying members' dues not
determined and levied by the locals, approving the locals' levy of dues, and
appointing trial committees. Supp. Stm't 9-10, JA 17-18. On the other hand, the
Secretary found that the NERCC locals themselves perform important local
functions, including conducting ratification votes on NERCC-negotiated
collective bargaining agreements, levying and collecting dues, informally
resolving grievances and disciplining members, withdrawing members from the
union upon their written request, administering job referrals and scholarship
and disability funds, lobbying, and engaging in voluntary organizing drives. Id.
at 10, JA __. The Secretary thus ruled that because the locals continue to
perform traditional local functions and purposes and play a significant role in
dealing with their members, there was no basis to find that the NERCC had "taken
over" so many of the locals' functions that it "must also be considered a local
to carry out the purpose of the [Act]." Id.
Under Bachowski, this Court may overturn the Secretary's comparative
assessment of the respective functions of the NERCC and the locals only when the
analysis is so irrational as to be arbitrary and capricious. 421 U.S. at 573. As
demonstrated above, the Secretary carefully reviewed the NERCC's and locals' functions and
came to a reasoned conclusion that is more than amply justified by the record.
This Court therefore should uphold the Secretary's analysis and her decision not
to sue.
II. ASSUMING ARGUENDO THAT THE COURT AFFIRMS THE DISTRICT COURT'S
ORDER OF OCTOBER 8, 2003, IT SHOULD MODIFY THE RELIEF ORDER OF NOVEMBER 25,
2003.
As we have demonstrated in Section I, supra, the district court erred in
holding that the Secretary's determination concerning the NERCC was arbitrary
and capricious, and the district court's entire judgment should therefore be
reversed. If the Court concludes otherwise, however, the district court's
relief order of November 25, 2003, should be modified, because it is
inconsistent with Bachowski and raises serious constitutional and
practical concerns.
1. Following the district court's grant of their summary judgment motion,
plaintiffs moved for an entry of judgment directing the Secretary to "order,
direct, and if necessary, require" the NERCC to conduct a direct election of its
officers. See DE 41, 42. The Secretary opposed that request (see DE
45) by raising statutory and constitutional concerns regarding a court order
directing the Secretary to institute suit. See Bachowski, 421 U.S. at
574-75. After considering these filings, the district court ordered the
Secretary "to take appropriate action within thirty (30) days of the date of
this Order [subsequently extended by Order of December 16, 2003, JA 27], consistent with the
determination of this Court that the Secretary's failure to treat the New
England Council of Carpenters as a statutory 'local labor organization' is
arbitrary and capricious." November 25, 2003 Order, JA 26.
The Supreme Court in Bachowski discussed at length "the question of
remedy" in two distinct types of cases. 421 U.S. at 574-76. In the first type of
case, the court determines that the Secretary's statement of reasons for not
suing "inadequately discloses [the Secretary's reasons], [and] the Secretary may
be afforded opportunity to supplement his statement." Id. at 574. This
Court's prior decision remanding the case to the Secretary to provide a more
complete explanation was precisely this type of order. See Harrington,
280 F.3d at 59-60.
In the second type of case, by contrast, where the court rules on the merits
that the statement is "so irrational as to constitute the decision arbitrary and
capricious," the Supreme Court "assume[d] that the Secretary would proceed
appropriately without the coercion of a court order when finally
advised by the courts that [her] decision was in law arbitrary and
capricious." Bachowski, 421 U.S. at 573, 576 (emphasis added).
Thus, the Court expected the Secretary to act only after she was "finally
advised by the courts" of her erroneous decision. The district court's decision
on remand is exemplary of this second type of order, but full exhaustion of all avenues of appellate review must occur
before it can be said the Secretary has been "finally advised."
Obviously, the courts have not given their "final" advice on the matter until
the appellate process has run its course, and the use of the term "finally
advised" suggests the Secretary must be given the opportunity to resort to and
exhaust her appeal rights before proceeding with an enforcement action against
the union. Otherwise, the Court would have omitted the qualifier "finally" and
expected Secretarial action once she was merely "advised" by the courts of her
incorrect decision, namely, once an adverse decision had been rendered.
Thus, the LMRDA, as interpreted by the Supreme Court, permits the Secretary
to exhaust her appeal rights before proceeding with an enforcement action that
she believes is contrary to law. Such a view is fully consistent with
congressional recognition of the Secretary's special knowledge in this area and
its grant of exclusive enforcement authority. See Bachowski, 421 U.S. at
571. That expertise and authority would be undermined if the Secretary were
required to execute the district court's judgment before she has completely
exhausted her right to seek further judicial review.
2. The Supreme Court reached this conclusion after considering, but declining
to answer, the question "whether the district court is empowered to order the
Secretary to bring a civil suit against the union." Bachowski, 421 U.S.
at 575. That question, the Court stated, "obviously presents some difficulty in
light of the strong evidence that Congress deliberately gave exclusive
enforcement authority to the Secretary." Id. The Court also noted
(without resolving the issue) that the defendant union had argued that such a
court order would be constitution- ally infirm, on the ground that it would
violate the separation of powers doctrine and the Article III "case or
controversy" requirement. Id. at 575 n.12.
Article II, Section 3 of the Constitution charges the President with the duty
to faithfully execute the laws. A court order directing the executive branch to
file a lawsuit it did not wish to bring would invade and usurp that authority.
The federal court would become, in essence, both prosecutor and judge, deciding
the allegations to be brought and then passing judgment on them. The consequent
absence of a case and controversy under Article III would stem from the lack of
genuine adverseness between the Secretary and the union (here, the NERCC),
because the Secretary has already concluded that the requested lawsuit to hold
an election is without merit.
To avoid these serious constitutional questions, the Court should hold that,
under Bachowski, the Secretary need not take enforcement action while
further judicial review is still available to her.
3. Moreover, resolution of this issue will also clarify whether it will be
necessary for the Secretary to request a stay pending appeal whenever a district
court finds that her decision not to sue in an LMRDA case is arbitrary and
capricious. She will have to do so to protect her appeal rights and to obviate
the possibility of mootness, if she is required to take action before she has
exhausted all avenues of appellate review.
[15]
This burdensome prospect is not in the interests of the courts, the
government or the private sector. Accordingly, to preserve judicial,
administrative and private resources, the Court should hold that the Secretary
need not take any enforcement action unless and until the issue of whether she
has acted arbitrarily and capriciously has been fully and finally adjudicated by
the courts.
CONCLUSION
For the foregoing reasons, the district court's orders of October 8, 2003,
and November 25, 2003, should be reversed, and the case should be remanded for
entry of summary judgment in favor of the Secretary. Assuming arguendo
that the Court upholds the order of October 8, 2003, the order of November
25, 2003, should be modified to clarify that the Secretary need not "take
appropriate action" prior to full exhaustion of her right to seek further
judicial review.
Respectfully submitted, |
OF COUNSEL: |
PETER D. KEISLER |
HOWARD M. RADZELY |
Assistant Attorney General |
Solicitor of Labor |
MICHAEL J. SULLIVAN |
ALLEN H. FELDMAN |
United States Attorney |
Associate Solicitor |
WILLIAM KANTER |
NATHANIEL I. SPILLER |
(202) 514-4575
JOHN S.
KOPPEL
(202)
514-2495 |
Deputy Associate Solicitor
GARY K. STEARMAN
Senior Appellate Attorney
U.S. Department of Labor
Suite N-2700
Washington, D.C. 20210 |
Attorneys, Appellate Staff
Civil Division, Room 9120
Department of Justice
601 D Street, N.W.
Washington, D.C. 20530
|
MARCH 2004
The Department of Labor did not have access to the certificate of compliance.
CERTIFICATE OF SERVICE
I hereby certify that on this 8th day of March, 2004, I served the Brief for
Appellant upon counsel both by e-mail transmission and by causing two copies to
be mailed, via Federal Express overnight mail, postage prepaid, to each of the
following counsel:
Michael A.
Feinberg
Esquire
Feinberg
Campbell &
Zack PC
177 Milk
Street
Boston, MA
02119
Alan Hyde,
Esquire
Rutgers
University School of Law
123 Washington
Street
Newark, NJ
07102-3094
Daniel J.
Hall, Esquire
DeCarlo,
Connor & Selvo, PC
533 South
Fremont Avenue, 5th Floor
Los Angeles,
CA 90071-1706
The requisite number of copies of the Brief, as well as the disk required by
1st Cir. R. 32(a), were sent to the Clerk's Office by Federal Express overnight
mail, on the same date.
JOHN S. KOPPEL
Attorney
The Department of Labor did not have access to the addendum.
Footnotes:
[1] Messrs. Harrington et al. are referred to collectively herein as
"complainants" or "plaintiffs," as appropriate.
[2] "Labor organization" is defined in Section 3(i) of the Act as:
[A]ny organization of any kind, any agency, or employee representation committee, group, association, or plan [engaged in an
industry affecting commerce] in which employees participate and which exists for
the purpose, in whole or in part, of dealing with employers concerning
grievances, labor disputes, wages, rates of pay, hours, or other terms or
conditions of employment, and any conference, general committee, joint or system
board, or joint council so engaged which is subordinate to a national or
international labor organization, other than a State or local central body.
29 U.S.C. § 402(i).
[3] The LMRDA's legislative history identifies "joint councils" as one type of
intermediate body. See S. Rep. No. 86-187, at 47 (1959), reprinted in 1959 U.S.C.C.A.N. 2318, 2363 (Senate Report accompanying the bill that ultimately
became the LMRDA (S. 1555), describing the provision for the election of
officers of intermediate bodies as applying to, among others, "joint council[s]"
and "other association[s] of labor organizations"). Elsewhere, the Secretary's
regulations provide a description of "typical intermediate bodies," which
include "joint councils," described as including "councils of building and
construction trades labor organizations." 29 C.F.R. § 451.4(f)(4).
[4] For the Court's convenience, the Supplemental Statement of Reasons is
also reproduced in the Addendum to this brief.
[5] The Secretary's initial Statement of Reasons is set forth in its
entirety in the Appendix to this Court's prior opinion, Harrington v. Chao, 280
F.3d. 50, 63-65 (1st Cir. 2002).
[6] The district court made no attempt to reconcile this conclusion with its
conclusion in the first decision that these cases were distinguishable. Compare
286 F. Supp. 2d at 86 n.9 with 138 F. Supp. 2d at 236.
[7] The district court thereafter refused to act on the Secretary's motion for a
stay pending appeal, on the ground that the Secretary's notice of appeal had
divested it of jurisdiction. Order of January 23, 2004, JA 30. By orders of
January 26, 2004, and February 20, 2004, this Court granted the Secretary's
motion for a stay pending the instant appeal, and expedited the case.
[8] The district court's decision is of limited import for purposes of the
instant appeal in any event, because the Court reviews de novo the grant of
summary judgment, Rankin v. Allstate Ins. Co., 336 F.3d 8, 11 (1st Cir. 2003), and must
affirm the Secretary’s decision not to sue unless it is so irrational as to be
arbitrary and capricious. Dunlop v. Bachowski, 421 U.S. at 572-73.
[9] The district court and plaintiffs accepted this formulation of the
regulation. See 286 F. Supp. 2d at 85; Pl. Mem. in Support of Mot. for Summary
Judgment, DE 30, 10.
[10] Resort to these tools was hardly objectionable.
See Penobscot Air Servs.,
Ltd. v. FAA, 164 F.3d 713, 722 (1st Cir. 1999) (agency interpretation of own
rule consistent with its statutory interpretation); see generally
Chevron U.S.A.
Inc. v. Natural Res. Def. Council, Inc., 467 U.S. 837, 845 (1984) (where statute
is silent or ambiguous on specific issue, court will uphold agency construction
"'unless it appears from the statute or its legislative history that the
accommodation is not one that Congress would have sanctioned'") (citation
omitted); 2A Sutherland Statutes and Statutory Construction § 48.03 (6th ed.
2000) ("[i]t is established practice in American legal processes to consider
relevant information concerning the historical background of enactment in making
decisions about how a statute is to be construed and applied").
[11] The Secretary's initial Statement of Reasons explained that there is no
basis for concluding that "if intermediate bodies possess certain functions and
powers" they must be considered local labor organizations. Harrington, 280 F.3d
at 64. According to Judge Torruella's concurring opinion, this statement
evidenced a "merely 'structural' [] approach." Id. at 62. It was that position
-- the disavowal of any functional analysis -- that Judge Torruella believed
could not be squared with the regulation and the case law.
The Supplemental Statement now before the Court contains no suggestion of a
purely structural analysis, and expressly adopts a test that makes the "functions and purposes" of the entity "the critical
inquiry," Supp. Stm't 3, JA 11, while also honoring the plain language of the
statute and its legislative history, which compel reference to the union's
structure, id. at 5, JA 13. Accordingly, the Secretary has now addressed Judge Torruella's concerns about the language in the initial Statement of Reasons.
[12] The district court in the instant case erroneously believed the NTD was an
intermediate body. 286 F. Supp. 2d at 86 n.9.
[13] The district court here was therefore clearly wrong in asserting that the
Boilermakers court was "referring to the structure of the challenged entity
itself and not the union as a whole." Harrington, 286 F. Supp. 2d at 86 n.9.
Moreover, the fact that the Eighth Circuit in Boilermakers agreed with the
Secretary's approach and rendered this finding strongly supports the Secretary's
view that the structure of the union as a whole has always been a relevant
factor.
[14] In fact, the district court never even applied the narrow, alternative test
it believed was correct to the facts of this case. Rather, after setting forth
the regulatory test and ruling the Secretary's determination "arbitrary and
capricious," the court did not take the next step of actually deciding if the
NERCC was a local under the particular facts here. Instead, it left it to the
Secretary "to take appropriate action" (Order of November 25, 2003, JA 26)
consistent with the court's holding that the Secretary's failure to treat the
NERCC as a local union was arbitrary and capricious. An "arbitrary and
capricious" ruling, however, even if based on an underlying presumption of
local-union status, is no substitute for real findings.
[15]
See, e.g., Hodel v. Irving,
481 U.S. 704, 711 (1987) ("the existence of a case or controversy is a
jurisdictional prerequisite to a federal court's deliberations"); North
Carolina v. Rice, 404 U.S. 244, 246 (1971) ("[m]ootness is a
jurisdictional question because the Court 'is not empowered to decide moot
questions or abstract propositions'"; judiciary's "impotence 'to review moot
cases derives from the requirement of Article III of the Constitution under
which the exercise of judicial power depends upon the existence of a case or
controversy'") (citations omitted)).
| |
|