Briefly Legal

The Economist: President Should Condemn the ‘Loony-Left’ NLRB

From a leader (editorial) in the latest Economist, “Don’t bully Boeing, Barack,” with the secondary headline, “Want to prove you are ‘pro-business’? Condemn a loony-left complaint against America’s biggest exporter.”

The NLRB is an autonomous body, but its board members are appointed by the president. Under a Democratic president, American businesses expect a more pro-union line, but the agency’s recent militancy is shocking, reminiscent of “loony-left” posturing in Britain in the 1970s. Not only does the agency in effect claim the power to tell firms where they may build factories. It is also suing two states (Arizona and South Dakota) where voters have decided that workers should be guaranteed a secret-ballot election before their workplace is unionised. Mr Obama has so far said nothing about any of these cases. The president claims he understands business. Condemning the NLRB would be a good way to prove it.

The magazine also covers the National Labor Relations Board’s complaint against Boeing in an article, “A watchdog bites: A federal agency bashes Boeing“:

Businesspeople everywhere in America are stunned. Employers have a constitutional right to whinge about unions (and vice versa). They are not allowed to punish strikers—by sacking them, for example. But Boeing has done nothing of the sort. No work has been transferred from Boeing’s Puget Sound plant to South Carolina, nor have any IAM members lost their jobs. In 2007 Boeing announced that it would build seven 787s per month in Puget Sound; two years later, to handle the backlog of orders, it announced an expansion to South Carolina. The backlog is so large that Boeing is increasing its workforce at Puget Sound, not cutting it.

We’d like to see a First Amendment expert address the issue mentioned above, the constitutional right to criticize labor. Articles and blog posts have raised the issue, but we have yet to see a full examination of the free speech implication in the NLRB’s complaint.

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On Boeing, Defending NLRB’s ‘Process’ Fails as Serious Argument

Few Democratic members of Congress have spoken up on the National Labor Relations Board’s unprecedented and extreme complaint against The Boeing Company for making a reasonable, legitimate management decision by building new production facilities in South Carolina. It’s a tough decision to defend, so those commenting have relied on a “process” argument — let the process work.

Senate Majority Leader Harry Reid hailed the NLRB as an example of the “checks and balances” envisioned by the Founding Fathers. Sen. Tom Harkin (D-IA) levied accusations, claiming, “Powerful corporate interests are pressuring Members of this body to interfere with an independent agency rather than letting it run its course.”

On Thursday, it was Sen. Richard Blumenthal’s turn to come to the Senate floor to defend the NLRB. The Connecticut Democrat made the most coherent, seriously framed argument based on process we’ve seen: “The NLRB and Lafe Solomon, the acting general counsel, have not only the right but the responsibility to investigate and act where the facts and the law establish a right and obligation to do so. So no one should be trying to prejudge this case before it goes before the administrative judge, and no one should be seeking a pass from the appropriate process, and no one should be seeking to intimidate or to interfere with this lawful proceeding. I come to the floor today because of the prospect of exactly that danger  occurring.”

Yet one specific example Blumenthal cites is the decision by Chairman Darrel Issa (R-CA) of the House Oversight Committee to request documents on the Boeing complaint from the NLRB. But that’s the only example. Otherwise, the Senator seems to objecting to other elected officials publicly criticizing a federal agency.

These actions and some others are an attack on the integrity of the NLRB, an attack on its ability to make decisions and enforce the law as the Congress has instructed it and required it to do based on decisions involving the facts and the law alone. The NLRB is part of our justice system, and it should be given the opportunity to do justice in this instance. It should be given the opportunity to protect fairness and peace at the workplace, which is ultimately its mandate and its very solemn responsibility, and its tradition.

The NLRB is part of our justice system? Really? It does not behave that way. You have the NLRB’s public affairs office issuing press releases announcing the agency’s rulings against business and posting “Fact Checks” that are just political spin. Lafe Solomon commented publicly on the case, restating Boeing’s supposed offenses, before he retreated behind the protection of “let the process work.”

The agency is behaving as a political actor, and the complaint against Boeing is so at odds with the board’s mandate, solemn responsibility and tradition — to use Blumenthal’s terms — that silence would be an abdication of Congress’ oversight and policymaking responsibilities. If the NLRB’s complaint stands, the federal government will replace management in determining company locations and hiring. Such a radical restructuring of the U.S. economy and such an extreme expansion of federal power is at heart a policy matter, which in our system of government is the purview of Congress.

When an agency runs amok like the NLRB has done, it has abandoned process. That’s why the process arguments made by its defenders are just beside the point.

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Former Democratic NLRB Member Decries Boeing Complaint

Rounding up the most recent news and commentary about the National Labor Relations Board’s complaint against The Boeing Company for locating new production facilities in South Carolina instead of the unionized Puget Sound region…

At, Dave Weigel interviews Bill Gould, a former Democratic member appointed to the NLRB by President Clinton. From “Air Rage

“The Boeing case is unprecedented,” he says. “I agree with much of what this board has done and is likely to do, but I don’t agree with what the general counsel has done in the Boeing case. The general counsel is trying to equate an employer’s concern with strikes that disrupt production and make it difficult to make deadlines—he’s trying to equate that with hostility toward trade unionism. I don’t think that makes sense.”

Radio talk show host Hugh Hewitt asks Senate Republican Leader Mitch McConnell (R-KY) about NLRB’s move against Boeing.

MM: Unbelievable, isn’t it? The federal government is now, through the NLRB, going to tell you where you can locate your plant. You know, a lot of these big, global businesses, their response to that might be well, I’ll locate my plant in Mexico. I mean, I think that this is truly outrageous. This is the same administration who has now tried to introduce politics into the procurement process by making people who do business with the government reveal their political support for candidates. This is a Chicago-style thuggish administration. In other words, agree with us, or we’ll find a way to punish you. (continue reading…)

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Sunshine in Litigation Act, Polished Up a Little

The Senate Judiciary Committee has reported out a purportedly improved version of S. 623, the Sunshine in Litigation Act, but the legislation could still cast a cloud over the handling of business documents in federal court proceedings.

The original bill would permit plaintiffs’ lawyers to pry open sealed settlement agreements and documents closed under a judge’s order by asserting they could affect public safety or health. Trial lawyers have lobbied for the bill because it would make easier for them to acquire materials to use in alarmist campaigns against a company’s reputation. The legislation would make the discovery process even more expensive, useful leverage against a company to force a settlement.

In its new version (text of substitute amedment), the Sunshine in Litigation Act does the same thing, just with a few exemptions built in. Sen. Herb Kohl (D-WI) outlined the changes in his committee statement (which we’ve transcribed here): (continue reading…)

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Sen. Alexander: NLRB’s Boeing Complaint Helps Send Jobs Overseas

In a Senate floor speech Tuesday, Sen. Lamar Alexander (R-TN) discussed U.S. competitiveness and the trend of “on-shoring” manufacturing jobs as described in the recent Economist article, “Moving back to America –The dwindling allure of building factories offshore.”

Unfortunately, the health care law adds to business costs, and the United States has the highest corporate tax rate in the world, Alexander noted. Now, the National Labor Relations Board’s complaint against The Boeing Company sends a clear signal to large companies: Beware doing business in a United States burdened by this kind of anti-competitive government action.

[We] have a regulation from the National Labor Relations Board that may have the effect of law for 2 to 5 years that says it is prima facie evidence of an unfair labor practice if a company that is producing in a union State expands or moves to a right-to-work State. This is an assault on every middle-income Tennessean and on millions of middle-income Americans who have manufacturing jobs–certainly, everyone in the 22 right-to-work States. But as the Boeing chief executive said, it could be just as much of a disincentive to a State such as Michigan or Illinois or some other State that does not have a right-to-work law because why would you put a plant in Michigan if later you would not be allowed to put it in Tennessee? (continue reading…)

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Bilbray: Who Can I Sue? Litigation Denies Access to Needed Drugs

During the two days of committee discussion last week on the House’s medical liability reform bill,
H.R. 5, the Help Efficient, Accessible, Low-cost, Timely Healthcare (HEALTH) Act of 2011, Rep. Henry Waxman (D-CA) and several fellow committee members defended litigation and trial lawyers from the (well-founded) accusations that lawsuits increase health care costs and detract from medical treatment.

Litigation actually works to improve quality, supplementing the work of the Food and Drug Administration in the regulatory approval of drugs, they argued. Uh huh. The term is “regulation through litigation,” and it’s an inefficient, expensive and counterproductive system of dual regulation, in which trial lawyers and juries of laymen replace scientific experts and testing in determining which drugs are allowable.

At one point, an apparently frustrated Rep. Brian Bilbray (R-CA) reminded the committee members of the real-world consequences of this kind of litigation: Lawsuits force drugs off the market that help people. People really suffer because of the cash-seeking litigation by trial lawyers.

Bilbray spoke passionately about the loss of Benedictin, an anti-morning sickness medication, taken off the market after The National Enquirer published an alarmist article, “New Thalidomide Scandal-Experts Reveal,” and thousands of lawsuits followed. As a consequence, his wife was deprived of a safe and widely prescribed drug she had used in previous pregnancies. She wound up in intensive care.

Rep. Bilbray:

This is one issue you don’t talk about. You had a treatment, Benedictin, that was used all over the country. There was a National Enquirer story in ’79. It ended up being lawsuit after lawsuit after lawsuit, with no scientific data, according to the FDA, to take it off the market. But sheerly by the harassment of litigation this product is no longer available to women across this country.

And my wife was one of those that went into intensive care, while she was in the first trimester of pregnancy, because the litigation drove that product off the market and denied her access to that product. And you know what physicians do now? … They prescribe the chief components of Benedictin separately, because the private sector cannot provide it because it was driven off the market through litigation, not through science.

So this does have an effect. It has an effect on what’s available for consumers. And I say this…Who do I get to sue? Who do I get to take to trial for those who drove this product off the market. Who do I get to point the finger at? Which lawyers do I get to litigate with who drove it off the market, because my wife didn’t a product that she had in her previous pregnancies, she didn’t have the ability to get the medication that is essential to not only her, but to her unborn baby. Who do I get to have justice with because this product was driven off? (continue reading…)

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No Abeyance in Protests Against NLRB’s Boeing Complaint

How could we have gone three days without a post on the radicalized National Labor Relations Board? Well, there really have been few developments after last Thursday’s hearing in the Senate HELP Committee, “The Endangered Middle Class: Is the American Dream Slipping Out of Reach for American Families?,” which turned into a hearing on Boeing and the NLRB.

Mostly the story has percolated as new columnists catch up on the issue, as in George Will’s excellent piece over the weekend, “The Dreamliner nightmare.” (Datelined North Charleston, S.C., which means he was there. We saw Will rushing through Union Station last week, looking quite fit for a scribe who just celebrated his 70th birthday. Congratulations!)

The major substantive development was the introduction of S. 964, the Job Protection Act, by Sen. Lamar Alexander (R-TN) on Thursday, May 12. In his floor speech (here), Alexander explained:

The Job Protection Act, which I introduce today on behalf of 34 Senators, would preserve the Federal law’s current protection of State right-to-work laws in the National Labor Relations Act and provide necessary clarity to prevent the NLRB from moving forward in their case against Boeing or attempting a similar strategy against other companies.

Specifically, the Job Protection Act would, first, explicitly clarify that the board cannot order an employer to relocate jobs from one location to another; two, it guarantees an employer the right to decide where to do business within the United States; and, three, it protects an employer’s free speech regarding the costs associated with having a unionized workforce without fear of such communication being used as evidence in an anti-union discrimination suit.

Sen. Alexander announced general plans for the bill on May 4, and it appears he and his colleagues used the time since to craft a solid piece of legislation.

We appreciate the Senator’s mention of the First Amendment protections, a underreported part of this controversy. The NLRB seeks to punish Boeing in part because several top executives spoke openly about the business costs of labor disruptions. If the board’s complaint stands, company executives could be deprived of their rights to say things like, “We’re concerned that a strike could make it hard to deliver our products and make us less competitive.” That’s not a threat of retaliation, that’s a statement of opinion that should always be protected free speech.

Elsewhere, South Carolina Gov. Nikki Haley was on ABC’s This Week on Sunday. In a discussion of the 2012 campaigns and Republican candidates, she also repeated her call for a comment on the NLRB’s complaint from President Obama. (continue reading…)

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After Boeing Complaint, NLRB Plans Even More Aggressive Action

Hans von Spakovsky and James Sherk of the Heritage Foundation break disturbing news about the radicalized National Labor Relations Board in a post at NRO’s The Corner blog, “The New NLRB: Boeing Is Just the Beginning”:

An internal NLRB memorandum, dated May 10, shows that the board wants to give unions much greater power over employers and their investment and management decisions.

Under current NLRB rules, companies can make major business decisions (like relocating a plant) without negotiating with their union — as long as those changes are not primarily made to reduce labor costs. For example, a business can unilaterally merge several smaller operations into one larger facility to achieve administrative efficiencies. Companies only have to negotiate working conditions, not their business plans.

The NLRB apparently intends to change that. In the internal memorandum, the board’s associate general counsel, Richard Siegel, asks the NLRB’s regional directors to flag such business-relocation cases. Siegel explains that the Board is considering “whether to propose a new standard” in these situations because the chairman of the NLRB, Wilma Liebman, has expressed her desire to “revisit existing law in this area” by modifying the rule established in a case called Dubuque Packing…. (continue reading…)

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Cross-Border Trucking, the Opportunities, the Lawsuits

The 30-day comment period ended Friday for the Federal Motor Carrier Safety Administration’s proposed rules to put into effect the long-delayed cross-border Mexican trucking program required under the North American Free Trade Agreement. (Docket: FMCSA-2011-0097).

The Riverside (Calif.) Press-Enterprise offered a thorough report on the issue, albeit with a headline one can argue over, “Cross-border trucking and tariffs — hard to balance.” To exporters of agricultural and manufactured goods, it doesn’t seem that hard at all. The tariffs tilted the scales heavily in a bad direction, and enacting the cross-border trucking program restores the balance.

Much of the effect in California has been on agricultural products, including dates, table grapes, lettuce and other crops grown in eastern Riverside County. Dave Kranz, a spokesman for the California Farm Bureau, said the tariff on table grapes, as high as 45 percent initially, cost growers 70 percent of their Mexican market.

Doug Goudie, director of international trade policy for the National Association of Manufacturers, said adding on that kind of tariff drives away customers and damages American producers. Goudie said he knows of one Mexican firm that is buying potato products grown in Canada, which he said was absurd because the products had to move through the U.S. to get to the destination.

“If you have to add 25 cents to every dollar for everything you’re trying to sell, pretty soon a Chinese or a Canadian product looks a lot better,” Goudie said.

Once the program is place, there will be more economic activity on both sides of the border. Increased opportunity, investment and wealth means trial lawyers will follow with bogus, hyped, shakedown lawsuits. (Where have we seen that before?) The American Association for Justice, the trial lawyer lobby, is setting the stage for litigation with its comments to the FMCSA, described in a news release, “Mexican-Based Trucks Should Carry Adequate Insurance: NAFTA Trucking Provisions Lack Protections for Motorists Injured in Accidents.

The important thing for the U.S. plaintiffs’ lawyers is to get their assertion on record that the insurance requirements are inadequate. Personal injury attorneys can then point to their regulatory submission to broaden the targets of their litigation from Mexican operators/insurers to more deep-pocket U.S. companies.

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Hydrofracturing Produces Jobs, Energy, Wealth, Parasitic Lawsuits

Reporting on shale gas and hydrofracturing, the public radio program Marketplace Morning Report today captures the classic American phenomenon at work: Innovation creates opportunity, investment and wealth, and trial lawyers follow with bogus, hyped, shake-down lawsuits.

From “Fracking employs plenty of lawyers“:

Sarah Gardner: The U.S. is awash in natural gas. But the latest drilling technology that’s made the glut possible isn’t winning any popularity awards. “Fracking” involves a high pressure cocktail of water, chemicals and sand injected into shale rock — deep underground. Gas companies are drilling wells from Pennsylvania to Wyoming, and it doesn’t always go smoothly.

Richard Lippes: There have been explosions of homes, there’s a lot of people who can now actually light their water.

Not winning any popularity awards? Too bad this worthy report starts with such a clunker. Every job that hydofracturing creates wins a popularity award with the worker. Every stream of income from a producing well wins a popularity award with the property owner. Every hundred million dollars of tax revenue wins a popularity award with the taxpayers and citizens of a state.

As for the assertion from Lippes, the trial lawyer, that there are many who can now actually light their water? It’s false, a claim that’s supposed to inflame NIMBY sentiment against natural gas development and scare up clients. One scene of a fellow lighting water in his kitchen sink appeared in the agitprop film, “Gasland,” but the claims about fiery faucets have since been refuted and the entire movie debunked.

The Marketplace report also covers that activities of New York lawsuit engine Marc Bern, who specializes in environmental claims. Next up? The class-action lawsuit. Bern declares: “Wherever there is shale and there is natural gas trapped underneath, there will be litigation.” Isn’t that the sad truth. Just as where there is any creation of wealth in the U.S. economy, there will be trial lawyers. The more wealth, the more lawyers, which makes shale natural gas such a tempting target.

“Trial,” the monthly magazine of the American Association for Justice, hyped environmental litigation in its March issue, “Poisoned wells: dangers of natural gas drilling,” a piece authored by another plaintiffs’ attorney, William S. Friedlander. Environmental activists and litigators often team up in campaigns against energy, both exaggerating the risks to increase their potential income via membership dues or settlements, respectively.

Do we want a prosperous society, a growing economy, and a strong manufacturing base fueled by affordable natural gas, or do we want an elite class of trial lawyers and winners of the litigation lottery? (continue reading…)

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