Briefly Legal

Goal of NLRB Complaint against Boeing, Neutrality Agreement?

In promoting his new online column, “The Persecution of Boeing,” National Review Editor Rich Lowry commented in NRO’s The Corner blog:

The NLRB is on very tenuous ground here and will almost certainly lose in court. But one expert in these matters was telling me yesterday he wouldn’t be surprised if the game is to try to harass Boeing into agreeing to some sort of card check-like process to unionize the South Carolina facility.

That would consistent with our observation in the May 10 post, “NLRB Already Talking About ‘Settlement’ in Boeing Case.”

The term of art is a “neutrality agreement,” in which a company agrees with a labor union not to request a secret-ballot election if the union attempts to organize a facility. Often management goes that route after suffering a corporate campaign (or threat of a corporate campaign) in which the union blackens the reputations of the company and its executives.

But in this case, it’s the National Labor Relations Board leading the corporate campaign in support of the International Association of Machinists and Aerospace Workers.

The strategy make sense politically: Attack the critics, pummel the opposition into staying quiet. You can see it being played out in Congress, too. On Wednesday, Senate Majority Leader Harry Reid (D-NV), evoked the Founding Fathers and “checks and balances” into decrying any criticism of the NLRB. From The Congressional Record:

This kind of interference is inappropriate, it is disgraceful and dangerous.We wouldn’t allow threats to prosecutors or U.S. attorneys trying to stop them from moving forward with charges they see fit to bring to the courts, and we shouldn’t stand for this. It may not be illegal, but it is no better than the retaliation and intimidation that is the fundamental question in this case, and it should stop.

The Founders are telling critics of the NLRB to shut up? Well, in this case, it’s Congress and the states in the form of attorneys general that are providing the checks and balances to restrain a runaway federal agency.

Sen. Tom Harkin (D-IA) followed up Wednesday on the Senate floor, arguing in effect that the NLRB should be above criticism because it is an independent Executive Branch agency. The Senator conceded he did not know all the facts of the case, but knocked Boeing around and made the union’s arguments. He then declared: (continue reading…)

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White House Dodges Questions About NLRB’s Complaint Against Boeing

From today’s White House press briefing conducted by Jay Carney:

Q Boeing CEO Jim McNerney, who chairs the President’s Export Council, said the National Labor Relations Board suit against his company for building a plant in a right-to-work state is a fundamental assault on capitalism. I’m wondering is the President aware of the issue, and does he think the government should be involved in how businesses allocate capital or resources?

MR. CARNEY: Well, it’s obviously been in the news, so we are aware of it, but I would refer any questions about it to the NLRB because it is an independent agency, and we do not get involved in particular enforcement matters of independent agencies.

Q The President has weighed in on outside issues before, though. I mean is this something — it’s also coming from someone who is chairing the Export Council, who’s saying this is hurting job creation.

MR. CARNEY: I don’t have a reaction to this from the President. And I think the fact that he’s weighed in on outside issues doesn’t mean that he will weigh in on an independent agency’s enforcement action.

Carney then changed the subject to tout the President’s record on the auto industry and hail the growth of manufacturing.

The National Labor Relations Board is indeed an independent executive branch agency, one that is not directly answerable to the President. But there’s nothing stopping the President from expressing disapproval of a complaint that threatens a multi-billion-dollar investment, sows economic uncertainty, and could fundamentally change the business climate in the United States, making us less competitive. The President enjoys the same free speech rights as everyone else — except for Boeing executives talking about business decisions, apparently — and he can comment.

How about this instead from Carney? “The President is aware of this issue. While he does not presume to instruct an independent agency how to proceed, the President is very troubled by the implications for jobs and economic growth of the NLRB’s complaint. Some members of Congress are discussing a legislative response to make sure the federal government does not hinder the expansion of companies anywhere in the United States. The President is watching those efforts with interest.”

Or: “It seems like a very bad idea, what the NLRB is doing. I hope Lafe Solomon, my appointee as acting general counsel, reconsiders his complaint.”

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The Constitutional Basis for Federal Tort Reform in Health Care

The House Energy and Commerce Committee this morning is marking up H.R. 5, the Help Efficient, Accessible, Low-cost, Timely Healthcare (HEALTH) Act of 2011, legislation to control the unnecessary or excessive litigation costs that afflict health care in the United States. (Committee video. Hearing started at 10:41 a.m.)

In a timely and important contribution to the debate, the American Tort Reform Association has released a new paper,”The Constitutional Foundation for Federal Medical liability Reform.” In a news release, ATRA explained:

The ATRA paper, The Constitutional Foundation for Federal Medical liability Reform, addresses in some detail questions recently raised about whether provisions of H.R. 5 are consistent with the Commerce Clause, the Tenth Amendment, the guarantees of equal protection and due process, and the right to a jury trial.

“Citing more than 100 years’ worth of Supreme Court precedent, the consistent rejection of federal constitutional challenges to state medical liability reforms, and the opinion of the Congressional Research Service itself,” Joyce said, “our paper puts an end to any serious concern or question about the constitutionality of federal medical liability reform.

“With respect to perhaps the most important question about whether the Commerce Clause gives Congress sufficient authority to promulgate medical liability reform for the nation as a whole, it’s not even a close call. Congress has that authority.

Author of the paper is Mark A. Behrens of Shook, Hardy & Bacon L.L.P., a man who knows his civil liability issues. The National Association of Manufacturers has worked with Behrens and the law firm on numerous occasions over product liability litigation and related issues.

UPDATE (10:45 a.m.): Very timely report. Rep. Tammy Baldwin (D-WI) is making a “states rights” argument against the bill, proposing an amendment. She’s always been such a strong advocate for federalism.

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On NLRB, Boeing and Competitiveness: News Conference Video

From the office of Sen. Lindsey Graham (R-SC) comes the video of Tuesday’s news conference on the National Labor Relations Board’s complaint against Boeing. Hosted by the U.S. Chamber of Commerce, the event featured Gov. Nikki Haley (R-SC) as the first official to speak.

Her central point: President Obama must speak up on the issue.

We are demanding that the President respond to what the NLRB has done, because this goes against everything we know our American economy to be. When a company comes to South Carolina and wants to create jobs, they should be able to do that. For the President not to weigh in on this, and not to say that this is going to be harmful, is a problem.

Job creation is key in the next few years in this country. What we are doing is we are telling people, not only can you not go and work in any other state, we want you to go overseas.

That’s what the president is saying through his silence. He has got to speak up. We need to see leadership. He has to respond to what has happened from the NLRB to Boeing, and tell us, if we can’t create jobs this way, then how exactly are we supposed to create jobs.

The White House press corps has certainly had the time to pose the question to Jay Carney. Maybe today.

UPDATE [11:05 p.m.]: President Obama tapes a townhall discussion on the economy today at the Newseum, an appearance for CBS News. What a perfect opportunity to address the NLRB and Boeing issues. Now, back to news conference …

Joe Trauger of the National Association of Manufacturers speaks shortly after the 21 minute mark.

In other developments and commentary … (continue reading…)

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Boeing’s CEO McNerney on the NLRB’s Complaint, U.S. Competitiveness

Jim McNerney, president and CEO of The Boeing Company, refutes the complaint against the company by the National Labor Relations Board in an op-ed to be published in Wednesday’s Wall Street Journal. The column, “Boeing Is Pro-Growth, Not Anti-Union,” also delineates the threat that the NLRB’s unprecedented complaint represents to U.S. competitiveness. Excerpt:

The NLRB is wrong and has far overreached its authority. Its action is a fundamental assault on the capitalist principles that have sustained America’s competitiveness since it became the world’s largest economy nearly 140 years ago. We’ve made a rational, legal business decision about the allocation of our capital and the placement of new work within the U.S. We’re confident the federal courts will reject the claim, but only after a significant and unnecessary expense to taxpayers.

More worrisome, though, are the potential implications of such brazen regulatory activism on the U.S. manufacturing base and long-term job creation. The NLRB’s overreach could accelerate the overseas flight of good, middle-class American jobs.

See also Boeing’s “final answer” filed in response to the  (available here) to the NLRB’s complaint and the company’s letter last week rebutting assertions made by the NLRB’s acting general counsel, Lafe Solomon.

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Gov. Haley: Let’s Hear from President Obama on Boeing, NLRB

South Carolina Gov. Nikki Haley was in Washington today to draw national attention to the National Labor Relations Board’s unjustified and unprecedented complaint against The Boeing Company for locating new production facilities in South Carolina instead of unionized Washington State.

“We’ve got to make sure that we are responding to this in a strong way,” the Republican governor said at a news conference hosted by the U.S. Chamber of Commerce. “We have to do it in a loud way and the president owes it to the state of South Carolina and every state in the country on what he’s going to do in reference to what the NLRB has done against Boeing. While Boeing may be the first company, you know, I don’t think this will be the last company.”

Haley was joined by Sens. Lindsey Graham (R-SC), Jim DeMint (R-SC), Lamar Alexander (R-TN) and Rand Paul (R-KY), Rep. Joe Wilson (R-SC), and South Carolina’s Attorney General Alan Wilson.

Gov. Nikki Haley speaks to NAM's Joe Trauger

Business was also well represented with leaders from the Chamber, Business Roundtable, HR Policy Association, and the National Association of Manufacturers, all cited in the joint news release issued by the Chamber, “Business Leaders, Governor, Members of Congress Express Serious Concern with NLRB Complaint Against Boeing.” (To say the least.) The NAM’s Joe Trauger, vice president for human resources policy, said:

Manufacturers are alarmed by the recent action of the NLRB and the dangerous new precedent being set. This action is effectively a ban on companies from expanding in right-to-work states if they now have production facilities in a state with union representation. Companies are deeply concerned about the impact this complaint will have on their operations and ability to create jobs. The NLRB is reversing 45 years of its own precedent and calling into question companies’ fundamental business decisions on where to expand or whom to hire.

News coverage …

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President Draws a Royal (Judicial) Flush on Health Care Lawsuit

The three U.S. Appellate Court judges who today heard the federal government’s appeal of the decision by U.S. District Court Judge Henry Hudson of Virginia on the constitutionality of the individual mandate in the health care law, were all appointed by Democratic Presidents. In fact, two of three judges — all selected at random — were appointed by President Obama himself.

Why is this important? So far all the rulings made on the constitutionality of the new health care law – 12 in all – have correlated directly to which party’s president – Republican or Democrat – appointed them. The three-judge panel is effectively a royal flush because the Fourth Circuit is comprised of Republican appointees by a ratio of nearly 3-to-1. While not a certainty, it appears likely Hudson’s ruling will be overturned and appealed to the Supreme Court by the Commonwealth of Virginia from a losing position.

Joe Trauger is vice president for human resources policy at the National Association of Manufacturers.

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NLRB Already Talking About ‘Settlement’ in Boeing Case

Yes, elected officials, business groups and the public are continuing to speak out against the National Labor Relation Board’s unprecedented and extreme complaint against The Boeing Company, even though NLRB’s acting general counsel, Lafe Solomon, issued a statement Monday trying to silence the storm of criticism against the board.

Solomon’s statement also signaled the NLRB’s lack of confidence in the merits of its case.

The Associated Press reports, “Gov. Haley heads to Washington for Boeing battle“:

COLUMBIA (WACH, AP)- Governor Nikki Haley, members of Congress, U.S. Chamber of Commerce officials and business association leaders will hold a press conference on Tuesday in Washington, discuss concerns relating to the National Labor Relations Board complaint against the Boeing Company.

Joe Trauger, vice president for human resource policy for the National Association of Manufacturers, will participate in the 11:30 a.m. event. Other speakers from the business side are Business Roundtable President John Engler; the Chamber’s Randy Johnson, senior vice president of labor, immigration, and employee benefits; and Dan Yager, chief policy officer and general counsel at HR Policy Association.

In his statement Monday, Solomon urged “all interested parties [to] respect the legal process, rather than trying to litigate this case in the media and public arena.” The NAM’s Trauger already pointed out the arrogance represented by a government official like Solomon attempting to silence criticism after all he and the NLRB have done to promote their arguments “in the media and public arena.”

Solomon’s statement is interesting for another reason, his invocation of the word “settlement.”

It is important to note that the issuance of a complaint is just the beginning of a legal process, which now moves to a hearing before an administrative law judge. That hearing, scheduled for June 14 in Seattle, is the appropriate time and place to argue the merits of the complaint. The judge’s decision can further be appealed to the Board, and ultimately to the federal courts. At any point in this process, the parties could reach a settlement agreement and we remain willing to participate in any such discussions at the request of either or both parties.

Such a prominent appeal to “settlement” is highly unusual, perhaps unprecedented, knowledgeable observers tell us.

We read the statement to be Solomon acknowledging the weakness of the NLRB’s complaint against Boeing, which he filed at the behest of the International Association of Machinists and Aerospace Workers. This is the equivalent of a prosecutor saying, “We are confident in the strength of our case, but you know, there’s a judge, and it’s kind of hard, and maybe we’ll reach a deal or the charges might be dropped, because … A settlement would be really, really good, we think.”

Better idea: The NLRB should resist the political pressure from the labor unions and the Obama Administration and just withdraw the complaint, apologize and move on.

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NLRB’s General Counsel: Don’t Question Us About Boeing

Acting General Counsel Lafe Solomon of the National Labor Relations Board today released a statement asserting there is “nothing remarkable or unprecedented about the complaint issued against Boeing Company on April 20.”

Perhaps telling businesses where they can expand and chilling future capital investment is unremarkable to the Acting General Counsel, but it is certainly unprecedented.  The release of such a defensive statement by Mr. Solomon on an active case raises the question of whether the NLRB is starting to doubt the merits of its complaint.

While admonishing others who have raised questions or concerns about the complaint against “litigating this case in the public arena” the Acting General Counsel conveniently leaves out the news releases, “fact checks,” tweets and other materials issued by his office on this matter.  Are businesses and their associations supposed to sit down and shut up while an appointed board injects itself into fundamental business decisions about where to locate and whom to hire? Should the government be allowed to expend taxpayer dollars to damage a company’s reputation and force it to seek legal recourse without question?

Solomon probably just wants to avoid pointed inquiries about the NLRB’s preposterous complaint and the message it sends to other industries operating in the United States.

And in fact, he is scheduled to speak Tuesday in Chicago at a chapter meeting of the Labor and Employment Relations Association. The topic? “Recent Developments at the National Labor Relations Board (NLRB),” promoted on an association flyer with, “Both the National Labor Relations Board and the Board’s General Counsel have implemented numerous changes in federal labor law, encompassing a wide range of procedural and substantive areas. Please join the NLRB’s Acting General Counsel, Lafe Solomon, for a presentation and discussion regarding recent developments at the Board.”

But no questions about Boeing, please. (continue reading…)

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Sunshine in Litigation Act Threatens Dark Day for Business, Justice

UPDATE (May 12, 11:54 a.m.): The Senate Judiciary Committee did not act on this measure today, postponing consideration for another week.


The Senate Judiciary Committee on Thursday is scheduled to vote on  S.623, the Sunshine in Litigation Act, to force open sealed settlement agreements and documents closed under a judge’s order if the documents have an impact on public safety or health. Long promoted by trial lawyers, the bill would dramatically raise the costs of litigation and give the plaintiffs’ bar another weapon to pressure the businesses into out-of-court settlements.

The National Association of Manufacturers and other members of the  Coalition to Protect Privacy, Property, Confidentiality, and Efficiency in the Courts sent a letter to the Judiciary Committee last week explaining business’ vigorous opposition to the proposal. Excerpt:

[The] bill would severely restrict existing judicial discretion to protect the privacy, property, and confidentiality of all litigants by requiring federal judges to make premature decisions about the masses of information produced in modern civil litigation.

Ultimately, S. 623 would increase the costs and burdens associated with civil litigation while stifling the federal court system. Finally, the bill would confer unfair tactical advantages on certain litigants at the expense of others.

Protective and sealing orders are invaluable litigation tools. These orders help ensure the confidentiality of valuable information produced in discovery. Severe restrictions on their availability would have a chilling effect not only on discovery and settlements but also on the commencement and defense of claims. (continue reading…)

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