In late January, the D.C. Circuit ruled in Noel Canning that President Barack Obama’s January 2012 recess appointments of Members Richard Griffin, Terrence Flynn (who has since resigned), and Sharon Block to the National Labor Relations Board were unconstitutional because they did not occur during an intersession recess of the Senate. Yesterday, the Third Circuit invalidated the earlier recess appointment of former NLRB Member Craig Becker and became the second appellate court to rule that President Obama’s recess appointments to the Board were unconstitutional.
In NLRB v. New Vista Nursing and Rehabilitation, the employer, a New Jersey nursing home, challenged an August 26, 2012 Board Order signed by 3 members, including Member Becker. In its Order, the Board determined that New Vista had violated the National Labor Relations Act when it refused to bargain with a union for a recently certified unit of nurses. New Vista argued that the Board’s Order was invalid because Member Becker had not been validly appointed and, as a result, the Board had not acted with the required three members.
In a 2-1 decision, the Third Circuit sided with New Vista. The court swept aside concerns raised by several interested parties who filed briefs that this case involved a political question best left to Congress and the President to sort out. Like the D.C. Circuit’s decision in Noel Canning, the Third Circuit’s decision turned on the exact meaning of the Constitution’s Recess Clause. The majority’s whopping, and painstakingly detailed, 102-page opinion found that “the Recess of the Senate” mentioned in the Constitution is limited to “intersession” recesses only. Because Member Becker was appointed during an “intrasession” break, the court reasoned that his appointment was invalid, the Board had acted without the requisite 3 members and, therefore, its Order was invalid. A vigorous 55-page dissent, likewise thoroughly detailed and based on many of the same authorities on which the majority relied, would have upheld Member Becker’s appointment and the Board’s Order.
New Vista calls into question any 3-member Board decision in which Member Becker participated. Among the notable decisions in this group are the “Quickie Election” rules issued in December 2011 (and subsequently blocked by federal courts) and the Board’s D.R. Horton decision about mandatory arbitration and class action waiver clauses, currently pending in the Fifth Circuit. The Third Circuit did not directly address President Obama’s January 2012 recess appointments of Members Griffin, Flynn, and Block, but the court’s rationale would presumably invalidate those appointments as well.
The NLRB previously filed a petition for certiorari to appeal Noel Canning to the Supreme Court and may do the same with respect to New Vista. We will keep you apprised of relevant developments.