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Executive Summary: A federal trial court in Washington state has held that the President violated the Federal Vacancies Reform Act (5 U.S.C. § 3345, et. seq.) when he appointed Lafe Solomon as Acting General Counsel for the National Labor Relations Board (the Board) on June 21, 2010. See Hooks ex rel. NLRB v. Kitsap Tenant Support Servs. (W.D. Wa. 2013). Given that Solomon was improperly appointed, the court also held that neither he nor Regional Director Hooks had the authority to issue an unfair labor practice complaint against the employer. Furthermore, without a valid complaint, Hooks was without the authority to file for a § 10(j) preliminary injunction.
Regional Director Hooks issued a complaint against the employer under the National Labor Relations Act (NLRA), alleging various unfair labor practices. The employer filed a motion to dismiss, claiming that Solomon was improperly appointed as Acting General Counsel, that Hooks was appointed to his Regional Director position by a Board without a quorum, and that neither of them had the authority to issue a complaint. The Board rejected the employer's motion.
Subsequently, Hooks petitioned the federal district court for a preliminary injunction under § 10(j) of the NLRA to prevent the employer from committing further alleged unfair labor practices during the course of litigation. The employer filed a motion to dismiss, which the court granted.
The Court Decision
Board Appointments Invalid
The employer argued that the Board was without authority to act because it lacked a properly appointed quorum of Board members. A "complete" Board consists of five members serving five-year terms. The members are appointed by the President and confirmed with the advice and consent of the Senate. The Board must consist of at least three members to exercise its authority under the NLRA. On January 4, 2012, the President appointed Members Flynn, Block, and Griffin to the Board to serve with Board Chairman Pearce. The Senate was in session on January 4, 2012, however the President chose not to seek the Senate's advice and consent on his nominations. Members Flynn, Block, and Griffin were never confirmed by the Senate at any point. The employer argued that the President's January 2012 appointments were invalid without the required Senate confirmation.
The court, citing to NLRB v. Enterprise Leasing Co. Southeast, (4th Cir. 2013), and NLRB v. New Vista Nursing and Rehabilitation, (3rd Cir. 2013), agreed with the employer and granted the motion to dismiss. The court did not reiterate the rationale behind Enterprise and New Vista Nursing, but specifically agreed that "the Recess" in the Recess Appointment Clause meant the period of time between an adjournment sine die (without a specified date to reconvene) and the start of the Senate's next session. Given that the Senate was not in "the Recess" when Flynn, Block, and Griffin were appointed, the President was required to obtain Senate confirmation of his Board nominees. Because the Board lacked the power to act, Hooks lacked the power to file an unfair labor practice complaint against the employer. Without a valid complaint, Hooks was precluded from filing a petition under § 10(j).
Authority of Acting General Counsel Solomon and Regional Director Hooks
Hooks argued that even if the Board lacked authorization, Acting General Counsel Solomon validly delegated to him the authority to initiate legal action. The court rejected this argument, finding that Solomon was improperly appointed by the President. The court held that the Federal Vacancies Reform Act (FVRA) only permits the appointment of an officer of an executive agency under specific circumstances, and those circumstances did not apply to Solomon's appointment.
The court held that Solomon could only have been appointed under the FVRA if he had served as "first assistant" to the departing General Counsel. Ronald Meisburg retired from the General Counsel position on June 20, 2010, and Solomon was appointed to the Acting General Counsel position effective June 21, 2010. Prior to this appointment Solomon served as the director of the NLRB's Office of Representation Appeals for over 10 years. The court found that Solomon had never served as first assistant to the General Counsel, and therefore held that Solomon could not be appointed to the Acting General Counsel position under the FVRA. Accordingly, the court rejected Hooks' argument that he was acting under a valid grant of authority from Solomon.
Employer's Bottom Line: At first blush this case suggests that employers may successfully challenge any actions taken by Lafe Solomon in his role as Acting General Counsel; however, in reality it seems that this decision will have little practical impact. The Board is likely to appeal the decision, especially since the court's opinion on Solomon's appointment under the FVRA did not discuss portions of that law that could support the propriety of Solomon's appointment (specifically § 3345(a)(3), requiring only that the appointee have served in the specific agency for at least 90 days at a rate of pay equal to or above that of the minimum for the appointed position). Furthermore, Solomon will no longer serve as Acting General Counsel if the Senate confirms the President's nomination of Richard Griffin as General Counsel. The confirmation hearing is expected to be held in September 2013, although there is a question as to whether the confirmation will go smoothly.
Finally, the decision likely will have little impact on the Board's actions in future cases, since it has consistently rejected similar challenges to its authority to act, citing conflicting circuit court opinions on the matter that have yet to be definitively resolved by the Supreme Court. The Board has stated that it will continue to fulfill its duties under the NLRA until the Supreme Court decides the issue of its authority. With a full complement of Senate-confirmed Board members, and the possibility of a new General Counsel, the Board will undoubtedly continue with its aggressive rule-making agenda and its focus on the non-unionized workplace.
Topics: Corporate Counsel, NLRB, Political Appointments
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