JAMES E. BOASBERG, District Judge.
According to Woody Allen, eighty percent of life is just showing up. When it comes to satisfying a quorum requirement, though, showing up is even more important than that. Indeed, it is the only thing that matters — even when the quorum is constituted electronically. In this case, because no quorum ever existed for the pivotal
On December 22, 2011, the National Labor Relations Board published a rule that amended the procedures for determining whether a majority of employees wish to be represented by a labor organization for purposes of collective bargaining. Two of the Board's three members voted in favor of adopting the final rule. The third member of the Board, Brian Hayes, did not cast a vote. Because Hayes had previously voted against initiating the rulemaking and against proceeding with the drafting and publication of the final rule, the Board nevertheless determined that he had "effectively indicated his opposition."
In this suit, Plaintiffs — the Chamber of Commerce of the United States of America and the Coalition for a Democratic Workforce — challenge the final rule on myriad grounds. The Court, however, reaches only their first contention: that the rule was adopted without the statutorily required quorum. Absent limited circumstances not present here, the Board must muster a quorum of three members in order to act. Because Member Hayes did not participate in the decision to adopt the final rule, Plaintiffs argue, the other two members of the Board lacked the authority to effect its promulgation. The NLRB, on the other hand, maintains that all three members participated in the rulemaking in the relevant sense and, accordingly, that the quorum requirement was satisfied. The agency has now filed a Motion for Summary Judgment and an Alternative Partial Motion to Dismiss, and Plaintiffs have filed a Motion for Summary Judgment.
Plaintiffs are correct. Two members of the Board participated in the decision to adopt the final rule, and two is simply not enough. Member Hayes cannot be counted toward the quorum merely because he held office, and his participation in earlier decisions relating to the drafting of the rule does not suffice. He need not necessarily have voted, but he had to at least show up. At the end of the day, while the Court's decision may seem unduly technical, the quorum requirement, as the Supreme Court has made clear, is no trifle. Regardless of whether the final rule otherwise complies with the Constitution and the governing statute — let alone whether the amendments it contains are desirable from a policy perspective — the Board lacked the authority to issue it, and, therefore, it cannot stand. The Court, consequently, will grant Plaintiffs' Motion and deny Defendant's.
The National Labor Relations Act, codified at 29 U.S.C. § 151 et seq., governs, inter alia, the formation of collective-bargaining relationships between employers and employees in the private sector, and the NLRB is the federal agency charged with administering the statute. See generally id. §§ 151-57. At the time of the agency's creation, the NLRA provided that the Board would consist of three members and that two of those members would constitute a quorum. See Act of July 5, 1935 ("Wagner Act"), ch. 372, §§ 3(a)-(b), Pub. L. No. 74-198, 49 Stat. 449, 451. With the enaction of the Taft-Hartley Act in 1947, however, the Board's membership was increased from three to five. See 29 U.S.C. § 153(a); see also New Process Steel, L.P. v. NLRB, ___ U.S. ___, 130 S.Ct. 2635, 2638, 177 L.Ed.2d 162 (2010). Taft-Hartley concurrently altered the quorum requirement, providing that, except in limited circumstances not present here, "three members of the Board shall, at all times, constitute a quorum." See 29 U.S.C. § 153(b); see also New Process Steel, 130 S.Ct. at 2638. It now takes three Board members, in other words, for the Board to do business.
Although Congress set out the basic steps by which such a question is to be settled, it left it to the Board to fill in the gaps. See NLRB v. A.J. Tower Co., 329 U.S. 324, 330, 67 S.Ct. 324, 91 L.Ed. 322 (1946) ("Congress has entrusted the Board with a wide degree of discretion in establishing the procedure and safeguards necessary to insure the fair and free choice of bargaining representatives by employees."). "The Board has exercised this discretion through two mechanisms. First, the Board has promulgated binding rules of procedure, most of which are found in 29 C.F.R. part 102, subpart C. Second, the Board has interpreted and occasionally altered or created its representation case procedures through adjudication." Final Rule, 76 Fed.Reg. 80,138, 80,138 (Dec. 22, 2011) (footnote omitted).
On June 22, 2011, the Board formally proposed to amend its procedures for resolving disputes about union representation in a Notice of Proposed Rulemaking (NPRM), which was issued by a 3-1 vote of the four members then holding office. NPRM, 76 Fed.Reg. 36,812, 36,812 (June 22, 2011); see also Separate Concurring Statement by Chairman Pearce, 77 Fed. Reg. 25,548, 25,548 (Apr. 30, 2012). Then-Chairman Wilma Liebman, Member Craig Becker, and Member Mark Pearce voted in favor of publishing the NPRM; Member Brian Hayes dissented. See NPRM, 76 Fed.Reg. at 36,829-33. The proposed rule, the NPRM advised, would "remove unnecessary barriers to the fair and expeditious resolution of questions concerning representation." Id. at 36,812.
More than 65,000 written comments were received in response. See Final Rule, 76 Fed.Reg. at 80,140. In July 2011, the Board held two full days of hearings on the proposed rule. See id. at 80,142. All four Board members participated, and 66 individuals and organizations testified. See id. In the midst of the Board's subsequent deliberations, however, then-Chairman Liebman's term expired, leaving the Board with only three members. See Separate Concurring Statement by Chairman Pearce, 77 Fed.Reg. at 25,548. In addition, "the Board ... faced the imminent end of the recess appointment of Member Becker and with it, the indefinite loss of a quorum." Id. (footnote omitted).
At a public meeting held on November 30, 2011, the remaining three members of the Board considered a resolution to "[p]repare a final rule to be published in the Federal Register containing" eight of the amendments proposed in the NPRM and to "[c]ontinue to deliberate on the remainder" of the proposed amendments. See Def.'s Mot., Exh. 2 (NLRB Resolution No. 2011-1). This proposal was intended to allow for those eight amendments to be published in a final rule before the expiration of Member Becker's appointment. See Separate Concurring Statement by Chairman Pearce, 77 Fed.Reg. at 25,548. The resolution was passed by a vote of 2-1, with Member Hayes again dissenting. See Final Rule, 76 Fed.Reg. at 80,147
Consistent with that resolution, the final rule that is the subject of this case was prepared. The Chairman circulated a draft via email on December 9, 2011, and another draft was circulated via email on December 12. See Def.'s Opp., Exh. 1 (Decl. of Brian Hayes), ¶¶ 4-5.
Id., ¶ 6. "In situations where a particular Board Member has not voted and immediate action is desired, the Executive Secretary or Solicitor may convey, by phone or email, a request to act." Id., ¶ 11.
On December 14, 2011, the Chairman distributed by email a draft Order, which directed the Solicitor to publish the final rule in the Federal Register "immediately upon approval of a final rule by a majority of the Board." Def.'s Mot., Exh. 3 (Order, Dec. 15, 2011) at 1; see Hayes Decl., ¶ 7. The Order provided that any concurring or dissenting statements would be published in the Federal Register after the publication of the final rule itself, and it also stated that the Order would "constitute the final action of the Board in this matter." See Order, Dec. 15, 2011, at 1-2. All three members voted on this procedural Order by email on December 14 or 15, with Chairman Pearce and Member Becker voting in its favor and Member Hayes voting against. See Hayes Decl., ¶ 8.
Meanwhile, the draft final rule continued to be revised. A modified draft was circulated via JCMS on December 15. Id., ¶ 9. That same day, an email was sent from the Chairman's Chief Counsel to Hayes's Chief Counsel, with Hayes and others copied, asking whether Hayes wished to include a dissenting statement in the final rule. Id. Later that day, Hayes "authorized [his] Chief Counsel to advise that [he] would not attach any statement to the Final Rule" so long as, consistent with the Board's Order, he would be able to add a dissent later on. Id.
On December 16, the final version of the rule was circulated in JCMS. Id., ¶ 10. Both Chairman Pearce and Member Becker voted to approve the rule, and it was forwarded by the Solicitor for publication
In the interim, however, Plaintiffs the Chamber of Commerce of the United States of America and the Coalition for a Democratic Workforce, two organizations that together represent thousands of businesses that are subject to the final rule, filed suit. See First Am. Compl., ¶¶ 4-9. Their First Amended Complaint brings numerous challenges both to the procedure by which the rule was adopted and to its substance. Id., ¶¶ 34-76. The parties have now filed Cross-Motions for Summary Judgment, and the NLRB moves in the alternative for partial dismissal. In addition, several organizations have jointly filed a brief as amici curiae in support of Plaintiffs' Motion.
Summary judgment may be granted if "the movant shows that there is no genuine dispute as to any material fact and the movant is entitled to judgment as a matter of law." Fed.R.Civ.P. 56(a); see also Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 247-48, 106 S.Ct. 2505, 91 L.Ed.2d 202 (1986); Holcomb v. Powell, 433 F.3d 889, 895 (D.C.Cir.2006). A fact is "material" if it is capable of affecting the substantive outcome of the litigation. Holcomb, 433 F.3d at 895; Liberty Lobby, Inc., 477 U.S. at 248, 106 S.Ct. 2505. A dispute is "genuine" if the evidence is such that a reasonable jury could return a verdict for the nonmoving party. See Scott v. Harris, 550 U.S. 372, 380, 127 S.Ct. 1769, 167 L.Ed.2d 686 (2007); Liberty Lobby, Inc., 477 U.S. at 248, 106 S.Ct. 2505; Holcomb, 433 F.3d at 895.
Although styled Motions for Summary Judgment, the pleadings in this case more accurately seek the Court's review of an administrative decision. The standard set forth in Rule 56(c), therefore, does not apply because of the limited role of a court in reviewing the administrative record. See Sierra Club v. Mainella, 459 F.Supp.2d 76, 89-90 (D.D.C.2006) (citing National Wilderness Inst. v. United States Army Corps of Eng'rs, 2005 WL 691775, at *7 (D.D.C.2005); Fund for Animals v. Babbitt, 903 F.Supp. 96, 105 (D.D.C.1995), amended on other grounds, 967 F.Supp. 6 (D.D.C.1997)). "[T]he function of the district court is to determine whether or not as a matter of law the evidence in the administrative record permitted the agency to make the decision it did." Id. (internal citations omitted). Summary judgment thus serves as the mechanism for deciding, as a matter of law, whether the agency action is supported by the administrative record and otherwise consistent with the APA and governing law. See Richards v. INS, 554 F.2d 1173, 1177 & n. 28 (D.C.Cir.1977), cited in Bloch v. Powell, 227 F.Supp.2d 25, 31 (D.D.C.2002), aff'd, 348 F.3d 1060 (D.C.Cir.2003).
Except under circumstances that neither side argues obtain here, the NLRA provides
The NLRB's arguments that he should be considered part of the quorum despite his not having voted on the adoption of the final rule are twofold. First, the agency maintains that Hayes's participation in two earlier decisions relating to the final rule's publication — specifically, the November 30th decision to adopt a resolution providing that the final rule should be prepared and the December 15th decision to issue a procedural order providing that the final rule should be published upon a majority vote to adopt it — sufficed to satisfy the NLRA's quorum requirement with respect to the rule's promulgation. Second, even if Hayes's participation in those earlier votes does not suffice, the NLRB contends that he was "present" for the December 16th vote to adopt the rule and should thus be counted toward the quorum.
The Court will address each of these arguments in turn. Ultimately, it concludes that the December 16th decision to adopt the final rule, not the earlier votes, was the relevant agency action. A quorum, accordingly, must have participated in that decision. And although Hayes need not have voted in order to be counted toward the quorum, he may not be counted merely because he was a member of the Board at the time the rule was adopted. More was required. Because the final rule was promulgated without the requisite quorum, the Court must set it aside on that ground and does not reach Plaintiffs' remaining arguments.
The NLRB argues in its Motion that the December 15th procedural Order was the agency's final action with respect to the rulemaking. See Def.'s Mot. at 42-43. Because Member Hayes voted on that Order, it argues, 29 U.S.C. § 153(b)'s quorum requirement was satisfied regardless of what took place afterward. See id. The agency refines its position somewhat in its Opposition to Plaintiffs' Motion, emphasizing that Hayes participated in two earlier decisions relating to the final rule — those regarding the December 15th Order and the November 30th Resolution — and that his votes in those proceedings constitute participation in the rulemaking. See Def.'s Opp. at 4-5. Because the December 16th vote to adopt the final rule was the relevant agency action, however, the NLRB's focus on these earlier decisions is misplaced.
Borrowing from precedent concerning ripeness and finality — which, while not a perfect analog, is certainly informative — it is well established that to be "final," an agency action "must mark the consummation of the agency's decisionmaking process — it must not be of a merely tentative or interlocutory nature." Nat'l Ass'n of Home Builders v. Norton, 415 F.3d 8, 13 (D.C.Cir.2005) (quoting Bennett v. Spear, 520 U.S. 154, 177-78, 117 S.Ct. 1154, 137 L.Ed.2d 281 (1997)) (internal quotation marks omitted). "[T]he action must `be one by which rights or obligations have been determined, or from which legal consequences will flow.'" Id. (quoting Bennett, 520 U.S. at 178, 117 S.Ct. 1154). The November 30th resolution plainly does not fit this bill. Nor does the December 15th Order, despite the fact that it purports to
No rights or legal consequences derive from the December 15th Order. The Order was simply a procedural one, addressing the timing of the rule's publication as well as the subsequent publication of any separate concurring or dissenting statements. Indeed, even while the Order professes to be the agency's final action, it contemplates the subsequent "approval of a final rule by a majority of the Board." See id. at 1. Until and unless the agency voted to adopt the final rule, its terms would not be effective. See id. at 1. The Order, standing alone, does nothing at all. Its effect is expressly made contingent upon subsequent agency action. See Rochester Tel. Corp. v. United States, 307 U.S. 125, 130, 59 S.Ct. 754, 83 L.Ed. 1147 (1939) (non-final agency order "does not of itself adversely affect complainant but only affects his rights adversely on the contingency of future administrative action"). It is that subsequent action — the decision to actually adopt the final rule — that was the Board's final action in relation to the rulemaking.
Although within the confines of the APA and its governing statute an agency is generally free to devise its own procedures, see Vermont Yankee Nuclear Power Corp. v. Nat. Res. Def. Council, Inc., 435 U.S. 519, 524, 98 S.Ct. 1197, 55 L.Ed.2d 460 (1978), it cannot evade the statutorily mandated quorum requirement simply by designating interlocutory decisions as final actions. The NLRB, in other words, may not transform a procedural order into the relevant final action merely by its say-so. As the Supreme Court has emphasized, the quorum requirement is not a mere "technical obstacle[ ]" an agency may contrive to avoid. See New Process Steel, 130 S.Ct. at 2644. Rather, it is a limit on the agency's power to act. Even if, as the NLRB insists, agencies may alter the text of a final rule after the official vote on its adoption, see Def.'s Mot. at 43, a quorum still must participate in that official vote, regardless of any intermediate decisions that may have preceded it.
What if, for example, one of the three Board members had been tragically killed following the vote on the December 15th procedural Order but prior to the December 16th vote to adopt the final rule? Or what if one of the three Board members' terms had expired prior to the vote to adopt the final rule? Under the NLRB's theory, the two remaining members could nevertheless have adopted the rule in either scenario. Such a result, however, would render the three-member quorum requirement meaningless. With Taft-Hartley, Congress made the conscious decision to increase the quorum requirement from two to three members. "[H]ad Congress wanted to provide for two members alone to act as the Board, it could have maintained the NLRA's original two-member Board quorum provision." New Process Steel, 130 S.Ct. at 2641 (citing 29 U.S.C. § 153(b)).
In the end, deciding whether to adopt a regulation that will bind the public is perhaps the agency's weightiest responsibility. Myriad subsidiary decisions are required in the process of promulgating regulations, but it is the final decision to adopt (or not to adopt) a given rule that transforms words on paper into binding law. That decision, which in this case took place on December 16, 2011, required a quorum.
To satisfy 29 U.S.C. § 153(b), then, a quorum must have participated in the December 16th decision to adopt the final rule. As the Supreme Court recently explained with reference to the NLRA's
Despite the Supreme Court's repeated use of the term "participate" in New Process Steel, a 2010 case that turned on the proper construction of the NLRA's quorum provision, see generally 130 S.Ct. at 2638, the NLRB quibbles over its appropriateness. "Mere presence," it argues, is enough to constitute a quorum. See Def.'s Opp. at 3 (citing United States v. Ballin, 144 U.S. 1, 5-6, 12 S.Ct. 507, 36 L.Ed. 321 (1892)). If the difference in terminology matters — and the Court is not convinced that it does — Plaintiffs, whose argument for "participation" over "presence" relies on a more recent case involving the same statute at issue here, have the better of the dispute. Indeed, the NLRB itself interpreted the NLRA's quorum requirement to "denote[] that the Board may legally transact business when three of its members are participating" in its Brief in New Process Steel. See Br. of Respondent NLRB at 19, 2010 WL 383618, New Process Steel, 130 S.Ct. 2635 (emphasis added).
To the extent the agency's argument is simply that a member need not vote in order to form part of the quorum, however, the Court certainly agrees. Indeed, it is axiomatic that "[a]n abstaining voter ... is counted in determining the presence of a quorum." 59 Am.Jur.2d Parliamentary Law § 9; see also Ballin, 144 U.S. at 5-6, 12 S.Ct. 507; 2 Am.Jur.2d Admin. Law § 83 ("One who merely abstains, however, is counted toward the quorum."). The NLRB is correct, therefore, that Member Hayes thus need not have cast a vote in order to be counted.
But whether the standard is "mere presence" or "participation," the difficulty is in applying that standard to an online vote. When the very concept of a quorum seems
As a preliminary matter, while electronic voting is relatively new, the idea that "the quorum acting on a matter need not be physically present together at any particular time" is not. Braniff Airways, Inc. v. Civil Aeronautics Board, 379 F.2d 453, 460 (D.C.Cir.1967). That the Board may "proceed with its members acting separately, in their various offices, rather than jointly in conference," accordingly, is not controversial. See id. (describing the "notation voting" system). When a full quorum participates — usually, by voting — the use of an electronic voting system that permits the Board to reach a decision without actually being together is perfectly appropriate.
Member Hayes, however, did not vote on the adoption of the final rule when it was circulated through the JCMS system on December 16, 2011. See Hayes Decl., ¶ 11. As the rule was forwarded for publication that same day, see id., it must only have been a matter of hours during which he had the opportunity to do so. When no vote or other response was received from Hayes, no one requested that he provide one, per the agency's usual practice. See id. The NLRB's claim that Hayes was part of the quorum that adopted the final rule, then, is based only on the fact that he was a member of the Board at the time the rule was circulated and thus was sent a notification that it had been called for a vote.
The Supreme Court clearly stated in New Process Steel, however, that a member may not be counted toward a quorum simply because he holds office. See 130 S.Ct. at 2643 n. 4. "The requisite membership of an organization, and the number of members who must participate for it to take an action, are two separate (albeit related) characteristics." Id.; see also FTC v. Flotill Prods., Inc., 389 U.S. 179, 183-84, 88 S.Ct. 401, 19 L.Ed.2d 398 (1967) (concluding that Commissioner who declined to participate could not be counted toward quorum). Distinguishing between an organization's total membership and those members who are actually a part of a given decision, moreover, is consistent with the way quorum requirements operate in public and private organizations of all sizes. See, e.g., Ballin, 144 U.S. at 5-6, 12 S.Ct. 507 (explaining the quorum requirement for the House of Representatives); 18 C.J.S. Corporations § 454 (explaining quorum requirements with respect to shareholders' meetings); 2 Fletcher Cyc. Corp. § 419 (explaining quorum requirements for actions by boards of directors). The NLRB's suggestion that the quorum requirement was satisfied on the ground that three members held office when the rule was approved, see, e.g., Final Rule, 76 Fed.Reg. at 80,146 ("The Board currently has three members, a lawful quorum under Section 3(b) of the Act."), contradicts the clear pronouncements of the Supreme Court as well as common practice (and common sense). Something more than mere membership is necessary.
Unfortunately, however, nothing more took place here. Member Hayes was sent a notification that the final rule had been circulated for a vote, but he took
That Member Hayes issued a dissenting statement months later, furthermore, does not cure the quorum defect. See Separate Concurring Statement by Member Hayes, 77 Fed.Reg. 25,548, 25,559 (Apr. 30, 2012). Indeed, the agency does not appear to argue that it does. See Def.'s Reply to Pl.'s Response to Def.'s Notice at 1-2, ECF No. 38. Even if his post hoc dissent were properly considered by the Court — despite its having come into existence after the events in question — it still does not change the fact that no quorum existed to adopt the rule. As the Board made clear in the Federal Register, "neither statement" — Chairman Pearce's or Member Hayes's — "constitutes part of the rule or modifies the rule or the Board's approval of the rule in any way." Separate Concurring and Dissenting Statements, 77 Fed. Reg. at 25548.
In arguing that the electronic transmission to Hayes of a notification that the rule had been put to a vote is enough, the NLRB harps on United States v. Ballin, a case addressing the quorum requirement for the U.S. House of Representatives. See 144 U.S. at 5-6, 12 S.Ct. 507. "What did the non-voting members in Ballin do to constitute the quorum?" the NLRB rightly asks. See Def.'s Opp. at 3 (emphasis added). "They were identified as sitting in their seats when the U.S. House of Representatives called the question for a vote. And then, they did nothing. They did not have to do anything: the quorum was created by their mere presence." Id. Although the members of the House need not have taken any action after they showed up for the vote, the NLRB's argument only confirms that they needed to actually be there in the first place. See Ballin, 144 U.S. at 5-6, 12 S.Ct. 507. In other words, Ballin fully supports the proposition that merely holding office is not enough and confirms that an individual needs to something — that is, he needs to show up — in order to be counted toward a quorum.
The NLRB further protests that there is no basis "for indefinitely postponing adoption of the final rule and for, in essence, permitting one Member to exercise what would amount to a minority veto over a proper exercise of the Board's rulemaking authority." Final Rule, 76 Fed.Reg. at 80,147. There is no suggestion, however, that this is what happened here. Indeed, Hayes himself has averred that he neglected to vote on the final rule not out of an intent to abstain or to block the rule's promulgation, but rather because he did not realize that his further participation was required. See Hayes Decl., ¶ 11. The other members of the Board appear to have been under a similar misimpression, as the text of the final rule suggests that they believed that it was enough that Member Hayes had "effectively indicated his opposition." Final Rule, 76 Fed.Reg.
In the end, the Court recognizes that its decision not to reach the merits here may be unsatisfying to the NLRB, as well as to the many employers and employees who are affected by the rule's provisions. But to do so would degrade the quorum requirement from a fundamental constraint on the exercise of the Board's power to an "easily surmounted technical obstacle[ ] of little to no import." New Process Steel, 130 S.Ct. at 2644. The NLRB is a "creature of statute" and possesses only that power that has been allocated to it by Congress. See Michigan v. EPA, 268 F.3d 1075, 1081 (D.C.Cir.2001). Indeed, "[i]t is axiomatic that an administrative agency's power to promulgate legislative regulations is limited to the authority delegated by Congress." Bowen v. Georgetown Univ. Hosp., 488 U.S. 204, 208, 109 S.Ct. 468, 102 L.Ed.2d 493 (1988). As the final rule was promulgated without the requisite quorum and thus in excess of that authority, it must be set aside.
In so doing, however, the Court emphasizes that its ruling need not necessarily spell the end of the final rule for all time. The Court does not reach — and expresses no opinion on — Plaintiffs' other procedural and substantive challenges to the rule, but it may well be that, had a quorum participated in its promulgation, the final rule would have been found perfectly lawful. As a result, nothing appears to prevent a properly constituted quorum of the Board from voting to adopt the rule if it has the desire to do so. In the meantime, though, representation elections will have to continue under the old procedures.
For the foregoing reasons, the Court will issue a contemporaneous Order granting Plaintiffs' Motion for Summary Judgment and denying Defendant's.
On December 20, 2011, Plaintiffs Chamber of Commerce of the United States of America and the Coalition for a Democratic Workplace filed a lawsuit that sought to invalidate a regulation promulgated by Defendant National Labor Relations Board. On May 14, 2012, they succeeded in that aim. Finding that the Board lacked the statutorily mandated three-member quorum when it voted to adopt the rule, the Court granted Plaintiffs' Motion for Summary Judgment and invalidated the rule. The NLRB has now filed a Rule 59(e) Motion to Alter or Amend that judgment.
Contending that the Court erred in finding that Member Brian Hayes could not be counted toward the quorum requirement, the NLRB both restates an old argument and proffers new evidence. The former is easily disposed of. The Court has already considered and rejected the Board's position that Hayes should be counted toward the quorum based on his prior statements and his participation in preliminary votes. Rule 59(e) is not a vehicle for rehashing arguments that have been previously rejected, and, in any event, the argument is no more persuasive in its expanded and refined form than it was in the first goround.
The new evidence, though, presents a closer question. An affidavit submitted with the Board's Motion sets forth facts entirely absent from its summary-judgment filings, and those facts do somewhat strengthen the agency's position that Hayes was present for but abstained from the pivotal vote. That said, the Board has neither adequately explained why it could
Both the factual background of this case and the legal framework at play are set forth more fully in the Court's May 14th Opinion. See 879 F.Supp.2d 18. For purposes of the instant Motion, only a few facts and a bit of procedural history are necessary.
The NLRB, the federal agency tasked with administering the National Labor Relations Act, is a five-member body authorized "to make ... such rules and regulations as may be necessary to carry out the provisions of [the Act]." 29 U.S.C. § 156; see also generally id. §§ 151-57; New Process Steel, L.P. v. NLRB, ___ U.S. ___, 130 S.Ct. 2635, 2638, 177 L.Ed.2d 162 (2010). Except in limited circumstances not present here, the Board must have a quorum of three members in order to act. See 29 U.S.C. § 153(b); see also New Process Steel, 130 S.Ct. at 2638. In December 2011 the NLRB issued a new rule that purported to change the procedures for resolving disputes about union representation. See Final Rule, 76 Fed.Reg. 80,138 (Dec. 22, 2011). Two of the Board's three members voted in favor of adopting the final rule; the third, Member Hayes, did not cast a vote. See id. at 80,146; Def.'s Opp. to Pls.' Mot. for Summ. J., Exh. 1 (Decl. of Brian Hayes), ¶ 11.
Plaintiffs challenged the rule on multiple grounds, most of which the Court did not reach because their claim that the Board lacked the statutorily mandated threemember quorum when it voted to adopt the rule carried the day. See 879 F.Supp.2d 18. In granting Plaintiffs' Motion for Summary Judgment, the Court first found that Hayes's participation in the rule's development and in two earlier decisions did not suffice. See id. at 24-26. "[T]he December 16th decision to adopt the final rule, not the earlier votes, was the relevant agency action," and "[a] quorum... must have participated in that decision." Id. at 25 (emphasis in original). Second, the Court concluded that Hayes did not participate in the December 16th vote to adopt the final rule and thus could not be counted toward the quorum. See id. at 26-30. While Hayes need not have voted in order to be counted, the mere fact that he held office was not enough. See id. at 28-29. His failure to be present for or participate in the vote to adopt the rule meant that the Board lacked the required three-member quorum when it purported to promulgate such rule. See id. at 26-30.
A few weeks after the Court granted Plaintiffs' Motion for Summary Judgment and determined that the challenged rule had been promulgated without the participation of quorum, the NLRB filed a Rule 59(e) Motion to Alter or Amend the Judgment. It is to the resolution of that Motion that the Court now turns.
Federal Rule of Civil Procedure 59(e) permits the filing of a motion to alter or amend a judgment when such motion is filed within 28 days after the judgment's entry. The court must apply a "stringent" standard when evaluating Rule 59(e) motions. Ciralsky v. CIA, 355 F.3d 661, 673 (D.C.Cir.2004). "A Rule 59(e) motion is 'discretionary' and need not be granted unless the district court finds that there is an 'intervening change of controlling law, the availability of new evidence, or the need to correct a clear error or prevent manifest injustice.'" Firestone v. Firestone, 76 F.3d 1205, 1208 (D.C.Cir.
In asking the Court to reconsider its conclusion that the Board lacked a quorum when it voted to adopt the final rule, the NLRB appears to accept — at least for purposes of this Motion — much of the Court's reasoning. The agency, for example does not at this juncture dispute that "a member may not be counted toward a quorum simply because he holds office." 879 F.Supp.2d at 28. Indeed, the NLRB seems to concede that the relevant "line [is] between a present but abstaining voter (who may be counted toward a quorum) and an absent voter (who may not be)," id. at 28, and it contends only that the Court made a "clear error of fact" when it found that Hayes fell on the latter side of that divide. In other words, everyone seems to agree on the standard; only its application to the facts is at issue.
The NLRB makes two distinct arguments in its attempt to show that the Court got the facts wrong when it granted Plaintiffs' Motion for Summary Judgment. First, it refines and expands its suggestion that Hayes's statements and actions prior to the December 16th vote to adopt the rule should qualify him for inclusion in the quorum. Second, it maintains that a newly submitted affidavit constitutes "proof that on December 16 Member Hayes was present in the Board's electronic voting room." Mot. at 1. These will be addressed separately.
In its summary-judgment briefs the NLRB argued that Hayes's actions prior to December 16, 2011 — in particular, his votes on a December 15th Procedural Order and the November 30th Resolution to proceed with drafting the final rule — sufficed to establish his membership in the quorum for the December 16th vote. See Def s Opp. to Pls.' Mot. for Summ. J. at 4-5. In its Rule 59(e) Motion, the agency has refined this argument to focus more on Hayes's prior statements than on these preliminary votes, and it makes the more nuanced point that these previous acts, even if not sufficient in themselves, should inform the Court's interpretation of his failure to vote or indicate his abstention on December 16. See Mot. at 6-10.
Although this argument expands and improves upon that which the agency previously espoused, the Court has already rejected its core:
879 F.Supp.2d at 26 (emphasis in original). "Rule 59(e) ... `may not be used to relitigate old matters ... or to raise arguments... that could have been raised prior to the entry of judgment.'" Exxon Shipping Co. v. Baker, 554 U.S. 471, 485 n. 5, 128 S.Ct. 2605, 171 L.Ed.2d 570 (2008) (quoting 11 Wright & Miller, Fed. Prac. & Proc. Civ. § 2810.1). The NLRB's argument based on Hayes's prior actions has already been adjudicated, and any aspects of that
Along with its Motion the NLRB has submitted an affidavit prepared by Bryan Burnett, the "principal architect" of the Board's electronic voting room. See Mot., Exh. 1 (Aff. of Bryan Burnett), ¶ 2. Burnett explains the mechanics of the voting room in general terms, see id., ¶¶ 4-19, and provides details about what went on in that virtual space on December 13-16, 2011, with respect to the challenged rule. See id., ¶¶ 20-31. All three members were actively voting on various matters on those days, and Hayes himself directed eighteen votes to be cast on December 16. See id., ¶¶ 26-27. The other two members voted on the final rule at 11:54 a.m. and 12:05 p.m. Id., ¶¶ 28-29. Approximately twenty minutes later, at 12:24 p.m., the Chairman electronically circulated the document to Member Hayes, creating a "voting task" that asked Hayes to cast his vote. See id., ¶ 30. At 12:37 p.m., Hayes's deputy chief counsel electronically "opened" this task. Id., ¶ 31. This evidence, the agency maintains, establishes that Hayes "was actually present and participating in the very same room at the very same time that this vote was held." Mot. at 6.
But where was this evidence and corresponding argument at summary-judgment time? The newly presented facts about the electronic voting room were not previously unavailable. Defendant simply chose not to include them. Attempting to justify that choice, the NLRB insists that Plaintiffs' opening brief assumed that Hayes had abstained and argued only that abstaining voters cannot be counted toward a quorum. See Mot. at 3-4. Because it was "[Plaintiffs'] apparent position that Member Hayes had abstained," the agency insists that it "did not have cause to burden the record" with the evidence suggesting that Hayes had participated in the final vote. Id. at 3. As it was not until Plaintiffs' Reply that Hayes's abstention was questioned, the Board maintains that it "had no opportunity" to respond with evidence of his participation. Id.
The agency seeks to slice Plaintiffs' opening brief too thin. Plaintiffs' argument was that "only two members participated in the vote to approve (or not) the Final Rule." Pls.' Summ. J. Mot. at 15; see id. at 13-15. The evidence the agency now seeks to introduce is plainly responsive to that argument. In addition, the NLRB had been on notice of Plaintiffs' contention even before the opening briefs were filed. A Motion for Extension of Time filed on January 30, 2012, with Defendant's consent stated that the parties had met to discuss the quorum requirement and that Plaintiffs had "requested ... any evidence... that Mr. Hayes voted or otherwise participated in issuing the Final Rule." Pls.' Ext. Mot. (ECF No. 15) at 2; see also id., Exh. 1 (Decl. of David Kerr), ¶ 6 ("Counsel for the Plaintiffs specifically asked ... counsel for the Board to share as soon as possible any evidence that Mr. Hayes in fact voted or participated in issuing the Final Rule."). Instead of arguing that Hayes participated in the final vote or providing Plaintiffs or the Court any evidence to that effect, the NLRB relied on his involvement in preliminary decisions. That was a tactical decision and not dictated by Plaintiffs' position.
Ultimately, the agency's insistence that it was blindsided by Plaintiffs' argument that Hayes did not participate in the vote does not hold water. And even if it had been caught off guard by Plaintiff's Reply, it was certainly free to seek leave to file a Surreply on the ground that new arguments had been raised. "[M]anifest
Yet even were the Court to excuse Defendant's failure to present this evidence at the appropriate time, the NLRB has not succeeded in demonstrating that the Court made a "clear error" when it determined that Hayes did not participate in the December 16th vote to adopt the final rule. "Courts have generally not defined what constitutes 'clear error' under Rule 59(e)," but "[w]hat can be learned from scarce case law on the subject is that clear error should conform to a 'very exacting standard.'" Piper v. DOJ, 312 F.Supp.2d 17, 21 (D.D.C.2004) (quoting Oneida Indian Nation of New York v. County of Oneida, 214 F.R.D. 83, 98 (N.D.N.Y.2003)). Indeed, the Seventh Circuit has "declared that a final judgment must be 'dead wrong' to constitute clear error." Id. (referencing and quoting Parts & Electric Motors, Inc. v. Sterling Electric, Inc., 866 F.2d 228, 233 (7th Cir.1988)).
While Burnett's affidavit certainly buttresses the agency's position, it by no means achieves this demanding standard. First, Hayes's presence for and participation in other votes taken that day do not necessarily establish his presence for the vote in question. He must have been present for this vote to be counted toward this quorum. Second, even if Hayes's employees were authorized to cast votes on his behalf with respect to the other actions up for consideration that day, there is no indication that they were authorized to vote or abstain on his behalf with respect to the decision to adopt the final rule. Indeed, Hayes's statement that after December 15 he simply "gave no thought to whether further action was required of [him]" with respect to the final rule belies that possibility. Third, even assuming that specific authorization was not required and Hayes's deputy chief counsel's opening the voting task could be attributed to Hayes, the NLRB has not provided any indication that the rule was sent for publication after that took place. In fact, the Board's consistent position has been that the Solicitor published the final rule in the Federal Register "[i]mmediately upon approval of a final rule by a majority of the Board." Def.'s Mot. for Summ. J., Exh. 3 (Order, Dec. 15, 2011) at 1 (emphasis added). The rule, accordingly, may well have been sent off for publication at 12:05 p.m., by which time a majority had voted in its favor, and 32 minutes before Hayes's staff "opened" the task. See Burnett Aff., ¶ 29. In sum, then, even if Hayes's deputy's opening the voting task could be taken as Hayes's participation and subsequent abstention, the agency has not shown that this purported abstention occurred prior to publication, let alone that Hayes was given a reasonable amount of time to cast a vote.
Perhaps most importantly, the final rule itself did not suggest that Hayes had abstained. Instead, it stated that Hayes had "effectively indicated his opposition" to the rule — presumably by his actions on previous days. Final Rule, 76 Fed.Reg. at 80,146. Hayes's own testimony, moreover, is inconsistent with the agency's abstention theory. See Hayes Aff., ¶ 11. And although Hayes's subjective mental state may not be decisive in determining whether he abstained or was absent from the vote, his account of his intentions is consistent with his actions. He apparently did not provide his employees with any instructions to take action on his behalf with
In the end, the NLRB has offered too little too late. Certainly Burnett's testimony would have been useful at the summary-judgment stage, but it likely would not have changed the outcome even then, and it certainly does not establish "clear error" or "manifest injustice" now. As the Court has previously stated, "[N]othing appears to prevent a properly constituted quorum of the Board from voting to adopt the rule if it has the desire to do so." 879 F.Supp.2d at 30. Until then, the Court cannot reinstate a rule that was promulgated without the requisite quorum and, accordingly, in excess of the agency's congressionally delegated power.
For the foregoing reasons, the court will issue a contemporaneous Order denying Defendant's Motion.
