Source: https://law.justia.com/cases/federal/appellate-courts/F2/686/1362/414824/
Timestamp: 2019-06-17 22:35:55
Document Index: 77991298

Matched Legal Cases: ['§ 159', '§ 164', '§ 103', '§ 1331', '§ 1331', '§ 1331', '§ 103', '§ 14', '§ 159', '§ 14', '§ 164', '§ 8', '§ 158', '§ 1251', '§ 9', '§ 159']

Florida Board of Business Regulation Department of Businessregulation, Division of Pari-mutuel Wagering, Astate Agency, and the State of Florida,plaintiffs-appellants, v. National Labor Relations Board, et al., Defendants-appellees, 686 F.2d 1362 (11th Cir. 1982) :: Justia
Justia › US Law › Case Law › Federal Courts › Courts of Appeals › Eleventh Circuit › 1982 › Florida Board of Business Regulation Department of Businessregulation, Division of Pari-mutuel Wager...
Florida Board of Business Regulation Department of Businessregulation, Division of Pari-mutuel Wagering, Astate Agency, and the State of Florida,plaintiffs-appellants, v. National Labor Relations Board, et al., Defendants-appellees, 686 F.2d 1362 (11th Cir. 1982)
U.S. Court of Appeals for the Eleventh Circuit - 686 F.2d 1362 (11th Cir. 1982)
The Board considered the case one of first impression, since it had never been asked to assert jurisdiction over labor disputes in the jai alai industry. The Board's initial task was to determine whether the labor dispute posed by the representation proceedings affected interstate commerce. 29 U.S.C. § 159(c) (1). If interstate commerce were affected, the Board's next step would be to determine, under section 14(c) (1) of the Act, 29 U.S.C. § 164(c) (1), whether it should decline to assert jurisdiction over the dispute because the effect of the dispute on interstate commerce was not "sufficiently substantial." If the Board concluded that the players' dispute with Volusia Jai Alai affected interstate commerce and that it should not decline to assert jurisdiction, the Board's final step would be to decide whether the Players Union's petition should be granted and an election ordered.
The State viewed the Board's decision with alarm. The Board had earlier declined involvement in dog and horse racing in order, the State presumed, to avoid inevitable and unnecessary conflict with the State's regulatory machinery. Now the Board was reversing itself and entering the equally state-regulated jai alai industry.7 The State perceived a real potential for federal-state conflict. The Board has implied authority to protect its jurisdiction over a labor dispute from state interference and may, for example, obtain a federal court injunction to prevent an employer from regulating through state court a labor activity which is within the scope of the Board's jurisdiction. NLRB v. Nash-Finch Company, 404 U.S. 138, 92 S. Ct. 373, 30 L. Ed. 2d 328 (1971). The State envisioned the possibility of the Board seeking the same remedy against it in the event the State sought to exercise its regulatory authority in a labor dispute context.
On April 27, 1976, the State filed suit in the district court to enjoin the election and to obtain a declaratory judgment that the Board lacked authority over labor disputes involving jai alai players.8 The State advanced several theories in support of its claim for declaratory relief. Two are presented in this appeal: that the Board should have declined jurisdiction under section 14(c) (1) of the Act; alternatively, that the tenth amendment barred Board regulation of labor disputes in this state-regulated jai alai industry.9
On August 19, 1976, the district court directed the parties to brief the question whether the election result mooted the State's suit. On December 30, 1976, the court dismissed the case as moot, rejecting arguments to the contrary by both the Board and the State, and consequently did not address the merits of the State's claim for declaratory relief. The Board acquiesced in this ruling, but the State appealed. Florida Board of Business Regulation v. NLRB, 605 F.2d 916 (5th Cir. 1979) (Jai Alai I) .
In Jai Alai I, we considered only whether the Players Union's election loss mooted the State's case. Jai Alai I, 605 F.2d at 918. We concluded that the portion of the State's complaint seeking to enjoin the May 12 election no longer presented a live controversy and was therefore moot, but that the State's request for a declaratory judgment regarding the Board's anticipated assertion of jurisdiction over all labor disputes involving jai alai players in Florida remained extant. Id. at 918-19. Stating that the remaining portions of Florida's complaint alleged facts that, " 'under all the circumstances, show that there is a substantial controversy, between parties having adverse legal interests, of sufficient immediacy and reality to warrant the issue of a declaratory judgment,' " id. at 918-19, quoting Connell v. Shoemaker, 555 F.2d 483, 486 (5th Cir. 1977), and Maryland Cas. Co. v. Pacific Coal & Oil Co., 312 U.S. 270, 273, 61 S. Ct. 510, 512, 85 L. Ed. 826 (1941), we reversed the district court and remanded the case, instructing the court to consider whether it had subject matter jurisdiction over the controversy and, if so, to rule on the merits. Jai Alai I, 605 F.2d at 920.
The employer and the State conceded that Florida Jai Alai's business affected interstate commerce and that labor disputes involving its employees therefore fell within the ambit of the Act. They contended, however, that the tenth amendment barred the Board's exercise of jurisdiction over these labor disputes because jai alai was a state-regulated gambling industry. In the alternative, the employer and the State contended that the Board should decline, under section 14(c) (1) of the Act, to exercise jurisdiction over the pari-mutuel employees at Florida Jai Alai's Orlando-Seminole fronton. They claimed that the employment-related characteristics of these employees were indistinguishable from those of the workers who performed identical functions at dog and horse tracks; that is, employee turnover rate was high, temporary part-time employees made up a high percentage of the labor force, and the work of all the employees was sporadic. The employer and the State argued that Board precedent, and a Board rule that adopted that precedent, recognized that it was virtually impossible for the Board effectively to regulate labor disputes at the dog and horse tracks, Hialeah Race Course, Inc., 125 NLRB 388 (1959); 29 CFR § 103.3, and they urged the Regional Director to apply this precedent and rule to the pari-mutuel jai alai employees. They suggested that it would be arbitrary and capricious, and therefore an abuse of discretion, for the Board to assert jurisdiction over these jai alai employees while declining to do so over identical employees at dog and horse tracks.
(2) whether the Board abused the discretion accorded by section 14(c) (1) of the Act by refusing to decline to assert jurisdiction over players and pari-mutuel workers in the jai alai industry in the face of its policy not to exercise jurisdiction over pari-mutuel employees in the dog and horse racing industries;
The district court carefully considered these issues in a memorandum opinion issued on September 30, 1980. Florida Board of Business Regulation v. NLRB, 497 F. Supp. 599 (M.D. Fla .1980). The court concluded that it had subject matter jurisdiction, that the Board had not abused its section 14(c) (1) discretion by asserting jurisdiction over the jai alai players and the pari-mutuel employees, and that the tenth amendment did not bar application of the Act to labor disputes in the jai alai industry.
In this appeal, the Board questions the district court's subject matter jurisdiction; the State asks us to reverse the district court on the section 14(c) (1) and tenth amendment issues. We will consider seriatim the three issues decided by the district court.
The Board, citing Boire v. Greyhound Corp., 376 U.S. 473, 479, 84 S. Ct. 894, 898, 11 L. Ed. 2d 849 (1964) and Leedom v. Kyne, 358 U.S. 184, 79 S. Ct. 180, 3 L. Ed. 2d 210 (1958), contends that the district court has subject matter jurisdiction to enjoin the execution of a representation election order only in certain "extraordinary circumstances,"12 and that such circumstances are not present in either of these jai alai cases. We are convinced that the rule of Boire v. Greyhound Corp. and Leedom v. Kyne is inapposite and that the district court had subject matter jurisdiction under 28 U.S.C. § 1331 (1978 Supp.) to entertain the State's suits against the Board. It is true that in each case the State asked the district court to enjoin the Board-ordered representation election. As to that prayer for relief the Board's position is correct, for the extraordinary circumstances rule of Greyhound and Leedom was clearly applicable. But the State's complaint asked for more than an injunction against a Board election order; it sought a declaration that the Board lacked statutory and constitutional authority to regulate labor disputes in the jai alai industry as a whole. As to this prayer for relief, the extraordinary circumstances rule had no application.
Boire v. Greyhound Corp., 376 U.S. at 478, 84 S. Ct. at 897, quoting H.R.Rep.No.972, 74th Cong., 1st Sess. at 5 (1935). Congress therefore provided that employers and labor unions could not seek direct review of Board election orders in the Court of Appeals until the election had been held and the Board had certified the result and entered a bargaining order. See American Federation of Labor v. NLRB, 308 U.S. 401, 60 S. Ct. 300, 84 L. Ed. 347 (1940).13
Congress did not expressly bar employers and unions from seeking pre-election review in district court, however, and they frequently turned to the district courts for relief. Leedom v. Kyne questioned the validity of this tactic, and the Supreme Court held that the district courts had subject matter jurisdiction to entertain these suits and to review the Board's representation orders. 358 U.S. at 188, 79 S. Ct. at 183-84. The Court later qualified this holding in Boire v. Greyhound Corp., 376 U.S. at 478-79, 84 S. Ct. at 897-98, to prevent attempts by an employer or a rival union to use the district court merely as a weapon to delay a Board-ordered election. Only in extraordinary circumstances,14 the Court concluded, where the need to hear the case immediately is manifest, is the district empowered to enjoin an election and to review an election order. Id. at 479-80, 84 S. Ct. at 898.
Nothing in Boire v. Greyhound Corp. suggests that this limitation on the power of the district court to review Board election orders is applicable to a suit that does not seek review of a representation order or a stay of an election or the certification of election results. The State contends, and we agree, that a plaintiff who cannot seek review of the Board's order in the Court of Appeals but who claims that the Board violated his federal rights has the right to repair to the district court under any statute that may grant the district court the power to hear his claim. See Leedom v. Kyne, 358 U.S. at 190, 79 S. Ct. at 184.
Section 1331, as it stood in September 1980, gave the district court original jurisdiction of any civil action arising under the Constitution, laws, or treaties of the United States and brought against the United States or any agency thereof. 28 U.S.C. § 1331(a) (1978 Supp.). The State's complaints alleged that the Board, in refusing to decline to assert jurisdiction over the Florida jai alai industry, abused the discretion given it by section 14(c) (1) of the Act because it directly contravened the firm policy it had established for identical employees in the horse and dog racing branches of Florida's gambling industry. The complaints also alleged that the Board's assertion of jurisdiction over the jai alai players and pari-mutuel employees impermissibly impinged on a State industry in violation of the tenth amendment. These claims obviously "arise under" the Constitution or law of the United States. Neither is frivolous or foreclosed by prior decision. See Bell v. Hood, 327 U.S. 678, 66 S. Ct. 773, 90 L. Ed. 939 (1946); Bell v. Health-Mor, Inc., 549 F.2d 342 (5th Cir. 1977). Subject matter jurisdiction under 28 U.S.C. § 1331 was clearly present.
The State contends that by deciding to regulate the jai alai industry, the Board abused its discretion under section 14(c) (1) of the Act because it violated its established policy of declining to regulate two identical industries, dog and horse racing. See 29 CFR § 103.3. The Board responds alternatively: First, the employment characteristics of jai alai employees and dog and horse track employees are materially dissimilar; therefore, its policy regarding dog and horse track employees does not apply. Second, even if jai alai and race track employees are identically situated, the Board need not treat them similarly, absent prejudice to the State. The parties have addressed this section 14(c) (1) issue as they did in the district court, as if the cases involving the jai alai players and the pari-mutuel employees were identical. The cases are not identical by any means and must be considered separately.A. The Jai Alai Players
The Board cites nothing in the record that refutes the State's evidence; nor does it explain why pari-mutuel employees in the jai alai business should be treated differently from their counterparts at the dog and horse tracks. Instead, the Board contends that its section 14(c) (1) discretion is so broad that it can arbitrarily treat similar labor disputes dissimilarly unless the affected party shows that it has been substantially prejudiced thereby. According to the Board, a decision to exercise jurisdiction cannot be disturbed unless the complaining party demonstrates that the decision has caused substantial prejudice. NLRB v. Austin Developmental Center, Inc., 606 F.2d 785, 790 (7th Cir. 1979); NLRB v. Harrah's Club, 362 F.2d 425, 427 (9th Cir. 1966), cert. denied, 386 U.S. 915, 87 S. Ct. 859, 17 L. Ed. 2d 788 (1967).
Moreover, we think it enough that the State has shown that the NLRB treated two industries, identical in all comparable respects, differently, and gave no reasons for doing so. The NLRB's actions in this case "fall somewhere on the distant side of arbitrary," Central Florida Enterprises, Inc., v. FCC, 598 F.2d 37, 50 (D.C. Cir. 1978), and violate the "fundamental principle of reasoned explanation" which serves
Matlovich v. Secretary of the Air Force, 591 F.2d 852, 857 (D.C. Cir. 1978); Davis, Administrative Law § 14.24 (1980).
This could easily be a different case if the NLRB had given even scant justification for its different treatment of jai alai and race track pari-mutuel employees; the discretion accorded the NLRB to exercise jurisdiction or not is, after all, quite broad. Here, however, where the NLRB in effect asserts a right to act arbitrarily absent some undefined showing of "prejudice," we have no difficulty in finding the Board's exercise of jurisdiction over jai alai pari-mutuel employees to be an abuse of its discretion under section 14(c) (1).
Because we have concluded that the Board's assertion of jurisdiction over labor disputes involving jai alai players was authorized by the Act, we must address the State's claim the Board's conduct violated the tenth amendment. In National League of Cities v. Usery, 426 U.S. 833, 96 S. Ct. 2465, 49 L. Ed. 2d 245 (1976), the Supreme Court struck down provisions of the Fair Labor Standards Act (FLSA)17 which applied to State employees because the provisions impinged on the tenth amendment right of the States to carry out their sovereign functions. Their validity could not be sustained, therefore, by the commerce clause. The FLSA could not be used by Congress, the Court said, to regulate the "States as States." Id. at 845, 96 S. Ct. at 2471. Florida contends that its relationship with the privately owned and operated jai alai industry is tantamount to the relationship between a state and its employees, and that Usery precludes application of the National Labor Relations Act to labor disputes in the jai alai industry.
The State concedes, as it must, that the case before us is not on all fours with Usery. It makes this concession because the Court in Usery was careful to state that its holding applied to the regulation of "States as States," as distinguished from the regulation of private business. Id. at 845, 96 S. Ct. at 2471. The State urges us to extend Usery's holding to include those situations in which the contested federal measure appears to affect only a business regulated by a State but which, in reality, is so closely tied to the state that the measure interferes with the state's sovereign functions.
The district court declined the State's invitation to extend the reasoning of Usery to this case, specifically concluding that nothing in Usery suggests that under the tenth amendment the State has more than the right to be free from commerce clause regulation. Two Supreme Court cases decided after summary judgment was entered in this case have proved the district court prophetic. These cases make it crystal clear the holding of Usery is to be strictly and narrowly construed:(I)n order to succeed, a claim that congressional commerce power legislation is invalid under the reasoning of National League of Cities must satisfy each of three requirements. First, there must be a showing that the challenged regulation regulates the "States as States." Id., (426 U.S.) at 854 (96 S. Ct. at 2475). Second, the federal regulation must address matters that are indisputably "attributes of state sovereignty." Id., at 845 (96 S. Ct. at 2471). And third, it must be apparent that the States' compliance with the federal law would directly impair their ability "to structure integral operations in areas of traditional functions." Id., at 852 (96 S. Ct. at 2474).
United Transportation Union v. Long Island Railroad Co., --- U.S. ----, ----, 102 S. Ct. 1349, 1353, 71 L. Ed. 2d 547 (1982) (footnote omitted), quoting Hodel v. Virginia Surface Mining & Reclamation Assn., 452 U.S. 264, 287-88, 101 S. Ct. 2352, 2366, 69 L. Ed. 2d 1 (1981). Moreover, "even if these three requirements are met, the federal statute is not automatically unconstitutional under the tenth amendment. The federal interest may still be so great as to 'justif(y) State submission.' " Long Island Railroad, --- U.S. at ---- n.9, 102 S. Ct. at 1353 n.9. Finally, in summing up its analysis in Hodel, the Supreme Court provided us with a definitive guide for deciding Florida's tenth amendment claim:
Hodel, 452 U.S. at 292, 101 S. Ct. at 2368. The Supreme Court refused to make that radical departure from precedent in Hodel, and we must do likewise. The State's tenth amendment claim therefore must be rejected.
The Board hearing officer properly made no recommendation to the Board with respect to the representation petition. 29 U.S.C. § 159(c) (1)
Florida had assumed jurisdiction over labor disputes in the jai alai, dog, and horse racing industries consistent with the provisions of § 14(c) (2) of the Act: "Nothing in this (Act) shall be deemed to prevent or bar any agency or the courts of any State ... from assuming and asserting jurisdiction over labor disputes over which the Board declines ... to assert jurisdiction." 29 U.S.C. § 164(c) (2). Once the Board properly asserted its jurisdiction over the jai alai labor dispute in this case, however, the Board's jurisdiction was exclusive with respect to actions arising under §§ 8, 9, and 10 of the Act, 29 U.S.C. §§ 158-160, including all charges of unfair labor practices by employers or labor organizations and all petitions for representation elections, and neither federal courts, except by way of review or on application by the Board, nor state administrative agencies, nor state courts might assume control over them. Garner v. Teamsters, Chauffeurs and Helpers Local No. 776, 346 U.S. 485, 491, 74 S. Ct. 161, 166, 98 L. Ed. 228 (1953)
The court granted Volusia Jai Alai's motion to appear amicus curiae because it had an interest in the outcome of the litigation. Volusia was precluded by law from joining the State as a party plaintiff in seeking to enjoin the representation election. An employer, like Volusia, subject to a Board-ordered election cannot seek pre-election federal judicial review of the Board's order absent extraordinary circumstances which Volusia would concede are not present in this case. See note 12, and accompanying text, and note 13, infra. A Board decision to order a representation election is a non-final order and the district court must ordinarily dismiss, for want of subject matter jurisdiction, employer or labor organization challenges to such a decision. See Leedom v. Kyne, 358 U.S. 184, 79 S. Ct. 180, 3 L. Ed. 2d 210 (1958); Bishop v. NLRB, 502 F.2d 1024 (5th Cir. 1974); Groendyke Transport, Inc. v. Davis, 406 F.2d 1158, 1163-64 (5th Cir.), cert. denied, 394 U.S. 1012, 89 S. Ct. 1628, 23 L. Ed. 2d 39 (1969); Boire v. Miami Herald Publishing Co., 343 F.2d 17 (5th Cir. 1965). See also Part II, infra
(3) that the Board's assertion of jurisdiction was contrary to 8 U.S.C. § 1251(a) (9) as implemented by the U. S. Immigration and Naturalization Service,
Three "extraordinary circumstances" requiring pre-election judicial review of a Board representation order have been recognized by the courts. Bishop v. NLRB, 502 F.2d 1024, 1027 (5th Cir. 1974). The first is when a case presents a "public question() particularly high on the scale of our national interest because of (its) international complexion." McCulloch v. Sociedad Nacional de Marineros de Honduras, 372 U.S. 10, 17, 83 S. Ct. 671, 675, 9 L. Ed. 2d 547 (1963). The second is when the plaintiff makes a clear and strong showing that the Board has violated his constitutional rights. Squillacote v. Int'l Bhd. of Teamsters, Local 344, 561 F.2d 31, 38 (7th Cir. 1977); McCulloch v. Libbey-Owens-Ford Glass Co., 403 F.2d 916, 917 (D.C. Cir. 1968), cert. denied, 393 U.S. 1016, 89 S. Ct. 618, 21 L. Ed. 2d 560 (1969); Greensboro Hosiery Mills, Inc., v. Johnston, 377 F.2d 28, 32 (4th Cir. 1967). Cf. Fay v. Douds, 172 F.2d 720 (2d Cir. 1949) (alleged constitutional violation that is not transparently frivolous sufficient to invoke district court's subject matter jurisdiction to review representation order). The third is when the plaintiff asserts that the Board clearly acted "in excess of its delegated powers and contrary to a specific prohibition in the Act." Leedom v. Kyne, 358 U.S. at 188, 79 S. Ct. at 184
Congress intended that Board representation election orders be reviewed by the Court of Appeals after the election and after the employer refused to bargain with the union. The employer's initial challenge to the Board representation election order would be made before the Board, when the employer responded to the union's unfair labor practice charge. If the Board affirmed its earlier election order and concluded that the employer was guilty of an unfair labor practice, the employer could then seek review of the Board's decision, including its election order, in the Court of Appeals. See §§ 9(d) and 10(f) of the Act, 29 U.S.C. §§ 159(d) and 160(f). See also Boire v. Greyhound Corp., 376 U.S. at 477, 84 S. Ct. at 896-97