Warren E. Burger: We will hear arguments next in Sure-Tan and Surak Leather Company against National Labor Relations Board. Mr. Flaherty, you may proceed whenever you are ready.
Michael R. Flaherty: Mr. Chief Justice, and may it please the Court, is it an unfair labor practice for employer to ask the Immigration and Naturalization Service to investigate the immigration status of its employees? That is the first and the most important issue presented in this case. Can an employer be required to pay illegal aliens a sum of money equal to six months' pay under the National Labor Relations Act covering a period of time when the illegal aliens are not present in this country, when they are in Mexico, and they are not lawfully available for work? That is the second issue presented in this case. And can the National Labor Relations Board require an employer to write reinstatement offers in Spanish and to leave them open for a period of four years? That is the third issue presented in this case. The operative facts in this case begin on January 20th, 1977, when Mr. John Surak, the president of Sure-Tan, wrote this letter to the Immigration and Naturalization Service. He asked the Immigration and Naturalization Service to investigate the immigration status of his employees.
Harry A. Blackmun: Incidentally, does he know the immigration status of his present employees?
Michael R. Flaherty: Your Honor, I don't know. I have not asked Mr. Surak that, and so I just cannot answer that question. In response to this letter, the INS came to Mr. Surak's facility and investigated the immigration status of the employees, and in response to this letter it was discovered that the illegal aliens... that the employees were illegal aliens, five of the eight of them listed on this letter. They were immediately arrested by the INS, and they were permitted to execute an INS form whereby they acknowledged their illegal presence in this country, and then they voluntary agreed to return to Mexico. The union filed an unfair labor practice charge against the employer, and the Labor Board returned a complaint, charging that Sure-Tan violated Section 883 of the National Labor Relations Act by discharging the employees when it sent this letter to the Immigration and Naturalization Service. In an attempt to resolve this dispute, Sure-Tan sent letters offering reinstatement to the employees. They were written in English, and they were sent on March 29th, 1977. They asked the employees to report to work by May 1st, 1977, if they accepted the offers of reinstatement. In the proceedings below, the Labor Board held that Sure-Tan constructively discharged the employees, in violation of Section 8(a)(3) of the Act by sending this letter to the INS requesting the INS investigation. The Board ordered Sure-Tan to offer unconditional reinstatement to the aliens, and it ordered them to pay them back pay. In response to this order, the board's own general counsel filed a motion for clarification, asking the board just what it meant by this order. The general counsel observed in its motion for clarification that an order that required unconditional reinstatement with back pay, regardless of the aliens' immigration status, created a conflict with the immigration laws and policies. It in effect served as an incentive for these aliens to re-enter the country illegally. Well, the board denied the motion, but in the decision denying the motion, it said that the accrual of back pay should be tolled during the period of time when the illegal aliens were unavailable for lawful employment in this country. The Court of Appeals upheld the order with certain modifications. Under the Court of Appeals' enforcement decree, the illegal aliens would have to be reinstated by Sure-Tan only if they can establish at the time they present themselves for employment that they are lawfully available for work in this country. With respect to the back pay issue, the Court of Appeals went way beyond the board. It invented its own remedy, or so-called remedy. It told Sure-Tan that it would have to pay each of these illegal aliens a minimum of six months' pay, regardless of whether they were lawfully available for work in this country. This was on the theory that the illegal aliens would have remained in this country illegally for some period of time but for this request sent to the Immigration and Naturalization Service. The Court of Appeals also held that Sure-Tan would have to write its own statement letters in Spanish, and it would have to leave them open for a period of four years. The most important issue facing this Court in this case is whether an employer can be held liable under the National Labor Relations Act for reporting a violation of the law to the immigration authorities. This case or this issue has already been decided by this Court six months ago in the Bill Johnson's case. In Bill Johnson's, an employer... or employees picketed one of Bill Johnson's restaurants. The owner of that one... of the restaurant told the employees he would get even with them if it was the last thing he did, and he made good on this threat. He filed a civil lawsuit against the employees. This Court held that the filing of a civil lawsuit was protected under the First Amendment right to petition the government, regardless of the employer's motive for filing that lawsuit. That is precisely the issue that is presented in this case. Sure-Tan's request to the Immigration and Naturalization Service was squarely within the First Amendment right to petition the government, just as was the lawsuit filed by Bill Johnson's Restaurants.
Byron R. White: What if it is found as a matter of fact that the employer acted solely because of his opposition to the union and the employees' desire to have a union? What if it were found that that was the sole reason for his going to the INS?
Michael R. Flaherty: If that were found, it would make no difference, Your Honor. The right of a citizen of this country to report a violation of the law is not conditioned upon the person's motive for reporting that violation of the law.
Warren E. Burger: Let's assume in the abstract that that's correct. In its interaction with labor relations, isn't the board entitled to draw some inferences from the conduct?
Michael R. Flaherty: Certainly, Your Honor, and it does so in every case that involves motive.
Warren E. Burger: It did so here.
Michael R. Flaherty: Yes, it did so here.
Warren E. Burger: The board said, in effect, all right, this is an exercise of your right to petition the government, but in the circumstances in which you exercised that right, it has some other meaning to us.
Michael R. Flaherty: In essence--
Warren E. Burger: Isn't that what they did?
Michael R. Flaherty: --That is what they did, Your Honor. They said that, yes, you have a First Amendment... Well, they did not address this directly, but assuming there is a first amendment right to petition the government, which certainly there is, they said, we are going to condition that right on your motive for exercising that constitutional right, and never before has this Court ever conditioned the right to exercise a constitutional right on a person's motive for doing so. Indeed, if this... if administrative agencies--
Byron R. White: So you don't dispute the fact that there was an anti-union motive somewhere in this set of facts?
Michael R. Flaherty: --I cannot put myself in Mr. Surak's head, but I can certainly tell you there was a dispute between the union and the company, just as there was in Bill Johnson's Restaurant, and the--
Byron R. White: Now, so there was... the employer was motivated by an anti-union bias, I take it. I know... that isn't the end of the case, I know, but--
Michael R. Flaherty: --Certainly not, and he--
Byron R. White: --But there was that in the case.
Michael R. Flaherty: --That was found below.
Byron R. White: Yes, yes.
Michael R. Flaherty: And that is not relevant, however, with--
Byron R. White: And sustained, and enforced.
Michael R. Flaherty: --That is not relevant, however, with respect to the right to exercise the constitutional right to report a violation of the law.
William H. Rehnquist: Mr. Flaherty, are you sure that the right to turn in aliens to the... illegal aliens to the INS can be equated with filing a lawsuit in state court, the way you had in Bill Johnson's, for constitutional purposes?
Michael R. Flaherty: Very definitely, Justice Rehnquist. Under the Nor Pennington doctrine, this Court has held repeatedly in many cases that efforts to enforce the law, whether they be through the filing of lawsuits, through petitioning, or through lobbying to seek stricter enforcement of the law by law enforcement agencies, or other petitions to the government, are within the First Amendment right to petition the government, and in the Foro Precision Metal case, which is cited in our reply brief, that precise issue was addressed by the Ninth Circuit. It was a petition to the police by IBM for them to enforce the law that led to the indictment of 14 people, and the Ninth Circuit held squarely that that was within the First Amendment right to petition the government.
William H. Rehnquist: But, Mr. Flaherty, isn't there a difference in the facts here? At the time the letter was written that you have exhibited to us two or three times, your client didn't know whether there had been a violation of the law, did he?
Michael R. Flaherty: He had had reports several months earlier.
John Paul Stevens: He listed other people besides these who were not in fact illegal aliens.
Michael R. Flaherty: That is correct, Your Honor.
John Paul Stevens: So he really didn't know which were and which were not.
Michael R. Flaherty: He had received reports--
John Paul Stevens: That what?
Michael R. Flaherty: --that some of these employees were present illegally.
John Paul Stevens: Some of them were.
Michael R. Flaherty: And also--
John Paul Stevens: And he sort of just tossed a bunch over and said, look at all of them.
Michael R. Flaherty: --He had asked the employees after the election, before this letter was written, whether they were present legally, and a number of them said, no, they weren't, so he did know at that time. At the time he wrote the letter, he did, Your Honor.
John Paul Stevens: Does the record show that?
Michael R. Flaherty: Yes, it does, Your Honor.
Sandra Day O'Connor: Mr. Flaherty, in Bill Johnson's, is it possible it should be distinguished because there the employer was asserting, trying to assert in state court an alleged injury to the employer's own reputation? The employer himself had suffered an injury that otherwise would not be redressed, and perhaps that is not the case here.
Michael R. Flaherty: The holding in Bill Johnson's focused on the First Amendment right to petition the government, and it said, for that reason, as well as--
Sandra Day O'Connor: Well, I think the opinion also focused on the fact that the employer would have been left with no forum in which to pursue a remedy for an actual injury to the employer. Does that distinguish this case?
Michael R. Flaherty: --I don't think so, Your Honor. I think the First Amendment right to petition the government stands on its own, and that this Court recognized that in Bill Johnson's. That was another factor that was present, but it was not a necessary factor. It was not necessary to this Court's decision in Bill Johnson's--
Sandra Day O'Connor: Well, it was certainly discussed by the Court, and apparently relied upon.
Michael R. Flaherty: --It was discussed. It was relied upon. But either one of those grounds, the First Amendment right to petition the government or the state's compelling interest in the maintenance of public peace were involved, and in fact in this case the reporting of a violation of the law is just as essential to the maintenance of the public peace as the filing of a civil lawsuit was in Bill Johnson's. If anything, the right to report a violation to law enforcement agencies is more important to the public peace.
Thurgood Marshall: But the complaint was not against these men. It was against the union.
Michael R. Flaherty: I am sorry?
Thurgood Marshall: The complaint was against the union.
Michael R. Flaherty: No, the letter, Justice Marshall, was--
Thurgood Marshall: I am not talking about the letter. I am talking about Sun-Tan's complaint. It only came about when the union tried to organize.
Michael R. Flaherty: --That--
Thurgood Marshall: Correct?
Michael R. Flaherty: --This letter was written after the union won the election. That is correct.
Thurgood Marshall: And that is what brought it on.
Michael R. Flaherty: This petition to the government is what brought on this case. That is correct.
Thurgood Marshall: Well, was the letter brought on by the election?
Michael R. Flaherty: I can... It was written after the union won the election.
Thurgood Marshall: And that is what... it came after the election.
Michael R. Flaherty: That's correct, after the union won the election.
Thurgood Marshall: And before the election, everything was hunky-dory.
Michael R. Flaherty: Well, before the election... it was after the election that he asked the employees whether they were legally present here, and they admitted that they were illegally present here. Once he knew that, then he wrote the letter. That is correct.
William H. Rehnquist: Well, the board and the lower courts drew the inference from the factual situation, though, that he was animated by antiunion animus in doing this.
Michael R. Flaherty: That is--
William H. Rehnquist: And certainly we don't review that sort of thing now.
Michael R. Flaherty: --No, we are not reviewing that. We are not asking for that fact determination to be reviewed here. That determination is irrelevant with respect to the right to report a violation of the law. In the Quarles case, this Court observed that a person's right to report a violation of the law to law enforcement agencies was one of the essential privileges and immunities which arises out of the essential character of our form of government, which must be constitutionally protected, regardless of a person's motive for seeking enforcement of the law.
Sandra Day O'Connor: What have lower courts done in the labor law area about instances where an employer has reported an employee out of an antiunion animus to law enforcement officers for commission of a crime? Maybe it is theft, or assault, or whatever it is.
Michael R. Flaherty: Justice O'Connor, I am not aware of any other cases. This is a case of first impression, to my knowledge, in this situation.
Sandra Day O'Connor: I think it may be in this Court, but have there not been some other cases below in the dealing with reporting of criminal violations? You are not aware of any, in any event?
Michael R. Flaherty: I am not aware of any, no.
Byron R. White: What was the issue in Johnson? Was it the issue whether the board could enjoin the holding of the... the prosecution of the suit, or not?
Michael R. Flaherty: That is correct, and it was alleged that the suit was brought in retaliation for the employees exercising their concerted... their right to engage in concerted protected activities, and in retaliation for their having filed a complaint, and that is precisely what is presented here. It is alleged that Sure-Tan's actions were undertaken in retaliation for these employees having voted in a union. It is precisely the same situation. And the First Amendment right to petition the government that was present in Bill Johnson's is just as present here as well, and drawing from the Nor Pennington line of cases, this Court has held that the right to seek enforcement of the law is privileged under the First Amendment regardless of why the actions were taken to enforce the law, as long as those actions were not a sham. And in Bill Johnson's, this Court held that a sham would mean that there would have to be no reasonable basis for the actions taken.
Harry A. Blackmun: Mr. Flaherty, is it illegal for an employer to hire illegal aliens?
Michael R. Flaherty: No, it is not, Justice Blackmun.
Harry A. Blackmun: Well, if you prevail here, then isn't a way to avoid the confines of the Labor Act just to keep hiring illegal aliens, and when one gets into a labor bind, report them to the INS?
Michael R. Flaherty: Your Honor, in this case, Sure-Tan is subject to... they voted in the union. The union stayed recognized. It has to bargain with the union. That was not a way out of a union recognition situation. The union didn't go away. It stayed there. Furthermore, there is a back pay and reinstatement liability that is faced here.
Byron R. White: Could you have fired, without committing an unfair labor practice, could you have fired the illegal aliens for the reason that they were illegal aliens?
Michael R. Flaherty: For the reason that they were illegal aliens, certainly. Certainly.
Byron R. White: And that would be a firing for cause under the collective bargaining agreement, if there was one?
Michael R. Flaherty: There was not a collective bargaining--
Byron R. White: I know. I said, if there was one, could an employer fire an employee because he is an illegal?
Michael R. Flaherty: --That would depend upon the arbitration case law, and I have not read arbitration cases covering that, but I would certainly think that firing an illegal alien because he is an illegal alien would be just cause.
Byron R. White: Even after the union won an election?
Michael R. Flaherty: Yes, it would. Yes, I definitely think it would.
Byron R. White: So you would say that if one of the reasons for firing a person is that he is an illegal alien, and another reason is because he is a member of the union, that it is not an unfair labor practice?
Michael R. Flaherty: Definitely not, in this case. He had a right to--
Byron R. White: Definitely not what? It is not a--
Michael R. Flaherty: --It is not an unfair labor practice in this case, because he had a right to report a violation of the law, a First Amendment right.
Byron R. White: --Well, I would think it would be a fortiori in this case if you are right in my example. You say the employer could even fire an illegal alien himself. He doesn't complain to the government at all. He just fires him. He says, you are an illegal alien, you are fired, but by the way, I am also firing you because you are a member of the union. And you say that would not be an unfair labor practice?
Michael R. Flaherty: If there is antiunion animus?
Byron R. White: Yes.
Michael R. Flaherty: I would say no, then there would be an unfair labor practice.
Byron R. White: All right.
Michael R. Flaherty: Because in that case you are not reporting a violation of the law. You are not exercising a constitutionally protected right. In this case, you are exercising a--
Warren E. Burger: You are sort of... you are enforcing the law yourself then. That is... the employer would be expelling the person instead of having the INS do it.
Michael R. Flaherty: --Well, no, in this case the enforcement of the law came by reporting it properly to the law enforcement agency. If you just fired them, you would not be aiding the INS in the enforcement of the law.
Byron R. White: Well, I know, but you say you would be privileged to fire them without committing an unfair labor practice, right?
Michael R. Flaherty: You did not mention that there was antiunion animus in your hypothetical.
Byron R. White: Well, let's say there was not an antiunion animus, but there was a collective bargaining agreement that says you can't fire except for just cause, and he fires a bunch of employees because they are illegal aliens. You say he has that privilege under the collective bargaining contract.
Michael R. Flaherty: Well, interpretation of a collective bargaining contract depends upon arbitration case law and the past history of the parties and so forth.
Byron R. White: Well, what is that law, do you think? May you fire?
Michael R. Flaherty: I definitely think that they could fire under that circumstance, yes--
Byron R. White: Yes, yes. But you couldn't fire them for that reason, if you also fire them for being a member of the union.
Michael R. Flaherty: --That would violate the labor laws. But this case is distinguishable, quite distinguishable from that hypothetical, because in our situation there was a report made to the law enforcement agency reporting a violation of the law, and that, as this Court held in the Quarles case, is one of the fundamental privileges and immunities of all citizens. It is clearly within the First Amendment right to--
John Paul Stevens: Mr. Flaherty, may I ask you a follow-up on Justice Blackmun's question?
Michael R. Flaherty: --Sure.
John Paul Stevens: You responded by pointing out in this case there was a remedy that was possible, but just as the general problem, would it not be true that if you prevail, an employer would be well advised to hire illegal aliens before they are organized and let them know promptly that if they do organize, they will be reported; if they don't organize, they won't be? Wouldn't that be good... it seems to me it would make a lot of sense for a businessman who wants to have inexpensive unorganized labor.
Michael R. Flaherty: Well--
John Paul Stevens: Maybe that's fine. I don't know. But isn't that... that would be a natural consequence of your position, isn't it?
Michael R. Flaherty: --Regardless of how this Court holds, Your Honor, it is a possible consequence, yes, but if this Court were to hold that that is an unfair labor practice, to report a crime to the law enforcement agency, that would not end this problem at all. Human nature being what it is, employers would make a telephone call rather than write a letter.
John Paul Stevens: But the result for which you are arguing would encourage the employment of illegal aliens by unorganized employers. That much is clear, I guess.
Michael R. Flaherty: It is a possible consequence. It is not an essential consequence. Employers... people--
John Paul Stevens: Which in turn might encourage more illegal aliens to come to the country.
Michael R. Flaherty: --People hire illegal aliens for a number of reasons, whether it be to perform work that other people don't want to do because they work for less money. There are a large number of reasons why people hire illegal aliens.
John Paul Stevens: But you think we should encourage the practice?
Michael R. Flaherty: Certainly not and I am not saying that this Court would--
John Paul Stevens: But the result for which you are arguing I think you have acknowledged would encourage the practice.
Michael R. Flaherty: --It is possible. It is possible. With respect to the... well, there is also a fundamental conflict in this case with the immigration laws presented by the board's order. In effect, the board is holding Sure-Tan liable under the labor laws for assisting in the enforcement of the immigration laws. Now, this just cannot be. You cannot be held liable under one set of laws for helping enforce other laws, and this Court noted in the Southern Steamship case that the labor laws have to be interpreted and enforced in consonance with the immigration laws, and to hold someone liable under one law for enforcing another violates the Southern Steamship mandate. Now, with regard to the back pay award, as we have argued, there was no violation of the National Labor Relations Act by exercising the constitutional right to report a violation of the law. There should be no back pay award. But under any circumstance, the award of back pay, six months' pay to illegal aliens covering a period of time when they are not lawfully available for work in this country is wholly inappropriate. The board itself acknowledged that this was improper. They would have tolled the accrual of back pay during the time that the illegal aliens were not available for employment, because they were in forced absence from this country. Yet the Court of Appeals invented its own remedy. It came up with a six-month back pay... essentially what was a fine that was imposed on Sure-Tan. There is no reasonable basis for this six-month back pay award. It is based on pure speculation, and as Judge Wood noted in his dissent, the rationale behind this back pay award seems to be to punish Sure-Tan for what it did.
Byron R. White: What if the only remedy the board imposed was an order to reinstate once the company... once the alien is back in the country legally?
Michael R. Flaherty: That would comport with immigration laws, certainly.
Byron R. White: Well, what about the labor laws?
Michael R. Flaherty: That would comport with the labor laws as well.
Byron R. White: Well, I know, but that would leave a remedy standing, a remedy which is premised on an unfair labor practice. You say there is no unfair labor practice at all.
Michael R. Flaherty: Well, assuming, contrary to fact, that there was an unfair labor practice, a remedy that would--
Byron R. White: Well, I am just saying that in this very case, if the only remedy that had been imposed by the board was an order to reinstate once the... if and when the alien is back in the country legally, Now, you would still be here, I take it, because that remedy would be... the predicate for that remedy would be an unfair labor practice, was the fact that there was an unfair labor practice.
Michael R. Flaherty: --That's right. Certainly we feel that there was not an unfair labor practice, and there should be no remedy. There is no need for a remedy.
Byron R. White: Well, I know, but the board could have had full regard for the labor board... for the immigration laws, and you still would be here.
Michael R. Flaherty: If they had full regard for the immigration laws, then they would not have... first of all, they would not have imposed back pay for a period of time when they were not lawfully available for work.
Byron R. White: I guess what I am asking really is that the Court of Appeals may have been wrong in some of its remedy decisions, but that doesn't mean it was wrong in saying there was an unfair labor practice.
Michael R. Flaherty: Oh, I certainly think they were wrong in saying there was an unfair labor practice.
William H. Rehnquist: But you are making two different arguments.
Michael R. Flaherty: Yes, I am making two different arguments.
William H. Rehnquist: One, that there was no unfair labor practice because of the board's failure to integrate it with the immigration laws, and second, even if there was an unfair labor practice, that the Court of Appeals' substitution of a remedy was improper--
Michael R. Flaherty: That's correct.
William H. Rehnquist: --even if there was a violation.
Michael R. Flaherty: That's correct. Assuming arguendo there was a violation, then the remedy was clearly erroneous. There should not have been an imposition of an arbitrary six-month back pay award during a period of time when the illegal aliens weren't available for work, because the board under its normal procedures would toll back pay. Indeed, that's what it wanted to do in its decision denying the motion for clarification. It said back pay should be tolled when the illegal aliens are not available for work, and certainly the illegal aliens should not be--
Byron R. White: Yes, but the board, under the board's order, wouldn't the tolling of back pay be ended if the alien came back to the country illegally, and was available for work?
Michael R. Flaherty: --I would certainly hope so.
Byron R. White: Well, I know, but under the terms of its order, the alien wouldn't have to be back here legally.
Michael R. Flaherty: Well, I think if they are not lawfully available for work is how I interpret that.
Byron R. White: I see.
Michael R. Flaherty: But I think certainly if there is any ambiguity in what they advised, it should be construed that way. Otherwise, they would have an incentive to come here illegally in order to prevent the tolling of back pay, so they could keep the meter running by being here illegally, and that certainly would conflict with the immigration laws.
Harry A. Blackmun: Of course, you object to the ALJ's four weeks back pay as much as you do to the Seventh Circuit's longer period, don't you?
Michael R. Flaherty: Definitely. In essence, what it does it, is conflicts with immigration laws. It treats them as though they had a legal right to remain here for four weeks or six months even though they were not lawfully here to begin with, and they were returned to Mexico. In essence, any back pay covering a period of time when they were not available for work treats the immigration laws as if they were of no consequence, and that type of a conflict with the immigration laws violates this Court's mandate in Southern Steamship that the remedies of the board have to comport with other fundamental Congressional objectives, those in the immigration laws. With respect to the reinstatement offers, never before has the board required an employer to communicate with its employees in a foreign language, and yet in this case it tells Sure-Tan that it has to communicate in writing with these employees in Spanish. It has to hire an interpreter to talk to these people. The government is not even required to communicate with its citizens in a foreign language. It is just fundamentally unfair and wrong to require a private employer to communicate with employees in Spanish when the government isn't even required to do so. In fact, there are board cases--
Harry A. Blackmun: How did the employer communicate with them on the job?
Michael R. Flaherty: --By attempts to... a combination of, I believe, English and Spanish.
Warren E. Burger: At least he got the message across.
Michael R. Flaherty: He got the message across. Pointing, and I really can't say, because I wasn't there, but it was a rather primitive communication, I would imagine. With respect to the four-year reinstatement offer, never before has the board required that reinstatement offers be left open for a period of four years. Traditionally the board has upheld reinstatement offers that have been held open for--
Thurgood Marshall: On this question about the Spanish letter, there were about a dozen employees, right?
Michael R. Flaherty: --There were eleven employees, five of whom were--
Thurgood Marshall: How much would it cost to translate eleven... translate one letter to eleven people?
Michael R. Flaherty: --I couldn't speak to that.
Thurgood Marshall: About $1.25, I guess, something like that. We are talking about de minimis.
Michael R. Flaherty: The courts have held and our brief points out cases to the effect that the government is not required to communicate in a foreign language with its citizens, and yet the board would require... impose that upon Sure-Tan, contrary to its prior cases. It changes its own precedent, without any warning. And with regard to the four-year reinstatement, that also is contrary to established precedent. In conclusion, this case presents the exact same issue that was presented to this Court in Bill Johnson's Restaurant. As this Court decided in Bill Johnson's restaurant, it should hold that Sure-Tan had a constitutional right to report a violation of the law, and that it did not commit an unfair labor practice by doing so.
Warren E. Burger: Your time has expired, Mr. Flaherty.
Michael R. Flaherty: Thank you.
Warren E. Burger: Mr. Kneedler.
Edwin S. Kneedler: Thank you, Mr. Chief Justice, and may it please the Court, before beginning, I would like to emphasize two points. One, in response to Mr. Justice White's question, this was a case in which the board held that the employer was motivated solely by antiunion animus. We don't view that as an essential attribute of the violation. Under Transportation Management the test would be whether the employer would have done it even in the absence of the antiunion animus, but here the court found that aggravated circumstance. And secondly, in petitioner's brief on the merits, they acknowledge that they were not challenging the board's finding of antiunion animus in the circumstances of this case. Now, this Court recognized in Plyler versus Doe and in United States versus Brignoni-Ponce that illegal aliens are especially vulnerable to exploitation by employers, and in De Canas, the Court recognized that the acceptance by illegal aliens of jobs on substandard conditions has the effect of depressing the wages and working conditions of lawfully resident American workers, and also undermines the effectiveness of labor unions. We submit that the appropriate accommodation of the National Labor Relations Act and the immigration laws in the circumstances of this case requires a recognition of those realities.
William H. Rehnquist: Well, Mr. Kneedler--
Edwin S. Kneedler: Yes.
William H. Rehnquist: --I am interested to know whether the government takes the position that the board's result here can be defended only in the circumstances of the immigration laws. Let's suppose that I am Mr. Surak, and I have this outfit in Chicago, and an effort is made to unionize my employees, and I hire a private investigator to find out what I can get on the people who are leading the union investigation move. I find that one of them, who is an employee, is a fugitive from Indiana, he has escaped from prison in Indiana, not under any immigration charge, you know, on an armed robbery charge. Now, the reason I made the investigation in the first place is, I want to hurt the union if I can. I am an employer, and I don't want to be unionized. Is it an unfair labor practice for me at that point to turn him in to Illinois authorities to be extradited to Indiana?
Edwin S. Kneedler: That would present much different considerations. Our position here depends not just on a construction of the National Labor Relations Act, but also the policies with respect to employment that are reflected in the other federal statute, the immigration laws. The proper accommodation would have to look to the other statute that the employer was seeking to assist in the enforcement of, and for instance the fact that it was a felony, a serious crime, a fugitive, and also that the... I think it is appropriate to consider the particular utility of this device to employers, as Mr. Justice Stevens was pointing out, the utility of this device to employers to avoid the policies of the Labor Act, I think that those same policies would not be present with respect to--
William H. Rehnquist: Well, but the obligation of the employer at least by statute and case law is much the same. The Ninth Circuit has held, hasn't it, that the employer has an obligation to notify the INS in these circumstances?
Edwin S. Kneedler: --Well, what the Ninth Circuit suggested in the passage that has been quoted by petitioners is really that it is not the board's function to enforce the immigration laws by excluding illegal aliens or determining the documentation of illegal aliens and excluding them from board protection, that the employer should take that problem to the Immigration Service if that is his point, that he wants to help enforce the immigration laws. I don't think the Ninth Circuit purported to suggest that the employer should have an absolute immunity from his obligations under the Labor Act to do so for antiunion reasons, if that was the motivation. I think the Ninth Circuit was making a much different point, that the enforcement of the immigration laws is essentially the responsibility of INS.
Byron R. White: Well, in Mr. Justice Rehnquist's example of the felon, the fugitive, would all the board have to do is find that the employer wouldn't have fired him except for an antiunion animus, and wouldn't have turned him in except for that? Is that all they have to find to find an unfair labor practice?
Edwin S. Kneedler: Well, that is ordinarily what is--
Byron R. White: He gets on the stand and he testifies. Well, why did you turn him in? I turned him in because he was a ringleader in this movement towards the union, but of course, and when I found out he was a felon, I could easily get rid of him, so I turned him in. Is that all the board would have to find?
Edwin S. Kneedler: --Again, I think that because of this--
Byron R. White: Well, that is all there is.
Edwin S. Kneedler: --Well, yes, in finding the normal unfair labor practice, that is true, but my question or my point is that there may be--
Byron R. White: What is abnormal about that?
Edwin S. Kneedler: --Well, nothing, if one looks only to the purposes of the immigration laws. My only point was that as in Bill Johnson's, the Court sometimes feels that it must look outside the immigration... or outside the Labor Act to see whether there are countervailing considerations, what the Court said in Bill Johnson's. It might preclude the board from finding an unfair labor practice, even when the other--
Byron R. White: So the policy of enforcing the laws against murder or something are stronger than enforcing the immigration laws. Is that any critical part of your submission, that the interest in enforcing the immigration laws just isn't that strong?
Edwin S. Kneedler: --No, certainly the Department of Justice is--
Byron R. White: One crime is different than another?
Edwin S. Kneedler: --No, but there are other--
William H. Rehnquist: The board is entitled to weigh each crime and make final decisions for the whole country as to what laws ought to be--
Edwin S. Kneedler: --No, what we are suggesting is with particular reference to the National Labor Relations Act. The board has never found an unfair labor practice in any other circumstances insofar as I am aware, where an employer has reported--
Byron R. White: --So your answer is yes, it does make a... the board does sit to decide which laws are to be ignored and which are not.
Edwin S. Kneedler: --No, I--
Byron R. White: Or it can pick out the immigration laws at least, you say.
Edwin S. Kneedler: --Well, it is not the board's own assessment of that. This is the position of the United States in this case, that there are countervailing policies reflected in the Immigration Act that reinforce the board's construction of the Labor Act in these circumstances.
Byron R. White: You mean sometimes it is all right not to report illegal aliens?
Edwin S. Kneedler: Well, absent an antiunion animus, and really, in a sense, an abuse of the reporting process, it would ordinarily be entirely appropriate and the responsibility of an employer or any other citizen to report. What we are suggesting is that the policies of the immigration laws are designed to protect--
Byron R. White: Well, he has to be able to prove he loves the union before he can turn an illegal alien in?
Edwin S. Kneedler: --No, the initial burden is on the board to establish an antiunion animus.
Thurgood Marshall: Let's try another one. He knew all along, for 20 years, that this man was a felon. And when the man joined the union, he blew the whistle on him.
Edwin S. Kneedler: Well, another... again, it might depend on the application of misprision of felony statutes, which is another consideration that would apply in the area of murder or any other felony. It is a federal crime, and it is, I would assume, a crime under the law of most states not to report a felony. So, if we are talking about an employer who has knowledge of a felon in his employ, that countervailing policy and the legislative judgment reflected in the statutes about reporting a felony I think might well override the finding of an unfair labor practice in those circumstances.
Warren E. Burger: Do you think you could support your position by saying that of course there is a duty to report illegal activity, there is a civic duty, and there is a First Amendment right to do it on the edges of that, but the National Labor Relations Board isn't concerned about civic duty or other factors. If there is an antiunion animus, that supports their position no matter what the other considerations are. Would that take care of it?
Edwin S. Kneedler: Well, that would obviously... I mean, that would control this case, yes.
William H. Rehnquist: Even where-- --right across the board. --Indiana felon, too.
Edwin S. Kneedler: That's right. So we are not urging the Court to adopt a broad rule like that. We are narrowly... we are eliminating felonies here. The only crime that an alien who enters the United States illegally in the vast majority of cases commits is a misdemeanor. I don't want to denigrate the fact it is a misdemeanor, but Congress has ranked the offenses, and the board can take some guidance from that.
Lewis F. Powell, Jr.: Mr. Kneedler?
Edwin S. Kneedler: Yes.
Lewis F. Powell, Jr.: In the example you have been discussing for the last five minutes, let's assume that the felon who escaped from Illinois or wherever it was was sent back and put in prison for four years. Would the board have had authority to demand that he be reinstated at the end of the four years?
Edwin S. Kneedler: Well, we would first have to determine whether the board could find an unfair labor practice.
Lewis F. Powell, Jr.: Well, let's assume, as I think Justice Rehnquist said, in reporting this fellow, the employer said quite candidly he was a leader of this antiunion movement, so I thought I had better report him, get him off my back.
Edwin S. Kneedler: Well, I have suggested that in the case of a felony or a murder, a crime like that, that the board, although it hasn't addressed it--
Lewis F. Powell, Jr.: The board would have to reinstate him after?
Edwin S. Kneedler: --No, I am suggesting there may not be a violation in those circumstances, so the question of reinstatement would never be reached, but--
Lewis F. Powell, Jr.: If... I don't quite see the distinction. Why wouldn't the board not only require the re-employment at the end of four years, but also compel an employer to send him six months' back pay to the prison?
Edwin S. Kneedler: --Well, the board does not reach the question of remedy, either reinstatement or back pay, until it has first found that the employer has violated the Act, and in the situation of a felon and the employer's reporting of a felon, if the board did not find for the reasons that I have suggested that the employer had violated the Labor Act, then there would be no occasion to impose a remedy, but in the situation where the board does find a violation of the Act, as here, because of the appropriate accommodation of the two statutes leads to that result, then it is appropriate for the board to consider the normal remedies, which are under 10(c) of the Act reinstatement with or without back pay, and then at that point the board would determine whether reinstatement and back pay were appropriate in light of the policies of the statute that the employers relied upon.
Lewis F. Powell, Jr.: That wouldn't encourage people to report crime, would it? They might be caught in the middle between a legal obligation to report it, quite apart from the First Amendment, and what you say the board might feel free to do.
Edwin S. Kneedler: Well, in this circumstance, I think it is important to stress the narrowness of the rule we are suggesting.
Lewis F. Powell, Jr.: Are you saying that the only crime to which your argument applies is where one employs an illegal alien and then discharges him?
Edwin S. Kneedler: That is all that is presented here, and that is all we are submitting here. I don't want--
Lewis F. Powell, Jr.: I understand that, but it seems to me the principle that you advocate is not going to be easy to carry.
Edwin S. Kneedler: --Well, there are affirmative indications in the purposes and background of the immigration laws to reinforce that conclusion here, purposes that I would think would be absent under most state criminal codes in the commission of a murder or something like that, and Congress has enacted two statutes here that have to be given due consideration by the board and the Court. And Congress fashioned an express exemption for employment of illegal aliens insofar as employers are concerned. It did that at the same time it was strengthening, it said, the laws against illegal immigration into the United States by enacting a prohibition against harboring, but Congress carved out employers from that prohibition. Now, obviously, Congress did not expect that the very employers who would take advantage of that immunity would turn around and report the employers immediately upon doing so and thereby sacrifice whatever advantage they had acquired by hiring the illegal aliens.
Thurgood Marshall: I am not so sure that it is just the immigration law. I think it is the whole Title 18.
Edwin S. Kneedler: Well, but in the immigration laws, there is the affirmative... there is the affirmative support for the decision of the Court of Appeals in this case, and in the typical Title 18 offense, I would think you could not find that support.
Thurgood Marshall: Well, maybe you will tell me exactly what was the violation of the labor law.
Edwin S. Kneedler: In this case.
Thurgood Marshall: In this case.
Edwin S. Kneedler: Yes, sir. In this case, the violation of the labor law was the reporting of the illegal aliens to the INS in retaliation for the union activities.
Thurgood Marshall: Well, why wouldn't that apply to the report of spitting on the sidewalk?
Edwin S. Kneedler: Well, if I could go back, in a cast like... Let me go back to Bill Johnson's, and really, what petitioner is really arguing here is that there is an implied exception from the labor laws for his conduct because of the policy favoring reporting of crimes and the policy of enforcing the immigration laws, and the question is whether the Court should recognize an implied exception for retaliatory conduct that would otherwise be a violation of the Act, and that requires looking to the competing statute, and here it is a violation because the policies of the competing... of the other statute, the immigration laws, are--
Byron R. White: Or the Constitution.
Edwin S. Kneedler: --Well, petitioners do rely on the Constitution. I--
Byron R. White: What about that?
Edwin S. Kneedler: --Well--
Byron R. White: First Amendment.
Edwin S. Kneedler: --I would note in the first instance that they did not raise that before the board, before the Court of Appeals, or in the petition for certiorari here. Putting that objection to one side, I think again, going back to Bill Johnson's, the distinctions between that case and this are instructive.
Byron R. White: What about the Nor Pennington line of cases generally? Certainly there have been other competing laws involved such as the antitrust laws, and it has been claimed that companies or a litigant has resorted to the courts deliberately to discourage competition or to get them out of business, and it has been held that the resort... their utilization of the legal processes is constitutionally guaranteed.
Edwin S. Kneedler: Well, in those cases, those cases have involved, as in Nor itself, political activity, which is at the core of the right of petition political activity--
Byron R. White: What about California Transport, or whatever that was?
Edwin S. Kneedler: --Yes, that was an invocation of the adjudicative process before an administrative agency, and what the companies were doing in those circumstances fits within the language of the First Amendment and fits within this Court's decision in Bill Johnson. They were petitioning for a redress of their grievances, and as Justice O'Connor pointed out, a grievance that was in a sense redress of a legal injury to themselves.
Byron R. White: So your answer to the constitutional claim is there is just no constitutional right, protected constitutional right to report a crime?
Edwin S. Kneedler: No, our submission does not go that far. Our submission is--
Byron R. White: Well, what is it?
Edwin S. Kneedler: --that it is not an absolute right, and where the employer does it in retaliation for other protected activities by the person who is being reported, that there is not an absolute right to do so. It must be remembered that the employees' activities here, even while protected by the National Labor Relations Act, also have constitutional overtones. The right of association and to organize in the area of employment are also constitutionally protected. So the employer's reporting of the violation was in response to activities that also have constitutional overtones.
William H. Rehnquist: Well, but certainly it wasn't... the employer's reporting may have had an indirect effect on those activities, but since the people... the activities were being conducted by people who had no business being in the country, I don't see how you can fault the employer on that account. And it was the government that expelled the people. The employer didn't.
Edwin S. Kneedler: But the employer brought it about, and concededly in this Court did so for... solely for antiunion reasons, and in terms of the constitutional right, in re Quarles and Butler, which opposing counsel has cited, the Court did not suggest that a right to inform about violations of the law derives from the First Amendment. In fact, Quarles was a prosecution under Section 241 of Title 18 for a conspiracy to interfere with rights protected by the Constitution or laws of the United States, and what was involved in that case was whether the federal government could protect its own processes by prosecuting people who in that case murdered someone who informed on a violation of federal law. And so the very essence of federal sovereignty was involved to recognize that the constitutional... the Constitution required the federal government to protect informants.
Lewis F. Powell, Jr.: Mr. Kneedler, may I ask another question? Am I correct in understanding that the Court of Appeals ordered the company to pay six months' back pay regardless of whether or not the former employee returned legally to the United States?
Edwin S. Kneedler: That's correct. The Court of Appeals ordered a minimum six-month back pay.
Lewis F. Powell, Jr.: Right. Well, let's assume, for example, that one of these employees called up the employer and said, I am now back in the United States. I have got a good job down in St. Louis. Will you send me that six months' pay, please? And the employer said, well, look, are you lawfully in the United States at this time? And the fellow said, no. He said, I don't have to be lawfully here to get my money. Could the employer report him then? And not pay the money? I guess he would have to pay it under the Court of Appeals order.
Edwin S. Kneedler: Unless it were shown that the employer was acting for some antiunion reason under the Court's decision, he could, and I am not sure what the antiunion reason would be after the employee had long since left.
Byron R. White: Did the board suggest this remedy, or was it... did the court come up with it by itself?
Edwin S. Kneedler: The board has not--
Byron R. White: The six months.
Edwin S. Kneedler: --The board had not ordered it in its decision. The ALJ had recommended that the board consider some minimum award of back pay.
Byron R. White: Who brought it up in the Court of appeals, anybody--
Edwin S. Kneedler: I think it was sua sponte.
Byron R. White: --Sua sponte? And are you defending that here?
Edwin S. Kneedler: Yes, we are in this case. The board did not purport to adopt a general policy to govern all such cases, but it did accept the--
William J. Brennan, Jr.: Ordinarily isn't it the board's job, not the courts, to specify a remedy?
Edwin S. Kneedler: --That's correct, and as we point out--
William J. Brennan, Jr.: And why is it all right for the Court of Appeals here to do something that the board hadn't done?
Edwin S. Kneedler: --Well, we don't suggest that it is. In fact, we--
William J. Brennan, Jr.: Well, you are defending it, you said. Yes.
Edwin S. Kneedler: --Well, the board was... in this particular case, the board was willing to accept the suggestion on remand, and to adopt that, so as far as the six-month back pay, that is the board's position in this case.
William J. Brennan, Jr.: That is the order finally entered by the board?
Edwin S. Kneedler: That is... well, the board proposed a judgment to the Court of Appeals, and that was the Court of Appeals' judgment in the particular case. Not that that is a new proceeding.
William J. Brennan, Jr.: Is that often done?
Edwin S. Kneedler: I think it is quite unusual.
Sandra Day O'Connor: They don't order back pay to someone who isn't available for work, do they?
Edwin S. Kneedler: No, it--
Sandra Day O'Connor: Here is somebody out of the country who can't legally enter. It is an extraordinary thing to order. How can you defend that?
Edwin S. Kneedler: --The employee's unavailability for work is directly attributable to the employer's unfair labor practice, and under the board's policies where the employer has caused the employee's unavailability for work because of injury, because of--
Sandra Day O'Connor: But the remedies are not supposed to be punitive. They are supposed to help the employee, but they are not normally extended when the employee is unavailable for work. It just seems like a most unusual requirement.
Edwin S. Kneedler: --What I am suggesting, though, is that even where the employee is unavailable, if the employer is responsible for causing the unavailability, the board has in the past approved the award of back pay, and here the employer is responsible for the employee's unavailability. Now, to be sure, the alien is, too.
Sandra Day O'Connor: Doesn't that encourage, as Justice Powell suggested, another illegal entry to come and see about the money, and doesn't that fly right in the face of our immigration policies?
Edwin S. Kneedler: No, the award of the back pay in this case is not contingent upon the alien's re-entering the country. The back pay award would be paid to the alien even if he remained in Mexico.
Byron R. White: You is supposed to just mail it to him, if you've got his address? In pesos?
Edwin S. Kneedler: That's correct.
Byron R. White: That's just a fine, then, for violating the law, I guess.
Edwin S. Kneedler: It is not a fine--
Byron R. White: Close to it, isn't it?
Edwin S. Kneedler: --No, I don't... I think it's quite different from a fine, because the ordinary remedy in an unfair labor practice, discriminatory discharge case is reinstatement and back pay. The employment relationship between the employer, and the employer here was not unlawful insofar as federal law is concerned. The alien had an illegal status, but the employment relationship was not unlawful. Because it was not, then it is not contrary to the immigration laws to recognize that employment relationship and apply the normal back pay remedy in those circumstances.
Byron R. White: So the employer ought to just feel lucky that it was confined to six months.
Edwin S. Kneedler: Well--
Byron R. White: Because the employment relation hasn't been legally terminated yet. And back pay ought to run forever.
Edwin S. Kneedler: --Well, we certainly don't suggest back pay should run forever, and the six-month figure--
Byron R. White: Well, there is just as much reason for running it a year as six months on your theory.
Edwin S. Kneedler: --Well, at some point the amount of the back pay might become so substantial that concerns about its being punitive rather than simply remedial might be raised, and indeed six months may be toward the cuter limit of the amount of back pay that should be awarded. Maybe the ALJ's decision as a general rule would be more appropriate. But if there is no back pay awarded, then the employer has really no financial disincentive to evade the purposes of the immigration laws in these circumstances.
Warren E. Burger: Hasn't the Court... hasn't this Court over the years said that we pay great deference to the Labor Board provisions for remedy and things of that kind because they are dealing with it all the time, and they develop what we call expertise? What expertise does the Court of Appeals have in these areas?
Edwin S. Kneedler: Well, generally none, and as I suggested--
Warren E. Burger: About the same as ours, wouldn't it be?
Edwin S. Kneedler: --Well--
Speaker: Not that bad. 0 [Generallaughter.]
Edwin S. Kneedler: --The board is the expert agency, and as a rule the matter ought to be remanded to the board.
Warren E. Burger: And the Courts of Appeals, all appellate courts ought to leave remedies, the devising of remedies to the agency that is very experienced and can understand its impact on the whole system rather than just one aberration of this kind?
Edwin S. Kneedler: That's correct, but a remedy such as this we think is entirely appropriate, because, again, deferring to the board's expertise, the normal rule is that unless there is some effort to make the employee whole, the purposes of the Act will not be effectuated which Section 10(c) requires.
Warren E. Burger: There is legislation pending in Congress to make it illegal, to make it an unlawful act, a crime to hire an undocumented alien. Suppose that legislation passed. Would the board or anybody else be entitled to make a remedy that would give back pay?
Edwin S. Kneedler: Oh, I would certainly think not.
Warren E. Burger: Not if they pass that legislation.
Edwin S. Kneedler: No, if the employment... in no circumstances. The employment relationship would then become illegal, and for the board to order the reinstatement of the employee to an illegal relationship and to pay him inconsistent with such a statute would clearly be improper, but as I said, the employment relationship is not illegal under the immigration laws.
Warren E. Burger: Let me go back to this dichotomy that seems to be interesting everyone about the employer doing the noble, patriotic, and altruistic thing in reporting these illegal aliens. The Labor Board historically has penalized employers or unions for doing good things if they were in violation of the Act. Hasn't that been so?
Edwin S. Kneedler: That's correct.
Warren E. Burger: In other words, suppose the employer on the day before Christmas, and there is an election coming up, sends a caterer out with a complete Christmas dinner for every employee and maybe a case of scotch along with it. Presumably he is doing a good Christian thing.
Edwin S. Kneedler: Right.
Warren E. Burger: But he might get in trouble with the Labor Board for doing that, might he not?
Edwin S. Kneedler: That's right. That's correct. The Labor Act does attach consequences to things that would otherwise be entirely lawful.
Warren E. Burger: So when he reports the criminal conduct of these employees being here illegally, he is doing his patriotic and civic duty, but he might get penalized for that properly, too. Is that not so?
Edwin S. Kneedler: That's correct, and we suggest that--
Byron R. White: But you aren't asking for all... that is more than you ask for.
Edwin S. Kneedler: --Yes, we are not saying everything that he... every report he makes, but in the circumstances of this case, we think that that... we believe that that is entirely appropriate. I would like to address Bill Johnson's and the First Amendment issue for just a moment, if I could. The First Amendment by its terms refers to petitioning for redress of grievances. That is what was going on in Bill Johnson's, because the employer went to court to try to get a remedy for a legal injury. That is not this case. There was no legal injury suffered by the employer here. The other distinguishing factor, countervailing consideration in Bill Johnson's was the deeply rooted interest of the states in providing a remedy for wrongs. That is not... that federalism question is not presented here. A last distinguishing factor is that the employer himself knowingly facilitated the employment of the illegal aliens in this case. It does not come with good grace, I submit, for the employer to then turn around and rely on the immigration laws, whose violation is encouraged as a basis for avoiding liability under the labor laws. This is not the first occasion in which these concerns have been raised, even with this employer. This employer was the subject of prior unfair labor practice proceedings in 1973 in which the board then found that except for a few senior employees, all of the employer's employees were Mexican nationals, and on that occasion the employer again had intimidated his Mexican employees by making it clear that they would be fired and he would hire another one if they supported the union. So this case highlights very strongly the concerns that underlie our submission here, and that is that if, as Justice Stevens pointed out, that an employer would have a powerful incentive and weapon to hire aliens in violation of the immigration laws if the decision of the Court of Appeals were reversed in these circumstances, and that would subvert the purposes of both the labor laws and of the immigration statutes.
Warren E. Burger: Well, it might depend on what the Court said if it reversed, might it not?
Edwin S. Kneedler: I was referring to if the Court were to find that this was not an unfair labor practice in this case.
Warren E. Burger: Thank you, gentlemen. The case is submitted. The Honorable Court is now adjourned until tomorrow at 10:00.


Northcutt Ely: May it please the Court. First, with the respect to some of the points made by Mr. Wilmer.
Hugo L. Black: (Inaudible)
Northcutt Ely: So I'm informed. Mr. Wilmer has submitted to the Court a set of tables indicating the quantity of water he believes California could survive on. This problem is litigated for several weeks. Arizona decided to submit no findings or conclusions upon it. We did, the Arizona decision apparently was made after Mr. Ryder, the Chief Planning Program Engineer of the Bureau of Reclamation may have gave the testimony which has been reproduced and submitted to you in which he classified the Imperial Irrigation District's efficiency as being near the top of those of all of the reclamation projects. We will cheerfully accept any probation under the decree that enforces conservation of water on both sides of the river and by the same standard where you think it as an appropriate provision of a decree. If it were so enforced, Arizona would have to cut back drastically upon the quantity she diverts per acre irrigated in Arizona because by the same testimony, her efficiency is far less than ours. Mr. Wilmer also said that it was a pigment of imagination to assume that any diversions were contemplated above Lake Mead and to the Central Arizona area. At page 125 of our opening brief, we have reproduced a quotation from the 13th Annual Report of the Arizona Interstate Stream Commission dated 1960, which says at page 31 of that report, “The circulation of the Special Master's draft report on Arizona versus California et al. has given new impetus to plans for utilizing Colorado River water in Arizona. An integral part of Colorado River water utilization plants for Central Arizona is a route for diversion. The Stream Commission and the United States Geological Survey have undertaken a cooperative program to map the unsurveyed area which would be traversed by a proposed diversion route from Marble Canyon which on the map as you will see is above Lake Mead, where the mapping program nearing completion, detailed cost estimates can be made which will facilitate consideration of the relative desirability of this diversion route to Central Arizona.” This is not a pigment of imagination. How the choice of routes will ultimately be resolved, I do not know. Mr. Legott also indicated that -- oh pardon me -- Mr. Wilmer also indicated that Central Arizona was in arduous rates through the dropping of its water tables and indicated that we were pleading to this Court on a poor mouth basis as he called it and he would do likewise. That is not the case. We do not ask here for sympathy or mercy for any of the States. We do ask that the Project Act be interpreted as we think it was designed to be interpreted and shall not be rewritten in the light of an administrative contract made in 1944, our contract, our bargain was made in 1929. But as long as this subject is raised, I should like to refer to the fact that their draft report or the report of the Special Master contains tables prepared by an expert Arizona witness and Mr. Legott of the Valley National Bank, designed to show the explosive growth in that State. Mr. Legott is the author of an article in the Arizona Highways in February - March 1962, an official publication of the State of Arizona in which this rather candid witness in this case, more recently, has expressed himself as follows. “The important Arizona's location in one of the most arid section of the United States often goes rise to questions as to whether its water supply is sufficient to permit a substantial population growth. The question can be answered quite specifically and simply, and the answer is definitely, yes. The important point to bear in mind is the distinction between water for agricultural purposes and water for domestic purposes. In the latter of the respect, there is no water problem in the lowland areas of Arizona. Arizona's water resources are ample to support at least 10 to 15 times the present population, i.e. a population even larger than that of California. In the process, this would probably mean that Phoenix larger than Los Angeles varies the thought” says, Mr. Legott, “and the Tucson larger than San Francisco. In all seriousness, Arizona's water supply for normal, domestic and industrial usage is one of the best in the country, although…” -- and he goes on with the quantities required. Thus, Arizona's present population of approximately 1,400,000 consumes approximately 175,000 acre-feet of water per annum, which is about the same amount as waters would normally be utilized on 60,000 acres of irrigated cropland. Stated in other way, the present domestic consumption of water in Arizona is less than 5% of the amount used for agricultural purposes and much of it actually finds its way back into the underground of reservoirs for reuse. And he goes on to say at the conclusion of this paragraph, whenever a cow pasture or citrus grove is converted into a residential subdivision, there's both the saving in water and a tremendous property increase. So we're confronted here with a -- whether the economy of Central Arizona based largely upon cotton shall continue by -- or whether it shall be gradually converted as we have had to do in Southern California by pulling up our beautiful orange groves and converting them to the support of the exploding population there.
Hugo L. Black: (Inaudible)
Northcutt Ely: I hope not, Your Honor. Too many of them have disappeared already. But both states are faced with an exploding population, we realize that that is not the necessary basis of decision here. Now, as to the limitation issue upon which both Mr. Wilmer and Mr. Cox said well, the words in the Section 4 (a), the first paragraph, a proposal to California are clear. A reference is to 4,400,000 acre-feet of the waters apportioned to the Lower Basin States by paragraph of (a) of Article III of the compact. We say that the Project Act intended by that to incorporate the compact whatever it might mean. The Congress knew that tributaries were included in the compact. Sections 13, 13 (b), 13 (c), 13 (d) specifically provide that the United States and all those claiming under the United States shall conform to the compact and that this compact shall be impressed upon the main river and its tributaries. The compact included the tributaries, Congress knew that, the Master so recognizes. And it's important perhaps that in 1941 when Congress enacted the Boulder Canyon Project Adjustment Act, it specified that Section 18 of which you've heard here and these same Sections 13 (b), 13 (c) and 13 (d) should be reenacted. The Master has made one of his -- the Master has made one of his few factual errors in his report in which he states that there is nothing to show that at the time of the Project Act or indeed since 1928, the Imperial Irrigation District had used the waters of the Gila River. Elsewhere in his report, he states the facts correctly that from 1901 to 1941 appeared 40 years, the diversion point for the Imperial Canal was below the Gila River and the Gila was used by the Imperial. But this fact was brought home to Congress in the testimony of Mr. Delph Carpenter, the principal author of the Colorado River Compact, and if you'll bear with me, I will quote a couple of paragraphs from his testimony on this specific subject as to why the Upper Basin as well California wherein it rested in the inclusion of the Gila in the county. Mr. Carpenter told a committee of Congress in 1926, the Gila River is not exclusively -- exclusively an Arizona stream even in the matter of origin. Secondly, the Gila and every other River, mentioned, contributes if uninterrupted, its water supply to the main river above the largest diversion canal in America, the Imperial Valley Canal heading now below Yuma. Gila water is of importance to the Imperial Valley Canal. The Canal naturally looks to the more stable flow from the main river but I'm informed that Gila water is frequently diverted and it has been my privilege to see water coming from the Gila River and flowing into the Colorado and down into the Imperial Valley Canal. That water is just as wet and just as serviceable as the water from the Green River in Utah. The waters of the Gila River are waters of the Colorado River just as much as the waters of the Green River. So that when you look at these facts squarely, you were brought to the proposition that there is not a single tributary of the entire Colorado River that does not enter the River above Yuma and the greatest diverter from this river or from any river in America or the world as the Canal of Imperial Valley located below Yuma. Then it goes on to say that they thought this advance that the Imperial District will move its point of diversion above Yuma and therefore with Gila no longer be of interest to it. But he says a canal for the irrigation of lands in Mexico would head below the mouth of the Gila.The whole theory of the Laguna Dam connection is founded upon an all-American Canal. Then he concludes by saying, “I'm going into this matter because there seems to be an idea or a dream that the Gila is not a tributary. An idea that because the All-American Canal will ultimately hook up with the Laguna Dam that therefore the Gila is a river unto itself. Senator Phipps of Colorado having heard the debate in which Senator Pittman and Senator Hayden participated and reported to the Senate, the Upper Basin Governors' recommendations obviously were concerned about the confusion that the Master has pointed out in his report. Now, we come to the Phipps Amendment in just a moment. But at page 189 and page 190, the Master points out that Senator Pittman in reporting to the Senate, the recommendation of the Governors in their 1927 Conference was confused. The Governors were recommending a division of the water let down at Lee Ferry that is flow not consumptive use. Flow of the stream not consumptive use as the Master would allocate. This -- says the Master, this report by Senator Pittman did not adopt or perhaps failed to grasp that portion of the Governors' resolution which expressly found the source of the allocated waters in the Article III (d) obligation of the upper division. Instead, Senator Pittman related the limitation to Article 3 (a) not 3 (d) as appears from the very next sentence of his statement which reads as follows and he quotes it. On page 190, the Master continues, “Thus Senator Pittman use Article III (a) to define the area against which the limitation was to operate. He did this in apparent misunderstanding of the Governor's recommendation. All subsequent discussion in the Senate flowed in the same channel.” Now, shall we be held to the bargain which the California legislature enacted in response to plain language of an act of Congress or shall be held of the confusion entertained by one senator, and so described by the Master. Senator Phipps of Colorado was the Chairman of the reporting committee. He was the author of the limitation and he was obviously concerned by this growing confusion because Senator Phipps offered a perfecting amendment to his own limitation which at the time read 4,600,000 acre-feet. The circumstances are cited in our opening brief at page 118. Senator Phipps said, “Referring to the amendment which is now before the Senate that was the committee amendment which imposed the limitation of 4,600,000 acre-feet.” Referring to the amendment which is now before -- and pardon me, 4,400,000 -- it had already been voted upon 4,600,000 versus 4,200,000 had been settled upon as 4,400,000. Referring to the amendment which is now before the Senate, in order to remove any possible misunderstanding regarding the 4,400,000 acre-feet of water, I desire to perfect the amendment by inserting on page 3, line 4 after the word “by”, the words paragraph (a) of Article III of, so that it will show that that allocation of water refers directly to the seven and one half million acre-feet of water that are mentioned in paragraph 3. Senator Phipps' perfecting amendment was accepted without objection and thereafter, the Phipps Amendment, the 4,400,000 acre-feet in it, instead 4,600,000 was adapted by the Senate. There cannot be a more explicit clarification. This did not come early in the debate as the Solicitor General is mistaken in believing. This was virtually the last utterance before the Limitation Amendment was adopted. It was approved by the Senate upon that understanding which identified the 7,500,000 million acre-feet with III (a) which includes the tributaries and cleared up the misunderstanding, the confusion, as the Master calls it, Senator Pittman and Senator Hayden that the limitation related to the flow of the stream at Lee Ferry, the III (d) obligation. Now, it is clear, however, that Senator Hayden was not demanding from the Senate, 2,800,000 acre-feet of consumptive use, diversions, less returns to the stream at all. Senator Hayden was consistent in relating the divisional water that he proposed to the flow of the stream, the III (d) delivery of Lee Ferry. Senator Hayden, three times, told the Senate that if Arizona were permitted to divert 2,800,000 acre-feet for the proposed Parker-Gila project, some 944,000 acre-feet of that when returned to the stream be capable of use only by Mexico and that Arizona claim no credit for that return flow. Here is his specific language. He is referring to the second paragraph of Section 4 (a). He has first described that the 2,800,000 -- 2,844,000 be diverted for this specific project, the Parker-Gila Project that the experts have testified the 948,000 acre-feet of the return flow and he nails it down with this statement: “I have specified in the amendment which I have offered that the State of Arizona lays no claim to that return flow. We do not ask to have any credit for it after it arises in the mainstream of the Colorado River. It will be surplus and unappropriated waters which Arizona cannot use and that water and that alone will be sufficient to supply any demand for water to meet the existing uses in Mexico.” The Master in other words awards to Arizona by definition of the 2,800,000 acre-feet as diversions less returns consumptive use. Some 948,000 acre-feet more than Senator Hayden explained to the Senate, he expected to get.Senator Hayden was consistent in his confusion. He identified at all times the allocation, the division he thought would be accomplished by Section 4 (a) to the flow of the river, the flow at Lee Ferry and not the consumptive use diversions less returns. Only by this explanation of Senator Hayden, can you possibly reconcile the arithmetic of Section 4 (a) with the arithmetic of the Colorado River Compact. Senator Pittman obviously was not content to leave this kind of confusion in the record, the man responsible for the act, he straightened it out with his perfecting amendment in California accepted the limitation in the light of the Phipps perfecting amendment. Nowhere did anybody propose a vote upon an amendment which would substitute for 4,600,000 or 4,200,000 or 4,400,000, an authorization of the Secretary of the Interior to reduce that figure to 44 seventy-fifths of X what the Secretary might elect to release. To the contrary, Senator Johnson was explicit in stating to the Senate that the -- that we were dealing with an irreducible minimum in California. At 70 Congressional Record 385, Senator Johnson said this, “I say to the gentleman of Arizona, you say the California shall have a 4,200,000 acre-feet, we say in the testimony of Mr. Francis Wilson is the best upon that subject” -- pardon me, “that the irreducible minimum of the State of California is 4,600,00 acre-feet. You say there was. You must bind your people for all time in the future and never to go beyond it by this amendment. The amendment does not divide the water between Arizona and California. It fixes a maximum amount of beyond reach California cannot go.” Now, with respect to the priority issue, Section 14 is explicit in incorporating in the Boulder Canyon Project Act the terms of the reclamation law.Section 8 of the reclamation law has been fully debated here. It provides that the -- that the beneficial use should be the basis of measure in the limit of the right. Section 5 is subject to Section 14. The United States in its brief does not characterize the Arizona project as a Section 5 water delivery contract. To the contrary, the United States says in its answering brief at page 47, “It is our understanding that this contract with Arizona does not by itself authorize the actual delivery of water in compliance with Section 5 of the Project Act, since that Section requires that the contracts be entered into with the actual users of the water, rather, this contract is in the nature of a commitment by the Secretary to enter into the contracts with users in Arizona up to the limit of 2,800,000 acre-feet. In this sense, it is an allocation by the Secretary of that amount of water for a future contractual use.” We say that neither Section 5 nor any other section authorizes the Secretary of Interior to make any such interstate apportionment, any such allocation for future use. And indeed Arizona, in her brief, opposing the theory of the United States that the Secretary or the creation of an Indian reservation, somehow reserves water, it calls the attention to Section 8. And Arizona's opening brief at page 144 says this, “Section 8 of the Reclamation Act also proscribes that beneficial use shall be the basis, the measure and the limit of the right.” “This requirement,” says Arizona “cannot be reconciled with the concept that a water right maybe acquired by a reservation without any physical application of water to have beneficial use.” If that is true with respect to the Federal Indian Law, it is surely true with respect to the Federal Reclamation Law in which Section 8 appears and which is incorporated in the Boulder Canyon Project Act.
Speaker: Mr. Ely, does it follow that (Inaudible) prohibition in the Government's theory would account only to those waters that can necessarily be achieved, (Inaudible)
Northcutt Ely: There are two prongs to the equitable apportionment rule: one, priority of appropriation, the other protection of existing uses. In California, we believe we're protected by both of those shields, they converged.
Speaker: (Inaudible)
Northcutt Ely: Well, to the damage to Arizona by allowing her water in excess of the total requirements over the existing projects is nil. We would grant her that. We recognize the priorities of those projects. The damage to California by reducing existing projects by more than a million acre-feet is catastrophic. It is a result not required by the principle of apportionment.
Speaker: Does it require a (Inaudible)
Northcutt Ely: No, that is -- with all due respect, that is not our argument. Our point --
Speaker: (Inaudible)
Northcutt Ely: No, I do not so read it. I read it as an intention to protect an existing economy even though built upon a junior appropriation. Our existing economy is built upon senior appropriations. Now, one word with respect to the legislative history, if the Solicitor General and Mr. Wilmer are correct, then the enactment of the Boulder Canyon Project Act was a tremendous victory for Arizona. The Gila was excluded. The California priorities were suppressed 2,800,000 acre-feet can be reserved for use in Arizona in the indefinite future. What more could she want? Why then that the Arizona Senators and Congressman vote against this windfall or vote against the bill? Why did Arizona bring suit in this Court to stop the construction of the dam? And why did Senator Hayden opposed the appropriation money to construct the dam? Senator Hayden is perfectly clear on it. He told the Senate in 1930, when the first appropriation bill was up, this: “Why they should not appropriate money to build Hoover Dam?” What will happen is that the waters of the Colorado River will be impounded in a Boulder Canyon reservoir and made available for use. Large quantities of water will be taken out of the Colorado River into the great All-American Canal. Over 1,000,000 acre-feet will be further taken out of the river by a pumping plant and taken over into the coastal plain of California in the vicinity of Los Angeles. They will be put to beneficial use. And once having acquired a prior right to its use, no other state can obtain the use of those waters. That was Senator Hayden's contemporary appraisal of the legislative history, what the Senate had done. That is not consistent with a curtailment of California's rights to present perfected rights. Section 6 of this Act in directing the Secretary to conform, the Article VIII of the compact is referring to an inter-basin, an inter-basin agreement. Article VIII has no intra-basin effect. The Master says that the compact is irrelevant intra-basin. Section 6 rises no higher than it source, Article VIII. It directs the Secretary to use this dam to satisfy present perfected rights instead of postponing that lien to the Glen Canyon Dam which might come at some future time. Now, a word or two in conclusion, we say there is nothing in the Boulder Canyon Project Act that deprives this Court of its function, its jurisdiction of making an equitable apportionment to decide the burden of shortages, whether that burden arises in a contest between the contractors or appropriators. Nothing in the Boulder Canyon Project Act requires the destruction of the -- of the Metropolitan Water District Act without everything in this Court's doctrine of equitable apportionment forbids that result. Thank you. Yes sir?
Hugo L. Black: (Inaudible)
Northcutt Ely: Well, the contracts of California are long since made. We aren't seeking any new ones. The contracts in Arizona only have been made to the extent of 1,100,000 acre-feet. There's a 1,700,000 within the total of this contract to the State that no user has undertaken a contract for. And I would regard it not a part of California's problem as to the standard to control the Secretary in making contracts with individual users in Arizona, except that consistently with Section 5 and Section 8 of the Reclamation Law, he must make contracts with individual users qualified under the Reclamation Law. And I would say that if a user, as appropriated under the laws of Arizona, waters to be released in Lake Mead and submits that application to the Secretary that he -- the user cannot proceed to take the water without conforming both to the contract and to the state appropriation. That's what we've done in California. Well perhaps, I didn't understand it sir. I'll try.
Hugo L. Black: (Inaudible)
Northcutt Ely: I don't understand (Inaudible) --
Hugo L. Black: (Inaudible)
Northcutt Ely: I do understand from your question, sir? You're speaking now to the allocation of the quantities if that's approved, is there remain a problem? Yes, priorities in the event of shortage.
Hugo L. Black: What?
Northcutt Ely: Priorities in the event of shortage remains. If you sustain the Master upon his allocation and quantities to the States, you nevertheless are faced what to do in the event of shortage for the water supply meet those quantities.
Hugo L. Black: (Inaudible)
Northcutt Ely: I know of no pending controversy on that issue, perhaps there is in Arizona or Nevada. There is none in California.
Hugo L. Black: (Inaudible)
Northcutt Ely: Well, apparent cross purposes here in some way that I don't grasp the implication of this question. What I say is that in the event of -- first of all, there is no -- there is no present shortage in meeting either the appropriations or the contract obligations of the Secretary with actual users. There is no quarrel with any existing user in Arizona. If hereafter individual contracts are made within individual users in Arizona and if those add up to a quantity that cannot be served together with our contracts, then the question of shortage does arise but you don't reach a question of shortage now unless you attribute to the Arizona contract the equality that we say Section 8 forbids. That is some kind of reservation and apportionment to Arizona in respect of abuse. And I can't tell you what the individual contracts would be in Arizona to add up and by -- with whom we ultimately be in conflict.
Arthur J. Goldberg: (Inaudible)
Northcutt Ely: Approximately 5,000,000 acre-feet.
Arthur J. Goldberg: (Inaudible)
Northcutt Ely: That is correct, sir.
Arthur J. Goldberg: (Inaudible)
Northcutt Ely: No, that is fixed in our contracts with the Secretary. The Secretary adopted the state law schedule of appropriations as to dates of priority and quantities. I should make this clear that the problem of shortage, I answered your question, yes, because I am assuming in the light of the earlier questions that you are attributing to the Arizona water contract that character of a present right and that water is put to use under it because this decree would be taken back as an advisory opinion to Congress under which the Central Arizona project be built. Now, if that project isn't built then no shortage, no problem.
Byron R. White: Mr. Ely.
Northcutt Ely: Excuse me, sir.
Byron R. White: Put it to you this way. I gather that you and the other States and the Solicitor General felt that there was a present controversy and dispute that should be decided as to whether or not the Master was correct in determining that in the event of the shortage, there would be proration rather than an allocation by equitable apportionment.
Northcutt Ely: That is right.
Byron R. White: And you think that is a very live controversy?
Northcutt Ely: I do Your Honor. Let me say that the case has originally pleaded and tried. It was on the assumption that the Colorado River Compact was relevant. It did constrict our water supply as so constricted, that supply would not meet the claims against it. As the Master has brought the report to you, the compact is irrelevant, he says, and we consequently are dealing with X. We are not told what the Secretary released but we do say that we are entitled to the protection of the Court's equitable apportionment doctrine where our contract --
Byron R. White: Assuming you lose in the limitation issue and that Arizona does have the water which the Master says Arizona is entitled to. But then you think the likelihood of a shortage is enough or it's imminent enough that there is live controversy on how that shortage should be apportioned among the States, if there is one.
Northcutt Ely: There is, Your Honor, if you give to the Arizona contract, a status of the reservation the Master has given. If you treat the Arizona contract as we do, as being ultra vires if it purports to make an interstate apportionment, as simply a letter of intent and announcement of the Secretary as to how far Gila go like our limitation act says in making individual contracts, then you don't know whether there is a question of priorities to deal with until you see the statute that authorizes the new project that creates the shortage. If that new project is authorized by a statute that respects the priorities of existing projects, it's conceivable and if you'll take the risk of going ahead, it might do so.
Byron R. White: That is what the Master decided.
Northcutt Ely: You're correct. The Master treats the Arizona contract as a present reservation and apportionment, a good in perpetuity, if that effect is given to it, of course there is a shortage on us now because that whole quantity is withdrawn from any stability of our use. He gives curiously enough the effect to the Arizona contract of a reservation perpetuity that he denies to paragraph (a) of Article III with respect to the Upper Basin. That is not a reservation of perpetuity, the apportionment in perpetuity says it is. The Arizona contract is although it says it's not.
Byron R. White: Well, I think that the Secretary in the event there is a shortage, if there's only going to be 6 million feet of -- reliably available, the Secretary is going to have to determine somehow which contracts he's going to honor and which ones he's not going to honor.
Northcutt Ely: I think what the Secretary should do and would do unless directed otherwise by your decree is to tell the contract holders there's a shortage, get this matter determined by a court of competent jurisdiction.
Byron R. White: And you would say that the rule -- that either he should follow or that the Court could follow is that of equitable apportionment as between the States.
Northcutt Ely: Exactly so.
Byron R. White: That made your component of which is the priority doctrine.
Northcutt Ely: Exactly so, Your Honor.
Hugo L. Black: (Inaudible)
Northcutt Ely: I hope not.
Hugo L. Black: (Inaudible)
Northcutt Ely: Your Honor, I didn't say that. In the first place, we don't think the Act did make any division. We --
Byron R. White: (Inaudible)
Northcutt Ely: But Your Honor --
Byron R. White: (Inaudible)
Northcutt Ely: No, Your Honor. First of all, the Master, with reference, did not say that the Act could make a division of the water. He denied that twice. Arizona contends that the Master rejects that argument. He says that the Act delegated to the Secretary the power to make the apportionment. He did in 1994.
Hugo L. Black: (Inaudible)
Northcutt Ely: Yes.
Hugo L. Black: (Inaudible)
Northcutt Ely: Yes.
Hugo L. Black: (Inaudible)
Northcutt Ely: Well, You Honor, again, it isn't the question whether contracts governed by state law. It's a question of what law shall govern the federal contracts that the Secretary may make today, tomorrow, next year with users in Arizona in the event of shortage. We say that the law that shall determine is the law of equitable apportionment of Section 8.
Hugo L. Black: (Inaudible)
Northcutt Ely: Yes, and we say that he's been in error in that.
Hugo L. Black: Certainly -- are we certain as to his rights -- what is left to determine with reference to the governments -- rather state law or federal law governed?
William O. Douglas: And I suppose we've decided the question if we decide it's right.
Northcutt Ely: Well, I would suppose so if you'll decide all that, in that way the premises (Voice Overlap) report.
Hugo L. Black: That's what I was at.
Northcutt Ely: I'm sorry if I failed to comprehend your question, Your Honor. Thank you.