Court Opinion

ID: 185305
Source: CourtListenerOpinion
Date Created: 2011-02-05 02:30:23+00
Date Added: 2024-06-11T09:43:06.222000
License: Public Domain

234 F.3d 714 (D.C. Cir. 2000)
Yukon-Kuskokwim Health Corporation, Petitionerv.National Labor Relations Board, Respondent
No. 99-1440
United States Court of Appeals FOR THE DISTRICT OF COLUMBIA CIRCUIT
Argued September 7, 2000Decided December 19, 2000

On Petition for Review and Cross-Application for Enforcement of an Order of the  National Labor Relations Board
James E. Glaze argued the cause for petitioner.  With him  on the briefs were Lloyd Benton Miller, Donald J. Simon,  Stephen H. Hutchings and Douglas S. Burdin.
Sharon I. Block, Attorney, National Labor Relations  Board, argued the cause for respondent.  With her on the  brief were Leonard R. Page, General Counsel, Linda Sher,  Associate General Counsel, Aileen A. Armstrong, Deputy Associate General Counsel, and Charles Donnelly, Supervisory Attorney.
Before:  Ginsburg, Randolph and Tatel, Circuit Judges.
Opinion for the Court filed by Circuit Judge Ginsburg.
Separate statement dissenting in part filed by Circuit Judge Randolph.
Ginsburg, Circuit Judge:

1
The Yukon-Kuskokwim Health  Corporation (Yukon), a non-profit organization controlled by  Alaska Native tribes, challenges the National Labor Relations  Board's assertion of jurisdiction over a hospital that Yukon  operates.  The Board properly rejected the employer's claim  to be exempt pursuant to S 2(2) of the National Labor  Relations Act (NLRA) on the ground that it is an Indian tribe  acting in a governmental capacity.  The Board failed, however, to consider the employer's argument that it is entitled to  exemption under S 2(2) because the Indian Self Determination Act (ISDA) authorizes it to act as an arm of,  and thus to share in the exemption of, the United States. Accordingly, we remand this matter to the Board for further  proceedings.

I. Background

2
A group of Alaska Native tribes formed Yukon in 1969 to  provide health services, primarily to Alaska Natives, in Southwestern Alaska.  Yukon is controlled by a board of directors  elected by the tribal councils of the 58 tribes in the region.

3
In 1975 the Congress enacted the ISDA, 25 U.S.C. SS 450  et seq., to bring about "an orderly transition from the Federal  domination of programs for, and services to, Indians to  effective and meaningful participation by Indian people in the  planning, conduct, and administration of those programs and  services."  25 U.S.C. S 450a(b).  The federal government  recognized Yukon as an "Indian tribe" for purposes of the  ISDA and, pursuant to that statute, Yukon began to assume  responsibility from the Indian Health Service, an agency  within the U.S. Department of Health and Human Services,  for the operation of clinics in native villages throughout  Southwestern Alaska.

4
In 1991 Yukon took over a hospital previously operated by  the IHS in Bethel, Alaska, the largest town in the region. Most of the federal employees at the hospital, including 40  nurses, remained on staff.  In 1996 the Board received an  election petition from a union seeking to represent the nurses.  Yukon opposed the petition on the basis of S 2(2) of the  NLRA, which excludes from the definition of "employer" "the  United States or any wholly owned Government corporation  ... or any State or political subdivision thereof."  29 U.S.C.  S 152(2).  Yukon argued that it qualified for exemption under  S 2(2) both as a political subdivision (because it is an Indian  tribe acting in a governmental capacity) and as an arm of the  United States (because it operates a federal hospital pursuant  to the ISDA).

5
The Board overruled Yukon's objection on the ground that  the Board had never applied the exemption in S 2(2) to the  activities of an Indian tribe not conducted on an Indian  reservation.  The Board certified the union and Yukon took a  refusal to bargain charge so that it could get judicial review  of the Board's order under SS 10(e) and (f) of the NLRA.  29  U.S. SS 160(e) and (f).

II. Analysis

6
Yukon advances two arguments for the proposition that its  hospital is not subject to the NLRA.  First, Yukon argues  that it qualifies under S 2(2) as a "State or political subdivision" because it is an Indian tribe acting in a governmental  capacity.  Second, Yukon argues that it shares in the exemption that S 2(2) grants to the federal government because the  ISDA authorizes it to operate a federal hospital pursuant to a  government-to-government compact with the United States.

A. Governmental Capacity

7
Yukon argues that the Board acted arbitrarily in limiting  the exemption afforded to Indian tribes under S 2(2) to  activities conducted on a reservation, rather than limiting the  exemption to "governmental activities" of Indian tribes, wherever conducted.  In our review of the Board's decision, we  "must accept the Board's position unless it conflicts with the 'unambiguously expressed intent' of the Congress or is [otherwise] not 'a permissible construction of the statute.' "  Hormel v. NLRB, 962 F.2d 1061, 1065 (D.C. Cir. 1992) (quoting  Chevron v. NRDC, 467 U.S. 837, 843 (1984)).

8
In the past, the Board has interpreted the exemption under  S 2(2) for "any State or political subdivision thereof," to  include "entities that are either (1) created directly by the  State, so as to constitute departments or administrative arms  of the government, or (2) administered by individuals who are  responsible to public officials or to the general electorate." NLRB v. Natural Gas Utility District of Hawkins County,  Tennessee, 402 U.S. 600, 604-605 (1971).  In Fort Apache  Timber Co. v. NLRB, 1976-77 NLRB Dec. (CCH) p 17,475  (Oct. 19, 1976), the Board applied this test to conclude that  because "the Fort Apache Timber Company is an entity  administered by individuals directly responsible to the Tribal  Council ... [it is] exempt as a governmental entity recognized by the United States, to whose employees the Act was  never intended to apply."  Id. at 28,876 n.22.

9
More recently, in Southern Indian Health Council v.  NLRB, 1988-89 NLRB Dec. (CCH) p 15,052 (July 29, 1998),  the Board applied the "direct responsibility" test to a hospital  located on a reservation and operated by a consortium of  seven tribes.  The Board concluded that the hospital was  exempt from the NLRA pursuant to the "State or political  subdivision" exemption because "the directors of the Employer are directly appointed by, and subject to removal by, the  governing bodies of the member tribes."  Id. at 28,226.

10
Later, in Sac & Fox Industries v. NLRB, 1992-93 NLRB  Dec. (CCH) p 17,250 (Apr. 24, 1992), the Board modified its  test for application of the "State or political subdivision"  exemption to Indian tribes.  In that case the tribe had  secured a $30 million supply contract with the Department of  Defense, for which it had built or acquired four factories not  on its reservation.  Many of the workers employed at the  acquired factories previously had been represented by a  union, but the tribe argued that its substitution as the employer made the operation exempt from the NLRA and, hence, from the obligation to bargain with the union.  The  Board rejected this claim, explaining that "[a]lthough the  Board's decision in Fort Apache [ ]contains statements to the  contrary ... we read that decision as limited to situations in  which the tribal enterprise is located on the reservation."  Id.  at 32,416.

11
Yukon argues that the Board should read Sac & Fox as  having denied exemption to the off-reservation factories in  material part because of their commercial nature, not simply  because of their location off the reservation.  The Board,  however, has never drawn a distinction based upon the nature  of the Indian enterprise.  The Board first said somewhat  tentatively in Sac & Fox that the "exemption in Section 2(2)  for a 'political subdivision' of a 'State' does not clearly include  an off-reservation tribal enterprise."  Id.  Now, the Board  has firmly concluded that an Indian tribe does not qualify as a  "State or political subdivision" for purposes of S 2(2) when it  conducts activities off its reservation.  We can hardly say that  position is unreasonable.

12
An Indian tribe, like any other governmental unit, typically  operates in its governmental capacity only within its geographical jurisdiction.  There are, to be sure, exceptions to  that general rule, as recognized, for example, in the Foreign  Sovereign Immunities Act (FSIA), 28 U.S.C. S 1605(a)(2). The distinction between commercial and governmental activities, however, is often elusive, see Princz v. Federal Republic  of Germany, 26 F.3d 1166, 1172 (D.C. Cir. 1994) (noting that  FSIA, rather than attempting to define "commercial" and  "governmental" activity, leaves to courts the task of distinguishing between the two), and the Board has long and  reasonably preferred bright line rules in order to avoid  disputes over its jurisdiction.  See, e.g., Siemons Mailing  Service, 122 N.L.R.B. 81, 85 (1958) (setting dollar threshold  for the "effect on commerce" sufficient to support Board  jurisdiction).  Accordingly, we defer to the Board's interpretation and reject Yukon's argument to the contrary.

B. The ISDA

13
Yukon also argues that it is exempt from the NLRA  pursuant to S 2(2) because that provision exempts "the United States" and here Yukon "stepped into the shoes of" and  "acts exactly for, and as, the United States" because it  operates a federal hospital pursuant to a government-togovernment compact authorized under the ISDA.*  Additionally, Yukon argues that for the Board to assert jurisdiction  over it would undermine the purpose of the ISDA, namely, to  increase tribal self-governance.

14
In the decision under review the Board mentioned but  dismissed the ISDA in a single sentence:

15
We further reject the Employer's contention that it is exempt from coverage because in light of the government-to-government Compact delegating Federal functions to the tribes on Federal property reserved and intended for that purpose, the Employer functions as an arm to [sic] the United States, and is, thus, an 'integral part of the government of the United States as a whole."

16
328 NLRB No. 101 at 4.  The Board then repeated its  conclusion that it has limited tribes' exemption under S 2(2)  "to situations in which the tribal enterprise is located on the  reservation."  Id. (emphasis in original).  The Board appears  simply to have misunderstood the tribe's argument here,  which is that its exemption derives not from its own sovereignty as an entity akin to a "State or political subdivision"  but, rather, from the exemption granted to "the United  States."  For the Board to limit to the confines of an Indian reservation the exemption granted to the United States  makes no sense.  Additionally, the Board wholly failed to  address Yukon's argument that asserting jurisdiction over the  hospital would "directly contraven[e] the ISDA's goal" of  increasing tribal self-governance.

17
As this court explained in New York Shipping v. Federal  Maritime Commission, 854 F.2d 1338, 1370 (1988):

18
[A]n agency, faced with alternative methods of effectuating the policies of the statute it administers, (1) must engage in a careful analysis of the possible effects those alternative courses of action may have on the functioning and policies of other statutory regimes, with which a conflict is claimed;  and (2) must explain why the action taken minimizes, to the extent possible, its intrusion into policies that are more properly the province of another agency or statutory regime.

19
The ISDA is undoubtedly intended to remove tribal programs  from federal oversight.  See Oklahoma Tax Comm'n v. Citizen Band Potawatomi Indian Tribe, 498 U.S. 505, 510 (1991)  (noting that ISDA "reflect[s] Congress'[s] desire to promote  the goal of Indian self-government").  Indeed, in the amendments to the ISDA enacted while this case was on review, the  Congress renewed its commitment to Indian self determination.  See Tribal Self-Governance Amendments of  2000, P.L. 106-260, 114 Stat. 711 S 2(3) (Aug. 18, 2000).

20
The Board's one-sentence rejection of Yukon's arguments  from the ISDA both relies upon what, in this context, is an  irrelevant distinction and ignores the Board's obligation to  address and to minimize conflict with another statutory regime with which a disparity is claimed.  Although the General  Counsel of the Board, in her argument before this court,  addressed in somewhat greater detail the Board's possible  reasons for rejecting Yukon's arguments from the ISDA,  " 'courts may not accept appellate counsel's post hoc rationalizations for agency action.' "  NLRB v. Metropolitan Life.  Ins., 380 U.S. 438, 444 (1965) (quoting Burlington Truck  Lines v. United States, 371 U.S. 156, 168 (1962)).

21
The Board's inadequate attention to the ISDA requires  that we remand this matter to the agency for further consideration.  See, e.g., Iowa v. FCC, 218 F.3d 756 (D.C. Cir. 2000)  (remanding for agency to address potentially dispositive argument).  On remand, the agency must determine whether  Yukon qualifies as "the United States" for purposes of S 2(2); in reaching its conclusion, the Board will need to consider  what allowance, if any, the NLRA must make in order to  accommodate federal Indian law, as reflected in the ISDA. As we noted in New York Shipping, our review of such a  determination "remains a matter of checking the [Board]  against the terms of the [labor] laws.  This is precisely the  type of appellate exercise governed by Chevron;  our review  must be correlatively deferential." 854 F.2d at 1364.  It is  for the agency, therefore, to consider the petitioner's argument in the first instance.

III. Conclusion

22
For the reason set out in Part II B above, we deny  enforcement of the order issued by the Board and remand  this case to the agency for further consideration of the  petitioner's argument from the ISDA.

23
So ordered.

Notes:

*
 Judge Randolph, in his dissent, states that his "colleagues think  that perhaps Yukon also wanted to be considered the United States  for the purpose of S 2(2)." Lest we be thought utterly mad, he  acknowledges a "hint here and there" in its briefs to this court that  Yukon "might have had this in mind," but says that this was not  "the thrust of its presentation," either before the Board or here. We think that it was a thrust.  The heading of Part IV of Yukon's  brief to the Board asserted that "The 58 Tribes are Exempt as an  Integral Part of the United States [Government]," and the ensuing  five pages (28-33) were devoted to arguing the point.  Yukon  renewed the argument before this court in the section of its brief  headed "Tribes operating pursuant to the [ISDA] are treated as the  equivalent of federal agencies under the [NLRA]."

24
Randolph, Circuit Judge, dissenting in part:

25
I agree with  the court's opinion except for part II.B., which remands the  case to the Board for "further consideration of the petitioner's  argument from the" Indian Self-Determination Act.  Maj. op.  at 8.

26
No principle of administrative law compels an agency to  respond to gibberish.  It is therefore understandable that the  Board never responded to an argument that the Indian SelfDetermination Act removed Yukon from the Board's jurisdiction. Maj. op. at 6.  The Board did not respond because  Yukon never made any coherent argument to this effect. And it barely managed to make one in this court.  About all  Yukon did before the Board and before us is slap the SelfDetermination Act down on the table in the hope that someone will figure out why it should matter.

27
Here are the few assertions Yukon presented to the Board  regarding the statute. The Self-Determination Act "authorizes and encourages tribal governments to assume operation  of federal Indian programs."  Employer's Brief on Review of  Jurisdictional Determination at 5.  Indeed it does.  "Through  the Act, Congress intended to shift programs from the federal government to tribal governments, thereby reducing federal domination of Indian programs."  Id.  That appears correct.  "Nothing in the federal government's authorization  requires that the tribes' ... activities [conducted pursuant to  the Self-Determination Act] occur 'on reservation.' " Id. at 8. This is obvious;  Yukon's hospital is not on a reservation.  (No  one--the Board included--has required Yukon or any Indian  tribe to conduct such activities on reservations.)  What then  is Yukon's point?  All of its statements about the SelfDetermination Act are contained in the section of its brief  claiming an exemption as a state or federal government under  S 2(2).  The section's heading is entitled "THE HOSPITAL  IS OPERATED BY FEDERALLY RECOGNIZED SOVEREIGN TRIBES ENTITLED TO THE GOVERNMENTAL EXEMPTION."  Id. at 4.  The "governmental exemption" is S 2(2) of the National Labor Relations Act, 29 U.S.C.  S 152(2), the provision granting an exemption to the federal government and state and local governments. The Board  rejected this argument, correctly we all agree at least to the  extent Yukon wanted to be considered a state.  So what was  left of Yukon's reliance on the Self-Determination Act in its  case before the Board?  There are two possibilities--nothing  or nothing comprehensible.  In either event, the Board had  no duty to respond.

28
My colleagues think that perhaps Yukon also wanted to be  considered the United States for the purpose of S 2(2).  (The  section provides in relevant part that the term employer  "shall not include the United States or any wholly owned  Government corporation." 29 U.S.C. S 152(2).)  Yukon's  briefs in this court hint here and there that it might have had  this in mind, although the thrust of its presentation to this  court and the Board was the rather inconsistent assertion  that it--Yukon--was a separate, independent sovereign.  See,  e.g., Brief of Petitioner at 36 (characterizing relationship  under Self-Determination Act as "inter-governmental delegation, transferring responsibility from one sovereign to another");  Employer's Brief on Review of Jurisdictional Determination (No. 19-RC-13271) at 5 ("[a]ccess to the benefits of the  Act is only available to sovereigns");  id. ("by definition under  the Act, only sovereigns may compact as an exercise of their  sovereignty").

29
At all events, the Board said enough on this subject, given  the incoherence of Yukon's position.  The Board wrote:  "Significantly, the Employer was not brought into existence by a  special legislative Act.  Rather, it is a regional nonprofit  corporation formed ... under applicable Alaska laws.  Under  these circumstances, we find that the Employer is not exempt  under Section 2(2) 'as an integral part of the government of  the United States as a whole.' " Decision and Order, Yukon  Kuskokwim Health Corp., 329 N.L.R.B. No. 101 at 4 (June  18, 1999).  In other words, whatever the Self-Determination  Act means, or whatever Yukon thinks it means, Yukon remains an independent Alaska corporation, not a part of the  government of the United States.  If Yukon believes the Act  provides otherwise, it has yet to explain why.