Court Opinion

ID: 4644699
Source: CourtListenerOpinion
Date Created: 2020-12-18 18:00:28.23092+00
Date Added: 2024-06-11T08:00:47.516986
License: Public Domain

In the

    United States Court of Appeals
                  For the Seventh Circuit
                    ____________________
Nos. 20-1672 & 20-1724
INTERNATIONAL UNION OF OPERATING ENGINEERS,
LOCAL 139, AFL-CIO, et al.,
                         Plaintiffs-Appellants, Cross-Appellees,

                                 v.

JAMES J. DALEY,
                                                Defendant-Appellee,

                                and

WISCONSIN LEGISLATURE,
                            Cross-Appellant, Proposed Intervenor.
                    ____________________

        Appeals from the United States District Court for the
                   Eastern District of Wisconsin.
           No. 19-cv-01233 — J. P. Stadtmueller, Judge.
                    ____________________

 ARGUED NOVEMBER 13, 2020 — DECIDED DECEMBER 17, 2020
               ____________________

   Before FLAUM, ROVNER, and BRENNAN, Circuit Judges.
   FLAUM, Circuit Judge. This First Amendment case repre-
sents the third constitutional challenge to Wisconsin’s Act 10
to reach this Court. We previously addressed Act 10 in
2                                        Nos. 20-1672 & 20-1724

Wisconsin Education Association Council v. Walker (WEAC),
705 F.3d 640 (7th Cir. 2013), and Laborers Local 236 v. Walker
(Laborers), 749 F.3d 628 (7th Cir. 2014). Act 10 significantly al-
tered Wisconsin’s public-employee labor laws. The Act sepa-
rated public employees into two classes—a select group of
“public safety employees” with the remainder classified as
“general employees.” It then made it more challenging for
general-employee unions to retain certification as exclusive
bargaining agents, prohibited public-sector employers from
collectively bargaining with their general employees over an-
ything except base wages, and prohibited public employers
from deducting union dues from general employees’
paychecks.
    Plaintiffs-appellants, a public-employee labor union and
two of its individual members, challenged these three
provisions—the annual recertification requirement, the
limitations on collective bargaining, and the prohibition on
payroll deduction of union dues—arguing that the provisions
infringe on their First Amendment rights. The chairman of the
Wisconsin Employment Relations Commission (WERC)
moved to dismiss. Shortly thereafter, the Wisconsin
Legislature moved to intervene. In two separate orders, the
district court dismissed plaintiffs-appellants’ complaint in
part for lack of standing and in part for failure to state a claim.
The district court also denied the Legislature’s motion to
intervene. Plaintiffs-appellants appeal the dismissal of their
complaint. The Legislature cross-appeals the denial of its
motion to intervene. We now affirm.
Nos. 20-1672 & 20-1724                                        3

                      I.   Background
       A. Act 10’s Statutory and Legal History
    Wisconsin grants public-sector employees the right to bar-
gain collectively through two principal laws: the State Em-
ployment Labor Relations Act (SELRA) and the Municipal
Employment Relations Act (MERA). These statutes define the
rights of public employees and their unions as well as their
relationship with state and municipal employers. Prior to
2011, public-sector unions enjoyed broad protections and
privileges under SELRA and MERA. Governmental employ-
ers were obligated to bargain in good faith with employee
representatives over a wide range of subjects, including
wages and conditions of employment. Public-sector unions
could petition WERC for an election to certify the union as the
employees’ exclusive bargaining agent. This certification re-
quired only a simple majority of those voting, and the union
remained the employees’ exclusive agent until 30% of the em-
ployee union members petitioned for a decertification elec-
tion. Unions could also utilize the state and municipal payroll
systems to automatically collect membership dues.
    In 2011, however, the Wisconsin Legislature amended
SELRA and MERA with the passage of Act 10. See 2011 Wis.
Act 10, 2011 Wis. Sess. Laws 23. Act 10 divided Wisconsin
state and municipal employees into two classes: “[p]ublic
safety employee[s],” which includes police officers, firefight-
ers, and deputy sheriffs, and “general municipal em-
ployee[s],” i.e., everyone else. See Wis. Stat. § 111.70(1)(fm),
(mm). A subsequent amendment created a third class of
“[t]ransit employee[s].” See id. § 111.70(1)(fm). Public safety
and transit employees and their unions continue to operate
under the pre-Act 10 scheme.
4                                            Nos. 20-1672 & 20-1724

    On the other hand, Act 10 subjected general employees to
the various restrictions on union activity. First, Act 10 limited
the scope of state and municipal employers’ collective-
bargaining obligations with respect to these employees. The
Act still requires public employers to collectively bargain
with general employees over base-wage increases, but it
prohibits public employers from bargaining over anything
else, including but not limited to other forms of
compensation—such as overtime or premium pay—as well as
nonwage issues. See id. §§ 111.70(1)(a), 111.70(4)(mb),
111.81(1), 111.91(3). Act 10 further mandates that general-
employee unions submit to an annual recertification election
to retain their status as the employees’ exclusive agent,
instead of allowing unions to remain certified indefinitely. Id.
§ 111.70(4)(d)3.b. Certification now requires affirmative votes
from an absolute majority—“at least 51 percent”—of all
employees in the bargaining unit, not just those voting. Id.
§§ 111.70(4)(d)3.b., 111.83(3)(b). Finally, Act 10 bars public
employers from deducting union dues from the earnings of
general employees. Id. § 111.70(3g).1
    We have already rejected two challenges to Act 10’s
constitutionality. The first came in WEAC, where we held that
Act 10’s prohibition on payroll deductions did not violate the
First Amendment. 705 F.3d at 645. We concluded that the
unions’ previous use of the payroll system was equivalent to
the state subsidizing the unions’ speech. Id. at 646–48.

1 Act 10 also precludes unions from imposing “fair-share” agreements on
general employees, which require nonunion employees to pay a portion
of the costs associated with the collective-bargaining process. Wis. Stat.
§§ 111.70(2), 111.85. Plaintiffs-appellants do not challenge the constitu-
tionality of these provisions in their complaint.
Nos. 20-1672 & 20-1724                                          5

Wisconsin could thus withdraw this subsidy from certain
groups so long as it did so on a viewpoint-neutral basis, and
Act 10’s distinction between public safety and general
employees was, in fact, viewpoint neutral. Id. at 648–49. We
also upheld Act 10’s collective-bargaining limitation,
recertification   requirement,      and     payroll-deduction
prohibition in the face of the WEAC plaintiffs’ Fourteenth
Amendment equal protection challenge, concluding that
these provisions survived rational basis review. Id. at 654–57.
    We considered a second challenge to Act 10 in Laborers.
The plaintiffs there argued that Act 10’s collective-bargaining
limitation violated their First Amendment right to petition
and that its various restrictions, in their cumulative effect, vi-
olated their First Amendment association rights. 749 F.3d at
634. They also challenged the collective-bargaining limitation
under the Equal Protection Clause, arguing that it impermis-
sibly disadvantaged represented employees compared to
nonunion employees. Id. at 639. We held that the challenged
provisions did not infringe the plaintiffs’ First or Fourteenth
Amendment rights. See id. at 638–41.
    In addition, the Wisconsin Supreme Court upheld Act 10
in Madison Teachers, Inc. v. Walker, 2014 WI 99, 358 Wis. 2d 1,
851 N.W.2d 337. The plaintiffs in that case alleged that the
collective-bargaining        limitation,    payroll-deduction
prohibition, prohibition of fair-share agreements, and annual
recertification requirement violated their First Amendment
associational and Fourteenth Amendment equal protection
rights. Id. ¶ 2. The state supreme court rejected each
challenge, holding that “[n]o matter the limitations or
‘burdens’ a legislative enactment places on the collective
bargaining process, collective bargaining remains a creation
6                                         Nos. 20-1672 & 20-1724

of legislative grace and not constitutional obligation.” See id.
¶ 160–61.
       B. Factual and Procedural Background
    Plaintiffs-appellants here, Local 139, a general-employee
union, and Karen Erickson and Heath Hanrahan, two of its
individual members, challenge the three provisions of Act 10
described above: the (1) stricter recertification requirement,
(2) limitation on permissible collective-bargaining subjects,
and (3) prohibition on payroll deductions of union dues. They
filed a three-count complaint against defendant-appellee
James Daley, chairman of WERC, in federal district court, al-
leging that these provisions violate their rights under the First
and Fourteenth Amendments and seeking declaratory and in-
junctive relief. The district court deemed plaintiffs-appellants’
Fourteenth Amendment claims waived below, and plaintiffs-
appellants do not raise them here. Therefore, our analysis pro-
ceeds along only First Amendment lines. See United States v.
Bryant, 750 F.3d 642, 651 (7th Cir. 2014) (“Failure to develop
an argument on appeal results in waiver even if the argument
was presented to the district court.”).
    In Count 1, plaintiffs-appellants claimed that the annual
recertification requirement violates their First Amendment
rights by compelling them to vote “no,” contrary to their wish
not to vote at all. Specifically, they alleged that the recertifica-
tion provision “declares that a non-vote is a vote against Un-
ion representation” and “[b]y equating not voting with voting
no, Act 10 directly infringes on the rights of public employees
to not engage in speech.” Plaintiffs-appellants asserted that
they had been “directly harmed by this provision of Act 10”
in an April 2019 election when Local 139 “received 100% of all
ballots cast,” but because a majority of employees did not
Nos. 20-1672 & 20-1724                                                   7

vote, and Act 10 counted their nonvotes as no votes, Local 139
“was not recertified as the bargaining unit representative.”
    In Count 2, plaintiffs-appellants alleged that Daley had
unlawfully interpreted Act 10’s collective-bargaining limita-
tion to preclude unions and municipal employers from enter-
ing into any agreements regarding nonwage issues, even out-
side of collective bargaining. Plaintiffs-appellants asserted
that this interpretation of Act 10 “imposes an arbitrary re-
striction” upon their ability to negotiate or contract with mu-
nicipal employers on matters of public concern, in violation
of the First Amendment.
    Finally, in Count 3, plaintiffs-appellants alleged that the
payroll-deduction prohibition “constitutes a content based re-
striction on public employees’ First Amendment rights.”
They acknowledged that we have “upheld the payroll dues
deduction prohibition pursuant to Act 10,” but they asked the
district court to revisit those prior determinations in light of
the Supreme Court’s decision in Janus v. American Federation
of State, County, & Municipal Employees, Council 31, 138 S. Ct.
2448 (2018).
   Daley moved to dismiss under Federal Rule of Civil Pro-
cedure 12(b)(6) for failure to state a claim. Defendant-appellee
the Wisconsin Legislature then moved to intervene as a de-
fendant and simultaneously filed a proposed motion to dis-
miss.2 The district court dismissed Counts 2 and 3 of the com-
plaint in an order issued March 3, 2020, and subsequently dis-
missed Count 1 in a separate order issued April 7, 2020.

2 Kristi Koschkee, a public-school teacher, also moved to intervene below.

She did not file a notice of appeal from the denial of her motion to inter-
vene, however, and is not a party on appeal.
8                                       Nos. 20-1672 & 20-1724

     Regarding Count 1, which challenged Act 10’s recertifica-
tion requirement, the district court held that only the individ-
ual plaintiffs could have Article III standing because the recer-
tification provision regulates voting for a union, and “a per-
son’s right to vote is individual and personal in nature.” The
court held that it was “not clear” whether the individual
plaintiffs had alleged facts sufficient for standing. The district
court therefore ordered plaintiffs-appellants to file a supple-
mental brief addressing the issue of standing as to Count 1.
    In their supplemental response, plaintiffs-appellants re-
quested leave to file an amended complaint adding allega-
tions to establish the individual plaintiffs’ standing. For Er-
ickson, the plaintiffs-appellants explained that an amended
complaint would allege that she “abstained from voting in the
2019 recertification election,” she “did want and does want
Local 139 to serve as her exclusive bargaining representative,”
and “her abstention from voting was not intended to express
an intent that she was voting against representation by Local
139. At most, her intent in abstaining from voting was to ac-
cept the will of those who chose to vote.” Therefore, by con-
verting her nonvote into a “no” vote, she “was injured by …
the State compel[ling] her to speak against representation by
Local 139” in a manner contrary to her wishes. Regarding
Hanrahan, plaintiffs-appellants stated that an amended com-
plaint would allege that he did vote in favor of Local 139 con-
tinuing to represent him as his exclusive bargaining repre-
sentative, and his vote was “unconstitutionally diluted” when
“the compelled speech of the non-voters le[d] to results which
actually reversed the will of those who did vote.”
   The district court then dismissed Count 1, concluding that
the individual plaintiffs lacked standing. The court explained
Nos. 20-1672 & 20-1724                                          9

that even if the individual plaintiffs could allege an injury in
fact, they were “unable to adequately allege causation” be-
cause that injury “would be fairly traceable to their fellow un-
ion members,” and those members’ decisions not to vote, not
Daley. The district court further reasoned that “the Supreme
Court [has] envisaged that a legislature could pass a law re-
quiring a majority of voters to weigh in” for a ballot proposi-
tion to succeed. The district court therefore denied plaintiffs-
appellants leave to amend on futility grounds.
    Regarding Count 2, the district court also held that
plaintiffs-appellants lacked standing to challenge Act 10’s
collective-bargaining limitation. Citing to our decision in
Laborers, the district court stated that the collective-bargaining
limitation “does not violate Plaintiffs’ First Amendment
rights because it does not prevent the union or its members
from speaking.” The court further concluded that to the extent
plaintiffs-appellants alleged that Daley’s application of the
collective-bargaining limitation was unconstitutional because
it “prohibit[ed] municipal employers from listening to what
the unions have to say, then the injury would run to the
municipal employers,” not to plaintiffs-appellants.
    Finally, the district court dismissed Count 3’s challenge to
Act 10’s payroll-deduction prohibition on the merits. The
court noted that we had “already upheld payroll deduction
prohibitions” against a First Amendment challenge in WEAC
under the framework set forth in Ysursa v. Pocatello Education
Association, 555 U.S. 353, 358–59 (2009). Specifically, the
district court recognized WEAC’s holding that the payroll-
deduction prohibition constituted a viewpoint-neutral
withdrawal of a state subsidy of unions’ speech and imposed
a viewpoint-neutral distinction between public safety and
10                                      Nos. 20-1672 & 20-1724

general employees. See WEAC, 705 F.3d at 649, 652–53. The
district court also rejected plaintiffs-appellants’ reliance upon
the Supreme Court’s decisions in Janus and Citizens United v.
Federal Election Commission, 558 U.S. 310 (2010), to argue that
the payroll-deduction prohibition violated individual union
members’ First Amendment rights, stating that WEAC and
Ysursa remain good law.
    The district court’s orders together resulted in the
dismissal of the case. Accordingly, the court also denied as
moot the Legislature’s pending motion to intervene.
Plaintiffs-appellants appealed the dismissal of their claims.
The Legislature cross-appealed the denial of its motion to
intervene. We consolidated the appeals for consideration.
                      II.   Discussion
    On appeal, plaintiffs-appellants argue that the district
court erred by dismissing Counts 1 and 2 for lack of standing
and Count 3 for failure to state a claim. “If the plaintiff lacks
standing, the federal court lacks subject matter jurisdiction
and the suit must be dismissed under [Federal Rule of Civil
Procedure] 12(b)(1).” Taylor v. McCament, 875 F.3d 849, 853
(7th Cir. 2017). We review a dismissal both for lack of subject
matter jurisdiction under Rule 12(b)(1) and for failure to state
a claim under Rule 12(b)(6) de novo. See id.; Degroot v. Client
Servs., Inc., 977 F.3d 656, 659 (7th Cir. 2020). “Generally, deni-
als of leave to amend are reviewed for abuse of discretion.”
Runnion ex rel. Runnion v. Girl Scouts of Greater Chi. & Nw. Ind.,
786 F.3d 510, 524 (7th Cir. 2015). But review of “futility-based
denials includes de novo review of the legal basis for the futil-
ity.” Id.
Nos. 20-1672 & 20-1724                                          11

       A. Standing as to Counts 1 and 2
    Our analysis begins with the district court’s conclusions
that plaintiffs-appellants lack standing as to Counts 1 and 2.
“To reach the merits of a case, an Article III court must have
jurisdiction.” Va. House of Delegates v. Bethune-Hill, 139 S. Ct.
1945, 1950 (2019). “One essential aspect of this requirement is
that any person invoking the power of a federal court must
demonstrate standing to do so.” Hollingsworth v. Perry,
570 U.S. 693, 704 (2013). To establish standing, “the plaintiff
must allege an injury in fact that is traceable to the defendant’s
conduct and redressable by a favorable judicial decision.”
Casillas v. Madison Ave. Assocs., Inc., 926 F.3d 329, 333 (7th Cir.
2019) (citing Lujan v. Defs. of Wildlife, 504 U.S. 555, 560–61
(1992)). “Foremost among these requirements is injury in
fact—a plaintiff’s pleading and proof that he has suffered the
‘invasion of a legally protected interest’ that is ‘concrete and
particularized,’ i.e., which ‘affect[s] the plaintiff in a personal
and individual way.’” Gill v. Whitford, 138 S. Ct. 1916, 1929
(2018) (alteration in original) (quoting Lujan, 504 U.S. at 560 &
n.1)). The allegations in a complaint must establish that the
plaintiff has “a personal stake in the outcome of the contro-
versy,” id. at 1929 (quoting Baker v. Carr, 369 U.S. 186, 204
(1962)), rather than a “generalized grievance about the con-
duct of government,” id. at 1931 (quoting Lance v. Coffman,
549 U.S. 437, 442 (2007)). “In determining at the pleadings
stage whether the plaintiff’s showing of standing passes mus-
ter, we accept as true the pleaded factual matter and draw all
reasonable inferences in favor of the plaintiff.” Democratic
Party of Wis. v. Vos, 966 F.3d 581, 585 (7th Cir. 2020).
12                                      Nos. 20-1672 & 20-1724

          1. Count 1: The Recertification Requirement
    We turn first to plaintiffs-appellants’ challenge to the
annual recertification election requirement in Count 1. As a
preliminary issue, Daley contends that our consideration on
appeal of plaintiffs-appellants’ standing is limited to the
allegations contained in the filed complaint, rather than the
additional allegations plaintiffs-appellants submitted to the
district court in their supplemental brief. We disagree. While
the district court’s local rules required plaintiffs-appellants to
formally move to amend their complaint, see E.D. Wis. Civ.
R. 15, the district court acted within its discretion to consider
the allegations in the supplemental brief, see Petty v. City of
Chicago, 754 F.3d 416, 420 (7th Cir. 2014) (“We have
consistently and repeatedly upheld a district court’s
discretion to require strict compliance with its local rules … .”
(citation and internal quotation marks omitted)).
Furthermore, federal courts “have an independent obligation
to confirm our jurisdiction before adjudicating a case.”
Gadelhak v. AT&T Servs., Inc., 950 F.3d 458, 461 (7th Cir. 2020).
Having determined it required more information to fulfill this
obligation, the district court requested supplemental briefing
regarding standing. The court then based its decision to
dismiss Count 1 and deny leave to amend on futility grounds,
at least in part, on the allegations in plaintiffs-appellants’
supplemental brief. Therefore, we may appropriately
consider these additional allegations on appeal.
    Count 1 focuses on whether Act 10 impermissibly compels
speech from public employees who wish to remain silent.
Specifically, it alleges that Act 10’s recertification requirement
infringes on plaintiffs-appellants’ First Amendment right not
to engage in speech because it effectively provides that
Nos. 20-1672 & 20-1724                                        13

nonvotes in the recertification election will be counted as
votes against union representation, rather than not being
counted at all. In its initial dismissal order requesting
supplemental briefing as to Count 1, the district court
explained that only the individual plaintiffs, and not Local
139, could have standing to sue because the right to vote is
“individual and personal in nature.” See Gill, 138 S. Ct. at
1929. Plaintiffs-appellants then explained in their
supplemental brief that they could amend their complaint to
allege    that      Act     10’s    recertification     provision
unconstitutionally compelled Erickson—who supported
Local 139’s recertification and whose intent in abstaining from
voting “was to accept the will of those who chose to vote”—
to engage in speech she did not support by converting her
nonvote into a “no” vote. They also stated that an amended
complaint would allege that the recertification provision
diluted Hanrahan’s vote in favor of Local 139 by compelling
speech from those who abstained from voting, thus reversing
the results of the election. They also asserted that these
alleged injuries gave Local 139 associational standing to sue
on the individual plaintiffs’ behalf. Plaintiffs-appellants argue
that these allegations satisfy Article III’s standing
requirements. We disagree.
    Regardless of whether plaintiffs-appellants have suffi-
ciently alleged a constitutional injury in fact as to Erickson
and Hanrahan, they have not pleaded “a causal connection
between the injury and the challenged action.” United States
v. Funds in the Amount of $239,400, 795 F.3d 639, 643 (7th Cir.
2015) (citing Lujan, 504 U.S. at 560–61). Plaintiffs-appellants
contend that the individual plaintiffs’ injuries—compelled
speech and vote dilution—are traceable to Act 10’s treatment
of nonvotes. The chain of causation between those purported
14                                      Nos. 20-1672 & 20-1724

injuries and Act 10 depends, however, on “the independent
action of some third part[ies] not before the court,” Lujan,
504 U.S. at 560 (quoting Simon v. E. Ky. Welfare Rts. Org.,
426 U.S. 26, 41–42 (1976)), specifically, the decisions of union
members who favored recertification not to vote in the recer-
tification election. As the Wisconsin Supreme Court has ex-
plained, “Act 10’s certification election provisions merely
specify the statutory requirements a certified representative
must satisfy in order to exclusively negotiate on behalf of the
general employees in its bargaining unit.” Madison Teachers,
2014 WI 99, ¶ 65. Nothing in Act 10 impedes members’ ability
to vote or requires or directs them how to vote.
   Stated differently, the individual plaintiffs’ injuries
depend on fewer than 51% of members choosing to
participate in the election. That fact alone undermines
plaintiffs-appellants’ ability to satisfy the requirement that
any injury in fact be fairly traceable to Act 10’s recertification
provision. See Clapper v. Amnesty Int’l USA, 568 U.S. 398, 414
(2013) (expressing “reluctance to endorse standing theories
that rest on speculation about the decisions of independent
actors”). Moreover, as the district court observed, if Erickson
and the other nonvoting members freely decided to abstain
despite having presumed knowledge of Act 10’s absolute-
majority requirement, then plaintiffs-appellants’ injuries
“would be fairly traceable to their fellow union members,”
not Act 10 or Daley. See Cheek v. United States, 498 U.S. 192, 199
(1991) (explaining that the common law presumes that “every
person kn[ows] the law.”).
    In sum, plaintiffs-appellants’ allegations regarding Count
1 in their complaint and supplemental briefing do not estab-
lish that the claimed injuries to Erickson or Hanrahan are
Nos. 20-1672 & 20-1724                                         15

fairly traceable to Act 10’s recertification provision. The indi-
vidual plaintiffs-appellants thus do not have standing. Fur-
thermore, we agree with the district court’s conclusion that
amendment as to Count 1 would be futile. Although Federal
Rule of Civil Procedure 15(a)(2) directs courts to “freely give
leave [to amend] when justice so requires,” courts may deny
a proposed amended pleading if the amendment would be
futile. Here, the fact that plaintiffs-appellants have not alleged
standing to sue, despite receiving instruction from the district
court and an opportunity to file supplemental briefing, indi-
cates the futility of granting further leave to amend.
    We also conclude that Local 139 lacks standing as to Count
1. The only theory of standing plaintiffs-appellants assert for
Local 139 is associational standing on behalf of its members.
Associational standing requires an organization’s “mem-
bers … [to] have standing to sue in their own right.” Vos,
966 F.3d at 586. Because we determine that no member of Lo-
cal 139 has standing to challenge this provision, Local 139
does not have standing to sue on their behalf. See Hunt v.
Wash. State Apple Advert. Comm’n, 432 U.S. 333, 343 (1977).
          2. Count 2: The Collective-Bargaining Limitation
   Regarding Count 2, plaintiffs-appellants allege that
Daley’s interpretation of Act 10’s collective-bargaining
limitation wrongfully prohibits all agreements between
unions and municipal employers regarding nonwage issues,
even if not collectively bargained. They assert that this
wrongful interpretation injured Local 139 by precluding it
from “entering into agreements that are fully consistent with
Act 10.” Relying on our decision in Laborers, the district court
held that plaintiffs-appellants lacked standing because Act 10
did not infringe their First Amendment rights. On appeal,
16                                             Nos. 20-1672 & 20-1724

plaintiffs-appellants acknowledge Laborers but contend that
the district court erred in dismissing Count 2 for lack of
standing because Daley’s interpretation goes beyond the
statutory text to “prevent[] the giving and receiving of speech
(i.e., a back and forth conversation), which is not prohibited
by Wis. Stat. [§] 111.70(a)(1) or Act 10 generally.”
     In Laborers, the plaintiff unions argued that Act 10’s
collective-bargaining limitation3 violated their First
Amendment petition clause rights because it “bars Wisconsin
public employers from voluntarily entering into binding
negotiations with a group of employees,” even if they want to
bargain outside of MERA’s statutory framework, 749 F.3d at
633, 636, essentially the same argument that plaintiffs-
appellants make here. We rejected that claim, concluding that
Act 10’s collective-bargaining limitation “does not proscribe
any conduct by the unions themselves.” Id. at 634. It “does not
prohibit the unions from forming,” “meeting,” or
“advocating on behalf of their members in any way they see
fit.” Id. Furthermore, “[n]othing in … Act 10 generally[]
precludes the unions or their members from expressing their
views to their municipal employer or from trying to persuade
the employer to adopt a particular policy.” Id. at 636. “Instead,
the collective-bargaining restriction acts upon government
employers. The statute tells these employers that they may not
enter into binding agreements with their employees on a

3 The specific provision at issue in Laborers provides that except as stated
under Wis. Stat. § 111.70 et seq. “no local governmental unit may collec-
tively bargain with its employees.” Wis. Stat. § 66.0508(1m). The chal-
lenged provision here, Wis. Stat. § 111.70(4)(mb)1., prohibits municipal
employers, a local governmental unit, from collectively bargaining with
employees about anything except total base wages.
Nos. 20-1672 & 20-1724                                        17

collective basis about anything other than base wages.” Id. at
634–35. Thus, “general employees remain free to associate
and represented employees and their unions remain free to
speak; municipal employers are simply not allowed to listen.”
Id. at 635 (citation omitted); see also WEAC, 705 F.3d at 646
(“Act 10 places no limitations on the speech of general
employee unions, which may continue speaking on any topic
or subject.”).
    Plaintiffs-appellants have not pleaded a constitutional in-
jury under Laborers. They alleged in the complaint and argue
on appeal that municipal employers “approached Local 139
to provide services relating to training, temporary staffing
and health benefits.” They also argue that the “same munici-
palities declined to enter into agreements with Local 139
based on advice they received from WERC that such agree-
ments would violate Act 10.” Under plaintiffs-appellants’
view, then, they could otherwise freely discuss certain topics
with municipal employers, but Act 10 restricted the munici-
pal employers from entering into agreements regarding those
topics. That situation is fully consistent with Laborers. Accord-
ingly, plaintiffs-appellants have suffered no invasion of their
First Amendment rights from Daley’s interpretation and ap-
plication of Act 10’s collective-bargaining limitation because
they retain their rights to speak and associate freely. Moreo-
ver, to the extent they allege that Act 10, as applied, is uncon-
stitutional because Daley interprets it to preclude municipal
employers from listening to the union’s speech, we agree with
the district court that “the injury would run to the municipal
employers, not to the union.”
   Perhaps anticipating this conclusion, as a backstop
plaintiffs-appellants encourage us to revisit our
18                                      Nos. 20-1672 & 20-1724

determination in Laborers that Act 10’s collective-bargaining
limitation is constitutional because it does not restrict the
ability of unions and their members to speak, only the ability
of municipal employers to listen. They assert that the
Supreme Court’s decision in Janus recognized that the right of
unions and their members to speak on topics of public
concern, whether through collective bargaining or otherwise,
includes “the right to have a meaningful interaction when a
municipality is willing.” Therefore, they are “troubled by the
rationale” we espoused in Laborers.
    We decline to reconsider our precedent. Our holding in
Laborers relied on the Supreme Court’s decisions in Smith v.
Arkansas State Highway Employees, Local 1315, 441 U.S. 463
(1979) (per curiam), and Minnesota State Board for Community
Colleges v. Knight, 465 U.S. 271 (1984). Those cases held that
the First Amendment does not entitle public employees to an
audience with the government. See Smith, 441 U.S. at 465
(“[T]he First Amendment does not impose any affirmative ob-
ligation on the government to listen, to respond or, in this con-
text, to recognize the association and bargain with it.”);
Knight, 465 U.S. at 285, 286–87 (“Nothing in the First Amend-
ment or in this Court’s case law interpreting it suggests that
the rights to speak, associate, and petition require govern-
ment policymakers to listen or respond to individuals’ com-
munications on public issues.”). While plaintiffs-appellants
argue that in light of Janus “there is every reason to believe
the Supreme Court would be open to righting this historical
wrong to the extent Smith and Knight bar Plaintiffs’ claim on
this issue,” Smith and Knight remain good law; Janus did not
address either case, and plaintiffs-appellants provide no
meaningful explanation as to why or how Janus affects Smith
and Knight. “No lower federal court can overrule a Supreme
Nos. 20-1672 & 20-1724                                         19

Court precedent.” Foreman v. Wadsworth, 844 F.3d 620, 623
(7th Cir. 2016). Therefore, Laborers dictates the outcome here.
See De Leon Castellanos v. Holder, 652 F.3d 762, 765 (7th Cir.
2011) (noting that “it would take compelling circumstances,
or an intervening on-point Supreme Court decision, to dis-
turb” settled circuit precedent).
   Accordingly, we agree with the district court that
plaintiffs-appellants lack standing to bring their Count 2
challenge to Act 10’s collective-bargaining limitation.
       B. Failure to State a Claim as to Count 3
    We turn next to the district court’s dismissal of Count 3 for
failure to state a claim for which relief may be granted. In re-
viewing a district court’s grant of a motion to dismiss for fail-
ure to state a claim, we “accept well-pleaded facts as true and
draw all reasonable inferences in the plaintiffs’ favor.” Shipley
v. Chi. Bd. of Election Comm’rs, 947 F.3d 1056, 1060–61 (7th Cir.
2020). To withstand a motion to dismiss, a complaint must
“state a claim to relief that is plausible on its face.” Bell Atl.
Corp. v. Twombly, 550 U.S. 544, 570 (2007). “A claim has facial
plausibility when the plaintiff pleads factual content that al-
lows the court to draw the reasonable inference that the de-
fendant is liable for the misconduct alleged.” Ashcroft v. Iqbal,
556 U.S. 662, 678 (2009).
    In Count 3, plaintiffs-appellants claim that Act 10’s preclu-
sion of voluntary dues deductions infringes on individual
employees’ First Amendment rights. They acknowledge that
we upheld Act 10’s payroll-deduction prohibition in WEAC,
and that our precedent and that of the Supreme Court, partic-
ularly Ysursa v. Pocatello Education Association, appear to fore-
close their challenge. Nonetheless, plaintiffs-appellants make
20                                      Nos. 20-1672 & 20-1724

a convoluted attempt to distinguish this case from Ysursa and
WEAC. Failing that, plaintiffs-appellants also argue that we
should revisit our WEAC decision through the lens of the Su-
preme Court’s decisions in Janus and Citizens United v. Federal
Election Commission.
    In Ysursa, the Supreme Court upheld a law prohibiting
payroll deductions for union political activities because the
First Amendment “does not confer an affirmative right to use
government payroll mechanisms for the purpose of obtaining
funds for expression.” 555 U.S. at 355. Therefore, “a legisla-
ture’s decision not to subsidize the exercise of a fundamental
right does not infringe the right.” Id. at 358 (quoting Regan v.
Tax’n With Representation of Wash., 461 U.S. 540, 549 (1983)).
The Court concluded that while “publicly administered pay-
roll deductions for political purposes can enhance the unions’
exercise of First Amendment rights,” states have “no obliga-
tion to aid the unions in their political activities.” Id. at 359.
Moreover, the decision not to allow payroll deductions “is not
an abridgment of the unions’ speech”; instead, “they are free
to engage in such speech as they see fit.” Id. Payroll-deduction
prohibitions thus represent a state’s decision to “decline[] to
promote that speech by allowing public employee checkoffs
for political activities.” Id. at 355.
    We applied Ysursa in WEAC to uphold Act 10’s payroll-
deduction prohibition against a First Amendment challenge.
The plaintiffs there attempted to distinguish Act 10 from the
law in Ysursa by noting that Act 10’s prohibition applied only
to general employees, rather than all public employees.
WEAC, 705 F.3d at 646. We held that this distinction did not
alter the analysis because “Act 10 erects no barrier to speech
and speaker-based discrimination is permissible when the
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state subsidizes speech.” Id. In other words, a “government
subsidy ‘that discriminates among speakers does not impli-
cate the First Amendment unless it discriminates on the basis
of ideas.’” Id. (quoting Leathers v. Medlock, 499 U.S. 439, 450
(1991)). Applying that understanding, we held Act 10 to be
constitutional under rational basis review because it “is nei-
ther facially discriminatory nor a neutral façade for viewpoint
discrimination.” Id. at 648.
    Plaintiffs-appellants attempt to escape this precedent by
arguing that WEAC did not consider Act 10’s impact on the
First Amendment rights of individual employees, rather than
unions—as distinct from the analysis in Ysursa. This argu-
ment overlooks the fact that the Supreme Court rendered this
distinction immaterial in Ysursa by concluding that “the State
is not constitutionally obligated to provide payroll deduc-
tions at all,” so long as it does not discriminate based on view-
point. 555 U.S. at 359. While plaintiffs-appellants complain
that Ysursa’s rationale “defies logic,” that does not change the
fact that it is binding on this Court.
    We find similarly unavailing plaintiffs-appellants’ argu-
ment that Ysursa’s rationale does not apply here because Act
10, unlike the statute in Ysursa, “does not impose a blanket
prohibition or draw constitutionally permissible lines” be-
cause it “allows payroll deductions for some favored Unions,
but not others.” We rejected these exact arguments in WEAC;
we concluded both that “speaker-based discrimination is per-
missible when the state subsidizes speech” and that “Act 10
is neutral—it does not tie public employees’ use of the state’s
payroll system to speech on any particular viewpoint.”
705 F.3d at 646, 648. Therefore, Act 10’s payroll-deduction
prohibition passed rational basis review, despite applying
22                                       Nos. 20-1672 & 20-1724

only to general employees and not public safety employees.
Id. at 657.
    In an effort to save their claim, plaintiffs-appellants rely on
Citizens United, arguing that “WEAC did not explain how a
law precluding individual employees from funding an
organization of their choice can be squared with” the holding
of that case. We expressly considered Citizens United in
WEAC, however, noting that the law there, unlike Act 10,
“actively created [a] barrier[] to speech rather than mere
subsidies. … by forbidding certain speakers from spending
money, akin to prohibiting speech altogether.” Id. at 648.
Despite plaintiffs-appellants’ claims to the contrary, Act 10
does not preclude municipal employees from funding their
union if they so choose or prohibit unions from freely
spending their money. Rather, Act 10 prohibits municipal
employers from “deduct[ing] labor organization dues from
the earnings of a general municipal employee or supervisor.”
Wis. Stat. § 111.70(3g).
    Plaintiffs-appellants’ contention that we should revisit
WEAC because Janus overruled Ysursa fares no better. Janus
held that the First Amendment prohibits compelled speech in
the form of mandatory agency fees. 138 S. Ct. at 2486. It did
not mention Ysursa, let alone overrule its holding that states
have no obligation to provide any payroll deductions.
Plaintiffs-appellants concede that “Janus did not have the
opportunity to have directly overruled or altered the
framework of Ysursa.” Given that the Supreme Court does not
normally overturn or dramatically limit its precedents sub
silentio, Shalala v. Ill. Council on Long Term Care, Inc., 529 U.S.
1, 18 (2000), we conclude that Ysursa—and by extension,
WEAC—still controls.
Nos. 20-1672 & 20-1724                                         23

    Finally, plaintiffs-appellants dispute the classification of a
payroll deduction as a subsidy, arguing that this classification
“ignores the de minimis burden on a governmental employer
to provide that option to its employees.” They therefore ask
that we remand this case to conduct discovery on the burden
payroll deductions impose on the state. As we noted in
WEAC, however, “the Supreme Court has settled the ques-
tion: use of the state’s payroll systems to collect union dues is
a state subsidy of speech that requires only viewpoint neu-
trality.” 705 F.3d at 645 (citing Ysursa, 555 U.S. at 358–59).
    Accordingly, the district court appropriately dismissed
Count 3 of plaintiffs-appellants’ complaint for failure to state
a claim.
       C. The Legislature’s Motion to Intervene
    Because we now affirm the district court’s dismissal of all
three counts in plaintiffs-appellants’ complaint, we agree
with its conclusion that the Legislature’s motion to intervene
is moot.
                     III.   Conclusion
   For the reasons explained above, we AFFIRM the district
court’s dismissal of plaintiffs-appellants’ complaint and de-
nial of leave to amend, as well as the district court’s denial of
the Legislature’s motion to intervene as moot.