Court Opinion

ID: 7799870
Source: CourtListenerOpinion
Date Created: 2022-08-11 17:01:02.561618+00
Date Added: 2024-06-11T16:29:00.457122
License: Public Domain

FOR PUBLICATION

  UNITED STATES COURT OF APPEALS
       FOR THE NINTH CIRCUIT

NATIONAL LABOR RELATIONS                 No. 21-71060
BOARD,
                      Petitioner,        NLRB Nos.
                                        31-CA-028589
                v.                      31-CA-028661
                                        31-CA-028667
AMPERSAND PUBLISHING, LLC,              31-CA-028700
DBA Santa Barbara News-Press,           31-CA-028733
                     Respondent.        31-CA-028734
                                        31-CA-028738
                                        31-CA-028799
                                        31-CA-028889
                                        31-CA-028890
                                        31-CA-028944
                                        31-CA-029032
                                        31-CA-029076
                                        31-CA-029099
                                        31-CA-029124

                                          OPINION

       On Petition for Review of an Order of the
           National Labor Relations Board

        Argued and Submitted April 14, 2022
               Pasadena, California
2              NLRB V. AMPERSAND PUBLISHING

                      Filed August 11, 2022

        Before: Richard A. Paez, D. Brooks Smith, * and
                Bridget S. Bade, Circuit Judges.

                      Opinion by Judge Paez

                          SUMMARY **

            National Labor Relations Boars / Fees

    The panel granted the National Labor Relations Board’s
petition for enforcement of its compliance order requiring an
employer to reimburse a union for legal fees incurred during
the collective bargaining process.

    The Board found that the employer engaged in unusually
aggravated misconduct sufficient to warrant more than a
traditional remedy, and ordered the employer to reimburse
the union for the costs and expenses the union incurred
during collective bargaining sessions. On appeal, the D.C.
Circuit upheld the Board’s findings and enforced its orders
in full. The parties could not reach an agreement on the total
amount the employer should be required to pay in remedies,
and in July 2018, the Regional Director for NLRB Region
27 issued a compliance specification detailing how much the
employer owed. After the employer responded to the

    *
      The Honorable D. Brooks Smith, United States Circuit Judge for
the U.S. Court of Appeals for the Third Circuit, sitting by designation.
    **
       This summary constitutes no part of the opinion of the court. It
has been prepared by court staff for the convenience of the reader.
             NLRB V. AMPERSAND PUBLISHING                   3

specification, the Board granted the Board’s General
Counsel’s motion for partial summary judgment. On
remand, an administrative law judge granted the full amount
of claimed costs and expenses incurred by the union during
bargaining. The Board applied to this court for enforcement
of its compliance order.

     The union incurred legal fees for consultations with its
outside counsel during contract negotiations, and the
Regional Director included those fees in the compliance
order as part of the bargaining expenses for which the
employer was required to reimburse the union. The panel
rejected the employer’s argument that D.C. Circuit
precedent established that the Board lacked power to order
the reimbursement of legal fees. The panel held that the D.C.
Circuit’s opinions were specifically limited to the context of
litigation, and they did not bar the award at issue here. The
National Labor Relations Act grants the Board broad
discretion to impose remedies for unfair labor practices. The
panel held that the award of legal fees in this case was
exactly the sort of remedy that courts have upheld as within
the Board’s statutory remedial authority. Prior adjudications
established that the employer committed an unfair labor
practice by refusing to bargain with the union in good faith.
The remedy was directly targeted at the employer’s
violation. Notably, the Board’s compliance order included
only those legal fees incurred during collective bargaining.
The bargaining process involved only the employer and the
union, with no active participation by Board officials. The
fact that attorney Ira L. Gottlieb was a lawyer who at time
represented the union in litigation before the Board did not
mean that his fees incurred in the collective bargaining
process must automatically be considered litigation
expenses, without any consideration of the actual work he
was paid to perform.
4           NLRB V. AMPERSAND PUBLISHING

    The panel concurrently filed a memorandum disposition
rejecting the employer’s remaining objections to the
compliance order.

                       COUNSEL

Gregoire Sauter (argued), Attorney; Julie Broido,
Supervisory Attorney; David Habenstreit, Assistant General
Counsel; Ruth E. Burdick, Deputy Associate General
Counsel; Peter Sung Ohr, Deputy General Counsel; Jennifer
A. Abruzzo, General Counsel; National Labor Relations
Board, Washington, D.C.; for Petitioner.

Amber Henry (argued) and Christopher Frost, Eisner LLP,
Beverly Hills, California, for Respondent.
              NLRB V. AMPERSAND PUBLISHING                           5

                             OPINION

PAEZ, Circuit Judge:

     This appeal presents the question of whether the National
Labor Relations Board (“NLRB” or “Board”) may order an
employer to reimburse a union for legal fees incurred during
the contract bargaining process. 1 We hold that it may, and
we therefore grant the NLRB’s petition for enforcement of
its compliance order. 2

                        BACKGROUND

A. The NLRB Administrative Process

    To provide context for the issue we decide here, a brief
overview of the NLRB administrative process is in order.
The National Labor Relations Act (“NLRA” or “Act”) grants
employees the right to bargain collectively through
representatives of their own choosing. See 29 U.S.C. § 157.
A common path to forming a union is through the union
election process. During the election process, any party can
file objections to conduct it believes could interfere with
employee free choice in the election, and the NLRB reviews
and adjudicates those objections. See 29 C.F.R. § 102.69(c)
(2022). If a majority of the employees vote in favor of the
union and the results of the election are certified by the
NLRB, the union becomes the exclusive bargaining agent
for the employees in the unit and is entitled to recognition by

    1
      We construe the term “legal fees” to include both attorney’s fees
and related expenses, as described in the NLRB’s compliance order.
    2
      In a concurrently filed Memorandum, we reject Ampersand
Publishing, LLC’s (“Ampersand’s”) remaining objections to the
compliance order.
6            NLRB V. AMPERSAND PUBLISHING

the employer. See id. § 102.69(h). At that point, the
employer is required to meet with the union to bargain in
good faith over the conditions of employment. See
29 U.S.C. § 158(a)(5). Failure to do so is considered an
unfair labor practice. See id.; see also Frankl v. HTH Corp.,
650 F.3d 1334, 1358 (9th Cir. 2011) (citing Regency Serv.
Carts, Inc., 345 N.L.R.B. 671, 671 (2005)).

     Any person may file a charge with the NLRB alleging
that a person or organization has engaged in an unfair labor
practice. See 29 C.F.R. § 101.2, 102.9. The NLRB is
empowered to prevent such practices. See 29 U.S.C.
§ 160(a). Charges are filed with the NLRB Regional
Director for the region in which the alleged violation
occurred, see 29 C.F.R. § 101.2, and that official is
responsible for investigating to determine if there is
sufficient evidence to substantiate a charge, see id. § 101.4.
If the Regional Director finds that a charge has merit, she
initiates formal action by issuing a complaint. See id.
§ 101.8. Complaints are adjudicated in a hearing before an
Administrative Law Judge (“ALJ”), see id. § 101.10(a),
whose decision may be appealed to the Board, see id.
§ 101.12(a).

    The General Counsel for the NLRB (“General Counsel”)
prosecutes the government’s case. See 29 U.S.C. § 153(d).
The charging party may participate in the proceedings in a
variety of ways, including by calling witnesses, introducing
evidence, submitting briefs, and engaging in oral argument,
but it is not required to do so. See 29 C.F.R. § 101.10(a);
Unbelievable, Inc. v. NLRB, 118 F.3d 795, 803 (D.C. Cir.
1997). Agency approval is required to withdraw the
complaint. See 29 C.F.R. §§ 102.9, 102.18. Any settlement
is also subject to agency approval and may be entered over
the objections of the charging party. See id. § 101.9.
              NLRB V. AMPERSAND PUBLISHING                         7

B. Factual and Procedural Background

    Ampersand does business as the Santa Barbara News-
Press, a daily newspaper. In September 2006, Ampersand’s
newsroom employees voted to be represented by the Graphic
Communications Conference, International Brotherhood of
Teamsters (“Union”). Ampersand filed objections to the
election process, but the results were ultimately certified by
the Board.

    Between November 2007 and April 2009, Ampersand
and the Union met several times to negotiate a collective
bargaining agreement. Concurrently, the Union filed
various unfair labor practice charges against Ampersand
stemming from the company’s actions during the bargaining
process. The Regional Director for NLRB Region 31
consolidated these charges into the underlying complaint in
this case. Following a hearing, an ALJ held that Ampersand
had violated sections 8(a)(1), 8(a)(3), and 8(a)(5) of the
NLRA. The ALJ identified a number of unfair labor
practices, including the paper’s discontinuance of its merit
pay raise program; its transfer of bargaining unit work to
non-union temporary employees without notice; its
discharge of two employees, Dennis Moran and Richard
Mineards; and its bad-faith bargaining with the Union. See
Ampersand Publ’g, LLC (Ampersand I), 358 N.L.R.B. 1415,
1501–02 (2012). The ALJ’s findings were adopted in full
by a three-member panel of the Board. See Ampersand
Publ’g, LLC (Ampersand II), 362 N.L.R.B. 252, 252
(2015). 3 Because the Board found that Ampersand engaged

    3
      The Board initially adopted the ALJ’s findings in a 2012 order.
Ampersand I, 358 N.L.R.B. at 1415. That order was invalidated by the
Supreme Court’s decision in NLRB v. Noel Canning, 573 U.S. 513
(2014), because two members who served on the panel were improperly
8             NLRB V. AMPERSAND PUBLISHING

in unusually aggravated misconduct sufficient to warrant
more than a traditional remedy, it ordered Ampersand to
reimburse the Union for the costs and expenses the Union
incurred during the collective bargaining sessions. See
Ampersand I, 358 N.L.R.B. at 1417; Ampersand II,
362 N.L.R.B. at 252–53 (ordering reimbursement and
incorporating the reasoning of Ampersand I). On appeal, the
D.C. Circuit upheld the Board’s findings and enforced its
order in full. See Ampersand Publ’g, LLC v. NLRB, No. 15-
1074, 2017 WL 1314946, at *4 (D.C. Cir. Mar. 3, 2017) (per
curiam).

     The parties could not reach an agreement on the total
amount Ampersand should be required to pay in remedies,
including the amount of reimbursement due to the Union. In
July 2018, the Regional Director for NLRB Region 27 issued
a compliance specification detailing her calculations of how
much Ampersand owed and setting a compliance hearing
before an ALJ. 4 After Ampersand responded to the
specification, the General Counsel filed a motion for partial
summary judgment, alleging that Ampersand’s answer was
insufficiently specific under the NLRB’s rules and sought to
relitigate matters already decided in the underlying case.
The Board granted the motion. It remanded to the ALJ to
decide the two remaining issues: the costs and expenses
incurred by the Union during bargaining and the net backpay
due to Moran and Mineards. After a hearing, the ALJ

appointed to the Board. A properly constituted panel of the Board
reconsidered the previous order and readopted it in full. Ampersand II,
362 N.L.R.B. at 252.
    4
      This case was transferred from Region 31 to Region 27 in 2017.
Therefore, the Regional Director of Region 31 issued the complaint,
while the Regional Director of Region 27 issued the compliance
specification.
             NLRB V. AMPERSAND PUBLISHING                    9

granted the full amount claimed in an amended specification.
Ampersand filed exceptions to this decision, and a three-
member panel of the Board affirmed.            The NLRB
subsequently applied to this court for enforcement of its
compliance order.

                STANDARD OF REVIEW

     We have jurisdiction under 29 U.S.C. § 160(e). The
NLRB’s discretion in selecting remedies is “exceedingly
broad,” and we will enforce a remedy “unless it represents a
clear abuse of discretion.” NLRB v. C.E. Wylie Constr. Co.,
934 F.2d 234, 236 (9th Cir. 1991) (internal quotation marks
and citation omitted). “Such an abuse of discretion is present
if it is shown that the order is a patent attempt to achieve
ends other than those that can be fairly said to effectuate the
policies of the Act.” Id. (internal quotation marks and
citation omitted). “The function of the remedy in unfair
labor cases is to restore the situation, as nearly as possible,
to that which would have occurred but for the violation.”
Kallmann v. NLRB, 640 F.2d 1094, 1103 (9th Cir. 1981).
We resolve any doubts about the remedy “against the
perpetrator of the unfair labor practice.” Sever v. NLRB,
231 F.3d 1156, 1165 (9th Cir. 2000).

                       DISCUSSION

    The Union incurred legal fees for consultations with its
outside counsel, the Bush Gottlieb law firm (“Bush
Gottlieb”), during contract negotiations. The Regional
Director included those fees in the compliance order as part
of the bargaining expenses for which Ampersand was
required to reimburse the Union. Ampersand objects,
arguing that D.C. Circuit precedent has established that the
NLRB lacks the power to order the reimbursement of legal
fees.
10             NLRB V. AMPERSAND PUBLISHING

    Ampersand misreads the D.C. Circuit’s opinions. It is
true that the cases Ampersand cites did reject portions of
NLRB orders that awarded attorney’s fees to unions, holding
that the Board lacked either statutory or inherent authority to
shift these costs to an employer. See Camelot Terrace, Inc.
v. NLRB, 824 F.3d 1085, 1089–90 (D.C. Cir. 2016); HTH
Corp. v. NLRB, 823 F.3d 668, 678–81 (D.C. Cir. 2016).
These holdings, however, were specifically limited to the
context of litigation, and they do not bar the award at issue
here. See Camelot Terrace, 824 F.3d at 1094.

     In HTH Corp., the NLRB determined that HTH
Corporation, which operated a hotel in Honolulu, had
committed “severe and pervasive unfair labor practices” in
its dealing with the International Longshore and Warehouse
Union, Local 142. 823 F.3d at 671. The Board imposed a
number of “extraordinary remedies” on the company,
including awarding litigation expenses to the General
Counsel and the union. Id. at 672. HTH challenged this
remedy, arguing that it exceeded the NLRB’s power under
the NLRA. See id. at 674. Although it acknowledged that,
under D.C. Circuit law, it lacked statutory authority to seek
recovery of litigation costs, the Board argued that its remedy
was justified by its “inherent authority to control and
maintain the integrity of its own proceedings through an
application of the bad-faith exception to the American
Rule.” 5 Id. at 678–79. The D.C. Circuit rejected the Board’s
argument, noting that the NLRB is a “creature of statute” and

     5
       The American Rule “generally requires each party to bear his own
litigation expenses, including attorney’s fees, regardless whether he wins
or loses.” Fox v. Vice, 563 U.S. 826, 832 (2011). The bad-faith
exception to the American Rule permits a court to award attorney’s fees
to the prevailing party when the losing party has acted “in bad faith,
vexatiously, wantonly, or for oppressive reasons.” Hall v. Cole, 412 U.S.
1, 5 (1973) (citation omitted).
            NLRB V. AMPERSAND PUBLISHING                 11

“has only those powers conferred upon it by Congress.” Id.
Because no provision of the Act “explicitly or implicitly”
grants the NLRB the power to apply the bad-faith exception,
the D.C. Circuit held that the Board did not have the
authority to order reimbursement of litigation costs. Id.

     A few months later, the D.C. Circuit decided Camelot
Terrace. In that case, the NLRB determined that Camelot
Terrace and Galesburg Terrace, two nursing home operators,
had violated the NLRA by engaging in bad-faith bargaining
with the Service Employees International Union. See
Camelot Terrace, 824 F.3d at 1087. Among other remedies,
the Board required that the companies reimburse the
“litigation costs incurred by both the Board and the Union
during Board proceedings” as well as “all of the negotiation
expenses the Union incurred during its bargaining sessions
with the Companies.” Id. (internal quotation marks
omitted). The companies objected that the Board lacked the
authority to impose either remedy. See id. Reiterating its
holding in HTH Corp., the D.C. Circuit held that the NLRB
did not have the power to require the reimbursement of
litigation costs. See id. at 1089–90. It upheld the NLRB’s
award of negotiation expenses, however, emphasizing that
“litigation costs” and “bargaining expenses” are distinct
categories. Id. at 1087. The court explained that litigation
expenses were punitive in nature and thus beyond the
Board’s remedial power under section 10(c) of the NLRA.
Id. at 1089–90. However, it held that an award of bargaining
expenses is a primarily compensatory remedy, designed to
restore “the economic status quo that would have obtained
but for the Companies’ wrongful acts,” and thus falls within
the Board’s section 10(c) power. Id. at 1094–95 (internal
brackets and citation omitted).
12             NLRB V. AMPERSAND PUBLISHING

    These cases establish that the NLRB lacks the power to
award attorney’s fees that are incurred as a litigation
expense, not that it lacks the power to ever require the
reimbursement of such fees. The NLRA grants the Board
“broad discretion to impose remedies for unfair labor
practices.” Cal. Pac. Med. Ctr. v. NLRB, 87 F.3d 304, 311
(9th Cir. 1996). The Board may take any “affirmative
action” that “will effectuate the policies” of the Act.
29 U.S.C. § 160(c); see also Va. Elec. & Power Co. v. NLRB,
319 U.S. 533, 539–40 (1943). The award of legal fees in this
case is exactly the sort of remedy that courts have upheld as
within the Board’s statutory remedial authority. Prior
adjudications have established that Ampersand committed
an unfair labor practice by refusing to bargain with the Union
in good faith. This remedy is directly targeted at
Ampersand’s violation, compensating the Union for “the
resources that were wasted because of the [company’s]
unlawful conduct” and “restor[ing] the economic strength
that is necessary to ensure a return to the status quo ante at
the bargaining table.” Camelot Terrace, 824 F.3d at 1093
(internal quotation marks and citation omitted). Imposing
such remedies, designed to “respond[] directly to an unfair
labor practice,” falls squarely within the heartland of the
NLRB’s delegated powers. 6 Unbelievable, Inc., 118 F.3d
at 805.

     6
       Indeed, the D.C. Circuit has held that it is even within the NLRB’s
remedial power to “award a Union the costs and fees it incurs in
defending against an employer’s baseless, retaliatory lawsuit . . . if it
determines that the filing or maintenance of the lawsuit was an unfair
labor practice.” Gibson Greetings, Inc. v. NLRB, 53 F.3d 385, 394 (D.C.
Cir. 1995); see also Bill Johnson’s Rests., Inc. v. NLRB, 461 U.S. 731,
747 (1983) (“If a violation is found, the Board may order the employer
to reimburse the employees whom he had wrongfully sued for their
attorneys’ fees and other expenses.”).
              NLRB V. AMPERSAND PUBLISHING                          13

     Notably, the NLRB’s compliance order included only
those legal fees incurred during collective bargaining.
Although Bush Gottlieb also represented the Union in
litigation before the NLRB, the portion of the firm’s
activities relevant here related exclusively to the bargaining
process. Indeed, attorney Ira L. Gottlieb (“Gottlieb”)
personally participated in bargaining sessions and testified
that he advised the bargaining committee during
negotiations. The amount the Union spent on legal fees for
bargaining and litigation could be separately calculated
because the firm assigned the tasks different matter numbers.
The calculations in the specification were based only on
expenses listed under the matter number for bargaining
activities, and Gottlieb carefully excluded any expense that
was unclear or questionable. While the underlying order
broadly directs Ampersand to “[r]eimburse the Union for its
costs and expenses incurred in collective bargaining,”
Ampersand, 362 N.L.R.B. at 253, neither it nor the
compliance order includes litigation expenses or goes
beyond what is necessary to put the Union in the position it
was in before the contract negotiations.

    Nonetheless, Ampersand argues that the cost of Bush
Gottlieb’s services should be considered a litigation
expense, not a bargaining expense, because the parties were
involved in ongoing adjudications before the NLRB during
the same period in which bargaining took place. 7 This
misconstrues the nature of both bargaining and the NLRB’s
adjudicatory process.      Although there were NLRB

    7
      Bargaining sessions occurred between November 2007 and April
2009. At the same time, Ampersand and the Union were engaged in
ongoing litigation before the NLRB and the courts over actions taken by
Ampersand during the union organizing campaign. See Ampersand
Pub., LLC v. NLRB, 702 F.3d 51, 55 (D.C. Cir. 2012).
14           NLRB V. AMPERSAND PUBLISHING

complaints pending against Ampersand while it negotiated
with the Union over the terms and conditions of
employment—and, in fact, more charges were filed during
negotiations—the bargaining itself, as noted above, was
independent from the NLRB adjudications. The pending
NLRB complaints were prosecuted by the General Counsel,
not by the Union. See 29 U.S.C. § 153(d); 29 C.F.R.
§ 101.10(a). The bargaining process, meanwhile, involved
only Ampersand and the Union, with no active participation
by NLRB officials. The NLRB adjudication dealt with
allegations that Ampersand had engaged in unfair labor
practices; the bargaining process focused on Union
members’ conditions of employment. Although Gottlieb
was involved in both activities on behalf of the Union, he
testified that the work he did for each project was separate
and distinct. We see no reason to believe that the mere fact
that these activities occurred simultaneously would alter the
fundamental fact that bargaining is a “private contractual
negotiation[],” not a part of litigation. Camelot Terrace, 824
F.3d at 1094. Nor does the fact that Gottlieb is a lawyer who
at times represented the Union in litigation before the NLRB
mean that his fees must automatically be considered
litigation expenses, without any consideration of the actual
work he was paid to perform. We therefore hold that the
NLRB did not abuse its discretion in ordering Ampersand to
reimburse the Union for the legal fees it incurred as part of
the bargaining process.

     PETITION FOR ENFORCEMENT GRANTED.