Court Opinion

ID: 4673408
Source: CourtListenerOpinion
Date Created: 2021-03-31 22:03:46.775153+00
Date Added: 2024-06-11T08:03:13.487715
License: Public Domain

UNITED STATES DISTRICT COURT
                            FOR THE DISTRICT OF COLUMBIA

TRANSPORTATION TRADES
DEPARTMENT, AFL-CIO, et al.,

              Plaintiffs,

      v.                                              Civil Action No. 1:19-cv-03107 (CJN)

NATIONAL MEDIATION BOARD,

              Defendant.

                                 MEMORANDUM OPINION

       Plaintiff unions challenge the National Mediation Board’s Final Rule regarding

decertification of collective bargaining representatives on the grounds that the Rule violates the

Railway Labor Act, 45 U.S.C. § 151 et seq., and is arbitrary and capricious under the

Administrative Procedure Act, 5 U.S.C. § 706(2)(A). See generally Compl., ECF No. 1. Pending

before the Court are the Board’s Motion to Dismiss or for Summary Judgment, ECF No. 13

(“Def.’s Mot.”), and the unions’ Cross-Motion for Summary Judgment, ECF No. 17 (“Pls.’ Mot.”).

Because the Final Rule is permissible under the Act and is not arbitrary and capricious, the Court

denies the unions’ Motion for Summary Judgment and grants summary judgment to the Board.

                                        I.      Background

       The Railway Labor Act governs labor relations in the railroad and airline industries.

Among other things, the Act seeks to protect workers’ right to “organize and bargain collectively

through representatives of their own choosing.” 45 U.S.C. 152, Fourth; see generally 45 U.S.C.

§ 151a (describing the Act’s “[g]eneral purposes”).

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       The Act has little to say about how employees should choose their representatives, but does

provide that “[t]he majority of any craft or class of employees shall have the right to determine

who shall be the representative of the craft or class.” 45 U.S.C. § 152, Fourth. Section 2, Ninth

establishes the National Mediation Board, which is authorized to hold elections to resolve

representation disputes:

       If any dispute shall arise among a carrier’s employees as to who are the
       representatives of such employees designated and authorized in accordance with
       the requirements of this chapter, it shall be the duty of the Mediation Board, upon
       request of either party to the dispute, to investigate such dispute and to certify [the
       proper representatives] . . . . In such an investigation, the Mediation Board shall be
       authorized to take a secret ballot of the employees involved, or to utilize any other
       appropriate method of ascertaining the names of their duly designated and
       authorized representatives in such manner as shall insure the choice of
       representatives by the employees without interference, influence, or coercion
       exercised by the carrier . . . . In the conduct of any election for the purposes herein
       indicated the Board shall designate who may participate in the election and
       establish the rules to govern the election.

45 U.S.C. § 152, Ninth. Representation elections are further governed by Section 2, Twelfth,

which provides:

       The Mediation Board, upon receipt of an application requesting that an organization
       or individual be certified as the representative of any craft or class of employees,
       shall not direct an election or use any other method to determine who shall be the
       representative of such craft or class unless the Mediation Board determines that the
       application is supported by a showing of interest from not less than 50 percent of
       the employees in the craft or class.

45 U.S.C. § 152, Twelfth. The Act does not contain express language granting workers the right

to seek decertification of a union, but the Supreme Court held long ago that workers have the

statutory “right to determine who shall be the representative of the group or, indeed, whether they

shall have any representation at all.” Bhd. of Ry. & S. S. Clerks, Freight Handlers, Express &

Station Emps. v. Ass’n for the Benefit of Non-Contract Emps., 380 U.S. 650, 670 (1965) (“Bhd. of

Ry. & S. S. Clerks”).

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       Prior to the Board’s adoption of the Final Rule in 2019, decertification of a union could be

sought through what came to be known as the “straw-man” procedure. 84 Fed. Reg. 35,978.

Because representation elections were triggered only if the Board received an application for an

individual seeking to be certified as a representative, employees seeking decertification first had

to find an individual—a “straw man”—who would apply to be certified as the collective bargaining

representative, even though the ultimate goal was decertification. Id. At the election, the ballot

included two options that would effectively result in decertification: a “no union” option or

election of the straw man (who would step down if elected). Id. But the “no union” and straw

man votes were counted separately, so employees could achieve decertification only if either the

“no union” option or the straw man option won a majority of votes cast during the election. Id.

       In 2019, the Board sought to simplify this process by eliminating this procedure. 84 Fed.

Reg. 35,979. Following notice and comment, the Board issued a Final Rule permitting the Board

to accept applications that seek decertification directly. 84 Fed. Reg. 35,987. The Final Rule also

extends the period of repose—during which no representation elections can be held absent

“unusual or extraordinary circumstances,” 29 C.F.R. § 1206.4—following a decertification from

one year to two years, the same period of repose following certification, Pls.’ Mot. at 22–26.

       Plaintiffs filed this action on October 16, 2019, claiming that the new decertification

procedure violates the Railway Labor Act and that it was arbitrary and capricious to extend the

post-decertification period of repose. See generally Compl. Pending before the Court are the

Board’s Motion to Dismiss or for Summary Judgment, see generally Def.’s Mot., and the unions’

Motion for Summary Judgment, see generally Pls.’ Mot. The Board argues that the unions do not

have standing to challenge the Final Rule and that, even if they do, the Final Rule is lawful.

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                                         II.      Analysis

                                               A. Standing

       Courts “have an independent obligation to determine whether subject-matter jurisdiction

exists.” Arbaugh v. Y&H Corp., 546 U.S. 500, 514 (2006). If “a federal court concludes that it

lacks subject-matter jurisdiction, the complaint must be dismissed in its entirety.” Id. at 502. On

a motion to dismiss for lack of subject-matter jurisdiction under Rule 12(b)(1), “the plaintiff bears

the burden of establishing jurisdiction by a preponderance of the evidence.” Tex. Children’s Hosp.

v. Azar, 315 F. Supp. 3d 322, 329 (D.D.C. 2018) (citing Lujan v. Defs. of Wildlife, 504 U.S. 555,

561 (1992)). The Court “is not limited to the allegations of the complaint,” Hohri v. United States,

782 F.2d 227, 241 (D.C. Cir. 1986), vacated on other grounds, 482 U.S. 64 (1987); instead, the

Court “may consider such materials outside the pleadings as it deems appropriate,” Scolaro v. Dist.

of Columbia Bd. of Elections & Ethics, 104 F. Supp. 2d 18, 22 (D.D.C. 2000); see also Jerome

Stevens Pharms., Inc. v. FDA, 402 F.3d 1249, 1253 (D.C. Cir. 2005).

       Standing requires the “plaintiff [to] have (1) suffered an injury in fact, (2) that is fairly

traceable to the challenged conduct of the defendant, and (3) that is likely to be redressed by a

favorable judicial decision.” Spokeo, Inc. v. Robins, 136 S.Ct. 1540, 1547 (2016) (citing Lujan,

504 U.S. at 560–61). The Board argues that the unions satisfy none of these requirements because

(1) no union has been (or imminently will be) decertified as a result of the Final Rule; (2) such

decertification would not confer standing because the unions could also be decertified under the

prior straw-man procedure; (3) any injury would be the result of third-party choices, not

attributable to the Board; and (4) no injury is traceable to the Final Rule or redressable by a

decision favorable to the unions. Def.’s Mot. at 8–12.

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         The unions respond that they have standing to challenge the Final Rule under the so-called

competitor standing doctrine.           Pls.’ Mot. at 10–15.1          That doctrine recognizes that “when

regulations illegally structure a competitive environment—whether an agency proceeding, a

market, or a reelection race—parties defending concrete interests in that environment suffer legal

harm under Article III.” Save Jobs USA v. U.S. Dep’t of Homeland Sec., 942 F.3d 504, 509 (D.C.

Cir. 2019) (quoting Am. Inst. of Certified Pub. Accountants v. IRS, 804 F.3d 1193, 1197 (D.C. Cir.

2015)). The Court of Appeals has repeatedly held that “an individual who competes in a labor

market has standing to challenge allegedly unlawful government action that is likely to lead to an

increased supply of labor—and thus competition—in that market.”                            Id. (collecting cases).

Although the classic competitor standing cases involve increased competition for jobs in a labor

market, the Court of Appeals has also held that plaintiffs suffer an injury in fact when a regulation

presents political candidates with additional competitors and additional tactics that “fundamentally

alter the environment in which rival parties defend their concrete interests (e.g., their interest in

. . . winning reelection).” Shays v. Fed. Election Comm’n, 414 F.3d 76, 86 (D.C. Cir. 2005). And

when a regulation permits increased competition, the competitive injury is “directly traceable” to

the agency as a matter of law (and redressable by a favorable court order). See Wash. All. of Tech.

Workers v. United States Dep’t of Homeland Sec., 892 F.3d 332, 341 (D.C. Cir. 2018).

         Although no court has apparently applied the competitor standing doctrine in the context

of union elections, it does seem apt here. After all, the Final Rule fundamentally alters the

environment in which rival parties—employees who wish to be represented, employees who do

not wish to be represented, the union, and perhaps even the employer—defend their concrete

1
  In addition to their competitor-standing argument, the unions argue that they have sufficiently demonstrated injury
in fact because at least one Plaintiff has already faced potential decertification in an election conducted pursuant to
the new direct decertification procedure. See Pls.’ Reply in Support of Mot. for Summ. J. at 4, ECF No. 21.

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interests. The Rule not only removes a barrier to entry for employees seeking decertification, but

it also concentrates support for decertification by eliminating the straw man option at the ballot

box. The Board itself is of the view that the prior rules made it confusing—and therefore more

difficult—to mount a decertification challenge to union representation. 84 Fed. Reg. 35,984.

Now, the Board has changed the procedures to make it less confusing—and therefore easier—for

a union to be decertified. Id. (Surely if the Board had changed the procedures to make

decertification harder to achieve, employees who did not wish to be represented would have

standing to challenge the new regime.) In much the same way that political candidates may

challenge rules that “fundamentally alter the environment in which rival parties defend their

concrete interests (e.g., their interest in . . . winning reelection),” Shays, 414 F.3d at 86, the unions

have standing to challenge the Final Rule.

                                        B. Direct Decertification

        The unions’ first challenge to the Final Rule is to the new direct decertification procedure.

They contend that Section 2, Twelfth, precludes the Board from conducting elections after

receiving an application to decertify representation, Pls.’ Mot. at 2, because the Act permits the

Board to conduct elections only upon receipt of “an application requesting that an organization or

individual be certified as the representative.” 45 U.S.C. § 152, Twelfth (emphasis added).

        “When an agency ‘interpret[s] a statute it is charged with administering in a manner (and

through a process) evincing an exercise of its lawmaking authority,’ that interpretation is entitled

to [Chevron deference.]” Am. Hosp. Ass’n v. Azar, 967 F.3d 818, 828 (D.C. Cir. 2020) (quoting

SoundExchange, Inc. v. Copyright Royalty Bd., 904 F.3d 41, 54–55 (D.C. Cir. 2018)). “If the

intent of Congress is clear, that is the end of the matter; for the court, as well as the agency, must

give effect to the unambiguously expressed intent of Congress.” Chevron U.S.A., Inc. v. Nat’l Res.

Def. Council, 467 U.S. 837, 842–43 (1984). But when a statute is “silent or ambiguous with
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respect to the specific issue, the question for the court is whether the agency’s answer is based on

a permissible construction of the statute.” Chevron, 467 U.S. at 843.

       Under Chevron, we first ask whether “Congress has directly spoken to the precise question

at issue.” 467 U.S. at 842. Here, the “precise question at issue” is whether the Board may hold an

election upon receiving an application directly seeking decertification.

       The unions argue that the plain language of Section 2, Twelfth prohibits the Board from

acting on such applications. Pls.’ Mot. at 2–3, 17–18. The unions rely heavily on RLEA, in which

the Court of Appeals considered a different section of the Act—Section 2, Ninth—and held that

the Board had authority to investigate representation disputes only when the condition in the

section granting the authority was satisfied, that is, “only upon request of the employees involved

in the dispute,” Ry. Lab. Execs.’ Ass’n v. Nat’l Mediation Bd., 29 F.3d 655, 664 (D.C. Cir. 1994),

amended, 38 F.3d 1224 (“RLEA”). The unions contend that the “upon” language in the section

relevant to this dispute—Section 2, Twelfth—similarly limits the Board to holding elections only

when it has received an “application requesting that an organization or individual be certified as

the representative of any craft or class of employees.” Pls.’ Mot. at 2–3; Pls.’ Reply in Support of

Mot. for Summ. J. at 9, ECF No. 21.

       But there are important differences between Section 2, Twelfth and Section 2, Ninth that

the unions’ argument ignores. First, Section 2, Twelfth does not grant the Board its authority to

hold elections; that authority is granted by Section 2, Ninth. And as the Court of Appeals has

already held, “the Board enjoys exceptional latitude when acting within its proper sphere of

Section 2, Ninth power.” RLEA, 29 F.3d at 662. Section 2, Twelfth provides a carveout within

that grant of authority: the Board cannot hold an election when the application for that election is

not supported by at least half of the employees.

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       Moreover, Section 2, Ninth contains a positive command (“it shall be the duty of the

Mediation Board . . . to investigate such dispute and to certify [the proper representatives],” 45

U.S.C. § 152, Ninth (emphasis added)), while Section 2, Twelfth contains a negative conditional

command (“[the Board] shall not direct an election . . . unless [the application is supported by at

least 50 percent of employees],” 45 U.S.C. § 152, Twelfth (emphasis added)). Section 2, Twelfth’s

plain language means simply that when the Board receives an application for certification, it cannot

hold an election unless the application is supported by at least half of the employees.

       The unions argue that the lack of any mention of decertification in Section 2, Twelfth,

indicates that Congress did not authorize the Board to act on applications seeking decertification.

Pls.’ Mot. at 3.    They note that the Railway Labor Act does not contain a provision for

decertification (although other labor statutes have been amended to provide decertification

procedures), id. at 5 n.4, and that Congress used the term “decertify” in another part of the Act,

but not in Section 2, Twelfth, id. at 19–20, contending that if Congress had intended to authorize

the Board to hold elections after receiving a decertification application, it would have mentioned

decertification in Section 2, Twelfth, id. But this argument proves too much, since the Supreme

Court held long ago that workers covered by the Act have “the right to determine . . . whether they

shall have any representation at all,” Bhd. of Ry. & S. S. Clerks, 380 U.S. at 670, even though there

was no mention of decertification in the Act at the time. The unions do not argue that that decision

is incorrect, or that employees do not have the right to seek decertification.

       At the very least, the Act does not unambiguously preclude the direct decertification

method adopted in the Final Rule, and the Court therefore defers to the Board’s reasonable

interpretation of the statute. See Am. Hosp. Ass’n v. Azar, 967 F.3d at 828. The Board established

decertification procedures through notice-and-comment rulemaking and explained its belief that

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“Section 2, Twelfth does not require employees or their representative to pretend to seek

certification in order to vindicate their statutorily protected right of complete independence in the

choice to be represented or be unrepresented.” 84 Fed. Reg. 35,980. That interpretation is the

better reading of the Act; at a minimum, it is a reasonable one. See Chevron, 467 U.S. at 842. The

Final Rule’s direct decertification procedure is not prohibited by the Railway Labor Act.

                                           C. Extended Period of Repose

         The unions next challenge the Final Rule’s extension of the period of repose following

decertification. Under the old rules, a vote to decertify representation was followed by a one-year

bar to challenges to that vote, while a vote to certify representation was followed by a two-year

bar. 84 Fed. Reg. 35,985. The Final Rule extends the period of repose following decertification

to two years, matching the period of repose following certifications. 84 Fed. Reg. 35,978–79. The

unions assert that the extension is arbitrary and capricious because the Board has no rational and

reasonable explanation for the two-year bar and the extended period of repose undermines the

Act’s purpose of “forbid[ding] any limitation upon freedom of association among employees or

any denial, as a condition of employment or otherwise, of the right of employees to join a labor

organization.” Pls.’ Mot. at 22–26 (quoting 45 U.S.C. § 151a).2

         The APA’s arbitrary and capricious standard requires that agency rules be reasonable and

reasonably explained. Carlson v. Postal Regulatory Comm’n, 938 F.3d 337, 343–44 (D.C. Cir.

2019). The agency must “articulate a satisfactory explanation” for its decision, Encino Motorcars,

2
 In their Complaint, the unions allege that “[t]he two-year bar runs directly contrary” to the Act’s mandate “to protect
employees’ freedom to choose a representative.” Compl. ¶ 51. But the unions make no argument in their briefs that
a one-year period of repose following decertification violates the Act, and they provide no explanation for why a two-
year period of repose (to match the period of repose that follows certification) is impermissible under the Act when a
one-year period of repose is not. Considering that the Board has regularly modified the period of repose over the past
decades, see Def.’s Mot. at 17 (citing 84 Fed. Reg. 35,985), and in light of the fact that the Act also protects employees’
choice to forego union representation, Bhd. of Ry. & S. S. Clerks, 380 U.S. at 670, the Court concludes (assuming the
unions have preserved an argument to the contrary) that the Act does not preclude a two-year period of repose
following decertification.

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LLC v. Navarro, 136 S. Ct. 2117, 2125 (2016) (quoting Motor Vehicle Mfrs. Ass’n of U.S., Inc. v.

State Farm Mut. Auto. Ins. Co., 463 U.S. 29, 43 (1983)), and provide “a rational connection

between the facts found and the choice made,” id. An agency violates the arbitrary and capricious

standard if it fails to respond to “significant points” and consider “all relevant factors” raised in

public comments. Carlson, 938 F.3d at 344 (quoting Home Box Office, Inc. v. FCC, 567 F.2d 9,

35–36 (D.C. Cir. 1977)). An agency’s response to those comments must enable the Court “to see

what major issues of policy were ventilated . . . and why the agency reacted to them as it did,” but

an agency need not “discuss every item of fact or opinion included in the submissions made to it.”

Carlson, 938 F.3d at 344 (quoting Del. Dep’t of Nat. Res. & Envtl. Control v. EPA, 785 F.3d 1, 17

(D.C. Cir. 2015)).

       The unions argue that there is no rational and reasonable explanation for the Final Rule’s

extension of the period of repose following decertification. Pls.’ Mot. at 23–24. They contend

that the two-year period of repose following certification exists to “give a newly certified

representative adequate time to negotiate a new collective bargaining agreement free from the

distraction and uncertainty of a challenge to the new representative’s certification” and was

“informed by the Board’s experience in its mediation capacity, recognizing that collective

bargaining under the [Act] is often a lengthy process.” Id. at 24. The unions argue that those

concerns (and the Board’s expertise) are not implicated by decertification. Id. They further argue

that, because the Board has no experience working with employees after decertification, it has no

evidence to support its determination that an extension is warranted. Id. at 24–25. According to

the unions, none of the “complex . . . legal obligations . . . regarding both negotiations [and their

enforcement]” following certification exist after decertification, so a two-year period of repose

following decertification is unnecessary. Id. at 25.

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        But the unions give the Board’s explanation short shrift: The Final Rule states that the

extended period of repose “reflects the Board’s belief that both certification and decertification are

significant undertakings by employees with a substantial impact on the workplace and employees’

relationship with their employer” and gives employees who supported decertification an equal

opportunity to “judge the advantages and disadvantages of their decision without the turmoil of an

immediate organizing campaign.” 84 Fed. Reg. at 35,986. The Board relied upon a comment

(from an employee who successfully led a decertification effort using the old straw man procedure)

that indicated that the one-year period of repose did not give employees enough time to evaluate

the “benefits of a direct relationship” with the employer. Id.3 And the Final Rule responded to

opponents’ comments questioning the necessity of a two-year period following decertification,

explaining that the change “recognizes that the transition from represented to unrepresented has a

significant impact on the employees and their workplace” and gives “employees who have rejected

representation an additional year to experience their workplace and their direct relationship with

their employer before another representation dispute can be raised in their work group.” 84 Fed.

Reg. at 35,985–87.

        As for the unions’ argument that the extended period of repose is arbitrary and capricious

because it undermines the purpose of the Act, it is unclear how a two-year period of repose

following certification advances the statute’s purposes but a similar period following

decertification does not. See Bhd. of Ry. & S. S. Clerks, 380 U.S. at 670 (finding that the Act

grants workers “the right to determine who shall be the representative of the group or, indeed,

3
  The unions also imply that the Board’s reliance on a single comment is inappropriate when outnumbered by
comments opposing the Final Rule. See Pls.’ Mot. at 25. But the Final Rule relied on multiple comments to reach its
decision, see 84 Fed. Reg. at 35,986–87, and in any event, agency rulemaking is not a “democratic process by which
the majority of commenters prevail by sheer weight of numbers,” Nat. Res. Def. Council, Inc. v. EPA, 822 F.2d 104,
122 15 n.17 (D.C. Cir. 1987).

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whether they shall have any representation at all”). In any event, the Court’s arbitrary and

capricious review asks whether agency action is reasonable, reasonably explained, and has

adequately considered and responded to public comments. See Carlson, 938 F.3d at 343–44. It

does not replace an agency’s reasoned decision-making with the Court’s (or the unions’) own

judgment. Citizens to Pres. Overton Park, Inc. v. Volpe, 401 U.S. 402, 416 (1971).

       Here, the Board explained the reasons for its decision to extend the period of repose

following decertification. See Encino Motorcars, LLC, 136 S. Ct. at 2125 (quoting Motor Vehicle

Mfrs. Ass’n of U.S., Inc., 463 U.S. at 43). The administrative record demonstrates that the Final

Rule adequately responded to opponents’ public comments. Although the unions may disagree

with the Board’s ultimate determination, the Court will not replace the Board’s judgment with its

own. The Court therefore concludes that the Final Rule’s extension of the period of repose is not

arbitrary and capricious.

                                         III.    Conclusion

       The unions have failed to demonstrate that the Railway Labor Act forecloses the Rule’s

new decertification procedures or that the Board acted arbitrarily and capriciously when it adopted

the two-year period of repose following decertification. The Court therefore denies the unions’

Motion for Summary Judgment and grants summary judgment to the Board in full. An Order will

be entered contemporaneously with this Memorandum Opinion.

DATE: March 31, 2021
                                                            CARL J. NICHOLS
                                                            United States District Judge

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