Courthouse Steps Oral Argument: Glacier Northwest, Inc. v. International Brotherhood of Teamsters

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Jack Capizzi:  Welcome to today’s Federalist Society virtual event. This afternoon, Tuesday, January 10, we are delighted to present another edition of our Courthouse Steps program. Today, we are breaking down the oral arguments in Glacier Northwest v. International Brotherhood of Teamsters. My name is Jack Capizzi, and I’m an Assistant Director of Practice Groups at The Federalist Society. As always, please note that all expressions of opinion are those of the expert on today’s call.

 

      Today, we are joined by Alex MacDonald, a former labor lawyer at Littler Mendelson and Director of the Future of Work and Labor Law project at Instacart. He’s also a member of the Labor Executive Committee at The Federalist Society. Today’s program will run for roughly half an hour. After Alex gives his opening remarks, we will turn to you, the audience, for any questions you may have. If you do have a question at any time, please enter it by typing into the Q&A feature at the bottom of your screen, and we will handle them as we approach the second half of the program.

 

      With that, thank you all for being with us today. Alex, the floor is yours.

 

Alex MacDonald:  Thank you so much, Jack, and I do want to just say very quickly, off the top, thank you to The Federalist Society for putting this on. I was saying this to Jack before we actually started here today, but it's incredible how much educational and professional material The Society puts out free for its members—for the public. I consider it a true public service, and I’m honored to be able to do my little part in making it happen. So that’s going to be all the patting on the back I do today because we are here to talk about a case, Glacier Northwest.

 

      Argument was held this morning at the US Supreme Court, and the arguments turned out to be a little more complicated than I think a lot of us were expecting. Some of the issues that came to the fore were not the ones that many of us expected the Court to focus on. So what I want to do at the very beginning -- because there’s a lot of misconceptions about this case floating out there.

 

      So let’s just kind of start about what this case is not about. If you had been reading just what you read in the general media about this case, you could have been led to believe that it was about strike rights, that somehow, this case represented a threat to the basic right under federal law—under the National Labor Relations Act—for a worker to withhold his or her labor collectively as part of a protected concerted activity. And that’s not what this case is about.

 

      In fact, it’s more -- it’s about a narrow issue—a few narrow issues, actually—under federal preemption doctrine, under the National Labor Relations Act. Now, before people start logging out of Zoom, I want to just stop you. Preemption is actually really important. It’s still quite interesting; it’s just not this direct full-on assault on strike rights that you may have heard about in the media.

 

      So just so we all are on the same page and we’re working off the same sheet of music, just take a step back, talk a little bit about preemption—what were the issues the Court was considering today? The Court was actually considering one type of preemption, of which there are several flavors under the NLRA. There’s something called Section 301 Preemption that has to deal with federal labor contracts and who gets to interpret them. There’s another type of preemption called Machinists Preemption, which is where Congress meant to leave a particular activity unregulated, and the state tries to regulate it, and the Court has said that that’s improper. 

 

      We’re actually talking about a different type, and this type is called Garmon Preemption. And that comes from the name of a case from the 1950s. That case involved picketing on an employer’s property. There was a dispute about whether the picketing was protected by the NLRA. The question sort of turned on the union’s motivation—whether it was prohibited under certain sections of Section 8 or whether it was protected under those same sections.

 

      The Court ultimately reasoned that when Congress passed the NLRA, what it was trying to do was create a uniform national scheme of labor law, and it meant to give primary authority for developing that labor law and administering it to a centralized agency, which is the National Labor Relations Board. And so that that scheme would stay uniform and coherent, the Court announced this fairly broad preemptive standard for conduct that is—and this is the key word, arguably -- that is arguably protected or arguably prohibited under the Statute.

 

      If conduct is arguably protected or arguably prohibited, then state courts are preempted or prevented from regulating that same conduct under state law. And that is true whether the state has passed some specific scheme on its own to try to manage labor law or it’s regulating the conduct under a more general statute such as state court law, which is what’s at issue here today -- or was at issue here this morning.

 

      So as broad as that is, there’s a couple caveats we have to offer before we’ve launched into arguments. Garmon Preemption is not absolute, as you might expect. It’s been around for, now, 70 some—or nearly 70—years, and courts have developed -- and even Garmon itself announced that there would be certain exceptions to it. The two main exceptions—and, I guess, a third that’s not really an exception -- and we’ll just walk through those quickly because only one of them is really important here.

 

      One is if the conduct at issue is tangential to the federal scheme, then courts will not preempt states from regulating it. So it’s just like, “Yes, this is protected, but it’s really beside the point, and it’s not going to interfere with our administration.” then that’s going to fall within an exception.

 

      Another exception—and this is the one that’s actually being litigated and important here—is when the conduct in question is close to local feelings and interests—so close, in fact, that it would be irrational to think that Congress intended to prevent states from regulating it. And that bucket sounds very imprecise. But really, what it’s been used to do is allow states to prosecute -- or not -- well, prosecute, yes, in some cases -- but allow suits to go forward under state law dealing with improper conduct that happens to occur during a labor dispute.

 

      For example, if I punch somebody, that person can still sue me even if I punched them while I was on a picket line. Right? Just because there was a labor dispute going on doesn’t mean the state is entirely ousted from regulating things that it’s traditionally regulated, such as violence, or in this case, the question was property damage.

 

      The third one -- and I’ll just cover this very quickly. The third one that I mentioned a few minutes ago about not really being an exception -- if the conduct is, in fact, clearly not covered by the NLRA, then none of this matters. Right? If something is clearly unprotected—it is outside the scope of the NLRA—then we don’t even need to get into Garmon Preemption. States can regulate that. So that’s another potential -- that was something that was lurking in the background in this case. It didn’t really play into oral arguments. It was in the briefs.

 

      So let’s talk very quickly about how this case got to the Supreme Court. What actually happened here? So that’s preemption doctrine. What is this case actually about? It came out of a surprise strike. The company in question is a ready-mix concrete company. And I am not a ready-mix concrete expert. What I’m about to tell you, I am learning second-hand along with all of you.

 

      Ready-mix concrete—as I understand now, as it’s been described in the record and as it was described in the briefs—is a substance that dries and hardens very quickly. It has to be continuously mixed, and it has to be poured on the same day. And for that reason, the company maintains these special -- or has these special trucks that have spinning drums that keep the concrete wet while it is being transported and ready to be poured at whatever site it’s being poured.

 

      In August 2017—this is when the strike occurred—the company’s contract—it had a collective bargaining agreement with a Teamsters Local—expired, and a few days after expiration, the union called a strike. As the strike was called very early in the morning at 7:00 a.m.; it’s described rather colorfully. Apparently, one of the union representatives came out and made a thrashing motion with his hand -- or a slashing motion with his hand, rather, and called the strike, and the workers all walked off the job.

 

      At this point, because the work actually starts at around 2:00 a.m., there were a bunch of workers already out at various stages within the delivery process, and at least 16 of these workers—as it's been alleged in the complaint—had full loads and were in various stages of delivery. And they all turned around, took their trucks back to the lot, and parked them. They did not dump them. They did not wash them out. They did not deliver the concrete. They just drove them back to the company, and at least nine of those folks didn’t even tell the company that they were doing that or had a full load. They just parked them.

 

      As a result—again, everything I’m telling you is coming from the complainant, and that’s important for a reason I’ll get to in a second—according to the company, it had no workers spare on hand; it couldn’t deliver the concrete. And so, what it ultimately had to do was dump the concrete in special depots, and the concrete was ruined, and it lost the value of that concrete. None of the trucks, incidentally, were damaged, but the concrete, of course, was lost. 

 

      In reaction to this, the company did two things. One, it disciplined the workers who were involved—the 16 who returned with their full loads. It ultimately rescinded some of the disciplinary letters for those folks who had given them notice, but it left them in place for those nine who had not given them any notice on the ground that they had intentionally tried to damage the property. And it also sued the union. It filed the lawsuit in state court—filed a complaint—said that the union had timed the strike to deliberately destroy its property. It compared the conduct to vandalism. Right? The union had not just gone out on strike but had deliberately decided to time the strike at this exact moment to maximize the risk and the damage to the company’s property.

 

      The union response said—invoked Garmon—that because the strike itself was arguably protected by the NLRA, the claim was preempted. And at the same time, it filed a charge with the National Labor Relations Board -- well, I shouldn’t say at the same time. A few weeks later, it filed a charge with the National Labor Relations Board, saying that what the company had done when it had issued these disciplinary letters was that it had discriminated against the workers for engaging in protected activity.

 

      The state supreme court agreed with the company on the first question. It said that ordinary property destruction claims, like the one the company filed in this case, did not qualify for any exemption under Garmon, and because this strike had occurred in a labor dispute, it was arguably protected. It then pointed to the proceedings at the NLRB involving the charge to say, “Well, this should be addressed by the NLRB in the first place, and you have no exception. The conduct is covered. We’re going to dismiss your complaint even though what you’ve alleged is a deliberate destruction of property.”

 

      Okay. So that’s how -- and then, obviously, the employer filed a petition, and the court accepted it. One other thing before we jump into the argument today -- and this actually ended up being more important than some of the reporting—and even my own preview that I wrote for this—thought was going to be important. So lurking in the background of all of this is -- there’s a separate but distinct doctrine called primary jurisdiction. And that doctrine says that before courts get to weigh in on whether conduct is covered by the NLRA for the purposes of deciding whether it's arguably protected, the Board gets the first crack at that. And the reason goes back to what we said earlier about Congress trying to create a uniform labor regime. It wanted the Board to police that regime in the first place.

 

      So the union argues that the state court got it right on that question because the state court pointed to the fact that the Board was considering charges when it was -- when that case was going up and that the Board was going to have a chance to weigh in on whether this conduct was covered. And so, it dismissed the complaint, saying, “Nope. Primary jurisdiction, this is a question for the Board. All we can do is say that the Board is looking at this, and so we’re not going to peek behind the curtain. No reason for courts to get involved yet. The Board can work it out.”

 

      Okay. So that actually brought us to this morning’s argument. Off the top, I will say that all of this fighting about whether the conduct was arguably protected or whether it fell into that Garmon exception for local feeling, there seemed to be remarkable unanimity among the justices on that question. And I say that because most of the questioning during the company’s arguments—they had Noel Francisco arguing for them; he did a very good job -- and when the Biden administration took its turn; the court gave the administration half an hour to argue its perspective on this case—most of the discussion was not about these exceptions or whether the conduct alleged fell within the exception. Most of it was about this primary jurisdiction question.

 

      But when you got to the union’s argument at the end, even -- well, I’ll describe them as the liberal judges; I’m not sure that that third justice is -- I’m not sure that that’s the PC way to do it. But Justices Kagan and Sotomayor and even Jackson all seemed skeptical of this idea that, as alleged in the complaint, the union’s conduct was arguably protected. And the reason for that -- I mean, look. So this case was dismissed on a motion to dismiss. The state court should have accepted all the facts as alleged as true, as I just described them to you. And as alleged, what the union did in this case was deliberately act to destroy the company’s property.

 

      That may not be what happened, and the union vociferously has resisted that characterization of it. They resisted it in their -- at every stage in the Washington state courts. They resisted it at the Supreme Court today. They resisted it in their opposition to cert in this case. Their position is that, “Look. Under existing Board law, the only obligation employees who are going out on strike in a situation like this have is to take ‘reasonable precautions’ to protect the company’s property. And in this case, the drivers did that. They left the trucks running. They brought them back to the company. They let the company know it was coming.

 

      So there’s a factual dispute here. But what Justice Jackson was honing in on—and Justice Sotomayor seemed interested in this point as well—was, “Well, that may be the case, and it may be that once we get into the discovery and we litigate this and we dig into the facts, we learn that, no, there was no deliberate destruction here. The workers did every reasonable thing to make sure the concrete wasn’t lost. They had no obligation to deliver the concrete. They were engaged in a protected strike, but they did do what they needed to do to make sure that the concrete wasn’t unnecessarily destroyed or, at least, that the trucks weren’t unnecessarily destroyed, and what they did was reasonable.”

 

      Even if that’s true, you had to, at this stage in the litigation, accept those allegations and let the claim proceed because otherwise, what you’re saying is even if I come into court and I allege -- I don’t know, the example Justice Jackson gave was, “Well, you can’t burn down the factory on your way out.” Right? Everyone agrees you can’t burn down the factory. Even the union’s attorney said, “No. No. You can’t burn down the factory.” But if I come in and allege that, and then the union comes back and says, “Well, actually, I didn’t burn the factory. I accidentally dropped my cigarette on the way out, and I, otherwise, took reasonable precautions,” and the case gets kicked, that’s just not how civil procedure works. And I think it was the point they were making. 

 

      So there doesn’t actually seem to be, bottom line, any disagreement at the Supreme Court that deliberate, intentional destruction of property falls within this Garmon exception—that states would be allowed to process claims for deliberate destruction of property, even when they had occurred during an otherwise protected strike. So I’m getting to the end kind of quickly here or, at least, the bottom line on that point. But what I will say is that I would be very surprised if the Court came out and said anything else. I would expect that to be, if not unanimous, then at least a substantial majority of the Court would be willing to say, “No. The Washington Supreme Court got it wrong here. What was alleged was non-protected activity, and they shouldn’t have dismissed the complaint on that basis.”

 

      And, in fact, that’s the position the government is taking. The Biden administration is arguing that the Court should reverse the Washington Supreme Court and hold that the conduct, as alleged, was not protected.

 

      Now, we get to the actual disagreement in the case, which is about the primary jurisdiction question, which is about what happens next, right? So let’s say that the Court kicks this back to the Washington courts and says, “No. You inappropriately dismissed this. The complaint, on its face, alleged unprotected conduct.” Now what happens? The Biden administration thinks that under the doctrine of primary jurisdiction, what should happen is the courts should stay their own proceedings. They know that charges have been filed with the National Labor Relations Board, and they know that the general counsel at the National Labor Relations Board has accepted those charges and decided to file a complaint. And that means that the Board will ultimately get a crack at deciding whether this conduct was protected or not.

 

      And given that posture, their argument is that the courts have no choice but to -- the phrase that was being thrown around was a hiatus of jurisdiction, which that concept was a little more controversial among the justices. You got some skeptical questions on that point from Justice Thomas. He was focused on this idea like, “How does preemption doctrine normally work?” Right? Okay. Would we normally say that a federal agency has “primary jurisdiction” and that state courts can be ousted of their own jurisdiction? I think ousted, actually, was Noel Francisco’s phrase, but they were getting at the same concept, which was, “Can we force state courts when they have already properly taken jurisdiction over a pending claim which alleges unprotected conduct -- can we force them to stay their hand while the case proceeds?” He seemed extremely skeptical of that and so, frankly, did Justice Gorsuch.

 

      Justice Gorsuch asked these questions a little more pointedly. He was asking, “Can you give me an example anywhere else where we would apply preemption doctrine in the same way?” And the best that the government could do was point to the Interstate Commerce Commission and that there was a primary jurisdiction doctrine under the Interstate Commerce Commission, the ICC, which I think most people who would be on a call like this know has been defunct for decades.

 

      So there’s some suggestion there from Justice Gorsuch that Garmon is an outlier, and he honed in on that at one point and asked Noel Francisco, “Well, do you still think that Garmon is wrong? Are you still asking us to re-examine that?” And the company—Noel Francisco—he didn’t take the bait there. He pulled up short. He said, “Look. I think you can decide this case without actually re-examining Garmon.” He didn’t press that point. Though I will tell you, in their briefs, the company was much more aggressive on that point. It suggested that Garmon went further than any preemption case in federal jurisprudence, that it’s inappropriate, particularly because the NLRA itself says nothing about preemption.

 

      This is all sort of a judicially created doctrine that has developed over the years based on inferences about congressional intent and how we think labor law ought to be run and what makes the most sense as far as a centralizing authority and a central agency, all of which may or may not hang together logically. But it’s not based on text, which is sort of at odds with the way this modern Supreme Court approaches these questions.

 

      So there’s at least a couple of justices who are interested in re-examining the whole thing. But on the other side, Justices Jackson and Kagan and Sotomayor and, to some extent, the Chief were asking questions that suggested they do think that the Board ought to be the one to examine this question in the first instance, that the Board ought to have first crack, consider whether the conduct is protected, and if the Board decides it’s not, obviously, the case would be allowed to proceed. And even if the Board decides that it was, there would be a path for the company to challenge that conclusion through the normal appeals process under the NLRB.

     

      I see a question came in here about Alito and Kavanaugh. That was very interesting because neither Alito nor Kavanaugh asked a single question during oral argument today, so you don’t know where they are on this. And the Court doesn’t project video, so you couldn’t read their faces or anything. Alito was probably the most surprising because, look, if you read anything about Justice Alito’s jurisprudence and then you listen to some of the characterizations of him—and I would say maybe caricatures of him—he’s portrayed often, in reporting on the Court, as an anti-union Justice. And that mostly comes from a few decisions he wrote in the context of agency fees as they relate to public employees.

 

      He was the author of Janus, which was the famous case from 2018 that said agency fees are unconstitutional in the public sector. He also authored decisions like Knox, which was a precursor to Janus. He’s long been a critic of those particular fees, so he’s not known as somebody who has warm and fuzzy feelings for unions. I think that sort of approach—expecting him to just reflexively side with the company because this is a labor law case—is a little reductive, right? I mean, the issues here are entirely different than the issues in something like Janus or in something like Knox or in something like -- for another example, Cedar Point is a case that gets thrown into the mix here, when we -- in the reporting, it talks about this case. All those cases are just entirely orthogonal to the very recondite issues we’re talking about in this case under federal preemption doctrine.

 

      I see that we only have five minutes. I’m going to pause for a moment before we get into predictions just in case there are any other additional questions that we want to answer before we wrap up and talk about what is likely to happen with this case, which I say with some trepidation because it’s always risky to offer any kind of predictions just based on oral arguments. Jack, do we see anything else? I see one question in the Q&A, but I want to give folks an opportunity to jump in.

 

Jack Capizzi:  Sure. There aren’t any others at the moment, but just a brief reminder, all you have to do is type them into the Q&A chat button at the bottom of your screen, and we can read them out for you.

 

Alex MacDonald:  Okay. Well, while we wait for people—if they’re planning to jump in or maybe the explanation and legal issues are so clear that we don’t need to get into any questions—I’ll just say what I think is likely to happen here. I don’t want to duck the issue. I’m probably going to prove wildly wrong, but I said earlier that I think the Court will say that the Washington Supreme Court misconstrued the jurisprudence around this Garmon exception. I don’t think there’s any, or much, daylight among the justices about whether alleged intentional destruction of an employer’s property is protected under the NLRA.

 

      The way this -- I just want to make sure I’m giving fair shake to both sides here. The way the union has framed this case is, “Look, it's also undisputed that workers have the right to strike and that they often strike with the intention of causing economic distress to the company. And that means there will be incidental damage to ‘property.’” I mean, that happens all the time. Like, what if the employer makes cheeses, right? By striking, we may inevitably cause the company to lose some property because no one will be there to process the cheese or whatnot. And that will be true of any company that has perishable products. That’s, essentially, their line. Like, you can’t just say property destruction is unprotected because that would undermine the right to strike.

 

      But the justices seem to be looking at it a different way. There’s incidental destruction, which is destruction that just happens because I’m not on the job, right? That’s going to happen. I didn’t mean for that to happen. I didn’t time it to maximize the damage. All I did was I walked off the job. I exercised my right to strike, and the employer inevitably lost money. That’s different from alleging that I went out and I burned down the factory, to use Justice Jackson’s example again. And I think there’s unanimity on the Court that that kind of allegation and conduct is not protected. It’s a little less clear what the Court is going to do with the primary jurisdiction question.

 

      One thing that was suggested today at oral argument was that the Court not even say what should happen when the case gets remanded, that it just say, “Look. The Washington Supreme Court should not have dismissed this at the procedural posture where it was sitting. They should have accepted the allegations on face value, and now we’re remanding it to the Court for further proceedings to decide what it’s going to do, whether it’s going to go on a jurisdictional hiatus or whether it’s actually going to proceed with the claim.”

 

      Okay. We’ve got two minutes. I’m going to try to jump in. I saw some questions came in.

 

      Is overruling Garmon legitimately part of the question presented in the cert petition? That’s a good question because the question presented did not present any question about Garmon itself. Right? The question presented did not say, “Was Garmon properly decided, and should it be revisited?” Though in the substance of the cert petition, the company does argue that Garmon was arguably wrongly decided—that it arguably [inaudible 28:11] the text of the NLRA.

 

      So I don’t think it’s well teed up here, and I would be surprised if the Court was willing, on a case like this, to reach out and remake Garmon. It might be -- it’s not really procedurally proper, and the case itself doesn’t call for that kind of action. They just don’t need to do it to this case.

 

      Let me see. Did anybody explore whether the Board may find an unfair labor practice based on the filing of the tort claim if the employer prevails on its tort claim? No, but there was a lot of discussion about Bill Johnson, which was a case that did involve that question. The result in that case was, essentially, no. If the employer files a tort claim—a colorable tort claim, a legitimate tort claim—that has some reasonable basis to it, then there are First Amendment reasons beyond credential reasons to say that that conduct cannot itself be considered an unfair labor practice—that the NLRB has to let this proceed. It was actually the case that Noel Francisco kept going back to. But that particular question was not teed up this afternoon.

 

      Alright. We’re at time, but I’m going to try to answer this last -- one more question here. Why wasn’t the lack of remedies for the employer at the Board addressed? Good question. It might just be a question of time. It also raises a lot of complicated issues, which, again, I would be surprised if the Court got into. In Garmon itself, the Court said, “Yes, we recognize that, in some cases, this may leave the employer unable to collect damages, but that’s a feature not a bug of our doctrine. We don’t want this balkanized system of different states offering different remedies for different conduct that is arguably covered or arguably prohibited. We want a uniform system of remedies.”

 

      In its brief, the Court -- or excuse me -- the company says that that, in and of itself, creates a Fifth Amendment problem. You have essentially stripped me of my property because you’ve left me at the mercy of some tortfeasor who can just come in and burn down my factory. And if I have no remedy for that, you have effectively taken my property without just compensation. I think that’s a really complicated issue, and it could unravel the entire preemption doctrine if you really took it seriously. So I suspect the Court just doesn’t have the appetite to get into that, particularly since nobody asked questions about it. I would be personally shocked if that made its way into the opinion. I just don’t think it’s going to be an issue they tee up.

 

      But okay, I see we’re over time. I really appreciate everybody for tuning in today. I want to thank The Federalist Society again for putting this on. These webinars are a really great service to the membership and to the public. So thank you again for giving me the opportunity and giving this group the opportunity to get together and discuss it today.

 

Jack Capizzi:  Well, of course, on behalf of The Federalist Society, Alex, I want to thank you for your valuable time and expertise today. If anyone’s interested in finding out more of Alex’s coverage on this case, please visit the FedSoc blog, where you can find his preview of the case, along with any further updates that might follow.

 

      As always, we welcome listener feedback by email at [email protected]. Thank you all for joining us today. We are adjourned.