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Biden Firing of Trump Labor Board Lawyer Heads to 5th Circuit

Feb. 7, 2022, 10:00 AM

President Joe Biden’s unprecedented Inauguration Day firing of the federal labor board’s top lawyer during the Trump administration is teed up for judicial review at a Republican-dominated U.S. appeals court in New Orleans.

Business software firm Exela Enterprise Solutions Inc. has told the U.S. Court of Appeals for the Fifth Circuit that Biden lacked the legal authority to remove former National Labor Relations Board General Counsel Peter Robb.

The unlawful termination made the actions of Robb’s replacement—including issuing an unfair labor practice complaint that led to an NLRB ruling against Exela—legally invalid, the company argued in court filings.

The Fifth Circuit is set to be the first court to rule directly on the legality of Robb’s ouster, an issue with long-term implications for future presidents’ sway over the NLRB and the agency’s independence from the White House.

Judicial disapproval of Biden’s firing of Robb could hinder the agency in the short term, since that may delegitimize the work of Peter Sung Ohr after he replaced Robb and served as acting general counsel. Ohr now serves as deputy general counsel.

But current General Counsel Jennifer Abruzzo, who took over for Ohr after her Senate confirmation in July, has taken administrative steps that may protect Ohr’s actions even if his appointment was deemed invalid.

The Fifth Circuit hasn’t set an oral argument date or announced the three-judge panel that will consider Exela’s case.

The circuit, which hears cases arising in Texas, Louisiana, and Mississippi, is composed of 19 Republican-appointed active and senior status judges compared to seven selected by Democratic presidents, making it likely that a GOP-majority panel will hear the case.

But Exela faces long odds to win at the Fifth Circuit, said Anne Lofaso, a law professor at West Virginia University. The Biden administration has a strong case based on the text of the National Labor Relations Act, which includes removal protections for board members but not for the general counsel, she said.

“The company’s strategy might be to get to the Supreme Court,” said Lofaso, a former attorney in the NLRB’s Supreme Court branch.

Stonewalling Union

The case stems from Exela’s refusal to bargain with an affiliate of the United Steel Workers, which represents a group of its employees who provide mail, shipping and receiving, and customer services to company clients at a Bristol-Myers Squibb Co. facility in New Jersey.

Exela said it didn’t bargain because of its objections to the 2019 election. The company had fought the union’s victory, alleging that union misconduct tainted the vote.

Acting under Ohr’s authority, an NLRB regional official hit the company with an unfair labor practice complaint in February 2021 for failing to negotiate.

The NLRB ruled against Exela in May, saying the company didn’t raise anything new about its election objections beyond what was already litigated in proceedings around that vote.

The board, which was then controlled by a Republican majority, declined to rule on Exela’s challenge to the entire case based on Biden’s allegedly illegal termination of Robb, deciding it’s an issue best left to the courts. The board established that hands-off position on Robb’s firing in an April ruling in a separate case.

Agency Action

The NLRB and its legal arm took several significant steps related to the debate over Robb’s ouster after the board ruled against Exela.

Abruzzo formally ratified the complaint and prosecution of the case under Ohr shortly after she took over as general counsel. She ratified Ohr’s actions in at least one other case involving a challenge related to Robb’s removal.

A similar ratification strategy helped protect more than two years’ worth of the agency’s work that was put at risk by Lafe Solomon serving as acting general counsel while he was also the nominee for general counsel from 2011 to 2013, which the U.S. Supreme Court ruled was illegal in 2017. Solomon’s actions were ratified by then-General Counsel Richard Griffin.

The board endorsed Abruzzo’s ratification of Ohr’s actions in a case involving a Pennsylvania hospital in a February ruling. Abruzzo mooted the hospital’s challenge—which was based on claims that Biden couldn’t legally fire Robb—by signing off on the prosecution of the case under Ohr’s authority.

The NLRB also changed its tune on weighing in on the firing after it flipped to a Democratic majority in September. The board ruled in December that Biden’s termination of Robb was legal.

Splitting along partisan lines, the majority said the Supreme Court’s June decision in Collins v. Yellen made it clear that presidents can fire NLRB general counsels at will.

‘Undermine the Board’

Exela told the Fifth Circuit that the board’s ruling on Robb’s ejection isn’t pertinent because the statutory scheme at issue in Collins v. Yellen is different than that of the National Labor Relations Act.

The NLRA’s removal protections for NLRB members also apply to the general counsel because the latter is “fully and inextricably linked to the Board,” based on its title and its delegated responsibilities, Exela said. The general counsel is “tantamount” to a board member, the company said.

That removal protection is necessary in light of the NLRB’s structure and to protect the agency’s legal arm from political influence, the company argued.

“Allowing the President to fire the Board’s General Counsel without cause would, in effect, convert the role into a political position which would undermine the Board itself,” Exela said.

Exela said Abruzzo’s ratification of Ohr’s actions in the case has no bearing on the case before the Fifth Circuit because the ratification notice isn’t in the record, meaning the court can’t consider it.

Plain Text

The NLRB didn’t address Exela’s challenge to Robb’s removal, leaving that to the Justice Department while the agency focused on rebutting the company’s other arguments on appeal.

The plain text of the NLRA makes clear that the general counsel lacks removal protections, which are absent for that position and explicitly set forth for board members, the Justice Department said.

“Congress clearly knew how to give the General Counsel protection from removal had it wanted to do so, yet it included no such text in the NLRA,” government lawyers said.

Neither the NLRB nor the Justice Department addressed Abruzzo’s ratification of Ohr’s actions. The United Steel Workers raised it in a brief, saying it would cure any alleged legal defect in the complaint and prosecution of the case.

NLRB spokeswoman Kayla Blado declined to comment. Exela’s attorney, Daniel Schudroff of Jackson Lewis P.C., didn’t respond to requests for comment.

The case is Exela v. NLRB, 5th Cir., No. 21-60426.

To contact the reporter on this story: Robert Iafolla in Washington at riafolla@bloomberglaw.com

To contact the editors responsible for this story: Jay-Anne B. Casuga at jcasuga@bloomberglaw.com; Andrew Harris at aharris@bloomberglaw.com