D.C. Circuit Review – Reviewed: “It was the best of times ….”

by Aaron Nielson — Friday, Aug. 21, 2015@Aaron_L_Nielson

I begin this week’s post with a public service announcement: law students (and, increasingly, law graduates), if you want to clerk on the D.C. Circuit, you need to read more than just Reading Law,Federal Jurisdiction, and administrative law guides and treatises. One of the most common questions a judge will ask in an interview is “what is your favorite book?” You need a good answer. When I was asked, I fell back on the world’s finest century of literature: the 19th. (Hint, Abel Magwitch.) This week’s D.C. Circuit opinions show that was a good choice.

Consider, for instance, Round II of the National Association of Mining v. SEC litigation. There, Judge Randolph, joined by Judge Sentelle, knocked out the SEC’s “conflict minerals” rule on First Amendment grounds. Judge Srinivasan dissented. In Dodd-Frank, Congress, concerned with bloodshed in the Democratic Republic of the Congo, enacted a labeling law for “conflict minerals.” The SEC then promulgated a rule that “a company that uses any of the designated minerals is required to conduct a reasonable ‘country of origin’ inquiry” and publicly disclose the information. Such reporting is expensive and may have unintended consequences, but also may help prevent more deaths. The question for the court was whether this mandatory reporting is constitutional. Last timethey considered the issue, Judges Randolph and Sentelle also found a First Amendment violation. But then came the en banc decision in American Meat Institute v. Dep’t of Agriculture. So does American Meat change the outcome for conflict minerals? Judge Randolph said no; Judge Srinivasan said yes. And both inovked 19th-century literature as support. Judge Randolph, for instance, responded to the dissent’s point that those who issue securities are already required to “make all sorts of disclosures about their products” by invoking Charles Dickens, who “had a few words about this form of argumentation: “‘Whatever is is right’; an aphorism that would be as final as it is lazy, did it not include the troublesome consequence, that nothing that ever was, was wrong.””* Judge Srinivasan responded with a literary reference of his own: “the scarlet ‘A’ affixed to Hester Prynne’s gown conveyed personal information that she had a strong and obvious interest in withholding from the public. In that sense, requiring a company to disclose product information in the commercial marketplace is not the same as requiring Hester Prynne to ‘show [her] scarlet letter in the [town] marketplace.’” First Amendment scholars will have more to say about this very important case; perhaps the en banc D.C. Circuit and Supreme Court will too.

Shadows of 19th-century novels, however, fall over more than just SEC regulations. Consider, for example, Teamsters Local Union No. 509 v. NLRB and Healthbridge Mgmt, LLC v. NLRB. Each has a “North and South” feel to it, as they address the nitty-gritty of industrial relations. (If you want to read about the industrial revolution, stick with Elizabeth Gaskell; you can skip Hard Times or The Puppy Who Lost His Way.) In Teamsters, for instance, Judge Griffith (joined by Judges Rogers and Ginsburg), addressed a union “hiring hall.” In particular, the case arises out of the television showArmy Wives, which Judge Griffith helpfully tells the reader “was a fictional drama that ‘follow[ed] the struggles, dreams and friendships of a diverse group of women—and one man—living with their spouses and families on an active Army post.’” It seems that ABC Studios and Local 509 in South Carolina “negotiated a collective bargaining agreement for drivers working on the production of the first two seasons of Army Wives. According to the agreement’s terms, ABC committed to fill its need for drivers by hiring only from the list of qualified drivers the local would provide at the beginning of each season. In other words, ABC agreed to hire from an exclusive hiring hall run by Local 509.” An “exclusive hiring hall,” however, “is lawful only if it is open to all potential workers, not just members of the sponsoring local.” The NLRB concluded that Local 509’s hiring hall was not open to others. The union head, for instance, threatened ABC “that Local 509 members would picket the filming of Army Wives if his members did not receive full-time work before others, and boasted that he could and would shut down the entire production if his demand was not met.” The D.C. Circuit upheld the NRLB’s decision.

In HealthBridge, the NLRB also won, though this case was close as Judge Henderson dissented from Judge Wilkins’s decision (joined by Judge Pillard). After a regional office of the NLRB “issued a complaint against HealthBridge alleging that it unfairly terminated housekeeping employees” in its nursing homes, the union “distributed stickers and flyers asserting that HealthBridge had been‘busted’ for ‘violating federal labor law.’” The company “took down the flyers and ordered its workers to remove the stickers while working in patient care areas.” The NLRB said that was unlawful (though there was disagreement as to the stickers), and the D.C. Circuit majority agreed. The company argued that residents of its facilities “who saw the stickers ‘would not understand this was related to a labor matter’ and might fear the Centers had been ‘convicted of a crime,’” but the panel concluded that the references to “labor law” and the NLRB negated that concern: “Far from [the] surmise that residents would fear the shutdown of their facility and transfer to another home, the stickers made plain that the Centers had been accused of mistreating employees, not residents.” But are all people that legally sophisticated? Judge Henderson’s dissent thought it was asking far much of those in nursing homes to understand what “busted” meant in this context. But the burden was on the company to come up with the evidence of confusion, and the Board found the evidence wanting. The majority deferred to that finding. How to strike the right balance between the benefits and dangers of deferring to expert judgment is the most important question in all of administrative law. It also haunts great literature.

Home Care Ass’n v. Weil—also a very important case—concerns “domestic service,” another common 19th-century theme (many of the great heroines and heroes, after all, were live-in workers … though so was Becky Sharp, and she was no hero.) The question is whether workers who provide “companionship services” or live-in care to “the elderly, ill, or disabled” are eligible for overtime pay under the Fair Labor Standards Act. The Department of Labor used to say no, but has changed its position because, it says, the marketplace has evolved. Judge Srinivasan, joined by Judges Griffith and Pillard, agreed with the agency, relying on Chevron (which Justice Thomas suggests may conflict with19th-century precedent). In theory, after today, “third-party employers of companionship-services and live-in employees may no longer ‘avail themselves’ of the statutory exemptions.” The lengthy list of amici for both sides, however, suggests that this case is not yet over.

Finally, in Texas v. United States, Judge Millett (joined by Judges Pillard and Sentelle), required Texas to pay attorneys’ fees, even though Texas says it was the prevailing party. Lawyers (usually) do notfare well in 19th-century novels, and as much as I love those novels, that’s unfair. Just because cases never seem to end does not (necessarily) mean that lawyers are villains – they have to keep litigating or bad things happen. Here, for instance, is a (very, very) quick version of what occurred: Texas in effect got what it wanted when the coverage formula in Section 4 of the Voting Rights Act was struck down as unconstitutional, but nonetheless Texas filed a cursory (at best) brief in the district court in opposition to a request for attorney’s fees. That was a mistake. Indeed, it appears that the only argument Texas preserved was wrong: “a GVR has no precedential weight and does not dictate how the lower court should rule on remand.” If you don’t make an argument in the district court, it’s extraordinarily hard to win on appeal, a fact that lawyers know well—even if Mr. Dickens might not appreciate judicial procedures.

So that’s the week at the D.C. Circuit. What’s the take away? The D.C. Circuit is a literary court. Beyond preparing writing samples and arranging recommendation letters, it would seem that would-be clerks should brush up on their Brontë.

* Judge Randolph also cited 1984 (alas, of the 20th century), to discuss the dangers of “governmental redefinition.” I’m a fan of Orwell, but Animal Farm is the better book.

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About Aaron Nielson

Professor Nielson is an associate professor at Brigham Young University Law School, where he teaches and writes in the areas of administrative law, civil procedure, federal courts, and antitrust. He currently serves as a public member of the Administrative Conference of the United States, a federal agency that studies the administrative process and makes recommendations on ways to improve it. He also co-chairs the Rulemaking Committee of the American Bar Association’s Section of Administrative Law & Regulatory Practice. Previously he chaired the Section's Antitrust & Trade Regulation Committee. Before joining the academy, Professor Nielson was a partner in the Washington, D.C. office of Kirkland & Ellis LLP (where he remains of counsel). He also has served as a law clerk to Justice Samuel A. Alito, Jr. of the U.S. Supreme Court, Judge Janice Rogers Brown of the U.S. Court of Appeals for the D.C. Circuit, and Judge Jerry E. Smith of the U.S. Court of Appeals for the Fifth Circuit. Follow him on Twitter @Aaron_L_Nielson.

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