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May 17, 2005.

GEORGE E. PATAKI, Governor of the State of New York; ELIOT SPITZER, Attorney General of the State of New York; LINDA ANGELLO, Commissioner of Labor of the State of New York, Defendants.

The opinion of the court was delivered by: NEAL McCURN, Senior District Judge



  Plaintiffs are a group of five health care organizations, whose members or affiliates provide a broad range of health care services, such as operating "220 acute care hospitals," "nearly 300 residential health care facilities," and providing services to individuals "with mental retardation and other developmental disabilities[.]" Amended Complaint ("Co.") at 4, ¶¶ 6 and 8; and at 5 ¶ 9. Plaintiffs are suing the Governor, the Attorney General and the Commissioner of Labor for the State of New York, seeking to overturn section 211-a of New York's Labor Law (hereinafter collectively referred to as "the State").

  In a nutshell, that statute prohibits the use of "state funds," including Medicaid (which provides a substantial portion of the funding for plaintiffs), from "encourag[ing] or discourag[ing] union organization[.]" N.Y. LAB. LAW § 211-a (McKinney Supp. 2004). Supporters of the law, such as the AFL-CIO, depict it as a "`union neutrality law[,]'" 66 BNA Daily Labor Report A-5, 2003, whereas plaintiffs describe it as an "`Employer Gag Law.'" Co. at 11, ¶ 28.

  Given the chasm between labor and management with respect to the impact of § 211-a on labor relations in the workplace, it is not surprising that several groups moved to appear as amicus curiae in this action. The court assumes familiarity with its May 27, 2004, decision granting amicus status to the Business Council; the Coalition and the Brennan Center.


  In this declaratory judgment action, plaintiffs allege that the National Labor Relations Act ("NLRA") and the Labor Management Reporting and Disclosure Act ("LMRDA") preempt section 211-a. Plaintiffs are also mounting several constitutional challenges to section 211-a, claiming that it violates their rights under the First and Fourteenth Amendments.

  In its original form, section 211-a of the New York State Labor Law read as follows:
Notwithstanding any other provision of law, no monies appropriated by the state for any purpose shall be used or made available to employers to train managers, supervisors or other administrative personnel regarding methods to discourage union organization.
N.Y. LAB. LAW § 211-a (McKinney 2002) (emphasis added). Effective December 29, 2002, the scope of that statute was greatly expanded. Under the amended version of section 211-a, organizations that receive state funding, including Medicaid, are barred from using such monies to either encourage or discourage union organizing. Prohibited activities include the hiring of attorneys or consultants or the training of managers or hiring employees "to encourage or discourage union organization, or to encourage or discourage an employee from participating in a union organizing drive[.]" Id. § 211-a(2) (McKinney Supp. 2004). In addition, § 211-a contains detailed reporting requirements "sufficient to show that state funds were not used to pay for . . . activities [prohibited thereunder.]" Id. § 211-a(3). The statute goes on to grant the State Attorney General enforcement powers in the form of seeking the "return of unlawfully expended funds?" and the imposition of civil penalties. See id. at § 211-a(4). Finally, in its amended form § 211-a directs the State Labor Commissioner to, inter alia, promulgate regulations pertaining to the financial recordkeeping requirements thereunder. See id. at § 211-a(5).

  As noted at the outset, the parties have widely divergent views of section 211-a. The plaintiff health care associations which allegedly are "either currently facing union organizing campaigns or reasonably expect to be subjected to [same] in the near future[,]" refer to it as the "`Employer Gag Law.'" Co. at 10, ¶ 23; and at 11, ¶ 28. In their view section 211-a is nothing more than an "ill-conceived statute," which the State has enacted "[i]n its fervor to defeat employer opposition to union organization[.]" Pl. Memo. at 1.

  Conversely the State refers to section 211-a as a "labor neutrality bill[,]" which, according to Governor Pataki, "will protect taxpayers by ensuring that State tax dollars are used for their intended purpose, instead of being diverted to promote or discourage union organizing activities[.]" Co., exh. B thereto at 1. Despite being touted as labor "neutral," unions clearly view section 211-a as sending a pro-union message. In the Governor's press release announcing the amendment of section 211-a, the President of New York State's AFL-CIO proclaimed that that statute "`ensures that taxpayer dollars will not be used to interfere with a worker's constitutional right to join a union.'" Id. Another supporter of section 211-a claims that that statute will "`provide much needed protection for workers seeking to organize unions.'" Id.


  I. Rule 12(c) Conversion

  There is one minor procedural issue which needs to be clarified. In its Notice of Motion, arguing that plaintiffs have failed to state a claim upon which relief may be granted, the State is moving for dismissal pursuant to Fed.R.Civ.P. 12(b)(6). Alternatively, in their opposition memorandum, in accordance with Fed.R.Civ.P. 12(c), the State is seeking to have its Rule 12(b)(6) motion converted to a motion for summary judgment. As alluded to during oral argument, the court views the preemption issues which these motions present as "predominately legal," and hence it sees no need to convert the State's motion to one for summary judgment. See Pac. Gas & Elec. v. St. Energy Resources Conserv., 461 U.S. 190, 201, 103 S.Ct. 1713, 1720 (1983). Consistent with the foregoing, in deciding plaintiffs' cross-motion for summary judgment the court will take into account only those documents which would be otherwise permissible in connection with a Rule 12(b)(6) motion. II. Scope of Record

  Clearly the court's decision to treat the State's motion as a Rule 12(b)(6) motion rather than a Rule 56 motion, limits the scope of the record herein. Included in the State's supporting papers is the affidavit of an attorney representing UNITE, a labor union which "organizes and represents employees employed by agencies which receive funding from" New York State. Affidavit of Brent Garren (Dec. 17, 2003), at 1-2, ¶¶ 1 and 2. Currently UNITE is involved in litigation before the National Labor Relations Board ("NLRB"). In that matter the employer, Independent Residences, Inc. ("IRI"), alleges "that the [union] election should be overturned because New York State Labor Law Sec. 211-A interfered with its ability to campaign against UNITE." Id. at 2, ¶ 5. Attached to the Garren affidavit are a number of documents pertaining to that NLRB matter.

  During oral argument the court directed the State to provide a copy of the exceptions filed to the Administrative Law Judge's decision in IRI. See Transcript (Sept. 13, 2004) ("Tr.") at 46. It also directed the State to provide the court with a copy of the transcript of the argument. Id. at 76. The State complied, but in its post-argument submissions it included 20 additional documents which the court did not request. Among those documents are newspaper articles, excerpts from several books and articles as well as the State Comptroller's 2003-04 Budget Analysis. Plaintiffs and one of the amici, the Chamber of Commerce of the United States ("the Chamber"), objected to these additional documents being made a part of the record on these motions. Thereafter, the court informed the parties that insofar as those objections were concerned, it would "advise the[m] . . . as to its determination in due course." Dkt. # 61.

  Having had the opportunity to carefully consider the State's post-hearing submissions and the objections to same as to whether such should be made a part of the record herein, the court sustains the objections to same.

  III. Preemption

  The court will address NLRA preemption first. If the court finds that the NLRA preempts section 211-a, then there is no need to address the issue of LMRDA preemption, see Tr. at 62, and there would be no need to address the constitutionality of that statute. See Piazza's Seafood World, LLC v. Odom, No. Civ.A. 04-690, 2004 WL 1375306, at *4 (E.D.L.A. June 17, 2004) ("In light of the Court's finding that federal law preempts [a Louisiana State statute,] the constitutional challenges are now moot and need not be decided."); see also Greater NY Metropolitan Food Council v. Giuliani, 195 F.3d 100, 110 (2d Cir. 1999).

  A. Generally

  Preemption has its origins in the Supremacy Clause of the United States Constitution, which provides in pertinent part that "the Laws of the United States which shall be made in Pursuance thereof . . . shall be the supreme Law of the Land[.]" U.S. Const. Art. VI, cl. 2. "Although not a source of a federal right by itself, th[is] . . . Clause secure[s] federal rights by according them priority whenever they come in conflict with state law." Rondout Electric, Inc. v. NYS Dept. of Labor, 335 F.3d 162, 166 (2d Cir. 2003), cert. denied, 540 U.S. 1105 (2004) (internal quotation marks and citations omitted).

  Preemption can be either explicit or implicit. "State law is preempted explicitly where Congress states an intent to occupy a field and to exclude state regulation." Id. Implicit preemption results "where the federal interest in the subject matter regulated is so pervasive that no room remains for state action, indicating an implicit intent to occupy the field, or where the state regulation at issue conflicts with federal law or stands as an obstacle to the accomplishment of its objectives." Id. (citing, inter alia, Pac. Gas & Elec. Co. v. State Energy Res. Conservation & Dev. Comm'n, 461 U.S. 190, 203-04 (1983)). "Preemption, whether express or implied, may partially, as well as totally, displace state law." Drake v. Laboratory Corporation of America Holdings, 290 F.Supp.2d 352, 364 (E.D.N.Y. 2003).

  B. NLRA*fn1

  The NLRA, 29 U.S.C. §§ 151-169 (2002), which governs labor-management relations in the private sector, contains no express pre-emption provision. Bldg. & Const. Trades Council of the Metro. Dist. v. Associated Builders & Contractors of Mass./R.I., Inc., 507 U.S. 218, 224, 113 S.Ct. 1190, 1194 (1983)) ("Boston Harbor"). Nonetheless in 1986 the Supreme Court declared, "It is by now a commonplace that in passing the NLRA Congress largely displaced state regulation of industrial relations." Wisconsin Dept. of Industry v. Gould Inc., 475 U.S. 282, 286, 106 S.Ct. 1057 (1986)). This is consistent with the presumption under the Supremacy Clause "in favor of preemption in fields that are inherently federal in character and that the states have not traditionally occupied." Drake, 290 F.Supp.2d at 363-64 (citing Buckman Co. v. Plts' Legal Comm., 513 U.S. 341, 347 (2001)). Two distinct lines of preemption jurisprudence have emerged under the NLRA. At this juncture only a brief outline of the two strands of NLRA preemption is necessary.

  1. Garmon Preemption

  The first line of NLRA preemption, Garmon preemption, "developed from a line of cases that focused on the primary jurisdiction of the NLRB." New England Health Care, Employees Union, District 1199, SEIA/AFL-CIO v. Rowland, 221 F.Supp.2d 297, 324 (D.Conn. 2002) (citation omitted). It "corresponds to the `actual conflict category of general preemption theory[.]" Aeroground, Inc. v. City and County of San Francisco, 170 F.Supp.2d 950, 955 (N.D.Cal. 2001) (citation omitted). "Sections 7*fn2 and 8*fn3 of the [NRLA] regulate `concerted activities' and `unfair labor practices,' respectively, seeking to protect the former and stamp out the latter." Building Trades Employers' Ass'n v. McGowan, 311 F.3d 501, 508 (2d Cir. 2002) (citing 29 U.S.C. §§ 157, 158 (codifying § 7 and § 8 of the NLRA)) (footnotes added). "`Garmon pre-emption,' . . . forbids state and local regulation of activities that are `protected by § 7 of the [NLRA], or constitute an unfair labor practice under § 8." Boston Harbor, 507 U.S. at 224, 113 S.Ct. at 1194 (internal quotation marks and citations omitted). Garmon preemption is relatively broad in that it "prohibits regulation even of activities that the NLRA only arguably protects or prohibits." Id. (citation omitted). The purpose of Garmon pre-emption is "to prevent conflict between, on the one hand, ...

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