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National Labor Relations Board v. Pier Sixty, LLC

United States Court of Appeals, Second Circuit

April 21, 2017

National Labor Relations Board, Petitioner-Cross-Respondent,
v.
Pier Sixty, LLC, Respondent-Cross-Petitioner.

          Argued: April 5, 2016

         On Petition for Review and Cross-Application for Enforcement of an Order of the National Labor Relations Board

         This case presents two questions. The first is whether respondent has forfeited its challenge to the legality of the appointment of the Acting General Counsel of the National Labor Relations Board (the "NLRB" or the "Board"). The second question is the extent to which the National Labor Relations Act (the "NLRA") protects an employee's comments on social media and the point at which an employee's conduct is so "opprobrious" as to lose the NLRA's protection.

         We conclude that the respondent forfeited its challenge to the Acting General Counsel's appointment by failing to raise that argument before the Board as required by 29 U.S.C. § 160(e). We also affirm the NLRB's determination that the respondent violated Sections 8(a)(1) and 8(a)(3) of the NLRA by discharging Hernan Perez since Perez's conduct was not so "opprobrious" as to lose the protection of the NLRA. Our decision rests heavily on the deference afforded to the NLRB's factual determinations, found after a six-day bench trial informed by the specific social and cultural context in this case. We nonetheless note that Perez's conduct sits at the outer- bounds of protected, union-related comments for the reasons set forth below.

         Accordingly, we GRANT the Board's application for enforcement and DENY Pier Sixty's cross-petition for review.

          Thomas V. Walsh, Jackson Lewis P.C., White Plains, NY, for Respondent-Cross- Petitioner.

          Benjamin M. Shultz and Scott R. McIntosh, Attorneys, Appellate Staff, for Benjamin C. Mizer, Principal Deputy Assistant Attorney General, U.S. Department of Justice, Civil Division, Washington, DC; Amy H. Ginn, Attorney (Jennifer Abruzzo, Deputy General Counsel; John H. Ferguson, Associate General Counsel; Linda Dreeben, Deputy Associate General Counsel; Usha Dheenan, Supervisor Attorney), for Richard F. Griffin, Jr., General Counsel, National Labor Relations Board, Washington, DC, for Petitioner-Cross-Respondent.

          Before: Kearse, Cabranes, and Chin, Circuit Judges.

          JOSÉ A. CABRANES, CIRCUIT JUDGE:

         This petition for enforcement of an order of the National Labor Relations Board (the "Board" or the "NLRB") and an employer's cross-petition for review present two questions. The first is whether the employer, Respondent-Cross-Petitioner Pier Sixty, LLC ("Pier Sixty"), has forfeited its challenge to the legality of the appointment of Acting General Counsel of the NLRB, Lafe Solomon ("Solomon"). Pier Sixty argues that Solomon, who authorized the complaint in this case, served in violation of the Federal Vacancies Reform Act of 1998 (the "FVRA")[1] and that the complaint was therefore issued illegally. Although Pier Sixty failed to raise this argument before the Board, as required by Section 10(e) of the National Labor Relations Act (the "NLRA"), [2] Pier Sixty argues that we may nonetheless consider it on appeal, under the "extraordinary circumstances" exception in that section.

         The second question presented is what constitutes "opprobrious conduct" in the context of an employee's comments on social media. To be more precise: the NLRA generally prohibits employers from terminating an employee based on that employee's union-related activity. But even an employee engaged in protected activity "can, by opprobrious conduct, lose the protection of the [NLRA.]"[3] We are thus required to resolve whether an employee's Facebook post insulting his boss's mother and encouraging other employees to vote for the union ought to receive protection under Sections 8(a)(1) and 8(a)(3) of NLRA. [4]

         We hold that Pier Sixty has not shown the existence of an "extraordinary circumstance" that requires us to waive the ordinary rule against considering arguments not presented to the Board as required by 29 U.S.C. § 160(e). We therefore do not reach the merits of the challenge to Acting General Counsel Solomon's appointment. We also affirm the NLRB's determination that Pier Sixty violated Sections 8(a)(1) and 8(a)(3) by discharging Hernan Perez since Perez's conduct was not so "opprobrious" as to lose the protection of the NLRA. Our decision rests heavily on the deference afforded to NLRB factual findings, made following a six-day bench trial informed by the specific social and cultural context in this case. We note, however, that Perez's conduct sits at the outer-bounds of protected, union- related comments for the reasons laid out below.

         Accordingly, we GRANT the Board's application for enforcement and DENY Pier Sixty's cross-petition for review.

         BACKGROUND

         Pier Sixty operates a catering company in New York, N.Y. In early 2011, many of its service employees began seeking union representation. Following what the parties substantially agree was a tense organizing campaign that included threats from management that employees could be penalized or discharged for union activities, Pier Sixty employees voted to unionize in an October 27, 2011 election.[5]

         Two days before that election, Hernan Perez was working as a server at a Pier Sixty venue. A supervisor, Robert McSweeney, gave Perez and two other servers various directions in what the NLRB's opinion describes as a "harsh tone."[6] These directions included "Turn your head that way [towards the guests] and stop chitchatting, " and "Spread out, move, move."[7] McSweeney's attitude in delivering these instructions upset Perez, who viewed them as the latest instance of the management's continuing disrespect for employees. About forty- five minutes later, during an authorized break from work, Perez used his iPhone to post the following message on his Facebook page:

Bob is such a NASTY MOTHER FUCKER don't know how to talk to people!!!!!! Fuck his mother and his entire fucking family!!!! What a LOSER!!!! Vote YES for the UNION!!!!!!![8]

         "Bob" referred to McSweeney. Perez knew that his Facebook "friends, " including ten coworkers, would be able to see the post; the post was also publicly accessible, although Perez may not have known so at the time.[9] Perez took down the post three days later, on October 28, 2011. The post had already come to the attention of the management of Pier Sixty which, following an investigation, fired Perez on November 9, 2011.[10]

         Later that day, Perez filed a charge with the NLRB alleging that he had been terminated in retaliation for "protected concerted activities." On December 15, 2011, Evelyn Gonzalez, who had led organizing efforts at Pier Sixty, filed a second charge, alleging various unfair labor practices in violation of Section 8(a)(1) of the NLRA. On August 24, 2012, NLRB Region Two issued an amended complaint consolidating those two charges.[11]

         On April 18, 2013, the presiding Administrative Law Judge ("ALJ") issued a decision finding, as relevant here, that Pier Sixty had violated Sections 8(a)(1) and 8(a)(3) of the NLRA by discharging Perez in retaliation for protected activity.[12] Pier Sixty filed exceptions, and a three-member panel of the NLRB affirmed the ALJ's decision, with one member dissenting. The NLRB filed an application for enforcement, and Pier Sixty filed a cross-petition for review that are now before this Court.

         JURISDICTION

         While both parties agree that we have jurisdiction, we nonetheless consider the issue independently.[13] As an initial matter, the Board had jurisdiction over the original petition under 29 U.S.C. § 160(a)-(c), which empowers the Board to prevent unfair labor practices.[14] Exercising that power, the Board issued a final order in this matter on March 31, 2015.[15] Since Pier Sixty is located in New York and transacts business within this Circuit, we have jurisdiction over both the Board's petition for enforcement of that order, under Section 10(e) of the NLRA, [16] and Pier Sixty's cross-petition for review of that order, under Section 10(f) of the NLRA.[17]

         DISCUSSION

         A. The Validity of the Acting General Counsel's Appointment

         As an initial matter, we address Pier Sixty's argument that the Court cannot enforce the NLRB decision because the complaint against Pier Sixty was not authorized by law. We do not reach the merits of this FVRA challenge because Pier Sixty has forfeited the issue by not raising it in the proceedings before the Board.

         In making this argument, Pier Sixty relies entirely on SW General, Inc. v. NLRB, a recent decision of the Court of Appeals for the District of Columbia Circuit ("D.C. Circuit"), which held that the NLRB's Acting General Counsel Solomon-under whose authority the complaint against Pier Sixty issued-served in violation of the FVRA, 5 U.S.C. §§ 3345 et seq.[18] The Supreme Court recently affirmed that decision and adopted the D.C. Circuit's interpretation of the FVRA. Once President Obama nominated Solomon (on January 5, 2011) to serve as General Counsel, the Supreme Court concluded, the FVRA prohibited Solomon from continuing his service as Acting General Counsel.[19] Pier Sixty argues that because the complaint here was issued under the purported authority of Solomon as Acting General Counsel on August 24, 2012, it was invalid.

         But unlike the petitioner in SW General, Pier Sixty never raised this argument before the Board. Pursuant to 29 U.S.C. § 160(e), "[n]o objection that has not been urged before the Board . . . shall be considered by the court, unless the failure or neglect to urge such objection shall be excused because of extraordinary circumstances." Our precedents make clear, moreover, that even an apparently meritorious challenge to the authority of an NLRB agent in itself does not qualify as an "exceptional circumstance" allowing the party to raise the argument for the first time before our Court.[20]

         While we recognize that this issue, generally construed, has divided various panels of the Courts of Appeals, [21] Pier Sixty does not even cite or acknowledge any of those cases-aside, of course, from asking us to "take judicial notice of the [D.C. Circuit's opinion in] SW General"[22]-let alone address any of the arguments with which those panels have grappled. Our Court has already addressed the matter, so we need not be long detained by these other decisions; we simply note that to the extent Pier Sixty's "arguments" might be construed as requesting us to reconsider our precedents, we decline to do so. Accordingly, we conclude that Pier Sixty forfeited its FVRA challenge.

         B. The NLRB's Decision That Pier Sixty Violated the NLRA by Discharging Perez

         We now turn to the second question presented-namely, whether the NLRB's petition for enforcement should be granted. That question itself turns on a more particular one: was Perez's Facebook post so "opprobrious" as to lose the protection that the NLRA affords union-related speech?

         In answering that question, we will accept the NLRB's factual findings ʺif they are supported by substantial evidence in light of the record as a whole."[23] Substantial evidence means "such relevant evidence as a reasonable mind might accept as adequate to support a conclusion."[24] Furthermore, we will not disturb the Board's adoption of an ALJ's credibility determinations unless "the testimony is hopelessly incredible or the findings flatly contradict either the law of nature or undisputed documentary testimony."[25] While we review the NLRB's legal conclusions de novo, [26] "[l]egal conclusions based upon the Board's expertise should receive, pursuant to longstanding Supreme Court precedent, considerable deference."[27]

         The NLRA generally prohibits employers from discharging an employee for concerted or union-related activity. Specifically, Section 7 of the NLRA guarantees employees the right "to engage in . . . concerted activities for the purpose of collective bargaining or other mutual aid or protection."[28] Determining whether an activity falls within the meaning of Section 7 is a task that "implicates [the Board's] expertise in labor relations" and is for "the Board to perform in the first instance."[29]

         This right to engage in union-related activity is protected by Sections 8(a)(1) and 8(a)(3) of the NLRA, which prohibit an employer from discharging employees for participating in protected, union- related activity under Section 7.[30] But even an employee engaged in ostensibly protected activity may act" in such an abusive manner that he loses the protection" of the NLRA.[31] The parties disagree about the proper framework for identifying "abusive" behavior.

         The "abusive" behavior at issue here is Perez's use of obscenities in the workplace. Traditionally, the starting point for evaluating whether an employee's "uttering of . . . obscenities" in the workplace qualifies for protection under the NLRA has been the four-factor test established by the NLRB in Atlantic Steel.[32] That test considers: "(1) the place of the discussion; (2) the subject matter of the discussion; (3) the nature of the employee's outburst; ...


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