American Federation of Labor and Congress of Industrial Organizations v. National Labor Relations Board

UNITED STATES DISTRICT COURT
FOR THE DISTRICT OF COLUMBIA
)
AMERICAN FEDERATION OF )
LABOR AND CONGRESS OF )
INDUSTRIAL ORGANIZATIONS, )
)
Plaintiff, )
)
v. ) Civ. No. 20-cv-0675 (KBJ)
)
NATIONAL LABOR RELATIONS )
BOARD, )
)
Defendant. )
)
MEMORANDUM OPINION
Administrative agencies have a duty to both notify the public before
promulgating rules that potentially affect the substantive rights of regulated parties and
review the solicited public feedback before finally adopting such significant policy
changes. See Administrative Procedures Act (“APA”), Pub. L. 79-404, 60 Stat. 237
(1946) (codified as amended at 5 U.S.C. §§ 551–559, 701–706). The law presumes that
an agency will engage in notice-and-comment rulemaking in nearly every instance in
which a final rule is adopted. Thus, if an agency promulgates a rule without providing
notice and receiving public comments, the agency must be prepared to demonstrate that
the rule it intends to enforce is not actually subject to those APA prescriptions, because
it satisfies one of the narrow exceptions to notice-and-comment rulemaking that are
specifically identified in the APA. The instant case involves one of th ose statutory
exceptions: notice-and-comment rulemaking is not required with respect to “rules of
agency organization, procedure, or practice[.]” 5 U.S.C § 553(b)(A). This is generally
1
and colloquially referred to as the APA exception for “procedural” rules. Mendoza v.
Perez, 754 F.3d 1002, 1023 (D.C. Cir. 2014).
On December 18, 2019, the National Labor Relations Board (“NLRB” or “the
Board”) took the rare step of promulgating a rule that prescribes certain procedures that
employers, employees, and labor unions have to implement with respect to the election
of employee representatives for collective bargaining purposes. See 84 Fed. Reg.
69,524 (Dec. 18, 2019) (hereinafter “2019 Election Rule”). The undisputed purpose
behind the 2019 Election Rule was to rescind certain election-related regulations that
the Board had adopted in 2014: back then, the NLRB undertook notice -and-comment
rulemaking to promulgate a rule that was primarily designed to effectuate “the essential
principle that [union] representation cases should be resolved quickly and fairly[,]” 79
Fed. Reg. 74,308, 74,308 (Dec. 15, 2014), while the 2019 Election Rule sought to
implement various pre-election and pre-certification safeguards in order to “promote[]
efficiency and expeditious final resolution of the question of representation,” 84 Fed.
Reg. at 69,529 (emphasis in original).
Significantly for present purposes, when the NLRB reversed course and enacted
the 2019 Election Rule, the agency took the position that the rule it was adopting was
merely procedural in nature for the purpose of the APA, and as such, it promulgated the
rule amendments without notifying the public of the new provisions of law that
implemented this policy shift and without soliciting public comment about them. See
84 Fed. Reg. at 69,528. One of the labor organizations that has a significant interest in
NLRB rulemaking—the American Federation of Labor and Congress of Industrial
Organizations (“AFL-CIO”)—has filed the instant lawsuit to challenge the 2019
2
Election Rule, and argues that the NLRB’s rulemaking violates the APA in several
respects. (See Compl., ECF No. 1, at 1.) The AFL-CIO’s primary argument is that
notice-and-comment rulemaking was required with respect to certain provisions of the
2019 Election Rule (see id. ¶¶ 43–50 (Count I)), and it further maintains that the 2019
Election Rule is both arbitrary and capricious (as a whole (see id. ¶¶ 51–59 (Count II))
and with respect to specific provisions (id. ¶¶ 60–69 (Count III))), and inconsistent with
the National Labor Relations Act (“NLRA”), 29 U.S.C. §§ 151–69 (see id. ¶¶ 70–81
(Count IV)). Accordingly, the AFL-CIO seeks a declaration that the entire 2019
Election Rule violates the APA and a court order that vacates it. (See id. at 15 (“Prayer
for Relief”).)
Before this Court at present are the parties’ cross-motions for summary judgment
(see Def.’s Mot. for Summ. J., ECF No. 22; Pl.’s Mot. for Summ. J., ECF No. 23) , and
also a threshold motion that the NLRB has filed, which argues that this matter must be
transferred to the D.C. Circuit for lack of jurisdiction (see Def.’s Mot. to Transfer to the
D.C. Cir. to Cure Want of Jurisdiction, ECF No. 15). Given the May 31, 2020,
effective date of the challenged rule, this Court held a telephonic motions hearing on
May 14, 2020, after which it took the motions under advisement, on an expedited basis.
(See Minute Entry of May 14, 2020.) The Court then issued an Order on May 30, 2020,
which GRANTED the AFL-CIO’s motion for summary judgment, DENIED the Board’s
motion to transfer and cross-motion for summary judgment, and REMANDED the
matter to the agency for reconsideration in light of this Court’s ruling. (See Order of
May 30, 2020, ECF No. 34.)
3
The present Memorandum Opinion explains the reasons for this Court’s Order.
In short, the Court has concluded that it has subject-matter jurisdiction to entertain the
AFL-CIO’s challenges under 28 U.S.C. § 1331, and that the instant case need not be
transferred to the U.S. Court of Appeals for the District of Columbia Circuit, because
the direct-review provision of the NLRA that channels review of certain NLRB actions
directly to the courts of appeals does not apply to the agency action at issue here. With
respect to the merits of the AFL-CIO’s APA claims, this Court agrees that the
challenged parts of the 2019 Election Rule do not qualify as procedural rules within the
meaning of the APA’s exception to notice-and-comment rulemaking, and the Court thus
finds that those particular provisions were promulgated unlawfully and must be set
aside.
I. BACKGROUND
A. The NLRB’s General Authority To Regulate Labor Practices Under
The National Labor Relations Act
The NLRB is an administrative agency that Congress created in 1935, when it
enacted the National Labor Relations Act, 29 U.S.C. §§ 151–69, which is the primary
federal statute that regulates private sector labor-employer relations in the United
States. The text of the NLRA makes clear that Congress intended to “encourag[e] the
practice and procedure of collective bargaining” and to “protect[] the exercise by
workers of full freedom of association, self-organization, and designation of
representatives of their own choosing[.]” Id. § 151. In furtherance of these goals, the
statute expressly bestows upon the NLRB the power to engage in general and specific
rulemaking, see id. §§ 156, 159(c)(1), and to adjudicate certain disputes that commonly
arise between labor organizations, employees, and employers, see §§ 158, 159, 160.
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The NLRA also plainly distinguishes between the NLRB’s exercise of its powers
with respect to addressing alleged unfair labor practices, on the one hand, and
regulating collective bargaining practices (generally referred to as “representation”), on
the other. Indeed, after establishing that employees have “the right to self -organization,
to form, join, or assist labor organizations, to bargain collectively . . . [and] to refrain
from any or all of such activities[,]” id. § 157, the NLRA enumerates the various
actions that constitute “unfair labor practices” on the part of both employers and
employees in one section of the statute, see id. § 158, and separately addresses
“representatives and elections” (i.e., how representatives are chosen and representation
elections are conducted) for collective bargaining purposes in another, see id. § 159.
In the unfair labor practice realm, the NLRA empowers the NLRB “to prevent
any person from engaging in any unfair labor practice affecting commerce.” Id.
§ 160(a). Such unfair labor practices include an employer’s “interfere[nce] with the
formation or administration of any labor organization,” id. § 158(a)(2), or the refusal on
the part of either an employer or a labor organization to engage in collective bargaining
with the other, id. §§ 158(a)(5), (b)(3). And with respect to the employees’ selection of
their representatives for collective bargaining purposes, the NLRA confers upon the
NLRB, inter alia, the power to determine “the unit appropriate for the purposes of
collective bargaining[,]” id. § 159(b), and to adjudicate any “question of representation
affecting commerce[,]” id. § 159(c)(1)(B); see also 29 C.F.R. § 102.64 (2019)
(explaining that “[a] question of representation exists if a proper petition has been filed
concerning a unit appropriate for the purpose of collective bargaining or concerning a
5
unit in which an individual or labor organization has been certified or is being currently
recognized by the employer as the bargaining representative”).
For present purposes, it is important to understand that the NLRA addresses the
specific powers of the NLRB with respect to preventing unfair labor practices in section
160 of Title 29, which is entitled “[p]revention of unfair labor practices.” See 29
U.S.C. § 160. The first four subsections of section 160 pertain to various aspects of the
Board’s authority with respect to responding to such practices. See, e.g., id. § 160(a)
(the Board has general authority to address unfair labor practices “affecting
commerce”); id. § 160(b) (the Board can issue a complaint and schedule a hearing when
someone is accused of engaging in unfair labor practices); id. § 160(c) (the Board can
take testimony, make findings, order the cessation of unfair labor practices, and take
affirmative actions to effectuate the policies of the statute); id. § 160(d) (the Board is
free to modify its orders concerning unfair labor practices until judicial review or
judicial enforcement is sought). Additionally, section 160 expressly provides that the
Board’s orders concerning unfair labor practices may be enforced or challenged in
federal court. See id. §§ 160(e), (f). Pursuant to section 160(e), “[t]he Board shall have
power to petition any court of appeals of the United States . . . wherein the unfair labor
practice in question occurred or wherein such person resides or transacts business, for
the enforcement of [the Board’s] order[.]” Id. § 160(e). Likewise, and importantly,
under section 160(f), “[a]ny person aggrieved by a final order of the Board granting or
denying in whole or in part the relief sought may obtain a review of such order in any
United States court of appeals in the circuit wherein the unfair labor practice in
question was alleged to have been engaged in or wherein such person resides or
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transacts business, or in the United States Court of Appeals for the District of
Columbia[.]” Id. § 160(f).
B. The NLRB’s Relatively Recent Rulemaking Concerning The
Procedures For Conducting Representation Elections
Although section 156 of the NLRA provides the NLRB with the general
“authority from time to time to make, amend, and rescind . . . such rules and regulations
as may be necessary to carry out the provisions” of the statute, 29 U.S.C. § 156, the
Board has seldom acted through notice-and-comment rulemaking on any subject, see
N.L.R.B. v. Curtin Matheson Sci., Inc., 494 U.S. 775, 818 (1990) (Scalia, J., dissenting)
(“Despite the fact that the NLRB has explicit rulemaking authority, it has chosen —
unlike any other major agency of the Federal Government—to make almost all its
policy through adjudication.” (internal citation omitted)); see also generally Cornelius
Peck, The Atrophied Rulemaking Powers of the National Labor Relations Board, 70
Yale L.J. 729 (1961). However, over the last decade, the Board has opted to regulate
the procedures that relate to the election of union representatives through a series of
rulemakings, see 29 U.S.C. § 159(c)(1), in addition to its adjudications.
First, in 2011, the NLRB issued a final rule that addressed certain representation-
election practices. See Representation—Case Procedures, 76 Fed. Reg. 80,138 (Dec.
22, 2011). The final rule that the agency issued was unusual insofar as it was
promulgated through notice-and-comment rulemaking. See id. at 80,142 (explaining
that “[a] review of prior Board rulemaking procedures” had “reveal[ed] that the Board
ha[d] not held a public hearing attended b y all Board Members for at least half a
century”). The 2011 rule was challenged in court and was ultimately invalidated on the
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sole ground that the Board acted in the absence of a quorum. See Chamber of
Commerce v. N.L.R.B., 879 F. Supp. 2d 18, 20–21, 30 (D.D.C. 2012).
In 2014, the NLRB announced a proposed rule that was almost identical to the
2011 regulation—it was likewise aimed at facilitating the expeditious certification of
new labor organizations by “remov[ing] unnecessary barriers to the fair an d expeditious
resolution of representation cases[,]” eliminating “[d]uplicative and unnecessary
litigation,” and “simplify[ing] representation-case procedures,” among other things. 79
Fed. Reg. at 74,308; see also id. (asserting that the 2014 rule would allow the Board to
“better fulfill its duty to protect employees’ rights by fairly, efficiently, and
expeditiously resolving questions of representation”). The agency subjected its
proposed regulation to notice-and-comment rulemaking, including holding at least one
public hearing, and eventually promulgated the rules over the dissent of two Board
members. See id. The 2014 rule survived a subsequent court challenge, see generally
Chamber of Commerce v. N.L.R.B., 118 F. Supp. 3d 171 (D.D.C. 2015); Associated
Builders & Contractors of Texas, Inc. v. N.L.R.B., No. 1:15-CV-026, 2015 WL
3609116, at *1 (W.D. Tex. June 1, 2015), aff’d, 826 F.3d 215 (5th Cir. 2016), and was
implemented in full in 2015.
The 2014 rule made approximately twenty-five changes to the procedures that
had previously governed the election of union representatives for collective bargaining
purposes, 79 Fed. Reg. at 74,308–10 (summarizing the amendments)—five of which are
relevant to the instant dispute. First, the 2014 rule eliminated parties’ right to litigate
questions of individual eligibility and inclusion in the unit before the election of a
union representative (i.e., at the pre-election hearing); instead, the rule gave NLRB
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Regional Directors discretion to permit disputed individuals to vote subject to
challenge, with the challenges being resolved (if necessary) after the election. See id.
at 74,385. 1 Second, the 2014 rule required the Regional Directors to set a
representation election for “the earliest date practicable,” id. at 74,310, and eliminated
the requirement that “[e]lections . . . be automatically stayed [for 25 to 30 calendar
days] in anticipation of requests for review[,]” id. at 74,309. Third, the 2014 rule
codified the requirement that employers provide a list of eligible voters to the union or
the petitioning employees, together with their contact information, and further provided
that employers should serve the list on the petitioners within two business days of the
direction of election. Id. at 74,310. Fourth, the 2014 rule stated that the task of
certifying the results of elections should be performed at the Regional Director level in
every case. Id. Fifth, and finally, the 2014 rule provided that a party’s filing of a
request for Board review of a Regional Director’s certification of the election would not
stay the election, the counting of ballots, or the certification itself, “unless specifically
ordered by the Board[.]” Id. at 74,309. 2
When it promulgated the 2014 rule, the NLRB specifically recognized that the
NLRA “enshrines a democratic framework for employee choice and, within that
framework, charges the Board to promulgate rules and regulations in order that
employees’ votes may be recorded accurately, efficiently and speedily.” Id. at 74,314
1
Per section 153 of the NLRA, the NLRB may delegate to Regional Directors various powers of the
Board, including the authority “to determine the unit appropriate for the purpose of collective
bargaining, to investigate and provide for hearings, and determine whether a question of representation
exists, and to direct an election or take a secret ballot . . . and certify the results thereof.” 29 U.S.C.
§ 153(b).
2
Parties are authorized to seek Board review of a Regional Director’s certification of a representation
election under section 153(b) of the NLRA. See 29 U.S.C. § 153(b).
9
(emphasis added) (internal quotation marks and citation omitted). Accordingly, the
2014 rule was “[i]ntended to decrease the time preceding union elections,” Associated
Builders & Contractors, 826 F.3d at 219, although timeliness was just “one of many
reasons proffered for the amendments[,]” 79 Fed. Reg. at 74,315.
C. The 2019 Election Rule
In December of 2017, the NLRB issued a request for information (“RFI”)
concerning how the 2014 rule was working. See Representation–Case Procedures, 82
Fed. Reg. 58,783 (Dec. 14, 2017). 3 The NLRB posted that “it will be helpful to solicit
and consider public responses to this request for information[,]” id. at 58,783, and
sought public input with respect to the following questions:
1. Should the 2014 Election Rule be retained without change?
2. Should the 2014 Election Rule be retained with modifications? If so,
what should be modified?
3. Should the 2014 Election Rule be rescinded? If so, should the Board
revert to the Election Regulations that were in effect prior to the 2014
Election Rule’s adoption, or should the Board make changes to the prior
Election Regulations? If the Board should make changes to the prior
Election Regulations, what should be changed?
Id. at 58,784. The agency received nearly 7,000 submissions in response to its RFI (see
Pl.’s Mot. for Summ. J. at 17), including a response from the NLRB’s own Regional
Directors. Among other things, these highly interested stakeholders observed that,
3
According to the Administrative Conference of the United States, “RFIs are general ly used when an
agency is determining whether to proceed at all and, if so, what general approach to take.” Adoption of
Recommendations, 84 Fed. Reg. 2,139, 2,146–47 (Feb. 6, 2019); see also Michael Sant’Ambrogio &
Glen Staszewski, Final Report: Public Engagement with Agency Rulemaking, Admin. Conf. of the U.S.
at 50 n.234 (Nov. 19, 2018), https://perma.cc/2UGX -UCFE (explaining that RFIs are “requests for
comments early in the rule development process or retrospective review when the agency is still
considering whether to engage in a rulemaking project and is just beginning to consider potential
approaches to a problem”).
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“[w]hile parties initially voiced great concerns about the 2014 Election Rule, to a ll the
parties’ credit, after the initial learning curve, there have been very few difficulties in
the adoption of the rules[.]” (Letter from Regional Director Committee to Marvin
Kaplan, Chairman, N.L.R.B., at 4 (Apr. 13, 2018), J.A., Doc. 21, ECF No. 33 -3, at
8721.)
Approximately 24 months after it issued the RFI, the NLRB promulgated the
final rule at issue in this case, over the dissent of one of its three Board members. See
Representation–Case Procedures, 84 Fed. Reg. 69,524 (Dec. 18, 2019). The 2019
Election Rule, which was eventually slated to take effect on May 31, 2020, see
Representation–Case Procedures, 85 Fed. Reg. 17,500 (Mar. 30, 2020), largely
repealed the election procedures that the agency had adopted in the 2014 rule, in order
to “promote[] efficiency and expeditious final resolution of the question of
representation, even if the election itself is not conducted as quickly as it may have
been under the 2014 amendments[,]” 84 Fed. Reg. at 69,529 (emphasis in original).
The 2019 Election Rule spans more than 70 pages in the Federal Register, and the
effective repeal of the 2014 rule is accomplished in a various ways. As relevant here,
certain provisions of the 2019 Election Rule directly impact the timing of many of the
required steps that lead up to the certification of an election for union representatives,
and the rule also provides directives concerning the employees’ selection of an
individual to serve as the election observer.
Specifically, while the 2014 rule had authorized post-election resolution of
questions of individual eligibility and unit-inclusion, see 29 C.F.R. § 102.64(a) (2019),
the 2019 Election Rule states that, normally, such questions are to be litigated during a
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pre-election hearing and adjudicated prior to the election, see 84 Fed. Reg. at 69,539. 4
The 2014 rule had also provided that “[t]he regional director shall schedule the election
for the earliest date practicable consistent with these rules[,]” 29 C.F.R. § 102.67(b)
(2019), but the 2019 Election Rule adds that “the Regional Director will normally not
schedule an election before the 20th business day after the date of the direction of
election, to permit the Board to rule on any request for review which may be filed
pursuant to paragraph (c) of this section[,]” 84 Fed. Reg. at 69,595. And instead of
requiring the Regional Director to issue a certification of the results of the election
“forthwith” (with some narrow exceptions), 29 C.F.R. § 102.69(b) (2019), the 2019
Election Rule provides that Regional Directors will issue certifications of election
results only after the Board had decided a request for review or after the time for filing
a request for review has passed, see 84 Fed. Reg. at 69,554, 69,597. 5
The 2019 Election Rule also delays the employer’s deadline to provide to the
petitioner the voter list, which the Supreme Court has characterized as a record that
promotes “the fair and free choice of bargaining representatives . . . by allowing unions
4
The text of 2014 rule says that “[d]isputes concerning individuals’ eligibility to vote or inclusion in
an appropriate unit ordinarily need not be litigated or resolved before an election is conducted[.] ” 29
C.F.R. § 102.64(a) (2019). On this same subject, the 2019 Election Rule provides that “[d]isputes
concerning unit scope, voter eligibility and supervisory status will normally be l itigated and resolved
by the Regional Director before an election is directed[,]” although “the parties may agree to permit
disputed employees to vote subject to challenge, thereby deferring litigation concerning such disputes
until after the election.” 84 Fed. Reg. at 69,593.
5
Under the 2014 rule, once certain prerequisites are satisfied, “the regional director shall forthwith
issue to the parties a certification of the results of the election, including certification of representative
where appropriate with the same force and effect as if issued by the Board.” 29 C.F.R. § 102.69(b)
(2019). The 2019 Election Rule amended this provision by adding an additional requirement —that “no
request for review filed pursuant to § 102.67(c) is pending,” 84 Fed. Reg. at 69,597—so as to make
clear that, “[i]f any request for review is filed, the certification will issue only after the Board’s ruling
on that request[,]” id. at 69,554.
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the right of access to employees that management already possesses[.]” NLRB v.
Wyman-Gordon Co., 394 U.S. 759, 767 (1969). Under the 2014 rule, the employer was
required to provide the voter list “within 2 business days after issuance of the direction ”
of an election, 29 C.F.R. § 102.67(l) (2019), while the 2019 amendment gives
employers up to five business days to tender that record, 84 Fed. Reg. at 69,531.
Moreover, rather than allowing parties to choose an election observer of their choice
without restriction (except for various limitations that the Board’s adjudications
manifest, see, e.g., Embassy Suites Hotel, Inc., 313 N.L.R.B. 302, 302 (1993)), the 2019
Election Rule provides that, whenever possible, a party will select as its election
observer either a current member of the voting unit or a current nonsupervisory
employee, see 84 Fed. Reg. at 69,597.
In the Federal Register notice that announces the 2019 Election Rule , the NLRB
states that the agency did not need to undertake notice-and-comment rulemaking,
because “the final rule is procedural as defined in 5 U.S.C. § 553(b)(A), and is therefore
exempt from notice and comment.” 84 Fed. Reg. at 69,528. The Board further
explained that, “although foregoing notice and comment deviates from the process used
in 2014, it is consistent with the Board’s general approach in this area ” because,
“despite having used notice-and-comment rulemaking [in 2014], the explanation for the
2014 amendments was at pains to emphasize that this process was not required by
law[,]” and “the fact that the final rule modifies certain of the 2014 amendments that
were adopted after notice-and-comment rulemaking in no way requires notice-and-
comment rulemaking now.” Id. The NLRB took care to clarify that “[n]one of the
procedural changes . . . ma[d]e today are premised on the responses to the Request for
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Information; indeed, [the Board] would make each of these changes irrespective of the
existence of the Request for Information.” Id. at 69,528 n.12.
D. Procedural History
The AFL-CIO filed the complaint in the instant case on March 6, 2020. (See
Compl., ECF No. 1.) The labor organization alleges that the Board’s 2019 Election
Rule violated the APA because certain provisions are not merely procedural for APA
purposes, as the NLRB claims, and are thus not exempt from the APA’s notice-and-
comment requirement. (See id. ¶¶ 43–50 (Count I).) The AFL-CIO’s complaint also
claims that the 2019 Election Rule is arbitrary and capricious, both as a whole (see id.
¶¶ 51–59 (Count II)), and with respect to specific parts (see id. ¶¶ 60–69 (Count III)),
and the union further maintains that the 2019 Election Rule is inconsistent with the
NLRA (see id. ¶¶ 70–81 (Count IV)).
Three days after filing the complaint, the AFL-CIO filed a motion for
preliminary injunction, requesting preliminary relief in light of the then-impending
April 16, 2020, effective date of the 2019 Election Rule. (See Mot. for Prelim. Inj.,
ECF No. 3.) This Court held a telephonic status conference on March 18, 2020, during
which an extension of the effective date of the rule was discussed, in order to permit
full briefing and fair consideration of the issues in the context of proposed cross-
motions for summary judgment that the Court would review on an expedited basis. (See
Min. Entry of Mar. 18, 2020.) The following day, the NLRB notified the Court that the
effective date of its rule would be postponed until May 31, 2020. (See Notice, ECF No.
18.)
The parties then filed cross-motions for summary judgment (see Def.’s Mot. for
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Summ. J., ECF No. 22; Pl.’s Mot. for Summ. J., ECF No. 23), and their respective
responses followed (see Def.’s Opp’n to Pl.’s Mot. for Summ. J. (“Def.’s Summ. J.
Opp’n”), ECF No. 28; Pl.’s Opp’n to Def.’s Mot. for Summ. J. (“Pl.’s Summ. J.
Opp’n”), ECF No. 29). In its motion, the NLRB argues that the agency is entitled to
summary judgment because the 2019 Election Rule is a procedural rule, such that it is
exempted from notice-and-comment rulemaking, and that it is neither arbitrary and
capricious nor a violation of the NLRA, given that the Board “acted within the scope of
the broad authority granted by Congress to make, amend, and rescind rules necessary to
carry out the Act.” (See Def.’s Mot. for Summ. J. at 16). For its part, the AFL-CIO
reiterates its view that certain parts of the 2019 Election Rule are unlawful because they
were not promulgated after the required notice-and-comment rulemaking (see Pl.’s Mot.
for Summ. J. at 20), and also maintains that the entire rule fails to meet “basic
standard[s] of reasoned decision-making” (id. at 39), and is otherwise in violation of the
law (id. at 49).
The NLRB has also filed a motion to transfer the case to the U.S. Court of
Appeals for the D.C. Circuit pursuant to section 160(f) of Title 29 of the United States
Code. (See Def.’s Mot. to Transfer, ECF No. 15; see also Def.’s Reply to Pl.’s Opp’n
to Transfer (“Def.’s Reply to Transfer”), ECF No. 26.) The motion argues, for the first
time in the NLRB’s history, that this direct-review provision vests the jurisdiction to
review the instant exercise of rulemaking authority by the NLRB in the court of appeals
rather than in the district court. (See Def.’s Mot. to Transfer at 3–4.) In opposition to
the transfer motion, the AFL-CIO argues that section 160(f) is limited to NLRB orders
that concern unfair labor practice disputes, and that this Court has subject -matter
15
jurisdiction under 28 U.S.C. § 1331 to review its challenge to the 2019 Election Rule,
which pertains to the election of union representatives for collective bargaining
purposes. (See Pl.’s Opp’n to Mot. to Transfer (“Pl’s Opp’n to Transfer”), ECF No.
20.)
This Court held a telephonic motions hearing on May 14, 2020, and at the end of
the hearing the Court took the motion to transfer and cross -motions for summary
judgment, now ripe for review, under advisement. (See Minute Entry of May 14, 2020.)
II. LEGAL STANDARD
A. Motions To Transfer Cases To The Court Of Appeals Pursuant To A
Direct-Review Statute
Although Congress certainly has the prerogative to “choose the court in which
judicial review of agency decisions may occur[,]” Five Flags Pipe Line Co. v. Dep’t of
Transp., 854 F.2d 1438, 1439 (D.C. Cir. 1988) (internal quotation marks, alterations,
and citation omitted), “[i]n this circuit, the normal default rule is that persons seeking
review of agency action go first to district court rather than to a court of appeals [,]” Am.
Petroleum Inst. v. S.E.C., 714 F.3d 1329, 1332 (D.C. Cir. 2013) (internal quotation
marks and citation omitted). “[T]he APA neither confers nor restricts jurisdiction, ” so
it is “the general federal-question statute, 28 U.S.C. § 1331[,]” that is the font of
authority for district courts to review claims brought under the APA. Trudeau v.
F.T.C., 456 F.3d 178, 185 (D.C. Cir. 2006). And, “unless Congress expressly says
otherwise, APA review takes place first in the federal district courts, not the courts of
appeals.” Rodriguez v. Penrod, 857 F.3d 902, 906 (D.C. Cir. 2017). Indeed, it is by
now clear beyond cavil that, where the district court has subject-matter jurisdiction
under section 1331, “[i]nitial review occurs at the appellate level only when a direct -
16
review statute specifically gives the court of appeals subject-matter jurisdiction to
directly review agency action.” Watts v. S.E.C., 482 F.3d 501, 505 (D.C. Cir. 2007).
With respect to interpreting such direct-review statutes, “[w]hether initial
subject-matter jurisdiction lies initially in the court of appeals must of course be
governed by the intent of Congress and not by any views we may have about sound
policy.” Florida Power & Light Co. v. Lorion, 470 U.S. 729, 745 (1985). Because
“courts have just so much jurisdiction as Congress has provided by statute[,]” Sierra
Club v. Thomas, 828 F.2d 783, 792 (D.C. Cir. 1987), they must “act on the basis of
statutory language and probative legislative history” in order to discern congressional
intent with respect to jurisdictional provisions, including direct review provisions, Am.
Petroleum Inst., 714 F.3d at 1337. However, if a particular direct-review provision is
“ambiguous on its face,” it will likely be read to confer direct-review authority to the
court of appeals, for the Supreme Court has specifically instructed that, “[a]bsent a firm
indication that Congress intended to locate initial APA review of agency action in the
district courts, we will not presume that Congress intended to depart from the sound
policy of placing initial APA review in the courts of appeals.” Lorion, 470 U.S. at 737.
Thus, as relevant here, the D.C. Circuit has adopted a presumption with respect to
ambiguous direct-review provisions, which holds that a statutory provision “creating a
right of direct judicial review in the court of appeals of an administrative ‘order’
authorizes such review of any agency action that is otherwise susceptible of review on
the basis of the administrative record alone.” N.Y. Republican State Comm. v. S.E.C.
(“NYRSC”), 799 F.3d 1126, 1131 (D.C. Cir. 2015) (emphasis added).
B. Summary Judgment In The APA Context
As a general matter, summary judgment may be granted in favor of a party
17
pursuant to Federal Rule of Civil Procedure 56 “if the pleadings, the discovery and
disclosure materials on file, and any affidavits [or declarations] show that there is no
genuine issue as to any material fact and that the movant is entitled to a judgment as
matter of law.” Air Transp. Ass’n. of Am., Inc. v. Nat’l Mediation Bd., 719 F. Supp. 2d
26, 31–32 (D.D.C. 2010), aff’d, 663 F.3d 476 (D.C. Cir. 2011) (alteration in original)
(quoting Fed. R. Civ. P. 56(c)). In the instant case, however, the parties have sought
summary judgment with respect to an action of an administrative agency that allegedly
violates the APA; as a result, the typical legal standard articulated in Federal Rule of
Civil Procedure 56 does not apply. See Wilhelmus v. Geren, 796 F. Supp. 2d 157, 160
(D.D.C. 2011) (internal citation omitted).
Instead, “in APA cases, the summary judgment standard functions slightly
differently, because the reviewing court generally reviews the agency’s decision as an
appellate court addressing issues of law.” Policy & Research, LLC v. Dep’t of Health
& Human Servs., 313 F. Supp. 3d 62, 74 (D.D.C. 2018) (internal quotation marks,
alterations, and citation omitted). Thus, in the instant context, “it is the role of the
agency to resolve factual issues to arrive at a decision that is supported by the
administrative record,” and “the function of the district court is to determine whether or
not as a matter of law the evidence in the administrative record permitted the agency to
make the decision it did.” Zemeka v. Holder, 963 F. Supp. 2d 22, 24 (D.D.C. 2013)
(internal quotation marks and citations omitted). “Summary judgment thus serves as
the mechanism for deciding, as a matter of law, whether the agency action is supported
by the administrative record and otherwise consistent with the APA standard of
review.” Wilhelmus, 796 F. Supp. 2d at 160 (citation omitted).
18
III. ANALYSIS
The NLRB vigorously maintains, as a threshold matter, that the instant APA
dispute concerning its newly promulgated election-procedures rule must be transferred
to the court of appeals forthwith, because the direct-review provision in section 160(f)
of the NLRA divests this Court of jurisdiction over the claims that the AFL -CIO brings
here. (See Def.’s Mot. to Transfer at 5 (arguing that “the AFL-CIO’s Complaint was
filed in a court which lacks subject-matter jurisdiction to hear it”).) The Board argues
further that, if this Court addresses the AFL-CIO’s challenges to the 2019 Election
Rule, summary judgment must be granted in the NLRB’s favor, because the challenged
regulatory provisions are procedural rules that did not require pre-promulgation notice-
and-comment rulemaking, and none of them is arbitrary and capricious or otherwise
violative of the NLRA. (See Def.’s Mot. for Summ. J. at 16.) The AFL-CIO responds
that section 160(f)’s direct-review provision is inapposite (see Pl.’s Opp’n to Transfer
at 1), and that the union is entitled to summary judgment on its APA claims, because
the NLRB’s promulgation of the challenged election -procedures provisions required
notice-and-comment rulemaking, and not only violated the APA’s prohibitions against
arbitrary and capricious rules, but also transgressed the NLRA (see Pl.’s Mot. for
Summ. J. at 9–10).
As explained below, this Court has concluded that section 160(f)’s direct-review
provision does not divest the district court of subject-matter jurisdiction over the instant
dispute, and it has further found that no fair assessment of the regulatory provisions
leads to the conclusion that the challenged parts of the 2019 Election Rule are mere
procedural rules. Consequently, the APA required that the challenged parts of the 2019
19
Election Rule be promulgated through notice-and-comment rulemaking, and given that
the NLRB did not actually engage in such a pre-promulgation process, the provisions
that the AFL-CIO has challenged on notice-and-comments grounds must be set aside.
But this Court will not invalidate the entire rule to remedy the notice -and-comment
defect, in accordance with well-established legal norms that require deference to agency
decision-making in the wake of a district court’s review of administrative action.
Instead, the Court will remand the matter to the agency for further consideration in light
of this Court’s ruling.
A. The Court Has Jurisdiction To Consider The Parties’ Cross-Motions
For Summary Judgment, Notwithstanding The NLRA’s Direct-Review
Provision
There is no question that federal courts are courts “of limited jurisdiction, ” and
thus any “inquiry must always begin by asking whether [the courts] have jurisdiction”
over the claim presented. Salazar ex rel. Salazar v. District of Columbia, 671 F.3d
1258, 1261 (D.C. Cir. 2012). The parties here disagree on whether district courts have
subject-matter jurisdiction to entertain any APA challenge to a rule promulgated by the
NLRB (see Def.’s Mot. to Transfer at 3; Pl.’s Opp’n to Transfer at 2), and this dispute
arises because section 160(f) of the NLRA provides, in relevant part, that
[a]ny person aggrieved by a final order of the Board granting or
denying in whole or in part the relief sought may obtain a review of
such order in any United States court of appeals in the circuit wherein
the unfair labor practice in question was alleged to have been engaged
in or wherein such person resides or transacts business, or in the
United States Court of Appeals for the District of Columbi a[.]
29 U.S.C. § 160(f). This Court easily concludes that the text, structure, and legislative
history of section 160(f) make it unambiguously clear that section 160(f) does not
20
channel to the courts of appeals direct-review jurisdiction over challenges to NLRB
rules governing the election of union representatives for collective bargaining purposes,
as explained below.
1. Section 160(f) Pertains Solely To Claims That Relate To Agency
Actions Concerning Unfair Labor Practices
Beginning, as this Court must, with the text of section 160(f), it is clear that this
statutory provision is directed to “final order[s]” of the NLRB that “grant[] or deny[] in
whole or in part the relief sought” in the context of the “unfair labor practice in
question.” 29 U.S.C. § 160(f). Thus, by its terms, the direct-review provision is quite
specific and relatively narrow, insofar as it provides for direct judicial review in the
court of appeals of only those “orders” of the NLRB that are “final,” and such final
orders must “grant[] or deny[]” some type of “relief” that has been “sough t” by an
entity that the NLRA governs. Id. Setting aside for the moment whether or not the
“final order” requirement is broad enough to cover an NLRB “rule” like the one at issue
here, there is no reasonable argument that credibly casts the 2019 Election Rule as an
agency action that grants or denies any relief to a regulated party, and this problem
alone is sufficient to cast doubt on the NLRB’s contention that section 160(f) applies to
the AFL-CIO’s claims. 6 But what clinches the conclusion that section 160(f) does not
6
The NLRB acknowledges that “no outside party specifically ‘sought’ relief in the form of a
rulemaking petition,” but it nonetheless asserts that “the Board itself sought—and granted—relief when
it entered the Final Rule.” (Def.’s Reply to Transfer at 7 n.3.) It further maintains that section 160(f)
must be read to encompass instances in which the Board seeks relief from itself in this manner,
because, otherwise, “[i]t would be hypertechnical and illogical to hold that rules issued by an agency on
its own initiative must be challenged in district court, but rules issued in response to a petition must be
challenged in circuit court.” (Id.) Of course, this odd argument is a strawman, for it demands an
entirely unnatural reading of what it means to seek relief from the NLRB, and simultaneously sidesteps
the fact that, regardless of who initiates the rule, section 160(f) only conceivably applies to agency
actions that pertain to unfair labor practices. See infra Section III.A.2.
21
divest the district court of the subject-matter jurisdiction that it would otherwise have to
address the AFL-CIO’s claims under 28 U.S.C. § 1331 is the very simple fact that what
is being directed to the court of appeals for direct-review per the text of the statute is
NLRB actions concerning the “unfair labor practice in question”—a textual reference
that strongly suggests that the provision is only triggered when some kind of unfair
labor practice is at issue. Cf. Am. Fed’n of Labor v. N.L.R.B., 308 U.S. 401, 409 (1940)
(holding that section 160(f) authorizes judicial review of NLRA section 158 “unfair
labor practice” orders, but it does not authorize judicial review of NLRA section 159
“representation” adjudications).
The structure of section 160 of the NLRA confirms that this interpretation is the
only possible reading of this direct-review provision. In this regard, as the Court
previously explained, subsection (f) “appears as an integral part” of section 160, id. at
407—which is itself entitled “prevention of unfair labor practices[,]” 29 U.S.C. § 160—
and “[a]ll the other subdivisions relate exclusively to proceedings for the prevention of
unfair labor practices[,]” Am. Fed’n of Labor, 308 U.S. at 407. 7 The NLRB provides no
explanation for its suggestion that Congress intended to place section 160(f) in the heart
of a section solely governing unfair labor practices, and yet somehow meant for this
7
See also 29 U.S.C. § 160(a) (authorizing the Board “to prevent any person from engaging in any
unfair labor practice . . . affecting commerce”); id. § 160(b) (setting out the Board’s procedures
“[w]henever it is charged that any person has engaged in or is engaging in any such unfair labor
practice”); id. § 160(c) (“If upon the preponderance of the testimony taken the Board shall be of the
opinion that any person named in the complaint has engaged in . . . any such unfair labor practice, then
the Board shall state its findings of fact and shall issue . . . an order requiring such person to cease and
desist from such unfair labor practice”); id. § 160(d) (“Until the record in a case shall have been filed
in a court, as hereinafter provided, the Board may at any time upon reasonable notice and in such
manner as it shall deem proper, modify or set aside, in whole or in part, any finding or order made or
issued by it.”); id. § 160(e) (“The Board shall have power to petition any court of appeals of the United
States . . . for the enforcement of such order[.]”).
22
particular provision alone to apply more broadly. Cf. Almendarez-Torres v. United
States, 523 U.S. 224, 234 (1998) (explaining that “the title of a statute and the heading
of a section are tools available for the resolution of a doubt about the meaning of a
statute” (internal quotation marks and citation omitted)). And because the entirety of
section 160 solely focuses on NLRB orders on unfair labor practice disputes, the only
reasonable construction of subdivision (f) takes into account that it only concerns
NLRB orders on unfair labor practice disputes as well.
The structure of the NLRA itself further solidifies this Court’s view that section
160(f) mandates direct review of NLRB actions that pertain to unfair labor practices.
Cf. Massachusetts v. Morash, 490 U.S. 107, 115 (1989) (“[I]n expounding a statute, we
are not guided by a single sentence or member of a sentence, but look to the provisions
of the whole law, and to its object and policy.” (internal quotation marks, alterations,
and citation omitted)). As explained in Section I.A above, the NLRA draws a clear
distinction between unfair labor practices and union elections in the collective
bargaining context, and provides the NLRB with the power to adjudicate disputes and to
promulgate rules with respect to both spheres of labor -related conduct. “Separate and
distinct” provisions of the NLRA “govern the procedure in unfair labor practice cases
and in representation cases[,]” and “[t]he procedure to be followed in the unfair labor
practice cases is outlined in some detail” in section 160, “which deal[s] with unfair
labor practices only and do[es] not deal with the area of representation elections[,]”
which are addressed in section 159 of the statute. Dep’t & Specialty Store Emp. Union,
Local 1265 v. Brown, 284 F.2d 619, 626 (9th Cir. 1960); see also Am. Fed’n of Labor,
308 U.S. at 406 (noting that section 160, “which as its heading indicates relates to the
23
prevention of unfair labor practices[,]” includes no “mention of investigations or
certifications authorized and defined by” section 159).
This Court’s reading of section 160(f) is also consistent with the scant legislative
history pertaining to this statutory provision. The House Report on the draft bill that
became the NLRA clarifies that section 160 is intended to empower the NLRB “to
prevent any person from engaging in any unfair labor practice[,]” and that it authorizes
the federal courts to get involved in two circumstances. H.R. Rep. No. 74 -969 at 21–22
(1935). The Report says, first, “[i]f the person complained of fails or neglects to obey
the Board’s order, it is provided that the Board shall be empowered to petition any
appropriate Circuit Court of Appeals of the United States for the enforcement of such
order.” Id. at 22. And, second, “[a]ccording to a similar procedure, any person
aggrieved by a final order of the Board granting or denying in whole or in part the relief
sought may obtain a review of such order in the appropriate circuit court of appeals, or
in the Court of Appeals of the District of Columbia.” Id. This same source explains
that the provision that allows an aggrieved person to solicit the intervention of the
circuit court “is intended here to give the party aggrieved a full, expeditious, and
exclusive method of review in one proceeding after a final order is made[,]” and “[u]ntil
such final order is made the party is not injured, and cannot be heard to complain[.]”
Id.
This all means that both Congress’s own description of the intended purpose of
section 160 and section 160(f), and also the text and structure of the statute that
Congress crafted to convey that intent, leave no doubt as to the limited scope of the
24
direct review created by the NLRA: it concerns the enforcement and review of NLRB
orders that pertain to unfair labor practice charges.
2. That Ambiguous Direct-Review Provisions Pertaining To Agency
“Orders” Presumptively Must Also Be Read To Include “Rules” Is
Of No Moment
The NLRB points out that the D.C. Circuit has long maintained, as a general
matter, that where there is ambiguity with respect to the scope of a direct -review
statute, the term “order” should be interpreted to include an agency “rule[.]” NYRSC,
799 F.3d at 1131; see also Inv. Co. Inst. v. Bd. of Governors of Fed. Reserve Sys., 551
F.2d 1270, 1273–78 (D.C. Cir. 1977) (interpreting Section 9 of the Bank Holding Act,
which authorizes “[a]ny party aggrieved by an order of the Board under this chapter [to]
obtain a review of such order . . . in the Court of Appeals in the District of
Columbia[,]” and holding that “the purposes underlying Section 9 will best be served if
‘order’ is interpreted to mean any agency action capable of review on the basis of the
administrative record,” including agency regulations). Given this binding authority, the
Board here takes the unprecedent step of arguing that the text of section 160(f) must be
read to mandate direct-review authority to the courts of appeals with respect to both any
order of the NLRB and any rule that the NLRB promulgates (with the exception of
orders certifying the election of union representatives), and as such, section 160(f)
applies to divest this Court of jurisdiction over the AFL-CIO’s claims. (See Def.’s Mot.
to Transfer at 3–5 (acknowledging that the Board never made this argument in prior
challenges to its rules).) But this entirely novel contention is also entirely
unpersuasive, because section 160(f) is not at all ambiguous in scope, as demonstrated
above—and, indeed, it makes crystal clear that the challenged agency action that is
25
subject to the courts of appeals’ direct review must be one that involves unfair labor
practices, while the elections rule at issue here indisputably concerns collective
bargaining procedures. See Pub. Citizen, Inc. v. Nat’l Highway Traffic Safety Admin.,
489 F.3d 1279, 1287 (D.C. Cir. 2007) (noting that, when interpreting a direct-review
provision, the question is whether the provision is “ ambiguous in any sense relevant”).
Not to belabor the point, the Court merely reiterates that Congress intentionally
designed subsection (f) of section 160 to provide “aggrieved parties” with the right to
seek review of a “final order” of the NLRB pertaining to such an unfair labor practice
in the court of appeals “in the circuit wherein the unfair labor p ractice in question was
alleged to have been engaged in[,]” among other places, 29 U.S.C. § 160(f), in the same
way that Board can seek court enforcement of any agency order concerning an alleged
unfair labor practice pursuant to subsection (e), see id. § 160(e). See generally supra
Section III.A.1. To be sure, subsection (f) is also in the nature of “a venue clause”
(Def.’s Reply to Transfer at 8 (emphasis omitted)) insofar as it specifies which of the
courts of appeals such aggrieved persons can petition to obtain judicial review. But the
text, structure, and legislative history of this direct-review provision unequivocally
establishes that, at bottom, the subject of a petition for review that is filed with the
court of appeals under section 160(f) must be an NLRB action that pertains to unfair
labor practices as opposed to any other topic that the agency might have acted to
address.
Thus, the NLRB’s reliance on that the D.C. Circuit’s holding that an “order” for
direct-review-statute purposes presumptively includes “rules” (see Def.’s Mot. to
Transfer at 3) is entirely beside the point. That is, regardless of whether, “absent
26
contrary congressional intent,” an ambiguous “statutory review provision creating a
right of direct judicial review in the court of appeals of an administrative ‘order’ [also]
authorizes such review of” any agency rule, NYRSC, 799 F.3d at 1131, Congress’s
intent with respect to section 160(f) is not absent; instead, Congress has unambiguously
made it crystal clear that, to trigger the direct-review directive, any NLRB order (or,
perhaps, any NLRB rule) must, as a threshold matter, relate to unfair labor practices.
This critical prerequisite manifestly distinguishes the instant direct-review
provision from those in each of the cases that NLRB points to as precedents for the
application of the presumption that “orders” includes “rules.” (See Def.’s Mot. to
Transfer at 3–4; Def.’s Reply to Transfer at 12–13.) 8 And the NLRB does not appear to
dispute that the 2019 Election Rule concerns collective bargaining practices, not unfair
labor practice determinations. Therefore, it is clear to this Court that it retains
jurisdiction over the instant challenge to the NLRB’s rulemaking, not because the
NLRB has promulgated a rule rather than issuing an order, but because the NLRB’s
action regulates representation rather than unfair labor practices, such that subsection
(f)’s direct-review provision does not apply. 9 Consequently, the Court will proceed to
8
For example, in Investment Co. Institute v. Board of Governors of Federal Reserve System , 551 F.2d
1270, 1278 (D.C. Cir. 1977), the D.C. Circuit interpreted a direct-review provision that authorizes
“[a]ny party aggrieved by an order of the Board under this chapter [to] obtain a review of such order
. . . in the Court of Appeals in the District of Columbia[,]” id. at 1273 n.3, and held that “the purposes
underlying [that provision] will best be served if ‘order’ is interpreted to mean any agency action
capable of review on the basis of the administrative record,” in cluding agency regulations, id. at 1278.
See also, e.g., N.Y. Republican State Comm. v. S.E.C., 799 F.3d 1126, 1129–31 (D.C. Cir. 2015); CTIA-
Wireless Ass’n v. F.C.C., 466 F.3d 105, 108–12 (D.C. Cir. 2006). Moreover, none of the cited
authorities addresses a direct-review provision that plainly channels to the court of appeals direct-
review authority only with respect to a certain specified category of agency decisions . (See Hr’g Tr. at
30–31 (admitting that the provisions at issue in the cited cases are not as specific as section 160(f) in
terms of applicability).)
9
This Court expresses no view as to whether section 160(f)’s reference to “orders” in the context of
unfair labor practice disputes should be interpreted to include “rules” that pertain to unfair labor
27
review the merits of the AFL-CIO’s claims pursuant to the general subject-matter
jurisdiction that Congress has conferred to it under 28 U.S.C. §1331.
B. The Board’s 2019 Election Rule Required Notice-And-Comment
Rulemaking Under The APA Because It Is Not A Procedural Rule
The APA “separates legislative [or substantive] rules, which have the force and
effect of law, from three types of rules that do not: interpretive rules, general statements
of policy, and procedural rules[,]” Planned Parenthood of Wisconsin, Inc. v. Azar, 316
F. Supp. 3d 291, 304 (D.D.C. 2018), vacated as moot, 942 F.3d 512 (D.C. Cir. 2019)
(internal quotation marks and citations omitted), and as relevant here, the APA also
provides that interpretive rules, policy statements, and procedural rules are exempted
from the statute’s notice-and-comment requirement, see 5 U.S.C. § 553(b)(A). The
exception for “procedural rules” is “the hardest to define[,]” Batterton v. Marshall, 648
F.2d 694, 707 (D.C. Cir. 1980); however, the APA states that Congress intended to
permit agencies to promulgate “rules of agency organization, procedure, or practice”
without first submitting rules of that nature to public scrutiny, 5 U.S.C. § 553(b)(A).
The nub of the instant dispute is the NLRB’s valiant effort to shoehorn five parts of its
2019 Election Rule into this narrow classification. But for the reasons explained below,
this Court finds that the challenged provisions of the 2019 Election Rule are not
procedural rules, and as a result, their promulgation violated the APA’s otherwise
mandatory notice-and-comment requirements.
practices, pursuant to “the presumption [] that statutory authorization of direct federal judicial review
of agency ‘order[s]’ encompasses rules[.]” NYRSC, 799 F.3d at 31. The claims at issue here concern
solely the NLRB’s rulemaking practices on representation elections, therefore the applicability of the
presumption to rules on unfair labor practices is not before this Court.
28
1. The Challenged Provisions Are Not Procedural Rules Because They
Are Not Rules Of Agency Organization, Procedure, Or Practice
The first step in understanding this Court’s evaluation of the instant dispute is to
recognize that the parties have framed this issue as a quest to ascertain whether or not
the 2019 Election Rule is a substantive rule for which notice-and-comment rulemaking
is required—a subject upon which they vehemently disagree. (Compare Pl.’s Mot. for
Summ. J. at 21 (arguing that the 2019 “amendments are substantive” (emphasis added))
with Def.’s Summ. J. Opp’n at 7 (contending that the challenged provisions are not
substantive rules, because “none of the changes challenged by AFL-CIO in the 2019
[Election Rule] is so burdensome that they either foreclose fair consideration of the
underlying controversy or have the intent or effect of changing the substantive outcome
of the elections”).) The parties appear to agree that the 2019 Election Rule is, in fact, a
“rule” for the purpose of the APA, see 5 U.S.C. § 551(4); therefore, it is puzzling that
the parties have framed the applicable legal standards in a manner that seems to lose
track of the central question—i.e., whether the 2019 Election Rule provisions are
procedural rules and thus exempt from required notice-and-comment rulemaking—and
have instead primarily engaged in a debate over whether the challenged parts of the
2019 Elections rule qualify as substantive and, as such, were entitled to notice-and-
comment rulemaking in the first place.
The parties’ struggle to keep their eyes on the ball is not surprising: the D.C.
Circuit, too, “ha[s] struggled with the distinction between ‘substantive’ and
‘procedural’ rules[,]” JEM Broad. Co. v. F.C.C., 22 F.3d 320, 326 (D.C. Cir. 1994), and
has repeatedly suggested that “the distinction between substantive and procedural rules
is one of degree[,]” rather than kind, Elec. Privacy Info. Ctr. v. Dep’t of Homeland Sec.
29
(“EPIC”), 653 F.3d 1, 5 (D.C. Cir. 2011). The Circuit has also indicated that the
relevant analysis “is functional, not formal[,]” Chamber of Commerce v. Dep’t of
Labor, 174 F.3d 206, 212 (D.C. Cir. 1999), but it has not further expounded upon how
one is expected to draw that line, as a practical matter, with respect to any particular
rule formulation. Cf. Nat’l Mining Ass’n v. McCarthy, 758 F.3d 243, 251 (D.C. Cir.
2014) (noting that this “inquiry turns out to be quite difficult and confused”).
Yet, the seemingly inscrutable task of discerning which agency rules function in
a sufficiently substantive manner to qualify for notice-and-comment rulemaking is
made substantially easier when one revisits the text of the APA, which helpfully
establishes that an agency rule is essentially presumed to be substantive for the purpose
of the notice-and-comment requirement, and that notice-and-comment rulemaking is
thus generally required unless a rule satisfies one of the listed exceptions. See 5 U.S.C.
§ 553(b). Therefore, this Court has initially focused its attention on identifying the
contours of the exception that the NLRB relies upon in this case rather than on defining
the limits of the general rule, so as to determine whether the challenged parts of the
2019 Election Rule qualify as procedural rules. Cf. Am. Hosp. Ass’n v. Bowen, 834
F.2d 1037, 1044 (D.C. Cir. 1987) (warning of the risks of “allow[ing] the exceptions
itemized in § 553 to swallow the APA’s well-intentioned directive”).
To be clear, attempting to ascertain the “procedural” nature of an agency rule by
eliminating the possibility that the rule is “substantive” would be a rational approach if
there were only those two options in the universe of possible rule classifications, and if
each was equally likely to occur. However, as noted above, the APA carves out and
exempts from notice-and-comment rulemaking three different kinds of agency rules —
30
not only “rules of agency organization, procedure, or practice,” 5 U.S.C. § 553(b)(A),
but also “interpretive rules” and “general statements of policy,” id. And even more
importantly, notice-and-comment rulemaking is the default when an agency
promulgates a rule, while “the various exceptions” are to “be narrowly construed and
only reluctantly countenanced.” N.J. Dep’t of Envtl. Prot. v. E.P.A., 626 F.2d 1038,
1045 (D.C. Cir. 1980); see also Mendoza, 754 F.3d at 1023. This means that, if the task
at hand is to determine when notice-and-comment is not required, than doing so is most
effectively and efficiently accomplished by demarcating the boundaries of the limited
exception at issue, and determining whether, in light of those parameters, the agency
has satisfied its burden of establishing that the rule it promulgated meets that mark.
Here, the NLRB argues that the challenged provisions of the 2019 Election Rule are
exempt from notice-and-comment rulemaking under the procedural-rule exception;
therefore, this Court has primarily undertaken to examine whether or not the provisions
at issue qualify as such.
Put another way, in order to prevent veering off course in this very murky area of
administrative law, this Court begins its analysis of the nature of the challenged
provisions of the 2019 Election Rule for APA purposes by establishing the scope of the
intended target: the procedural-rule exception. In this regard, the D.C. Circuit has
instructed that the APA’s procedural-rule exception exists “to ensure that agencies
retain latitude in organizing their internal operations,” but it has also noted that “many
. . . internal agency practices affect parties outside the agency—often in significant
ways.” Batterton, 648 F.2d at 707. The D.C. Circuit has provided few other insights
into the proper method for identifying procedural rules, but it is helpful to recall that
31
the term “procedural rule” is itself general nomenclature that is shorthand for the “rules
of agency organization, procedure, or practice” that are expressly exempted from the
notice-and-comment requirement under section 553(b) of the APA.
The Supreme Court has described the procedural rules provision as, essentially, a
“housekeeping statute,” Chrysler Corp. v. Brown, 441 U.S. 281, 310 (1979), and the
D.C. Circuit has clarified Congress’s intent with respect to this provision by explaining
that “Congress provided this exemption from the normal rulemaking procedures to
ensure that agencies retain latitude in organizing their internal operations[,]” Mendoza,
754 F.3d at 1023 (internal quotation marks and citation omitted) (emphasis added).
Thus, rules that are properly characterized as procedural in nature for APA purposes,
and are thus exempted from notice-and-comment rulemaking, are “primarily directed
toward improving the efficient and effective operations of an agency[,]” Batterton, 648
F.2d at 702 n.34; that is, they generally “relate to the method of operation of the
agency[,]” id. at 708 n.70 (citation omitted), although they can sometimes set
“timetable[s] for [regulated entities] asserting substantive rights[,]” Lamoille Valley
R.R. Co. v. Interstate Commerce Comm’n, 711 F.2d 295, 328 (D.C. Cir. 1983), or “alter
the manner in which the parties present themselves or their viewpoints to the agency [,]”
Nat’l Mining Ass’n, 758 F.3d at 250. Importantly, the D.C. Circuit has also warned that
the procedural-rule exception “should not be deemed to include any action which goes
beyond formality[,]” Pickus v. U.S. Bd. of Parole, 507 F.2d 1107, 1113 (D.C. Cir.
1974), because procedural rules are intended simply to “deal[] with the method of
operation utilized by the [agency] in the dispatch of its business[,]” Kessler v. F.C.C.,
326 F.2d 673, 680 (D.C. Cir. 1963) (citation omitted).
32
It is instructive to consider a few examples of agency rules that the D.C. Circuit
has found to be procedural in nature. For example, the circuit has concluded that rules
that create or modify deadlines for regulated entities to notify the agency of their choice
to exercise certain substantive rights are procedural rules. See, e.g., Lamoille Valley,
711 F.2d at 328; Ranger v. F.C.C., 294 F.2d 240, 244 (D.C. Cir. 1961). Similarly,
regulations regarding how the agency is going to receive petitions from regulated
entities, or the internal steps that the agency will take to screen such applications, have
been considered procedural. See, e.g., Nat’l Mining Ass’n, 758 F.3d at 250; James V.
Hurson Assocs., Inc. v. Glickman, 229 F.3d 277, 282 (D.C. Cir. 2000). The circuit has
also concluded that regulations that govern an agency’s internal procedures with respect
to its processing of incomplete or objected-to petitions filed by regulated entities satisfy
the procedural-rule exception. See, e.g., JEM Broad. Co., 22 F.3d at 327–28;
Neighborhood TV Co. v. F.C.C., 742 F.2d 629, 637 (D.C. Cir. 1984). And, lastly,
procedural rules include agency regulations organizing the agency’s internal procedures
to meet its own legal duties. See, e.g., Pub. Citizen v. Dep’t of State, 276 F.3d 634, 638
(D.C. Cir. 2002).
Thus, it is fair to say that D.C. Circuit’s precedents, as well as its more general
pronouncements regarding the scope and meaning of the procedural-rule exception,
suggest that procedural rules primarily concern the agency’s internal operations, even if
such rules also occasionally create expectations for regulated entities with respect to the
timeframe, means, and methods by which those entities assert their substantive rights
vis-à-vis the agency. Moreover, where (as here) a plaintiff challenges a rule provision
that is plainly not directed to internal agency processes, the APA seemingly requires the
33
agency to demonstrate that its rulemaking action nevertheless relates to “agency
organization, procedure, or practice[,]” 5 U.S.C. § 553(b)(A), to such a degree that it
cannot be fairly characterized as having a substantive impact on the parties. In other
words, in this Court’s view, if the agency cannot show that the default assumptions of
the APA have been properly displaced because the rule at issue is, in fact, directed at
the agency’s internal processes despite the incidental effect on the parties , then the rule
cannot be characterized as fitting within the APA’s narrow procedural exemption, and
notice-and-comment is required. Cf. EPIC, 653 F.3d at 5–6 (“[T]he distinction between
substantive and procedural rules is one of degree depending upon whether the
substantive effect is sufficiently grave so that notice and comment are needed to
safeguard the policies underlying the APA[,]” which include “serv[ing] the need for
public participation in agency decisionmaking” and “ensur[ing] the agency has all
pertinent information before it when making a decision[.]” (internal quotation marks
and citations omitted)).
Applying these principles to the instant case, this Court concludes that each of
the provisions of the 2019 Election Rule that the AFL-CIO challenges as a notice-and-
comment violation reaches far outside the Board’s internal operations, and the NLRB
has failed to show that each provision nonetheless still fits within the narrow scope of
the procedural-rule exception. Take, for instance, the 2019 Election Rule’s mandate
that Regional Directors “will normally not schedule an election before the 20th business
day after the date of the direction of election,” 84 Fed. Reg. at 69,595 , and also the
rule’s extension of the window of time within which employers must compile the list of
eligible voters and disclose it to the Board and the employees, see id. at 69,531. By
34
lengthening the timeframes wherein the agency (through its Regional Directors) and
employers who presumably oppose unionization are supposed to unde rtake certain
significant actions with respect to aspects of the representation -elections process, the
NLRB is doing much more than merely and ministerially altering deadlines for parties
to express their intentions to the agency. See, e.g., Lamoille Valley, 711 F.2d at 328;
Ranger, 294 F.2d at 244. Rather, the NLRB has delayed the timeframe within which
duties that are owed to the regulated entities will be carried out. To be sure, these rules
can be characterized as procedural at a certain level of abstraction, because they
generally relate to the procedures that must be followed to conduct representation
elections. But rule provisions that dictate when the Regional Directors will take certain
necessary actions on behalf of the agency in respo nse to employees’ filings, or when
employers must disclose certain information once the employees have already asserted
their substantive rights, do not bear meaningfully on the agency’s internal processes,
yet they do have a significant impact on the employees’ ability to mount a successful
campaign for unionization, as is their right under the NLRA.
Likewise, when the 2019 Election Rule provides that “[d]isputes concerning unit
scope, voter eligibility and supervisory status will normally be litigated and resolved by
the [R]egional [D]irector before an election is directed[,]” 84 Fed. Reg. at 69,539; or
requires the employees to choose as their election observer either “ a current member of
the voting unit” or “a current nonsupervisory employee[,]” id. at 69,597; or mandates
that, “the certification [of the election results] will issue only after the Board’s ruling
on [any] request” for review, id. at 69,554, the Board is manifestly outward facing, and
is unquestionably guiding the conduct of regulated entities in a manner that primarily
35
impacts matters outside its own internal operations. To put a finer point on this
particular assessment, by requiring pre-election litigation of potential voter eligibility
problems, the NLRB is causing employees to wait for issues concerning the scope of the
collective bargaining unit to be sorted out prior to an election, with the distinct
possibility that such a delay will hinder the employees’ prospects of mobilizing a
sufficient number of peers to unionize the workplace, and with no apparent
corresponding benefit with respect to the internal workings of the agency. And the
election-observer provision, which plainly directs whom the employees can choose to
protect their interests while the election is underwa y, might well be a significant
constraint for employees who are seeking to unionize, but appears to make not one whit
of difference with respect to the agency’s internal operations. Finally, to the extent that
the 2019 Election Rule delays certification, it likewise forestalls the benefits that
employees are seeking when they campaign for unionization, see, e.g., 29 U.S.C.
§ 158(b)(7) (allowing only “currently certified” labor organizations to picket for longer
than 30 days an employer who refuses to “recognize or bargain with a labor
organization as the representative of his employees” ), while the beneficial effect of this
prescribed delay on any internal practice or process of the NLRB has yet to be
established.
The Board’s response is that the challenged provisions of the 2019 Election Rule
qualify as procedural rules regardless, because they only “govern[] the content and
timing of case filings” (Def.’s Mot. for Summ. J. at 21 (quoting Nat’l Whistleblower
Ctr. v. Nuclear Regulatory Comm’n, 208 F.3d 256, 262 (D.C. Cir. 2000))), and/or
merely change “when [certain] issues are presented to, and decided by, the Board” (id.
36
at 17). Boiled to bare essence, this contention suggests that the NLRB considers any
rule that merely relates to procedures as opposed to substantive rights as a procedural
rule for the purpose of the APA (see Hr’g Tr. at 58–59)—a misconception that appears
to be fueled, first and foremost, by a misunderstanding of the intended scope of the
APA’s procedural-rule exception. Indeed, as explained above, section 553(b)(A) of the
APA does not encompass any and all rules that relate to procedures that an agency says
a regulated entity must follow; instead, procedural rules are properly understood as
agency rules that relate primarily to “internal house-keeping measures organizing
agency activities[,]” Batterton, 648 F.2d at 702, which is precisely why they need not
be subjected to notice and public comment.
The NLRB also presents an “overly abstract account” of the challenged
provisions of the 2019 Election Rule—one that casts their implications at a high “level
of generality[,]” EPIC, 653 F.3d at 2–3, and thereby ignores the actual impact of the
challenged provisions of this rule on parties other than the agency itself. The Board
may say that these provisions have only “an incidental effect on parties” ( Def.’s Mot.
for Summ. J. at 20), but its own Federal Register notice belies its underst anding that
these rule changes will significantly impact representation-election processes, which is
appears to be the very reason why the NLRB adopted these reforms. See, e.g., 84 Fed.
Reg. at 69,529 (stating, in reference to elections undertaken prior to the 2019 rule
changes, that “[t]he mere fact that elections are taking place quickly does not
necessarily mean that this speed is promoting finality or the most efficient resolution of
the question of representation”).
37
Thus, it is clear to this Court that each of the challenged provisions of the 2019
Election Rule actually (and, apparently, intentionally) reaches beyond the agency’s own
“organization, procedure[s], or practice[s]” to direct regulated entities concerning how
representation elections are to be conducted, 5 U.S.C. § 553(b)(A), in a manner that
actually (and, apparently, intentionally) impacts the substantive rights of parties .
Therefore, these provisions transcend the narrow scope of the procedural-rule
exception.
2. Even If Identifying Procedural Rules Requires Determining If A
Rule Is “Not Substantive” In Nature, The Challenged Provisions
Are Substantive And, Thus, Notice-And-Comment Rulemaking
Was Required
Despite the fact that the text of the APA appears to require courts to determine
whether an agency rule is procedural and therefore exempt from notice-and-comment
rulemaking, the D.C. Circuit has, at times, suggested that in order to evaluate properly
whether or not the APA requires notice-and-comment rulemaking, courts must ask
whether the rule at issue is not substantive. See, e.g., Bowen, 834 F.2d at 1045
(asserting that the reading “that seems most consonant with Congress’ purposes in
adopting the APA is to construe [the procedural-rule exception] as an attempt to
preserve agency flexibility in dealing with limited situations where substantive rights
are not at stake”). In the discussion that follows, this Court considers whether the
challenged parts of the 2019 Election Rule are, or are not, substantive rules as the D.C.
Circuit has defined them; it mirrors much of what has already been said, because,
unfortunately for the NLRB, even under that framing of the relevant legal standards, the
challenged provisions of the 2019 Election Rule are plainly substantive in nature, such
that notice-and-comment rulemaking should have been implemented.
38
In Batterton v. Marshall—an oft-cited case concerning the distinction between
substantive and procedural rules—the D.C. Circuit defines substantive rules as those
that “effectuate statutory purposes[,]” and emphasizes that, “[i]n so doing, they grant
rights, impose obligations, [] produce other significant effects on private interests[,] . . .
narrowly constrict the discretion of agency officials by largely determining the i ssue
addressed[,]” or otherwise “have substantive legal effect.” Batterton, 648 F.2d at 701–
02. In other words, “where the agency action trenches on substantial private rights and
interests[,]” id. at 708, or where the agency action “conclusively bind[s] the agency, the
court, or affected private parties[,]” id. at 704, or where the agency is changing the
applicable “substantive standards[,]” Glickman, 229 F.3d at 280, the exception for
procedural rules cannot be applied to relieve the agency of its notic e-and-comment
rulemaking obligations. In deciding whether or not a claimed procedural rule is
actually substantive, the D.C. Circuit has “examine[d] how the rule affects not only the
rights of aggrieved parties, but their interests as well.” Chamber of Commerce, 174
F.3d at 212 (internal quotation marks and citation omitted). The D.C. Circuit has also
at times undertaken to identify a rule as substantive by seeking to determine whether or
not the rule has “the force of law.” Id. Cf. Chrysler Corp., 441 U.S. at 308 (explaining
that an agency pronouncement that has “the force of law” is one that is “binding on the
courts unless [it is] arbitrary or not promulgated pursuant to prescribed procedures”). A
“force of law” finding “will not necessarily be controlling,” but “whether a rule has the
force of law often will bear upon its proper classification as substantive or procedural.”
Chamber of Commerce, 174 F.3d at 212. 10
10
Of course, part of the confusion in this area o f the law is that it is exceedingly difficult to keep in
mind that a rule’s failure to meet any of these marks, much less the degree to which a rule falls short of
39
Applying this alternative framework to the provisions of the 2019 Election Rule
that the AFL-CIO is challenging on notice-and-comment grounds, this Court concludes
that the rules at issue are certainly more substantive than procedural, because they
plainly impose obligations, alter substantive rights, and have substantive effects on
private interests. See Batterton, 648 F.2d at 701–02; see also EPIC, 653 F.3d at 5–6
(explaining that “the distinction between substantive and procedural rules is one of
degree” (internal quotation marks omitted)). For example, as the Court previously
explained, the provision that requires Regional Directors to decline to certify the
election results until any request for review has been decided by the Board, see 84 Fed.
Reg. at 69,554, delays employees’ procurement of significant statutory rights that
depend on the NLRB’s certification, see, e.g., 29 U.S.C. § 158(b)(7); see also EPIC,
653 F.3d at 6 (suggesting that, where a policy change “substantively affects the public
to a degree sufficient to implicate the policy interests animating notice -and-comment
rulemaking[,]” the new rule qualifies as “substantive”). While perhaps less directly
impactful, the imposition of restrictions regarding whom the employees can choose as
their election observer, see 84 Fed. Reg. at 69,587, not only alters the employees right
to choose their own observer, but it also plainly appears to have the force of law,
because it “forecloses alternate courses of action” and “conclusively binds the . . .
affected private parties[,]” Batterton, 648 F.2d at 702.
The other challenged provisions of the 2019 Election Rule—i.e., the increase in
the number of challenges that can be raised and must be resolved before the election,
these specific targets, is not, in itself, the hallmark of a procedural rule, as the APA def ines that
exception. To think otherwise is, effectively, to make no -notice-and-comment (procedural-rule status)
the default rule, rather than a narrow exception, as suggested supra, in Section III.B.1.
40
see 84 Fed. Reg. at 69,539; the mandatory delay of the election date, see id. at 69,595;
and the extention of time for releasing the eligible voters’ list, see id. at 69,531—may,
or may not, have a substantial impact on a particular unionization effort (one could
imagine that the degree of impact each of these provisions has might vary widely,
depending on the circumstances presented); however, each of these rules “grant[ s]
rights” and “impose[s] obligations[,]” and could conceivably produce “significant
effects on private interests[,]” Batterton, 648 F.2d at 701–02. Thus, each of those
provisions too, qualify as substantive for the purpose of the APA’s notice-and-comment
prescriptions.
In this regard, and in conclusion, this Court has found it helpful to consider the
relatively recent pronouncements of the D.C. Circuit in two cases in which the court of
appeals found that agencies had sidestepped their duties to undertake notice-and-
comment rulemaking with respect to substantive rules, and had thus committed an APA
violation. In Electronic Privacy Information Center v. Department of Homeland
Security, the D.C. Circuit reviewed a Transportation Security Administration (“TSA”)
decision to screen airline passengers using advanced imaging technology rather than
magnetometers, which the agency itself described as a change in its own procedures to
process passengers through the checkpoint. See 653 F.3d at 2–3, 5. The D.C. Circuit
noted that the TSA’s view was an “overly abstract account of the change in procedure at
the checkpoint[,] elid[ing] the privacy interests at the heart of the petitioners’
concern[,]” id. at 6, because the change “substantively affects the public to a degree
sufficient to implicate the policy interests animating notice-and-comment
rulemaking[,]” id.
41
Similarly, in Mendoza v. Perez, the D.C. Circuit considered two Department of
Labor guidance letters concerning applications for temporary work visas for immigrants
employed in the herding industry. 754 F.3d at 1003. The circuit found that, if “stated
at a high enough level of generality,” those letters might seem procedural—indeed, they
set forth the agency’s enforcement plan for determining employer compliance with the
applicable immigration laws, and described how employers seeking a certification that
the requirements to petition for such work visas were met should present themselves to
the agency—“[b]ut a more practical account of the rules makes it clear the [letters ]
create substantive requirements by, inter alia, setting the minimum wage an employer
must offer American workers before it can obtain [the work visa] certification” and by
“set[ting] the bar for what employers must do to obtain approval.” Id. at 1024.
So it is here. The NLRB apparently conceives of its 2019 Election Rule at a
level of abstraction that qualifies it as a “procedural” rule insofar as it generally
pertains the steps that must be followed to conduct a representation election, and the
agency argues that the rule is not substantive insofar as it does not bar, or otherwise
substantially impede, the conduct of that election. (See Def.’s Mot. for Summ. J. at 22.)
But none of the challenged provisions is actually addressed to “internal house -keeping
measures organizing agency activities[,]” Batterton, 648 F.2d at 702, nor do these
provisions merely set “timetable[s] for asserting substantive rights,” Lamoille Valley,
711 F.2d at 328, or “alter the manner in which the parties present themselves o r their
viewpoints to the agency[,]” Nat’l Mining Ass’n, 758 F.3d at 250. Instead, the
challenged provisions carry many of the indicia of substantive rules —i.e., they grant
rights and impose obligations; they produce “significant effects on private interests”;
42
and they “foreclose alternate courses of action” or “conclusively bind the . . . affected
private parties.” Batterton, 648 F.2d at 701–02, 704. Therefore, this Court finds that
the NLRB’s promulgation of these particular rules without engaging in n otice-and-
comment rulemaking violated the APA
C. The Court Will Vacate The Challenged Provisions Of The 2019
Election Rule And Remand This Matter To The Board
Finally, the Court will briefly address next steps, including the appropriate scope
of the remedy, given its conclusion that some of the 2019 Election Rule’s provisions
have been unlawfully promulgated. The ALF-CIO asserted in its briefing and during
the motions hearing that, if the Court concludes that the provisions of the 2019 Election
Rule that are challenged on notice-and-comment grounds have to be set aside as
unlawful, then the Court should end its analysis there and not proceed to consider the
other legal claims in the complaint. (See Pl.’s Mot. for Summ. J. at 4 (“If the Court
agrees with Plaintiff’s primary claim that the NLRB promulgated the 2019 election rule
in violation of the APA’s notice-and-comment requirement, the Court may grant
summary judgment and remand the rule to the Board without reaching Plaintiff’s
alternative grounds for invalidating the rule.”); see also Hr’g Tr. at 38–39.) Notably,
the AFL-CIO maintains that the entire 2019 Election Rule should be vacated and sent
back to the agency if based on a finding that some of the rule provisions were
improperly adopted because, according to the AFL-CIO, “the [challenged provisions of
the 2019 Election Rule] are not discrete and it would be illogical to adopt some reforms
without regard to whether others are adopted.” (Pl.’s Mot. for Summ. J. at 35.) The
NLRB strongly objects to the AFL-CIO’s severability argument (see Def.’s Mot. for
Summ. J. at 50–53); in this regard, the Board points to the text of 2019 Election Rule
43
(id. at 50–51), which specifically states that the NLRB “would adopt each of these
amendments individually, or in any combination, regardless of whether any of the other
amendments were made[,]” and that, “[f]or this reason, the amendments are
severable[,]” 84 Fed. Reg. at 69,525 n.5.
This Court is of the view that the standard severability analysis is not warranted
in a case such as this one—i.e., where the plaintiff specifically challenges only certain
parts of a regulation on the grounds that the defendant has violated the APA’s
procedural requirements—because the APA plainly authorizes this Court to vacate
unlawful parts of a rule, and the agency itself will have ample opportunity to decide
how to treat the remainder of its policy prescription when the Court remands the matter
back for reconsideration in light of the Court’s opinion. To the extent that t his Court
must nevertheless consider severability in the instant circumstances as a matter of law,
it finds, in the alternative, that the provisions of the 2019 Election Rule that the AFL -
CIO has challenged on notice-and-comment grounds can, and should be, severed from
the rest of the rule.
1. Severability Analysis Is Neither Warranted Nor Clearly Authorized
Under The Circumstances Presented In This Case
In the ordinary case, it would make eminent sense to inquire whether or not the
whole of a congressional enactment that carries the force of law must be invalidated if
one or more of its provisions are struck down by the courts, especially if the law itself
is silent as to the effect of such partial invalidation. Cf. Alaska Airlines, Inc. v. Brock,
480 U.S. 678, 684 (1987) (reasoning that “the invalid part [of a statute] may be
dropped” and the rest of the law allowed to take effect “if what is left is fully operative
as a law” “[u]nless it is evident that the Legislature would not have enacted those
44
[remaining] provisions[,] which are within its power, independently of that which is
not” (quotation marks and citation omitted)). Indeed, in some circumstances, it might
even be necessary to address whether the remaining parts of a partially invalidate la w
can be allowed to stand in order to avoid further violations of the rights of the regulated
parties. See Michael D. Shumsky, Severability, Inseverability, and the Rule of Law, 41
Harv. J. on Legis. 227, 256 (2004) (observing that “the [severability] standard seems to
recognize something constitutionally troubling about a residual statutory scheme that
cannot function” (emphasis in original)).
In this Court’s view, however, the conceptual question of the legal status of a
partly invalidated law seldom arises in the context of a challenge to an agency’s
rulemaking, for the APA itself provides the answer to what happens after a regulation is
found to be unlawful: courts “hold unlawful and set aside [such] agency action[,]” 5
U.S.C. § 706(2), and the “agency action” that the court sets aside may be either “the
whole or a part of an agency rule [or] order[,]” id. § 551(13) (emphasis added).
Moreover, once an unlawful agency rule is set aside in whole or in part, the court
remands the matter to the agency so that the agency can reconsider the rule in light of
the court’s ruling. See, e.g., Envtl. Def. Fund v. Reilly, 909 F.2d 1497, 1506 (D.C. Cir.
1990) (explaining that, “should a district court on APA review find agency action
defective, either substantively or procedurally, it ordinarily must remand to the agency
for further proceedings”).
This means that APA clearly contemplates a circumstance in which a court will
find that part of an agency rule is unlawful, and nothing in the text of the APA suggests
that a court has to proceed to invalidate the entire rule on the basis of the unlawfulness
45
of any of its parts; indeed, the court’s “scope of review” under the APA is plainly
limited to the “agency action” that is challenged as, and found to b e, in violation of the
statute. 5 U.S.C. § 706(2). Binding precedents have also clearly established that the
agency decides what happens next when all or part of a challenged action has been
invalidated. See Cont’l Air Lines, Inc. v. Dep’t of Transp., 843 F.2d 1444, 1451 (D.C.
Cir. 1988) (“[I]f one thing should be clear, it is that courts are not to engage (at least in
the arena of judicial review of agency action) in substantive policymaking.”). Thus, for
a court to proceed to speculate as to how the agency might have responded to the
court’s partial vacatur, if it had known that a certain part of its rule would be vacated,
seems both unnecessary and imprudent.
What is more, because an agency in the NLRB’s position gets to decide what
happens next in any event, it is unlikely this Court’s effort to engage in the sometimes
tricky exercise of analyzing severability will make any practical difference. To
understand why this is so, imagine that the Court determines that the 2019 Election
Rule is severable and vacates only the challenged provisions before remanding the
matter back to the agency. Upon receipt, the agency will still have to determine
whether or not, as a policy matter, it intends to enforce the parts of the rule that have
not been invalidated, and, presumably, the agency is free to make that non-justiciable
determination either immediately or after curing the notice-and-comment defect (or
appealing this Court’s order). 11 The same result appears to follow if the Court were to
11
This Court is not aware of any legal standard that would permit it to review an agency’s discretionary
determination regarding whether or not to proceed to enforce a rule that it has previously promulgated
and that has not been deemed unlawful, no matter how swiftly the agency undertakes to make that
decision. Cf. Ctr. for Biological Diversity v. Zinke, 260 F. Supp. 3d 11, 29 (D.D.C. 2017) (“[C]ourts do
not, and cannot, police agency deliberations as a general matter; indeed, it is only when the agency
actually takes some final action that review under the APA is appropriate.”) . Thus, the AFL-CIO’s
46
find that the remaining parts of the rule are so intertwined with the unlawful provisions
that the entire rule must be vacated. Nothing prevents the agency from issuing a new
rule concerning the subject of the vacated regulation, and presum ably that new rule
could reiterate the policies that were not previously found to be violative of the APA in
and of themselves, and it could do so immediately, or wait to cure the established
notice-and comment defect (or appeal the district court’s ruling). 12
Thus, it is hard for this Court to appreciate why there is any need to speculate as
to what the NLRB would have wanted in terms of the remainder of the 2019 Election
Rule, when the NLRB will decide how to move forward regardless. Cf. S.E.C. v.
Chenery Corp., 332 U.S. 194, 196–97 (1947) (“It will not do for a court to be
compelled to guess at the theory underlying the agency’s action.”) . And simply
remanding to the agency for reconsideration in light of the Court’s opinion (without
commenting on what should happen with respect to the remainder of the rule) not only
faithfully recognizes the district court’s limited authority under both the APA and the
Constitution, but it also underscores the fact that agencies, not courts, determine the
recent motion suggesting that the NLRB has not affor ded sufficient deliberation to the decision of
whether or not to enforce parts of the 2019 Election Rule that are not addressed in this Court’s order
(see Pl.’s Mot. for Clarification, ECF No. 35, at 3 –6) raises an issue that is plainly non-justiciable.
12
The argument that the agency could not immediately re-promulgate the unchallenged rule provisions
(cf. Pl.’s Mot. for Clarification at 5–6) seems dubious, because the Court would not have made any
determination that the remaining portions of the rule are themselves unlawful absent the severability
finding. To be sure, severability analysis nevertheless permits a court to strike otherwise lawful rule
provisions on the grounds that they are too integral to the unlawful parts to be allowed to stand, but,
again, unless there are clear constitutional implications, the logic of enforcing the residual parts of a
partially invalidated rule is the kind of policy judgment call that courts have consistently said belongs
to the agency. Thus, no matter how illogic al it might seem to this Court for the NLRB to proceed to
enforce the remaining portions of the 2019 Election Rule, it is up to the agency to determine which
otherwise lawful policy prescriptions it wishes to adopt and enforce, and a simple remand of the m atter
gives the agency the best opportunity to make that determination in the first instance.
47
logic of their own duly enacted policies, so long as their rulemaking is otherwise
consistent with the law. This Court also fails to discern any prejudice to plaintiffs, for
non-severability is not the only means of securing vacatur of an entire agency rule, and
plaintiffs are always free to press an independent basis for setting aside the remainder
of the rule and to ask the court to do so despite any finding that a part of the rule is
unlawful. 13
The bottom line is this: at this point, the AFL-CIO has only successfully
established that certain parts of the 2019 Election Rule should be struck down as
unlawful on notice-and-comment grounds, and, ultimately, it will be up to the agency to
decide whether and to what extent “the remainder of the regulation could function
sensibly without the stricken provision.” (Pl.’s Mot. for Summ. J. at 35 (quoting
MD/DC/DE Broadcasters Ass’n v. F.C.C., 236 F.3d 13, 22 (D.C. Cir. 2001)).) Thus,
the most prudent course of action is for the Court to follow the remedial path that hews
most closely to the well-accepted and limited role of the federal courts with respect to
actions of regulatory authorities, by merely holding unlawful and setting aside those
parts of the rule that cannot be maintained due to the established APA violation.
13
In the instant case, the AFL-CIO might well have argued that, even if this Court agreed that the
challenged provisions of the 2019 Election Rule are unlawful on notice-and-comment grounds, the
Court should nonetheless proceed to reach the merits of its alternative claims that the 2019 Election
Rule must be vacated in its entirety because it is arbitrary and capricious or violates the NLRA. ( See
Compl. ¶¶ 51–81.) But, for whatever reason, the AFL-CIO maintained that this Court need not reach
its other claims, apparently assuming that the Court would agree with its severability analysis. (See
Pl.’s Mot. for Summ. J. at 4; Hr’g Tr. at 38–39.)
48
2. In Any Event, The Parts Of The 2019 Election Rule That The AFL-
CIO Has Successfully Challenged On Notice-And-Comment
Grounds Are Severable
That all said, to the extent that binding precedent suggests that a standard
severability analysis must be undertaken in the context of APA challenges with respect
to partially invalidated rules, see, e.g., Carlson v. Postal Regulatory Comm’n, 938 F.3d
337, 351 (D.C. Cir. 2019) (asking “whether” a challenged provision could be severed
from the remainder of an agency rule, based on a finding that (1) “the agency would
have adopted the same disposition regarding the unchallenged portion of the regulation
if the challenged portion were subtracted” and (2) the parts of the regulation that remain
can “function sensibly without the stricken provision” (internal quotation marks,
citations, and alternation omitted)), this Court will merely add that it has no doubt that
the challenged provisions of the 2019 Election Rule are severable, for the following
reasons.
First, this Court is “without any substantial doubt that the agency would have
adopted the severed portion on its own.” ACA Int’l v. F.C.C., 885 F.3d 687, 708 (D.C.
Cir. 2018) (quotation marks and citation omitted). As repeatedly referenced above, the
2019 Election Rule contains an express severability provision, see 84 Fed. Reg. at
69,525 n.5, which plainly demonstrates the agency’s actual intent regarding partial
invalidation. Cf. Alaska Airlines, 480 U.S. at 686 (noting that a severability clause
creates a rebuttable “presumption that Congress did not intend the validity of the statute
in question to depend on the validity of the constitutionally offensive provision.”). See
also Am. Petroleum Inst. v. E.P.A., 862 F.3d 50, 71–72 (D.C. Cir. 2017) (explaining
that the court could not find that two provisions were “wholly independent” because
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“[a]t no point in the record does EPA propose keeping the [one provision] and repealing
[the other]”). Furthermore, even if the NLRB’s severability rule statement is
“contradicted by other statements in the preamble[,]” as the AFL-CIO claims (Pl.’s
Mot. for Summ. J. at 35), the AFL-CIO’s memoranda do not explain the conflict, and
regardless, the Court concludes that the NLRB has made it unmistakably clear that the
Board made an intentional determination that nearly all of the rule’s provisions,
including the parts that the AFL-CIO challenges as notice-and-comment violations,
should be treated as severable. See 84 Fed. Reg. at 69,533 n.40 (expressly asserting
that certain other provisions of the 2019 Election Rule are not to be deemed severable);
see also MD/DC/DE, 236 F.3d at 22 (explaining that, where the agency “clearly intends
that the regulation be treated as severable, to the extent possible, for it said so in
adopting the regulation[,]” the only “question for the court, then, is whether the balance
of the rule can function independently if shorn of its [unlawful] aspects”).
Second, and for what it’s worth, the remaining provisions of 2019 Election
Rule—i.e., those that this Court has not yet addressed, much less determined to be
unlawful—can most likely “function sensibly without the stricken provision[s].”
Sorenson Commc’ns, Inc. v. F.C.C., 755 F.3d 702, 710 (D.C. Cir. 2014). Under
standard severability analysis, an “entire rule must be vacated” only if severing the
unlawful aspects “would severely distort the [agency’s] program and produce a rule
strikingly different from any the [agency] has ever considered or promulgated in the
lengthy course of these proceedings.” MD/DC/DE, 236 F.3d at 23. And this Court
perceives little risk of such severe distortion here. While some of the residual does
relate back to the unlawfully promulgated provisions that expand the issues that must be
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litigated at the pre-election hearing, including the extension of the delay between the
announcement of a pre-election hearing and the actual hearing (see Pl.’s Summ. J.
Opp’n at 16), the Court is persuaded that the remaining provisions can still “function
sensibly without the [underlying and now] stricken provision[,]” Sorenson, 755 F.3d at
710, especially given that the Board’s overarching purpose for many of these rule
changes is to “permit parties to more easily manage the obligations imposed on them by
the filing of a petition and to better prepare for the hearing, thus promoting orderly
litigation[,]” 84 Fed. Reg. at 69,525, and both the stricken provisions and the residual
parts reflect various means of achieving the same goals.
In sum, it is clear beyond cavil that, when remedying an APA violation, courts
should ordinarily “limit the solution to the problem[.]” Nat. Res. Def. Council v.
Wheeler, 955 F.3d 68, 82 (D.C. Cir. 2020) (quoting Ayotte v. Planned Parenthood of N.
New England, 546 U.S. 320, 328–29 (2006)). Here, the AFL-CIO has chosen to press
its notice-and-comment challenge with respect to only certain provisions of the 2019
Election Rule, and it has also requested that the Court not proceed to adjudicate its
other claims with respect the remainder of the rule. (See Pl.’s Mot. for Summ. J. at 4;
Hr’g Tr. at 38–39.) Thus, this Court has only assessed the alleged procedural propriety
of the five rule provisions that the AFL-CIO has successfully challenged as a violation
of the APA’s notice-and-comment requirement, and it is only those provisions that this
Court is plainly authorized to hold unlawful and set aside. Consistent with this Court’s
view that courts should not substitute their own judgment about the logic of an
otherwise lawful policy prescription for that of the agency, th e Court will not vacate the
entire 2019 Election Rule; it opts instead to remand this matter back to the Board for
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consideration of how to proceed with respect to both the invalidated and as -yet
unchallenged parts of rule in light of this Court’s ruling.
IV. CONCLUSION
Section 160(f) of the NLRA is a direct-review provision that plainly governs
only NLRB actions that pertain to unfair labor practice disputes; therefore, this Court
retains subject-matter jurisdiction to entertain the challenges to the NLRB’s 2019
Elections Rule that the AFL-CIO has brought under the APA. Moreover, having
exercised its jurisdiction to address whether or not certain portions of the 2019
Elections Rule violate the APA because they required notice -and-comment rulemaking,
this Court has concluded that the challenged portions of the 2019 Elections Rule are not
procedural rules that are exempt from that rulemaking requirement, and thus those
provisions must be held unlawful and set aside. At the AFL-CIO’s request, the Court
has not proceeded further to consider the AFL-CIO’s remaining substantive APA
challenges. Instead, as set forth in the Order dated May 30, 2020, the Court has
DENIED both the Board’s motion to transfer the case to the D.C. Circuit and its motion
for summary judgment, and has GRANTED the AFL-CIO’s motion for summary
judgment with respect to Count One of the Complaint. The provisions of the rule that
are challenged in Count One have now been deemed invalid, and this matter is
remanded to the Board for consideration in light of this Court’s Memorandum Opinion
and Order.
DATE: June 7, 2020 Ketanji Brown Jackson
KETANJI BROWN JACKSON
United States District Judge
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