BE&K Construction Co. v. National Labor Relations Board

153 L. Ed. 2d 499, 15 Fla. L. Weekly Fed. S 457, 122 S. Ct. 2390, 536 U.S. 516, 170 L.R.R.M. (BNA) 2225, 2002 U.S. LEXIS 4653, 70 U.S.L.W. 4647, 2002 Daily Journal DAR 7059
Supreme Court of the United States·Decided June 24, 2002·No. 01-518·Published·Cited by 293 cases

Opinions

Justice O’Connor

delivered the opinion of the Court.

Petitioner sued respondent unions, claiming that their lobbying, litigation, and other concerted activities violated federal labor law and antitrust law. After petitioner lost on or withdrew each of its elaims, the National Labor Relations Board decided petitioner had violated federal labor law by prosecuting an unsuccessful suit with a retaliatory motive. The Court of Appeals affirmed. Because we find the Board [520]*520lacked authority to assess liability using this standard, we reverse and remand.

I

Petitioner, an industrial general contractor, received a contract to modernize a California steel mill near the beginning of 1987. 246 F. 3d 619, 621 (CA6 2001). According to petitioner, various unions attempted to delay the project because petitioner’s employees were nonunion. Ibid. That September, petitioner and the mill operator filed suit against those unions in the District Court for the Northern District of California. App. to Pet. for Cert. 33a. The suit was based on the following basic allegations: First, the unions had lobbied for adoption and enforcement of an emissions standard, despite having no real concern the project would harm the environment. 246 F. 3d, at 621. Second, the unions had handbilled and picketed at petitioner’s site — and also encouraged strikes among the employees of petitioner’s subcontractors — without revealing reasons for their disagreement. Ibid. Third, to delay the construction project and raise costs, the unions had filed an action in state court alleging violations of California’s Health and Safety Code. Id., at 621-622. Finally, the unions had launched grievance proceedings against petitioner’s joint venture partner based on inapplicable collective bargaining agreements. Id., at 622.

Initially, petitioner and the mill operator sought damages under §303 of the Labor-Management Relations Act, 1947 (LMRA), 61 Stat. 158, as amended, 29 U. S. C. § 187, which provides a cause of action against labor organizations for injuries caused by secondary boycotts prohibited under § 158(b)(4). 246 F. 3d, at 622. But after the District Court granted the unions’ motion for summary judgment on the plaintiffs’ lobbying- and grievance-related claims, the plaintiffs amended their complaint to allege that the unions’ activities violated §§ 1 and 2 of the Sherman Act, 26 Stat. 209, as amended, 15 U. S. C. §§ 1-2, which prohibit certain agree[521]*521ments in restraint of trade, monopolization, and attempts to monopolize. 246 F. 3d, at 622. The District Court dismissed the amended complaint, however, because it realleged claims that had already been decided. Id., at 622-623. The District Court also dismissed the plaintiffs’ claim regarding the unions’ state court lawsuit since the plaintiffs had no evidence that the suit was not reasonably based and because two unions that the plaintiffs sued were never parties to that state court action. Id., at 623.

The plaintiffs filed a second amended complaint. It included their remaining claims but again realleged claims that had already been decided. Ibid.; App. 32-33. The District Court dismissed the decided claims and imposed sanctions on the plaintiffs under Federal Rule of Civil Procedure 11. 246 F. 3d, at 623. At that point, the mill operator dismissed its remaining claims with prejudice. Ibid. The District Court then granted summary judgment to the unions on petitioner’s antitrust claim once petitioner was unable to show the unions had formed a combination with nonlabor entities for an illegitimate purpose. Ibid. Petitioner dismissed its remaining claims and appealed. Id., at 623-624.

The United States Court of Appeals for the Ninth Circuit affirmed the dismissal of petitioner’s antitrust claim. It held that the District Court erred in requiring petitioner to prove that the unions combined with nonlabor entities for an illegitimate purpose, but found the error harmless since the unions had antitrust immunity when lobbying officials or petitioning courts and agencies, unless the activity was a sham. USS-POSCO Industries v. Contra Costa County Bldg. & Const. Trades Council, AFL-CIO, 31 F. 3d 800, 810 (CA9 1994). Petitioner did' not argue that the unions’ litigation activity had been objectively baseless, but maintained that “the unions [had] engaged in a pattern of automatic petitioning of governmental bodies . . . without regard to . . . the merits of said petitions.” Ibid, (internal quotation marks omitted; emphasis added). The Ninth Circuit allowed that [522]*522petitioner’s claim, if proved, could overcome the unions’ antitrust immunity, but rejected it nonetheless because “fifteen of the twenty-nine [actions filed by the unions] . . . have proven successful. The fact that more than half of all the actions ... turn out to have merit cannot be reconciled with the charge that the unions were filing [them] willy-nilly without regard to success.” Id., at 811 (footnote omitted).

The Ninth Circuit reversed the District Court’s award of Rule 11 sanctions, however, after petitioner explained that it had realleged decided claims based on Circuit precedent suggesting that doing so was necessary to preserve them on appeal. Ibid. Although the Ninth Circuit decided that rule did not apply to amended complaints following summary judgment, it held that petitioner’s view was not frivolous and that its counsel could not be blamed for “err[ing] on the side of caution.” Id., at 812.

In the meantime, two unions had lodged complaints against petitioner with the National Labor Relations Board (Board), 246 F. 3d, at 624, and after the federal proceedings ended, the Board’s general counsel issued an administrative complaint against petitioner, alleging that it had violated § 8(a)(1) of the National Labor Relations Act (NLRA), 49 Stat. 452, as amended, 29 U. S. C. § 158(a)(1), by filing and maintaining the federal lawsuit. App. to Pet. for Cert. 29a. Section 8(a)(1) prohibits employers from restraining, coercing, of interfering with employees’ exercise of rights related to self-organization, collective bargaining, and other concerted activities. 29 U. S. C. §§ 157, 158(a)(1).

A three-member panel of the Board addressed cross-motions for summary judgment and ruled in favor of the general counsel. The panel determined that petitioner’s federal lawsuit had been unmeritorious because all of petitioner’s claims were dismissed or voluntarily withdrawn with prejudice. App. to Pet. for Cert. 30a, 47a, 49a. The panel then examined whether petitioner’s suit had been filed to retaliate against the unions for engaging in activities protected under [523]*523the NLRA. The panel first concluded that the unions’ conduct was protected activity, id,.,

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BE&K Construction Co. v. National Labor Relations Board, 153 L. Ed. 2d 499, 15 Fla. L. Weekly Fed. S 457, 122 S. Ct. 2390, 536 U.S. 516, 170 L.R.R.M. (BNA) 2225, 2002 U.S. LEXIS 4653, 70 U.S.L.W. 4647, 2002 Daily Journal DAR 7059 (U.S. 2002).

153 L. Ed. 2d 499 (BE&K Construction Co. v. National Labor Relations Board) — published by Counsel Stack Legal Research, free access to 12M+ legal documents.

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