409 F.3d 1199 (9th Cir. 2005), 03-56135, Overstreet v. United Broth. of Carpenters and Joiners of America, Local Union No. 1506

Docket Nº:03-56135.
Citation:409 F.3d 1199
Party Name:Cornele A. OVERSTREET, Regional Director for Region 28 of the National Labor Relations Board, for and on behalf of the National Labor Relations Board, Petitioner-Appellant, v. UNITED BROTHERHOOD OF CARPENTERS AND JOINERS OF AMERICA, LOCAL UNION NO. 1506, Respondent-Appellee.
Case Date:June 08, 2005
Court:United States Courts of Appeals, Court of Appeals for the Ninth Circuit

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409 F.3d 1199 (9th Cir. 2005)

Cornele A. OVERSTREET, Regional Director for Region 28 of the National Labor Relations Board, for and on behalf of the National Labor Relations Board, Petitioner-Appellant,



No. 03-56135.

United States Court of Appeals, Ninth Circuit

June 8, 2005

Argued and Submitted March 2, 2004.

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[Copyrighted Material Omitted]

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Robert Oddis (argued), Arthur F. Rosenfeld, John E. Higgins, Jr., Barry J. Kearney, Judith I. Katz, Aaron N. Karsh, and Robert N. Oddis (on the briefs), National Labor Relations Board, Washington, D.C., for the petitioner-appellant.

Gerald V. Selvo, DeCarlo, Connor & Selvo, Los Angeles, CA, for the respondent-appellee.

Appeal from the United States District Court for the Southern District of California; Napoleon A. Jones, District Judge, Presiding. D.C. No. CV-03-00773-NAJ.

Before: KLEINFELD, WARDLAW, and BERZON, Circuit Judges.

BERZON, Circuit Judge:

The National Labor Relations Board ("NLRB" or "the Board") Regional Director, Cornele Overstreet, seeks to enjoin members of a building trades union from holding aloft large banners announcing a "labor dispute." The banners are located so that they are visible to customers of businesses that deal with certain contractors who do not have union contracts. While the banners are displayed, other union members distribute handbills that explain the "labor dispute." The questions before us involve interpretation of the National Labor Relations Act ("the NLRA" or "the Act"), 29 U.S.C. § 151 et seq., set against the backdrop of First Amendment concerns raised by the request to enjoin peaceful speech activity. We conclude that the district court correctly declined to issue the injunction.

I. Background

For several years, the United Brotherhood of Carpenters and Joiners of America, Local Union Number 1506 ("the Carpenters") have had a labor dispute with three contracting companies--Brady Company/San Diego ("Brady"), Precision Hotel Interiors ("Precision"), and E & K Arizona ("E & K"). The Carpenters object to those companies' employment of non-union employees and their alleged failure to meet local labor standards--especially wage standards--on construction projects in the Phoenix, Los Angeles, and San Diego metropolitan areas.

The Carpenters decided to try to induce Brady, Precision, and E & K to change their labor practices, by influencing the contracting practices of some companies ("the Retailers" 1) that do business with them. The Carpenters sent the Retailers, also located in or around Phoenix, Los

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Angeles, and San Diego, letters promising an "aggressive public information campaign against [Brady, Precision, or E & K]," including "highly visible banner displays" at the Retailers' places of business. The letters urged the Retailers "to not allow [Brady, Precision, or E & K] to perform any work on any of your projects unless and until it generally meets area labor standards." Taking this step, the letters said, would "provide the greatest protection against your firm becoming publicly involved in this dispute."

When the Retailers did not respond, the Carpenters decided to protest at the site of eighteen Retailers that continued to contract with Brady, Precision, or E & K. Near each Retailer but one, 2 the Carpenters set up a four foot by fifteen foot banner that read "SHAME ON [NAME OF RETAILER]" in large red letters, with the words "LABOR DISPUTE" in somewhat smaller black letters on either side of that text. No other words or images appeared on the banners. Individual union members held the banners anywhere from twenty to several hundred feet from the Retailers' entrances. The members also distributed handbills to passing pedestrians, explaining the nature of the "labor dispute." The handbills specified that their underlying complaint was with Brady, Pecision, and E & K, and that the Carpenters believed that by using the service of those three contractors the Retailers were aiding them in undermining regional labor standards.

The Carpenters placed the banners on public sidewalks, facing away from the Retailers. In the vast majority of cases, the Carpenters placed the banners at a significant distance--scores if not hundreds of feet--away from the Retailers' entrances. The Carpenters generally placed the banners to be as visible as possible to passing motorists and other members of the public. There is no indication that the banners were directed at employees of the Retailers, or that any employee declined to work on account of the banners. At no point did the Carpenters block the entrances to the Retailers or directly confront individual customers of those businesses through chants, shouts, or any other means. The Carpenters, instead, remained generally stationary and quiet throughout their bannering activity.

One of the Retailers, Artisan Homes, Inc., responded to the Carpenters' banner with a banner posted on their work site that read: "We Support Our Subcontractors! It's a Right to Work State ... Shame on Carpenters Local Union 1506." (Ellipsis in original).

E & K and two of the Retailers--Associated General Contractors of America ("AGC") and Westin Bonaventure Hotel ("Westin")--filed charges with the NLRB against the Carpenters, alleging that the union's bannering activities 3 constituted unfair labor practices in violation of § 8(b)(4)(ii)(B) of the Act, 29 U.S.C. § 158(b)(4)(ii)(B). 4 After the NLRB General

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Counsel issued a complaint against the Carpenters under § 10(b) of the Act, 29 U.S.C. § 160(b), Overstreet filed a petition in the United States District Court for the Southern District of California, pursuant to § 10(l) of the Act, 5 29 U.S.C. § 160(l), seeking injunctive relief barring the Carpenters' bannering activity pending the NLRB's final resolution of the complaint. 6 Overstreet argued that the bannering violates § 8(b)(4)(ii)(B) of the Act because the visibility of the banners to customers--even those banners placed several hundred feet from the entrances of the Retailers--makes the bannering "picketing," and, in the alternative, because the banners include a fraudulent claim--that there is a "labor dispute" with the Retailer--and therefore constitute economic coercion.

The district court denied the petition in a decision issued on May 7, 2003. The district court noted that the Carpenters do not block access to the Retailers' entrances, nor do the union members patrol areas near the Retailers' places of business or initiate any verbal interactions with the public. The court concluded that "[t]he bannering activity lacks the confrontational, sometimes intimidating conduct associated with traditional picketing." Further, the district court ruled, because the Carpenters believes that the Retailers' decision to do business with Brady, Precision, and E & K contributes to the erosion of labor standards, the union does, in fact, have a "labor dispute" with the Retailers, so the banners are not fraudulent or misleading.

The NLRB consolidated the General Counsel's administrative complaint against the Carpenters with complaints regarding similar activities involving other Carpenters locals. The matter was tried before an Administrative Law Judge ("ALJ") in January 2003. The ALJ issued her decision on May 9, 2003, ruling in the complainants' favor. 7 The ALJ asserted that "[a]ctivity short of a traditional picket

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line that signals neutrals that sympathetic action on their part is desired by the union is regarded as signal picketing," and concluded that the Carpenters' bannering constituted "picketing." The ALJ further ruled that (1) the Carpenters intended this picket as a means to coerce the Retailers to cease doing business with Brady, Precision, and E & K; and (2) the words "labor dispute" in conjunction with naming the Retailers could only have "conveyed to viewers, including customers and suppliers, ... that [the Carpenters] had primary labor disputes with the [Retailers] named on the banners." The ALJ concluded, finally, that distributing explanatory handbills did not mitigate the message of the banners, because the banners were directed in some measure at passing motorists while only pedestrians received handbills. Accordingly, the ALJ found that the Carpenters' bannering activities violated § 8(b)(4)(ii)(B) and recommended that the NLRB order the Carpenters to cease and desist its bannering.

The Carpenters had argued to the ALJ that its bannering constituted "pure speech," which could not be constitutionally enjoined and does not fall within the Act's prohibitions. The ALJ did not respond to these arguments, except to say that because the bannering was "picketing," it fell outside the boundaries of the Supreme Court's First Amendment cases.

The Carpenters appealed the ALJ's ruling to the NLRB. On June 27, 2003, Overstreet filed this appeal of the district court's ruling.

II. Section 10(l) injunction standards

We review a grant or denial of a § 10 injunction for abuse of discretion. The district court abuses its discretion if it relies on a clearly erroneous finding of fact or an erroneous legal standard. Miller v. Cal. Pac. Med. Ctr., 19 F.3d 449, 455 (9th Cir. 1994) (en banc). We review the legal standards applied by the district court de novo. Id.

The district court, relying on Nelson v. International Brotherhood of Electrical Workers, Local Union No. 46, 899 F.2d 1557 (9th Cir. 1990), asked whether Overstreet had "reasonable cause" to believe that the Carpenters had violated § 8(b)(4)(ii)(B). Under Nelson, a "district court may find 'reasonable cause' where the factual allegations and propositions of law underlying the...

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