Chamber of Commerce of US v. Reich, Civ. A. No. 95-0503.
| Decision Date | 09 May 1995 |
| Docket Number | Civ. A. No. 95-0503. |
| Citation | 886 F. Supp. 66 |
| Parties | CHAMBER OF COMMERCE OF the UNITED STATES of America, et al., Plaintiffs, v. Robert B. REICH, Secretary, U.S. Department of Labor, Defendant. |
| Court | U.S. District Court — District of Columbia |
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Timothy B. Dyk, Andrew M. Kramer, Willis J. Goldsmith, Stephen J. Goodman and Stephen F. Smith, Jones, Day, Reavis & Pogue, Washington, DC, for plaintiffs.
Thomas S. Williamson, Jr., Office of Sol., Dept. of Labor, Margaret Hewing, Sandra Marguerite Schraibman, Dept. of Justice, Washington, DC, for defendant.
This is a suit brought by the Chamber of Commerce, Bridgestone/Firestone, and several corporate trade associations against the Secretary of Labor for declarative relief and an injunction prohibiting the Secretary from enforcing or administering an Executive Order. Although the suit was filed against the Secretary of Labor, it is, in essence, a suit against the President for promulgating the Executive Order in question. Because the Court ultimately concludes that the case is not ripe for review and consequently must be dismissed, it will not address either the merits of Plaintiffs' case or the reviewability of Defendant's actions in implementing the Executive Order.
On March 15, 1995, Plaintiffs, Chamber of Commerce of the United States of America, American Trucking Associations, Inc., Labor Policy Association, National Association of Manufacturers and Bridgestone/Firestone, Inc. filed the instant Complaint, as well as a Motion for Preliminary Injunction (3-1), seeking to immediately stop the implementation of Executive Order No. 12954 (hereinafter, "Executive Order" or "Order") and to declare it unlawful. Plaintiffs allege that the President lacked authority under both the Constitution and any Act of Congress to issue the Executive Order, which authorizes the Defendant, Secretary of Labor Robert B. Reich, to disqualify from federal contracts exceeding $100,000 employers who hire permanent replacement workers during a lawful strike.
On March 16, 1995, upon the request of Plaintiffs to expedite the motions hearing, and after conferring with counsel, the Court ordered consolidation of the hearing on the application for preliminary injunction with the hearing on the merits of this case. On March 24, 1995, and March 29, 1995, respectively, the National Right to Work Committee filed a Motion to File Amicus Brief, and Mosler, Inc. filed a Motion to Intervene as a Plaintiff, both of which the Court granted on April 12, 1995.
On April 3, 1995, Defendant filed a Motion to Dismiss, or, in the Alternative, for Summary Judgment (13-1, 14-1), and Plaintiffs and Intervenor-Plaintiffs filed a Motion for Summary Judgment on April 7, 1995. Upon consideration of all motions papers, the arguments of counsel at oral argument April 20, 1995, the applicable case, constitutional, and statutory law, and the file in this case in its entirety, the Court concludes that Plaintiffs' Motions for Preliminary Injunction (3-1) and for Summary Judgment must be denied, and Defendant's Motion to Dismiss, or in the Alternative, for Summary Judgment must be granted (13-1, 14-1), for the reasons discussed below.
On March 8, 1995, President William J. Clinton issued Executive Order 12954. 60 Fed.Reg. 13023 (March 10, 1995). The Order's stated purpose was "to ensure the economical and efficient administration and completion of Federal Government contracts". Id. at 13023. The Order states that "it is the policy of the executive branch in procuring goods and services that ... contracting agencies shall not contract with employers that permanently replace lawfully striking employees." Id. The Order applies to government contracts in excess of $100,000. Id. at 13024-25 ().
The Executive Order explains that "efficient economic performance and productivity are directly related to the existence of cooperative working relationships between employers and employees", and that "when Federal contractors become involved in prolonged labor disputes with their employees, the Federal Government's economy, efficiency, and cost of operations are adversely affected." Id. at 13023. The Executive Order continues that, "in order to operate as effectively as possible, by receiving timely goods and quality services, the Federal Government must assist the entities with which it has contractual relations to develop stable relationships with their employees." Id.
The Executive Order offers three justifications for its policy against contracting with firms that hire permanent replacement workers. First, "strikes involving permanent replacement workers are longer in duration than other strikes." Id. Second, "the use of permanent replacements can change a limited dispute into a broader, more contentious struggle, thereby exacerbating the problems that initially led to the strike." Id. Third, "by permanently replacing its workers, an employer loses the accumulated knowledge, experience, skill, and expertise of its incumbent employees." Id. These consequences of hiring permanent replacement workers, according to the Executive Order, then "adversely affect the businesses and entities, such as the Federal Government, which rely on that employer to provide high quality and reliable goods or services." Id.
The Executive Order gives responsibility for the administration and enforcement of the Executive Order to the Secretary of Labor. Id. at 13024 (§ 6). As a first step, the Secretary may investigate and hold hearings to determine whether an organizational unit of a federal contractor has permanently replaced lawfully striking workers. Id. at 13023 (§ 2). The Secretary may initiate such investigations directly or in response to employee complaints. Id.
If the Secretary determines that a federal contractor has permanently replaced lawfully striking employees, he has two options: he may terminate the contract and/or debar the contractor. Id. at 13023-24 (§§ 3-4). First, the Secretary may find that it is appropriate to terminate the contract for convenience. Id. at 13023 (§ 3(a)). In that case, he must transmit his finding to the head of any department or agency that contracts with the contractor. Id. If the head of the contracting department or agency objects in writing, the termination for convenience shall not be issued. Id. at 13024 (§ 3(b)).
Second, if the Secretary determines that a federal contractor has permanently replaced lawfully striking employees, he has discretion to debar the contractor, thereby making the contractor ineligible to receive future government contracts. Id. (§ 4(a)). Departments and agencies may solicit offers from, award contracts to, or consent to subcontracts with debarred contractors only if the head of the agency or his or her designee determines, in writing, that there is a compelling reason to do so. The debarment will be limited to the organizational units of the debarred contractor that have permanently replaced workers, and will not extend beyond the date when the Secretary determines that the labor dispute precipitating the permanent replacement has been resolved. Id. (§§ 4(b)-4(c)).
The Secretary may adopt rules and regulations to implement the Executive Order. Id. (§§ 6, 11). On March 29, 1995, the Secretary published a Notice of Proposed Rulemaking. 60 Fed.Reg. 16354. The proposed regulations define and clarify terms used in both the Executive Order and the implementing rules themselves. Id. at 16354-55. Additionally, the proposed rules set forth the procedure to be followed in investigating contractors and taking action to enforce the Executive Order. Id. at 16355-56. Interested persons were given until April 28, 1995 to comment on the proposed rules. Id. at 16354.
Although no formal enforcement actions have commenced, and the implementing regulations have not been finalized, the Department of Labor has begun to seek information regarding certain government contractors that may have hired permanent replacement workers.
The "basic rationale" of the ripeness doctrine "is to prevent the courts, through avoidance of premature adjudication, from entangling themselves in abstract disagreements over administrative policies, and also to protect the agencies from judicial interference until an administrative decision has been formalized and its effects felt in a concrete way by the challenging parties." Abbott Laboratories v. Gardner, 387 U.S. 136, 148-49, 87 S.Ct. 1507, 1515, 18 L.Ed.2d 681 (1967); see also Eagle-Picher Industries, Inc. v. United States Environmental Protection Agency, 759 F.2d 905, 912-13 (D.C.Cir. 1985); American Trucking Associations, Inc. v. Interstate Commerce Commission, 747 F.2d 787, 789 (D.C.Cir.1984).2
In determining whether a case is ripe for review, the Supreme Court has set out a twofold analysis, requiring courts to evaluate "both the fitness of the issues for judicial decision and the hardship to the parties of withholding court consideration." Abbott Laboratories, supra, 387 U.S. at 149, 87 S.Ct. at 1515. This test is forward-looking, serving the primary function of "aiding a court in ascertaining whether it should stay its hand until agency policy has crystallized." Eagle-Pitcher, supra, 759 F.2d at 913.
The first, or "fitness requirement", of the Abbott Laboratories test focuses on the institutional interests of the agency and the courts in deferring review, while the second, or "hardship requirement", looks at the impact of the administrative action being challenged on the party challenging the action. Abbott Laboratories, supra, 387 U.S....
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Chamber of Commerce v. Reich
...was not ripe for judicial review and dismissed Plaintiffs' requests for declaratory and injunctive relief. Chamber of Commerce v. Reich, 886 F.Supp. 66 (D.D.C.1995). On appeal, the Court of Appeals held, because the implementing regulations had become final and both the "fitness and hardshi......
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Chamber of Commerce of U.S. v. Reich, 95-5135
...judicial resources to review the Order before the Secretary had "fleshed out" the policy in final regulations. Chamber of Commerce v. Reich, 886 F.Supp. 66, 71 (D.D.C.1995). This concern need not detain us because the Secretary has since promulgated final regulations. See Permanent Replacem......