Farm Labor Org. Comm. v. Stein

• Decision Date: 18 August 2021
• Docket Number: 1:17cv1037
• Court: U.S. District Court — Middle District of North Carolina
• Parties: FARM LABOR ORGANIZING COMMITTEE, et al., Plaintiffs, v. JOSHUA STEIN, Defendant.

FARM LABOR ORGANIZING COMMITTEE, et al., Plaintiffs, v. JOSHUA STEIN, Defendant.

No. 1:17cv1037

United States District Court, M.D. North Carolina

August 18, 2021

MEMORANDUM OPINION AND RECOMMENDATION OF UNITED STATES MAGISTRATE JUDGE

L Patrick Auld, United States Magistrate Judge.

This case comes before the undersigned United States Magistrate Judge for a recommendation on the appropriate remedy for the constitutional violations found as to Section 20.5 of North Carolina General Assembly Session Law 2017-108 (the “Farm Act”). For the reasons that follow, the Court should enjoin defendant Joshua Stein, in his official capacity as Attorney General of the State of North Carolina (“Stein” or “Defendant”), from enforcing, and should issue a declaratory judgment invalidating, the unconstitutional aspects of the Farm Act.

BACKGROUND

For decades, the Farm Labor Organizing Committee (“FLOC”) has served as the only farmworker union in North Carolina. (See Docket Entry 108-1, ¶ 18; Docket Entry 108-3, ¶ 55.) In 2017, North Carolina enacted Section 20.5 (see Docket Entry 70, ¶ 78), which amended North Carolina General Statute Section 95-79(b) by adding the underlined text and deleting the stricken text shown below:

Any provision that directly or indirectly conditions the purchase of agricultural products[, ] products or the terms of an agreement for the purchase of agricultural products, or the terms of an agreement not to sue or settle litigation upon an agricultural producer's status as a union or nonunion employer or entry into or refusal to enter into an agreement with a labor union or labor organization is invalid and unenforceable as against public policy in restraint of trade or commerce in the State of North Carolina. Further notwithstanding G.S. 95-25.8, an agreement requiring an agricultural producer to transfer funds to a labor union or labor organization for the purpose of paying an employee's membership fee or dues is invalid and unenforceable against public policy in restraint of trade or commerce in the State of North Carolina.

(Docket Entry 108-1, ¶ 32.)^[1] On behalf of its members and itself, FLOC and FLOC member Valentin Alvarado Hernandez (collectively, the “Plaintiffs”) promptly sued to, inter alia, enjoin enforcement of Section 20.5. (See generally Docket Entry 31 (the “Amended Complaint”).)^[2] Stein responded by moving to dismiss the Amended Complaint, contending, in part, that he “[wa]s an improper party for Plaintiffs' federal constitutional claims.” (Docket Entry 44 at 2.)

The Court (per United States District Judge Loretta C. Biggs) denied Stein's dismissal motion and granted Plaintiffs' request for a preliminary injunction enjoining Stein “from enforcing the Farm Act” and waiving the preliminary injunction security requirement. (Docket Entry 62 at 1.) The parties thereafter proceeded to discovery (see Text Order dated Aug. 15, 2019 (adopting parties' proposed scheduling order)) and filed cross-motions for summary judgment (see Docket Entries 106, 108). Reviewing those motions, the undersigned recommended that the Court “enter summary judgment for Plaintiffs on their claims that the Settlement Provision violates their first-amendment and (first-amendment-related) equal-protection rights, but . . . enter summary judgment for Defendant on Plaintiffs' remaining claims.” (Docket Entry 124 (the “Recommendation”) at 89.) The Court (per Judge Biggs) adopted the Recommendation. (Docket Entry 141 (the “Order”) at 1-2.) Noting that, “[a]lthough the parties agree that the Court should tailor the relief awarded Plaintiffs, they do not appear to agree on the scope of that relief, ” the Court ordered “further briefing on the appropriate remedy.” (Id. at 2.) In accord with the Order, Plaintiffs and Stein filed memoranda addressing their proposed remedies. (See Docket Entries 142, 150, 151.)

Plaintiffs seek an order (1) declaring that the Settlement Provision, as created by the language “or the terms of an agreement not to sue or settle litigation” (the “Settlement Clause”) in North Carolina General Statute Section 95-79(b), violates the First Amendment and Equal Protection Clause of the Fourteenth Amendment (Docket Entry 142 at 2 (emphasis omitted)); (2) permanently enjoining Stein, and those acting in concert with him, from enforcing this aspect of the Farm Act; and (3) directing Stein “to take all reasonable and necessary steps to ensure statewide compliance with” the order, including by “providing immediate notice and a copy of” the order to those under his supervision, his employees, “and/or those who work in concert or participation with him in the enforcement of criminal and/or restraint of trade or commerce laws in North Carolina, including all of the district attorneys for each prosecutorial district of the state as defined in N.C. Gen. Stat. § 7A-60(a)-(a1)” (id. at 3). (See id. at 2-3.)

In response, Stein concedes that the Court's Order “meets the standard for injunctive relief.” (Docket Entry 150 at 5; see also id. (“Defendant agrees that, on the facts of this case and considering the Court's Order on Summary Judgment, some form of injunctive relief is appropriate.”).) However, Stein proposes significantly different injunctive relief than Plaintiffs; more specifically, Stein urges entry of the following order:

1. The “Settlement Provision, ” enacted in Section 20.5 of the Farm Act of 2017, N.C. Session Law 2017-108, and codified at N.C. Gen. Stat. § 95-79(b), is identified by the underlined text below:

Any provision that directly or indirectly conditions the purchase of agricultural products, the terms of an agreement for the purchase of agricultural products, or the terms of an agreement not to sue or settle litigation upon an agricultural producer's status as a union or nonunion employer or entry into or refusal to enter into an agreement with a labor union or labor organization is invalid and unenforceable as against public policy in restraint of trade or commerce in the State of North Carolina.

2. As applied to prohibit a labor union or labor organization from entering into settlement agreements other than those containing terms that are conditioned (1) on an agricultural producer's status as a union or nonunion employer or (2) on a party's entry into or refusal to enter in a separate agreement with a labor union or organization, the Settlement Provision is DECLARED to violate the First Amendment of the United States Constitution, and First-Amendment-related rights under the Equal Protection Clause.

3. Defendant Joshua Stein, in his official capacity as Attorney General, as well as Defendant's officers, agents, servants, employees, and attorneys, are PERMANENTLY ENJOINED from threatening to enforce and/or enforcing the Settlement Provision, as identified in paragraph 1 above, to the extent declared in paragraph 2 above to violate the Constitution.

4. The Settlement Provision may be enforced to prohibit settlement agreements (or agreements not to sue) containing the prohibited terms or conditions identified in the Settlement Provision, but it may not be enforced or threatened to be enforced to prevent any party (including but not limited to a labor union or labor organization) from entering into any settlement agreement (or agreement not to sue) that lacks the terms or conditions prohibited by the Settlement Provision.

(Docket Entry 150 at 11-12 (emphasis in original).) Stein also seeks dissolution of Court's preliminary injunction, especially as to the Dues Checkoff Provision. (See, e.g., id. at 12.)

DISCUSSION

I. Relevant Standards

Issuance of a permanent injunction lies within a district court's discretion upon a plaintiff's showing:

(1) that it has suffered an irreparable injury; (2) that remedies available at law, such as monetary damages, are inadequate to compensate for that injury; (3) that, considering the balance of hardships between the plaintiff and defendant, a remedy in equity is warranted; and (4) that the public interest would not be disserved by a permanent injunction.

Legend Night Club v. Miller, 637 F.3d 291, 297 (4th Cir. 2011) (internal quotation marks omitted).

Rule 65 of the Federal Rules of Civil Procedure (the “Rules”) specifies that every order granting injunctive relief must “(A) state the reasons why it issued; (B) state its terms specifically; and (C) describe in reasonable detail - and not by referring to the complaint or other document - the act or acts restrained or required.” Fed.R.Civ.P. 65(d)(1). As the United States Supreme Court has explained, Rule 65(d) “was designed to prevent uncertainty and confusion on the part of those faced with injunctive orders, and to avoid the possible founding of a contempt citation on a decree too vague to be understood.” Schmidt v. Lessard, 414 U.S. 473, 476 (1974). “In light of these important purposes, ‘the specificity provisions of Rule 65(d) are no mere technical requirements' and ‘basic fairness requires that those enjoined receive explicit notice of precisely what conduct is outlawed.'” Pashby v. Delia, 709 F.3d 307, 331 (4th Cir. 2013) (quoting Schmidt, 414 U.S. at 476). In other words, “to comply with Rule 65(d), [a] district court's order must be clear enough to inform the [enjoined party] of what it may and may not do.” Id.

As for declaratory relief, “[i]n a case of actual controversy within its jurisdiction . . . any court of the United States upon the filing of an appropriate pleading, may declare the rights and other legal relations of any interested party seeking such declaration, whether or not further relief is or could be sought.” 28 U.S.C. § 2201(a). In this regard, the United States Court of Appeals for the Fourth Circuit has observed,

it is elementary that a federal court may properly exercise jurisdiction

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