Frankl v. HTH Corp.

• Decision Date: 21 November 2011
• Docket Number: Civ. No. 11–00451JMS/RLP.
• Citation: 192 L.R.R.M. (BNA) 2202,825 F.Supp.2d 1010
• Parties: Joseph F. FRANKL, Regional Director of Region 20 of the National Labor Relations Board, for and on behalf of the National Labor Relations Board, Petitioner, v. HTH CORPORATION, Pacific Beach Corporation and Koa Management, LLC, A Single Employer, d/b/a Pacific Beach Hotel, Respondents.
• Court: U.S. District Court — District of Hawaii

192 L.R.R.M. (BNA) 2202

825 F.Supp.2d 1010

Joseph F. FRANKL, Regional Director of Region 20 of the National Labor Relations Board, for and on behalf of the National Labor Relations Board, Petitioner,

v.HTH CORPORATION, Pacific Beach Corporation and Koa Management, LLC, A Single Employer, d/b/a Pacific Beach Hotel, Respondents.

Civ. No. 11–00451JMS/RLP.

United States District Court, D. Hawai‘i.

Nov. 21, 2011.

Dale K. Yashiki, Thomas W. Cestare, Trent K. Kakuda, National Labor Relations Board, Honolulu, HI, Jill H. Coffman, Olivia Garcia, National Labor Relations Board, San Francisco, CA, for Petitioner.

Wesley M. Fujimoto, Ryan E. Sanada, Imanaka Kudo & Fujimoto LLC, Honolulu, HI, for Respondents.

ORDER GRANTING THE PETITION FOR INJUNCTION UNDER SECTION 10(J) OF THE NATIONAL LABOR RELATIONS ACT

J. MICHAEL SEABRIGHT, District Judge.

I. INTRODUCTION

Once again, the court addresses the National Labor Relations Board's (the “Board”) allegations that Waikiki's Pacific Beach Hotel (the “Hotel”) has engaged in unfair labor practices. And once again, the court agrees that the Hotel has engaged in unfair labor practices.

The parties in this action are no strangers to each other, much less to this court. For nearly a decade, the Board has filed numerous complaints asserting that HTH Corp. (“HTH”), Pacific Beach Corp. (“PBC”), and Koa Management, LLC (“Koa”) d/b/a/ the Hotel (collectively, “Respondents”) have engaged in a litany of violations of the National Labor Relations Act (the “NLRA” or the “Act”)-for meddling with, failing to recognize, and refusing to negotiate with the International Longshore and Warehouse Union, Local 142, AFL–CIO (the “Union”). In each action, the Board has found that Respondents did indeed commit various violations of the Act, and this court has already entered one injunction preventing Respondents from violating the Act and requiring them to take certain affirmative steps. The court now enters its second injunction in less than two years, and, in a separate order, finds Respondents in contempt for violating the court's previous injunction.

In this action, Petitioner Joseph F. Frankl, Director of Region 20 of the Board (“Petitioner”) asserts that Respondents have once again violated the Act by disciplining and terminating employee Rhandy Villanueva (“Villanueva”) to discourage Union activities, making unilateral changes to the policy of allowing Union representatives access to the Hotel, making unilateral changes to conditions of employment, and refusing to give requested information to the Union.¹ On September 13, 2011, Administrative Law Judge John J. McCarrick (“ALJ McCarrick”), after hearing sixteen days of testimony, issued a Decision finding that Respondents committed various violations of the NLRA, and Respondents have appealed the ALJ Decision to the Board. See HTH Corp., 2011 WL 4073681 (NLRB Sept. 13, 2011).

In the meantime, Petitioner has sought interim injunctive relief from this court pursuant to § 10(j) of the NLRA, 29 U.S.C. § 160(j) (referred to herein as “ § 10(j)”). Specifically, Petitioner requests that the court issue an injunction ordering Respondents to, among other things, reinstate Villanueva, bargain in good faith with the Union, and provide requested information. Respondents object to the Petition, arguing that they have not violated the Act and injunctive relief is not otherwise warranted. Based on the following, the court GRANTS the § 10(j) Petition.

II. BACKGROUND ²

Since the beginning of its drive to organize the Hotel's employees in 2002, the Union has faced opposition from Respondents. A July 31, 2002 election was overturned by the Board due to Respondents' coercive interrogation of employees and maintenance of an overly broad no-solicitation policy. HTH Corp., 342 NLRB 372 (2004). In a second election on August 24, 2004, Respondents challenged several ballots, resulting in the Board ordering those ballots to be counted and the Union winning the election by one vote. Pacific Beach Corp., 344 NLRB 1160 (2005). On August 15, 2005, the Regional Director issued a certificate of representation in favor of the Union.

After the Union was certified, Respondents continued their campaign to derail the Union, forcing Petitioner to file Complaints against Respondents from 2007 through 2008, which resulted in a September 30, 2009 decision by ALJ James M. Kennedy finding that Respondents had committed numerous NLRA violations, followed by a June 14, 2011 affirmance by the Board. See HTH Corp., 356 NLRB No. 182, 2011 WL 2414720 (2011). While waiting for the Board decision, Petitioner filed a Petition for § 10(j) relief, which this court granted on March 29, 2010 (the “March 29, 2010 Injunction”), see Norelli v. HTH Corp., 699 F.Supp.2d 1176 (D.Haw.2010), and which was affirmed on July 13, 2011. Frankl v. HTH Corp., 650 F.3d 1334 (9th Cir.2011).

After the March 29, 2010 Injunction, Petitioner filed a new Complaint against Respondents with the NLRB, and also sought contempt sanctions in this court for alleged violations of the March 29, 2010 Injunction (addressed in a separate order). On September 13, 2011, ALJ McCarrick issued his Decision finding that Respondents committed various violations of the NLRA. See HTH Corp., 2011 WL 4073681.

In the meantime, on July 20, 2011, Petitioner filed the present Petition seeking a § 10(j) injunction pending the final Board decision. Respondents filed their Opposition on September 19, 2011, and Petitioner filed its Reply on October 3, 2011. A hearing was held on October 31, 2011.

III. STANDARD OF REVIEW

The Board may petition a federal district court “for appropriate temporary relief or restraining order” pending the Board's resolution of an unfair labor practice charge, and the district court has “jurisdiction to grant to the Board such temporary relief or restraining order as it deems just and proper.” 29 U.S.C. § 160(j).

In determining a motion for temporary relief pursuant to § 10(j), the court must “consider the traditional equitable criteria used in deciding whether to grant a preliminary injunction [ ] and employ the Supreme Court's recent interpretation of the threshold showing necessary for granting such an ‘extraordinary remedy.’ ” McDermott v. Ampersand Publ'g, LLC, 593 F.3d 950, 957 (9th Cir.2010) (quoting Winter v. Natural Res. Def. Council, 555 U.S. 7, 129 S.Ct. 365, 374–76, 172 L.Ed.2d 249 (2008)); see also Munaf v. Geren, 553 U.S. 674, 689–90, 128 S.Ct. 2207, 171 L.Ed.2d 1 (2008) (“A preliminary injunction is an extraordinary and drastic remedy [that] is never awarded as of right.” (citation and quotation signals omitted)). “Thus, when a Regional Director seeks § 10(j) relief, he ‘must establish that he is likely to succeed on the merits, that he is likely to suffer irreparable harm in the absence of preliminary relief, that the balance of equities tips in his favor, and that an injunction is in the public interest.’ ” Frankl, 650 F.3d at 1355 (quoting Winter, 555 U.S. at 20, 129 S.Ct. 365); see also McDermott, 593 F.3d at 957. “ ‘[S]erious questions going to the merits' and a balance of hardships that tips sharply towards the [Regional Director] can support issuance of a preliminary injunction, so long as the [Regional Director] also shows that there is a likelihood of irreparable harm and that the injunction is in the public interest.’ ” Frankl, 650 F.3d at 1355 (quoting Alliance for the Wild Rockies v. Cottrell, 632 F.3d 1127, 1135 (9th Cir.2011)) (alterations in Frankl ). The Regional Director must nonetheless “establish that irreparable harm is likely, not just possible, in order to obtain a preliminary injunction.” Id. (quoting Alliance for the Wild Rockies, 632 F.3d at 1131).

The court must consider these factors “through the prism of the underlying purpose of section 10(j), which is to protect the integrity of the collective bargaining process and to preserve the Board's remedial power.” Id. (quoting Scott v. Stephen Dunn & Assocs., 241 F.3d 652, 661 (9th Cir.2001)).

IV. DISCUSSION

Petitioner asserts that the court should issue the requested injunction because he will likely succeed on the merits before the Board and the Ninth Circuit, the Union and Hotel employees will suffer irreparable harm in the absence of preliminary relief, the balance of equities tips in favor of injunctive relief, and an injunction is in the public interest. The court considers the arguments on each of these inquiries.

A. Likelihood of Success on the Merits

“On a § 10(j) petition, likelihood of success is a function of the probability that the Board will issue an order determining that the unfair labor practices alleged by the Regional Director occurred and that [Ninth Circuit] would grant a petition enforcing that order, if such enforcement were sought.” Frankl, 650 F.3d at 1355–56 (citing McDermott, 593 F.3d at 964). Likelihood of success is proven in § 10(j) cases where there is “some evidence to support the unfair labor practice charge together with an arguable legal theory.” Id. at 1356 (quoting Miller v. Cal. Pac. Med. Ctr., 19 F.3d 449, 460 (9th Cir.1994) (en banc)); see also Stephen Dunn & Assocs., 241 F.3d at 664 (quotations omitted). Alternatively, “if the Director does not show that success is likely, and instead shows only that there are serious questions going to the merits, then he must show that the balance of hardships tilts sharply in his favor, as well as showing that there is irreparable harm and that the injunction is in the public interest.” Frankl, 650 F.3d at 1356 (citing Alliance for the Wild Rockies, 632 F.3d at 1135).

Further, where the “Director seeks and receives approval from the NLRB before filing a § 10(j) petition,³ the Director is owed special deference because ‘likelihood of success is a function of the probability that the Board will issue an order determining that the unfair labor practices alleged by the Regional Director occurred.’ ” Small v. Avanti Health Sys., LLC, 661 F.3d 1180,...