Harrington v. Chao

• Decision Date: 21 June 2004
• Docket Number: No. 04-1144.,04-1144.
• Citation: 372 F.3d 52
• Parties: Thomas J. HARRINGTON; Richard S. Neville; Thomas Fordham; Francis J. Ferguson; John A. Biggins; Mark J. Durkin, Plaintiffs, Appellees, Joseph D. Flemming, III, Plaintiff, v. Elaine L. CHAO, Secretary of Labor, Defendant, Appellant.
• Court: U.S. Court of Appeals — First Circuit

372 F.3d 52

Thomas J. HARRINGTON; Richard S. Neville; Thomas Fordham; Francis J. Ferguson; John A. Biggins; Mark J. Durkin, Plaintiffs, Appellees, Joseph D. Flemming, III, Plaintiff, v. Elaine L. CHAO, Secretary of Labor, Defendant, Appellant.

No. 04-1144.

United States Court of Appeals, First Circuit.

Heard April 9, 2004.

Decided June 21, 2004.

William Kanter, with whom John S. Koppel, Appellate Staff, Civil Division, Michael J. Sullivan, U.S. Attorney, Peter D. Keisler, Assistant Attorney General, Gary K. Stearman, Senior Appellate Attorney, Department of Labor, Nathaniel I. Spiller, Deputy Associate Solicitor, Allen H. Feldman, Associate Solicitor, and Howard M. Radzely, Solicitor of Labor, were on brief, for appellant.

Michael A. Feinberg, with whom Jonathan M. Conti and Feinberg, Campbell & Zack, P.C. were on brief, for appellees.

Alan Hyde for the Association for Union Democracy, amicus curiae.

Daniel J. Hall, with whom DeCarlo, Connor, & Selvo was on brief, for the United Brotherhood of Carpenters and Joiners of America, amicus curiae.

Before TORRUELLA, LYNCH and LIPEZ, Circuit Judges.

LYNCH, Circuit Judge.

In 1996 the United Brotherhood of Carpenters (UBC) reorganized its system of local unions and state and district councils to create larger "Full Services Regional Councils." These new councils were given "all legislative and executive powers on all matters relating to the general interest and welfare of affiliated Local Unions and their members." The UBC's reorganization was largely a response to the accelerating regionalization of the construction industry. Construction work had become dominated by fewer and larger employers who increasingly handled out-of-state projects. As a result, the UBC determined that its old network of local unions and state and district councils was no longer capable of bargaining effectively with employer associations.

This case involves a challenge by seven dissatisfied rank-and-file members of one regional council, the New England Regional Council of Carpenters ("NERCC"), to the procedure by which their officers are elected. The NERCC members do not directly elect their officers. Rather, the regional council's officers are elected every four years by delegates who are themselves elected by the members of the local unions. The plaintiffs claim that the Labor-Management Reporting and Disclosure Act (LMRDA), 29 U.S.C. §§ 401-531, requires the direct election of the NERCC's officers because the NERCC is a "local labor organization" within the meaning of the Act, id. § 481(b), notwithstanding the UBC's designation of it as an intermediate body.

The Secretary of Labor initially determined that the NERCC is an "intermediate" rather than a "local" union body and is thus not required by the Act to conduct direct elections. In Harrington v. Chao, 280 F.3d 50 (1st Cir.2002) (Harrington I), we found the Secretary's explanation inadequate and remanded the case to her. A new Secretary reviewed the matter and reached the same conclusion, which she explained in a Supplemental Statement of Reasons ("SSR"). Plaintiffs again sued. The district court, interpreting Harrington I, found the conclusion as explained in the SSR to be arbitrary and capricious and issued injunctive relief. The Secretary appealed and at her behest this court stayed the district court's injunctive order. We now hold that the Secretary's determination was not arbitrary and capricious. We reverse the district court and order entry of judgment for the Secretary.

I. Background of LMRDA

Concerned about "instances of breach of trust, corruption, disregard of the rights of individual employees, and other failures to observe high standards of responsibility and ethical conduct" by entrenched union officials, 29 U.S.C. § 401(b), Congress in 1959 enacted the LMRDA. Pub.L. No. 86-257, 73 Stat. 519 (1959). Title IV of the Act regulates the election of union officers. 29 U.S.C. §§ 481-83. It requires that the officers of all "local labor organizations" be elected directly by secret ballot of their members and that these elections take place not less than every three years. Id. § 481(b). If an organization is an "intermediate bod[y],"¹ by contrast, Title IV allows the union to choose between direct elections of the organization's officers and election by representatives who are themselves elected,² and provides that these elections must occur at least every four years. Id. § 481(d). These requirements are designed "to protect the rights of rank-and-file members to participate fully in the operation of their union through processes of democratic self-government, and ... to keep the union leadership responsive to the membership." Wirtz v. Hotel, Motel & Club Employees Union, 391 U.S. 492, 497-98, 88 S.Ct. 1743, 20 L.Ed.2d 763 (1968).

The LMRDA does not define the terms "local labor organization" or "intermediate bodies." The only explicit guidance provided in the statutory text for categorizing union bodies as intermediate or local is the Act's specification of several example "intermediate bodies." These include "general committees, system boards, joint boards, or joint councils." See 29 U.S.C. § 481(d).

Given the lack of specific definitions of intermediate and local bodies in the Act, the possibility existed that labor organizations would attempt to label their constituent entities as "local" or "intermediate" for the purpose of dictating which method of election would be used. To curb this potential, Congress authorized the Secretary to promulgate regulations concerning how she would determine whether an organization was local or intermediate. Id. § 489(b). Pursuant to this authorization, the Secretary has supplemented the Act's limited guidance on the definitions of local and intermediate bodies with regulations providing that:

The characterization of a particular organizational unit as a "local," "intermediate," etc., is determined by its functions and purposes rather than the formal title by which it is known or how it classifies itself.

29 C.F.R. § 452.11.

Congress also made a union's designations of its constituent entities subject to review by the Secretary at the request of union members. 29 U.S.C. § 482(b). To initiate the review process, aggrieved union members who have exhausted internal union remedies file a complaint with the Secretary. Id. § 482(a). If, after investigating the complaint, the Secretary finds probable cause to believe that a violation of Title IV occurred and that it probably infected the outcome of the election, she must bring suit to set aside the election. Id. § 482(b); Wirtz v. Local 153, Glass Bottle Blowers Ass'n, 389 U.S. 463, 472, 88 S.Ct. 643, 19 L.Ed.2d 705 (1968). In that sense, the Secretary has no discretion. See Heckler v. Chaney, 470 U.S. 821, 834, 105 S.Ct. 1649, 84 L.Ed.2d 714 (1985) (section 482(b) "quite clearly withdrew discretion from the agency and provided guidelines for exercise of its enforcement power"). If she decides there is no probable cause, she must explain the rationale for that result in writing. Dunlop v. Bachowski, 421 U.S. 560, 571-72, 95 S.Ct. 1851, 44 L.Ed.2d 377 (1975).

At the same time that Congress was working to ensure effective union democracy, it was simultaneously taking steps to safeguard against excessive interference in the internal structure of unions. Most notably, Congress limited the ability to sue for violations of Title IV to the Secretary. See Calhoon v. Harvey, 379 U.S. 134, 140, 85 S.Ct. 292, 13 L.Ed.2d 190 (1964). Dissatisfied union members, as a result, are forced to proceed through the Secretary rather than the courts. Congress believed that this requirement would not only curb the potential for excessive litigation, but also facilitate the resolution of labor disputes by promoting uniformity. S.Rep. No. 86-187, at 19 (1959), reprinted in 1959 U.S.C.C.A.N. 2318, 2338.

Given the centrality of the Secretary's role in monitoring union democracy, the Act allows dissatisfied union members to challenge in federal court the Secretary's decision not to sue. Bachowski, 421 U.S. at 565, 95 S.Ct. 1851. This is quite unusual. Normally, the federal courts cannot review the decision of an administrative agency not to bring an enforcement action. Heckler, 470 U.S. at 831, 105 S.Ct. 1649. Such decisions are often inherently policy driven and thus best left to the discretion of the agency. See Bachowski, 421 U.S. at 572-73, 95 S.Ct. 1851. Largely for that reason, the Secretary's decision whether to sue a union for violating Title IV is reviewed only under the highly limited arbitrary and capricious standard contained in the Administrative Procedure Act, 5 U.S.C. § 706. Bachowski, 421 U.S. at 572-73, 95 S.Ct. 1851; Harrington, 280 F.3d at 56. Under that standard, a court reviews the Secretary's stated reasons for not suing only to determine whether they are "arbitrary, capricious, an abuse of discretion, or otherwise not in accordance with law." See Bachowski, 421 U.S. at 565 n. 5, 95 S.Ct. 1851 (quoting 5 U.S.C. § 706(2)(A)); Thomas Jefferson Univ. v. Shalala, 512 U.S. 504, 512, 114 S.Ct. 2381, 129 L.Ed.2d 405 (1994) (same).

In this case, the plaintiff dissident union members argue that the NERCC, while labeled an intermediate body by the UBC, really performs all the functions and purposes of a local union and thus, under the applicable regulations, that the Secretary must sue to bring about direct elections. The Secretary's decision to the contrary, the plaintiffs argue, is arbitrary and capricious because it failed to apply properly the "functions and purposes" test of the applicable regulations, 29 C.F.R. § 452.11. Each side is supported by able amicus.³

II. Procedural History

This is the second time that this case is before us. In Harrington I we reviewed the decision of the then-Secretary that the NERCC was an intermediate body. We held that the decision was arbitrary and capricious in the limited sense that the Secretary's...