Hotel Employees and Restaurant Employees Intern. Union v. Nevada Gaming Com'n

• Decision Date: 27 January 1993
• Docket Number: No. 91-15188,91-15188
• Citation: 984 F.2d 1507
• Parties: 142 L.R.R.M. (BNA) 2321, 61 USLW 2458, 124 Lab.Cas. P 10,532 HOTEL EMPLOYEES AND RESTAURANT EMPLOYEES INTERNATIONAL UNION; John Wilhelm; Donald M. Taylor; Mark D. Atkinson, Plaintiffs-Appellants, v. NEVADA GAMING COMMISSION, et al., Defendants-Appellees.
• Court: U.S. Court of Appeals — Ninth Circuit

Page 1507

984 F.2d 1507

142 L.R.R.M. (BNA) 2321, 61 USLW 2458,

124 Lab.Cas. P 10,532

HOTEL EMPLOYEES AND RESTAURANT EMPLOYEES INTERNATIONAL UNION; John Wilhelm; Donald M. Taylor; Mark D Atkinson, Plaintiffs-Appellants, v. NEVADA GAMING COMMISSION, et al., Defendants-Appellees.

No. 91-15188.

United States Court of Appeals Ninth Circuit.

Argued and Submitted May 11, 1992.

Decided Jan. 27, 1993.

George W. Foley, Jr., Pearson & Patton, Las Vegas, NV, for plaintiffs-appellants.

Gloria Stendardi and Charlotte M. Matanane, Deputy Attys. Gen., Las Vegas, NV, for defendants-appellees.

Appeal from the United States District Court for the District of Nevada.

Before: CHAMBERS, HUG, and RYMER, Circuit Judges. ^*

HUG, Circuit Judge:

An international union and some of its employees contest the validity of certain Nevada gaming control statutes and regulations and their applicability to them. The State of Nevada has a comprehensive statutory system to control the gaming industry in the state. The statutes provide for a Gaming Commission ("Commission") that is to adopt comprehensive regulations interpreting and applying the statutes and to perform adjudicatory functions in enforcing the gaming control statutes and regulations. The statutes also provide for a Gaming Control Board ("Board"), which is the enforcement arm in the system. The statutes and regulations provide for extensive reporting disclosure requirements for the owners and key employees of gaming establishments and provide for disqualification based on criminal or unsavory backgrounds. The statutes also provide for similar requirements for local labor organizations representing gaming employees. Certain personnel of such labor organizations also are subject to reporting and disclosure requirements and are subject to disqualification. The regulations also apply to the personnel of international unions that provide certain services to local unions representing gaming employees.

In this case, the Board notified employees of the Hotel Employees and Restaurant Employees International Union ("International Union") that they were required to comply with the reporting requirements of the gaming control statutes and regulations. Several employees complied; the three persons involved in this appeal have not done so and contest the right of the Board to require them to do so. In this appeal, the International Union and these employees first broadly contest the facial validity of the provisions of the regulatory system that impose reporting and disclosure requirements on labor unions and their personnel on the grounds that they are preempted by the National Labor Relations Act ("NLRA") and the Labor Management Reporting and Disclosure Act ("LMRDA"). Second, they contend that at least the application of these regulations to international union employees is preempted by the NLRA and the LMRDA. Third, they assert that the statutes and regulations violate their First Amendment speech and associational rights. Finally, they contend that, as a matter of state law, the reporting and disclosure requirements are not applicable to international union personnel. Issues of abstention and ripeness also are involved in this appeal.

The district court dismissed the action on the grounds of ripeness. We affirm, in part, and reverse, in part. Jurisdiction of the district court was based upon 28 U.S.C. § 1331 and § 1343(a)(3). Appellate jurisdiction is based upon 28 U.S.C. § 1291.

I.

The International Union and individual International Union employees brought this action for declaratory and injunctive relief from certain Commission regulations enacted pursuant to Nevada Revised Statute § 463A. The regulations provide for reporting and disclosure requirements for international union personnel who advise and consult with local unions representing gaming employees. The appellants claimed, in a motion for summary judgment, that the regulations exceeded the authority granted to the Commission by Nevada law, or, if the regulations were found to be valid under state law, that they were preempted by federal law and violated their rights of freedom of speech, freedom of association, and equal protection of the laws. Plaintiffs alternately sought certification of the state law issues to the Nevada Supreme Court or Pullman abstention.

The Commission filed a cross-motion for summary judgment, alleging that the case was not ripe for adjudication, that the International Union lacked standing, that Burford abstention was appropriate, and that the regulations were valid under state and federal law.

The district court held that although the International Union had standing, the challenges to the state law and regulations were not ripe for review. The court found that no proceedings had been initiated before the Commission to disqualify the plaintiffs for the employees' failure to comply with the disclosure requirements. The court noted that before the plaintiffs could be disqualified, they would be entitled to an administrative hearing and judicial review of the decision, pursuant to Nevada law. The remaining claims were denied as moot. The International Union and three of its staff members, Wilhelm, Taylor, and Atkinson, timely appealed.

II.

Nevada regulates labor unions and their employees who represent gaming casino employees in Nevada. Nev.Rev.Stat. §§ 463A.010-.260 (1989). Chapter 463A was enacted in 1975 with the express purposes of ensuring that gaming is conducted freely and honestly and protecting the welfare of gaming casino employees. Nev.Rev.Stat. § 463A.010.3. The statute extends to casino employees, including dealers, floormen, cashiers, money handlers and security officers, but not to ordinary hotel and restaurant personnel. Nev.Rev.Stat. § 463A.020.3.

Unions that represent gaming casino employees are required to submit to the Board a list of all union personnel who:

(a) Adjust grievances for, negotiate or administer the wages, hours, working conditions or conditions of employment of any gaming casino employee;

(b) Solicit, collect or receive any dues, assessments, levies, fines, contributions or other charges within this state for or on behalf of the organization from gaming casino employees; or

(c) Act as officers, members of the governing body, business agents or in any other policymaking or supervisory position in the organization.

Nev.Rev.Stat. § 463A.030.1. Each listed person is required to submit to the Board a personal history disclosure statement and a set of fingerprints. Nev.Rev.Stat. § 463A.030.2. The Commission may require additional information and may add others "whose duties significantly affect the conduct of a gaming operation" to the list of personnel subject to the statute. Nev.Rev.Stat. § 463A.030.4. If the Commission determines that a union employee is unsuitable to represent the interests of gaming casino employees, the Commission has the statutory authority to disqualify that employee. Nev.Rev.Stat. § 463A.040. The Commission also is authorized to seek injunctions and fines from the individual and from the union by proceeding in state court to enforce a disqualification order. Nev.Rev.Stat. § 463A.250.

The Commission adopted Regulation 19 in 1985 to implement Chapter 463A. The regulation provides that Chapter 463A applies to union personnel who "[f]or compensation advise, represent, or provide other assistance to a labor organization concerning Nevada gaming casino employees with respect to" the activities listed in 463A.030.1(a)-(c), as stated in Regulation 19.020.1(a)-(c). See Reg. 19.020.1(d). Local unions are required to identify international union personnel who perform any of the functions listed in Reg. 19.020.1. See Reg. 19.030.1(d). The regulation also provides for disqualification of listed personnel for failure to submit the required information. Reg. 19.050.3; see Nev.Rev.Stat. § 463A.040.

The Nevada Supreme Court has held that Regulation 19 does not apply directly to an international union itself. Hotel Employees and Restaurant Employees Int'l Union, AFL-CIO v. State ex rel. Nevada Gaming Control Bd., 103 Nev. 588, 747 P.2d 878, 880 (1987). Whether international union personnel that perform local union functions may be regulated under Chapter 463A is the question at issue in this case. The Nevada Supreme Court did not rule directly on this question. The court stated:

Under provisions pertaining to local unions, international union personnel who are involved with Nevada gaming employees are subject to regulation. The local organization is required to provide information about persons from the international who have either performed key functions described in NRS 463A.030, or have advised or consulted with the local union on the performance of such functions. Reg. 19.030. International union personnel listed by the local union are required to make a personal filing. These provisions are not challenged in this appeal.

Id. 747 P.2d at 879 n. 2.

The Board notified the local Culinary Union in June 1987 that it was required to identify international union personnel performing local union functions, pursuant to Nev.Rev.Stat. § 463A.030.1 and Regulation 19.020.1. The local union submitted the names of the individual appellants to the Board, and in May 1988, the Board sent letters to the employees informing them that their failure to comply with Regulation 19 by submitting personal information within the prescribed period "may be deemed grounds for disqualification." They were directed to contact the Board's agent within seven days of receiving the notice. The International Union and several of its employees and officers then filed this action in federal district court to challenge the validity of Regulation 19.030 as it applies to international union personnel.

The individual appellants, John Wilhelm, Donald Taylor, and Mark Atkinson, are employees of the International Union who have not complied with the Board's demand. Wilhelm is a...