Paulsen ex rel. Nat'l Labor Relations Bd. v. All Am. Sch. Bus Corp.

• Decision Date: 14 November 2013
• Docket Number: No. 13–CV–3762 (KAM).,13–CV–3762 (KAM).
• Citation: 986 F.Supp.2d 142
• Parties: James G. PAULSEN, Regional Director Of Region 29 of the NATIONAL LABOR RELATIONS BOARD, for and on behalf of The National Labor Relations Board, Petitioner, v. ALL AMERICAN SCHOOL BUS CORP., ANJ Service, Inc., Atlantic Queens Bus Corp., Bobby's Bus Co. Inc., Boro Transit, Inc., B–Alert Inc., Atlantic Escorts Inc., City Wide Transit, Inc., Canal Escorts, Inc., Cifra Escorts, Inc., Empire State Escorts, Inc., Gotham Bus Co. Inc., Grandpa's Bus Co., Inc., Hoyt Transportation Corp., IC Escorts Inc., Kings Matron Corp., Logan Transportation Systems, Inc., Lonero Transit Inc., Lorissa Bus Service Inc., Mountainside Transportation Co., Inc., Pioneer School Bus Rental, Inc., Pioneer Transportation Corp., Rainbow Transit Inc., Amboy Bus Co., Inc., Reliant Transportation, Inc., RPM Systems Inc., School Days Inc. and Tufaro Transit Co. Inc., Respondents, v. James G. Paulsen, Regional Director of Region 29 of the National Labor Relations Board, for and on behalf of The National Labor Relations Board, Counterclaim Defendant, and Sharon Block and Richard Griffin, members of the National Labor Relations Board, and Lafe Solomon, Acting General Counsel of the National Labor Relations Board, Third–Party Defendants.
• Court: U.S. District Court — Eastern District of New York

986 F.Supp.2d 142

James G. PAULSEN, Regional Director Of Region 29 of the NATIONAL LABOR RELATIONS BOARD, for and on behalf of The National Labor Relations Board, Petitioner,

v.ALL AMERICAN SCHOOL BUS CORP., ANJ Service, Inc., Atlantic Queens Bus Corp., Bobby's Bus Co. Inc., Boro Transit, Inc., B–Alert Inc., Atlantic Escorts Inc., City Wide Transit, Inc., Canal Escorts, Inc., Cifra Escorts, Inc., Empire State Escorts, Inc., Gotham Bus Co. Inc., Grandpa's Bus Co., Inc., Hoyt Transportation Corp., IC Escorts Inc., Kings Matron Corp., Logan Transportation Systems, Inc., Lonero Transit Inc., Lorissa Bus Service Inc., Mountainside Transportation Co., Inc., Pioneer School Bus Rental, Inc., Pioneer Transportation Corp., Rainbow Transit Inc., Amboy Bus Co., Inc., Reliant Transportation, Inc., RPM Systems Inc., School Days Inc. and Tufaro Transit Co. Inc., Respondents,

v.James G. Paulsen, Regional Director of Region 29 of the National Labor Relations Board, for and on behalf of The National Labor Relations Board, Counterclaim Defendant,andSharon Block and Richard Griffin, members of the National Labor Relations Board, and Lafe Solomon, Acting General Counsel of the National Labor Relations Board, Third–Party Defendants.

No. 13–CV–3762 (KAM).

United States District Court, E.D. New York.

Nov. 14, 2013.

Annie Hsu, Erin E. Schaefer, Nancy B. Lipin, National Labor Relations Board, Brooklyn, NY, Nancy K. Platt, Paul Augustus Thomas, National Labor Relations Board, Washington, DC, for Petitioner/Counterclaim Defendant/Third–Party Defendants.

Jeffery D. Pollack, Jessica Lee Boffa, Kevin Michael Brown, Timothy Harris Wolf, Mintz & Gold, LLP, New York, NY, Richard Milman, Milman Labuda Law Group PLLC, New Hyde Park, NY, Michael James Mauro, Milman Labuda Law Group PLLC, Lake Success, NY, for Respondents.

MEMORANDUM & ORDER

MATSUMOTO, District Judge.

On July 3, 2013, Petitioner James G. Paulsen, Regional Director of Region 29 of the National Labor Relations Board (“NLRB”), acting for and on behalf of the NLRB, filed a motion seeking a preliminary injunction under section 10(j), 29 U.S.C. § 160(j), of the National Labor Relations Act (the “Act”), 29 U.S.C. §§ 151–169, against respondents, bus companies that contract with the New York City Department of Education (“DOE”) to provide school bus transportation services to students. (ECF No. 1, Motion for Preliminary Injunction, 7/3/13.) On July 12, 2013, respondents filed an answer, a counterclaim against petitioner, and a third-party complaint against former NLRB members Sharon Block and Richard F. Griffin, Jr., and former NLRB acting general counsel Lafe E. Solomon. (ECF No. 18, Answer, Third Party Complaint, and Counterclaim (“Answer”), 7/12/13.)

Pending before the court is a motion to dismiss respondents' counterclaim and third-party complaint for lack of subject matter jurisdiction, pursuant to Federal Rule of Civil Procedure 12(b)(1), filed by petitioner, former NLRB members Block and Griffin, and former NLRB acting general counsel Solomon (collectively, “defendants”). (ECF No. 56, Motion to Dismiss for Lack of Jurisdiction (“Mot.”), 8/16/13.) For the reasons provided below, defendants' motion to dismiss the counterclaim and the third-party complaint for lack of subject matter jurisdiction is granted.

BACKGROUND

A. General Background

The general facts of this case have been set forth by the court in detail in previous decisions and will only be summarized briefly here. The respondents in this case are 28 companies that contract with DOE to provide school bus transportation for general and special education students. After twelve negotiation sessions with Local 1181–1061, Amalgamated Transit Union, AFL–CIO (“Local 1181”), five of which followed the termination of a strike by Local 1181, respondents declared an impasse because the union apparently would not agree to include a Most Favored Nations (“MFN”) clause in the collective bargaining agreement (“CBA”) during the negotiations sessions. Under the MFN clause, if Local 1181 granted an employer certain specified economic terms more favorable than the equivalent terms in its CBAs with respondents, then any respondent could adopt those more favorable terms in its CBA with Local 1181. (ECF No. 63, Preliminary Injunction Order (“Preliminary Injunction Order”), 8/28/13, at 4–12.) After reviewing the parties' arguments, and the exhibits and transcript of the testimony presented at a NLRB hearing before Administrative Law Judge Raymond P. Green,¹ this court found that (i) the consolidated complaint and the petition for section 10(j) relief were filed with valid legal authority, (ii) there was reasonable cause to believe that respondents had committed an unfair labor practice, (iii) injunctive relief was just and proper, and (iv) the public interest and the balance of the equities were served in this case by granting the relief sought by petitioner. ( Id. at 33–36.)

On October 23, 2013, this court denied respondents' motion to stay the Preliminary Injunction Order. (ECF No. 77, Order Denying Stay of Preliminary Injunction Order (“Order Denying Stay”), 10/23/13.)

B. Facts Related to Motion to Dismiss

The other facts relevant to this motion to dismiss are largely undisputed and primarilydrawn from the Answer and certain other documents.² On November 9, 2011, when the NLRB had three members, including Craig Becker, who was appointed by President Obama during an intrasession recess of the Senate on March 27, 2010, it “delegate[d] to the General Counsel full authority on all court litigation matters that would otherwise require Board authorization.” Order Contingently Delegating Authority to the General Counsel, 76 Fed.Reg. 69,768–69,769 (Nov. 9, 2011). This delegation included the authority to issue section 10(j) petitions. ( Id.) The Third Circuit Court of Appeals subsequently held that Becker's nomination was invalid because it occurred during an intrasession recess of the Senate and thus violated the Recess Appointments Clause of the Constitution, U.S. Const. art II, § 2, cl. 3. NLRB v. New Vista Nursing & Rehab., 719 F.3d 203 (3d Cir.2013).

Block and Griffin were also appointed to the NLRB by President Obama during an intrasession recess of the Senate on January 4, 2012. Noel Canning v. NLRB, 705 F.3d 490, 498 (D.C.Cir.2013). The Fourth Circuit Court of Appeals and the D.C. Circuit Court of Appeals later held that President Obama's intrasession appointments of Block and Griffin violated the Recess Appointments Clause of the Constitution. NLRB v. Enter. Leasing Co. Se., LLC, 722 F.3d 609 (4th Cir.2013); Noel Canning, 705 F.3d 490.³ Paulsen was approved as regional director of Region 29 of the NLRB on January 6, 2013 when the NLRB consisted of Block, Griffin, and Mark Pearce. (Answer at 5.)

The consolidated complaint was issued by Paulsen on June 10, 2013 (ECF No. 1–6, Consolidated Complaint, 6/10/13), and the petition for section 10(j) relief was issued on July 3, 2013, (ECF No. 1, Motion for Preliminary Injunction, 7/3/13). Former NLRB Acting General Counsel Solomon, however, ratified the issuance of the complaint in a letter on July 12, 2013. (ECF No. 26–5, Letter from Lafe E. Solomon to Peter Kirsanow, 7/12/13, at 3 (stating that “although Regional Director Paulsen has at all relevant times held the authority to issue the challenged complaint on my behalf, I also now expressly ratify the issuance of the complaint.”).)

The NLRB currently has five members who have all been confirmed by the Senate. See Board Members Since 1935, http:// www. nlrb. gov/ who– we– are/ board/ board– members– 1935 (last visited Nov. 9, 2013). Griffin was sworn in as the NLRB's general counsel on November 4, 2013. See Richard F. Griffin, Jr., http:// www. nlrb. gov/ who- we- are/ general- counsel/ richard- f- griffin- jr (last visited Nov. 9, 2013).

DISCUSSION

A. Legal Standard

“A case is properly dismissed for lack of subject matter jurisdiction under Rule 12(b)(1) when the district court lacks the statutory or constitutional power to adjudicate it.” Makarova, 201 F.3d at 113 (2d Cir.2000) (citing Fed.R.Civ.P. 12(b)(1)). “A plaintiff asserting subject matter jurisdiction has the burden of proving by a preponderance of the evidence that it exists.” Id. (citing Malik v. Meissner, 82 F.3d 560, 562 (2d Cir.1996)). Moreover, “[w]hen considering a motion to dismiss pursuant to Rule 12(b)(1), the court must take all facts alleged in the complaint as true and draw all reasonable inferences in favor of plaintiff.” Sweet v. Sheahan, 235 F.3d 80, 83 (2d Cir.2000) (citing Jaghory v. New York State Dep't of Educ., 131 F.3d 326, 329 (2d Cir.1997)).

Additionally, it is well settled that courts “avoid reaching constitutional questions when they are unnecessary to the disposition of a case.” Anobile v. Pelligrino, 303 F.3d 107, 123 (2d Cir.2002); see also Hutchinson v. Proxmire, 443 U.S. 111, 122, 99 S.Ct. 2675, 61 L.Ed.2d 411 (1979) (“Our practice is to avoid reaching constitutional questions if a dispositive nonconstitutional ground is available.”); Ashwander v. TVA, 297 U.S. 288, 347, 56 S.Ct. 466, 80 L.Ed. 688 (1936) (“The Court will not pass upon a constitutional question although properly presented by the record, if there is also present some other ground upon which the case may be disposed of.”) (Brandeis, J., concurring).

B. Application

Respondents claim that this court has subject matter jurisdiction over their counterclaim and third-party complaint based on two legal theories. First, respondents argue that this court has jurisdiction pursuant to 28 U.S.C. § 1361, the Mandamus Act, which provides that “district courts shall have original jurisdiction of any action in the nature of mandamus to compel an officer or employee of the United States or any agency thereof to perform a duty owed to the plaintiff.” 28 U.S.C. § 1361. Respondents also argue that this court has jurisdiction under Leedom v. Kyne, 358 U.S. 184, 79 S.Ct. 180, 3 L.Ed.2d 210 (1958),...