Associated Builders & Contractors of California Cooperation Committee, Inc. v. Becerra
231 F. Supp. 3d 810
S.D. Cal.2017Background
- California amended its prevailing wage law via SB 954 (effective Jan. 1, 2017) to limit "employer payments" credit: payments to industry advancement funds qualify for prevailing wage credit only if made pursuant to a collective bargaining agreement (CBA) that binds the employer.
- Plaintiffs: Associated Builders & Contractors of California Cooperation Committee (ABC-CCC), an industry advancement fund representing open-shop interests, and Interpipe Contracting (a contractor that previously received credit under the old statute).
- Plaintiffs allege SB 954 will reduce employer contributions to ABC-CCC, injuring ABC-CCC financially and harming Interpipe’s access to ABC-CCC services; they challenge SB 954 as (1) preempted by the NLRA, (2) violating ABC-CCC’s First Amendment rights, and (3) violating ABC-CCC’s equal protection rights.
- Defendants: California Attorney General Becerra, Director Baker, and Labor Commissioner Su moved to dismiss (Rule 12(b)(6)/12(c)); Plaintiffs sought a preliminary injunction to block SB 954 from taking effect.
- The district court found the case ripe, dismissed ABC-CCC’s equal protection claim for lack of standing to assert it on its own behalf, and rejected Plaintiffs’ facial constitutional challenges on the merits.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| NLRA preemption — Machinists doctrine | SB 954 targets noncoercive labor-related speech (industry-advancement advocacy) and is therefore preempted under Machinists/Government regulation of speech protected by §8(c). | SB 954 is a minimum labor standard with a CB A-based opt-out; it does not regulate bargaining mechanics or speech and thus is not preempted. | Dismissed: Machinists preemption does not apply; SB 954 is a state minimum labor standard with an opt-out and is not an unlawful intrusion into collective bargaining or protected speech. |
| NLRA preemption — Garmon doctrine | The NLRB regulates payments to industry advancement funds, so state law intrudes into an area reserved to the NLRB. | SB 954 does not regulate §7/§8 activity or bargaining terms; minimum labor standards with opt-outs are not Garmon-preempted. | Dismissed: No Garmon preemption; statute does not regulate activity the NLRA protects or prohibits in a way that precludes state action. |
| First Amendment (speech/subsidy and viewpoint discrimination) | SB 954 effectively burdens ABC-CCC’s speech by denying a state subsidy to non‑CBA-funded industry funds, discriminating by speaker/viewpoint and chilling open-shop advocacy. | The law is facially neutral, does not bar speech, merely declines to subsidize certain activity; subsidy cases (Regan/Ysursa) allow the state discretion; rational basis review applies. | Dismissed: ABC-CCC failed to plausibly show a First Amendment violation; the statute is a permissible subsidy choice that survives rational-basis review. |
| Equal Protection / Standing | ABC-CCC claims SB 954 denies it equal protection. | SB 954 regulates employers; ABC-CCC lacks standing to assert equal protection on its own behalf (any discrimination is against non‑CBA employers). | Dismissed: ABC-CCC lacks standing to bring its own equal protection claim; claim also fails on the merits under rational-basis review. |
Key Cases Cited
- Ashcroft v. Iqbal, 556 U.S. 662 (2009) (pleading standard for plausible claims)
- Winter v. Natural Res. Def. Council, 555 U.S. 7 (2008) (preliminary injunction standards)
- Chamber of Commerce v. Brown, 554 U.S. 60 (2008) (Machinists preemption and protection of noncoercive labor speech under §8(c))
- Regan v. Taxation With Representation, 461 U.S. 540 (1983) (government may decline to subsidize speech; subsidy doctrine)
- Ysursa v. Pocatello Educ. Ass'n, 555 U.S. 353 (2009) (states may structure payroll-subsidy choices without triggering strict scrutiny)
- Metro. Life Ins. Co. v. Massachusetts, 471 U.S. 724 (1985) (state minimum labor standards not preempted when they set a backdrop for bargaining)
- Fort Halifax Packing Co. v. Coyne, 482 U.S. 1 (1987) (state protections form the bargaining backdrop)
- Viceroy Gold Corp. v. Aubry, 75 F.3d 482 (9th Cir. 1996) (opt-out provisions for CBAs can avoid NLRA preemption)
- Am. Hotel & Lodging Ass'n v. City of Los Angeles, 834 F.3d 958 (9th Cir. 2016) (distinguishing state minimum standards from regulation of bargaining mechanics)