HTH Corp. v. National Labor Relations Board
2016 U.S. App. LEXIS 9226
| D.C. Cir. | 2016Background
- HTH Corporation (operator of the Pacific Beach Hotel) admitted to multiple, severe unfair labor practices against International Longshore and Warehouse Union Local 142 across repeated proceedings dating back to 2002.
- An ALJ found numerous violations (including unlawful firings, surveillance, unilateral changes, and withholding information) and recommended standard remedies plus two notable remedies: notice-posting and notice-reading.
- On appeal the NLRB affirmed liability but modified and expanded remedies sua sponte, tightening the notice-reading requirement (narrowing company-reader to Regional VP Minicola but adding an option to have a Board agent read the notice, requiring supervisors’ attendance, adding an Explanation of Rights, and permitting a union representative) and imposing three new remedies (litigation-expenses awards, bargaining/other expense reimbursement, and three years of Board visitation).
- HTH did not file a motion for reconsideration with the Board and instead petitioned the D.C. Circuit to review the new/modified remedies.
- The court held that § 10(e) bars review of most challenges not raised before the Board, but excused failure to seek reconsideration for the litigation-expenses award as patently futile; it reviewed two preserved issues: the notice-reading remedy and the litigation-expenses award.
- The court enforced the notice-reading remedy (as modified to allow a Board agent option) but vacated the award of litigation expenses, reasoning the Board lacks statutory authority to impose fee-shifting under § 10(c) because such awards are punitive/for deterrence and thus beyond the remedial-only scope of the Board’s powers.
Issues
| Issue | HTH's Argument | NLRB's Argument | Held |
|---|---|---|---|
| Jurisdiction under 29 U.S.C. § 160(e) to review remedies added or modified sua sponte | HTH: Board additions are reviewable; dissents and ALJ exceptions preserve or make reconsideration futile | NLRB: HTH failed to raise these objections before the Board; §10(e) bars review | Court: §10(e) bars review of most objections HTH failed to present to the Board; only notice-reading (preserved) and litigation-expenses (futility exception) reviewed |
| Validity of notice-reading remedy (including Board-agent option) | HTH: notice-reading is an extraordinary, humiliating remedy; ALJ’s trimmings insufficient; parts of Board modifications unlawful | NLRB: notice-reading (with Board-agent option) is within broad remedial authority given egregious and pervasive violations | Court: Enforced notice-reading as modified (Board-agent option acceptable); other unpreserved modifications barred by §10(e) |
| Whether the Board may award litigation expenses/attorney’s fees as an exercise of "inherent" authority | HTH: Board has no authority to shift fees; such awards are punitive and beyond §10(c) remedial power | NLRB: Board has inherent authority to protect integrity of its proceedings and may award fees for bad faith | Court: Vacated litigation-expenses award — Board cannot rely on extra-statutory "inherent" authority and §10(c) cannot be read to authorize punitive fee-shifting in view of precedent (fee-shifting is punitive) |
| Whether fee-shifting can be implied under §10(c) | HTH: §10(c) is remedial only; cannot imply punitive fee-shifting | NLRB: §10(c)’s authorization of affirmative action to effectuate the Act supports such awards | Court: Declined to find §10(c) authorizes bad-faith fee-shifting (fees are punitive/deterrent and thus outside §10(c)); remanded/vacated expense award |
Key Cases Cited
- International Union of Electrical, Radio & Machine Workers v. NLRB, 383 F.2d 230 (D.C. Cir. 1967) (criticized mandatory public reading by employer as degrading and generally inappropriate)
- Teamsters Local 115 v. NLRB, 640 F.2d 392 (D.C. Cir. 1981) (approved notice-reading in certain cases but rejected singling out a named individual when record lacked necessity)
- Conair Corp. v. NLRB, 721 F.2d 1355 (D.C. Cir. 1983) (upheld individual-reader order where president’s pervasive involvement justified it; notable dissent criticizing forced personal reading)
- Federated Logistics & Operations v. NLRB, 400 F.3d 920 (D.C. Cir. 2005) (enforced notice-reading remedy that included Board-agent alternative)
- Unbelievable, Inc. v. NLRB, 118 F.3d 795 (D.C. Cir. 1997) (held Board lacks statutory authority under §10(c) to shift attorney’s fees)
- Chambers v. NASCO, Inc., 501 U.S. 32 (1991) (federal courts have inherent authority to award fees for bad-faith conduct; fee-shifting serves punitive/deterrent functions)
- Woelke & Romero Framing, Inc. v. NLRB, 456 U.S. 645 (1982) (§10(e) exhaustion requirement is jurisdictional)