NLRB - Pending Cases that Allege Non-Meritorious Lawsuits Are Retaliatory and Unlawful

In several cases involving allegations that a lawsuit violated the Act under Bill Johnson's Restaurants, Inc. v. NLRB,¹ the Board has held that if the plaintiff's lawsuit has been finally concluded and the plaintiff has not prevailed, its lawsuit is deemed meritless, and the Board's inquiry, for purposes of resolving the unfair labor practice issue, proceeds to resolving whether the respondent/plaintiff acted with a retaliatory motive in filing the lawsuit. In one such case, BE&K,² the Supreme Court recently granted certiorari to consider whether the Board may impose liability on an employer for filing a losing retaliatory lawsuit, even if the employer could show the suit was not objectively baseless under Professional Real Estate Investors, Inc. v. Columbia Pictures Industries, Inc., 508 U.S. 49, 113 S.Ct. 1920, 123 L.Ed.2d 611 (1993).

The Court's decision may well affect both the scope of our investigation in such cases as well as the theory of any ultimate litigation. Moreover, because the suit in such cases has concluded, it is unlikely to be having an immediate effect on the parties' relationship in most instances. Accordingly, pending the Supreme Court's decision in BE&K, we have decided to withhold further processing of charges and complaints that involve allegations that a concluded suit is an unfair labor practice. Specifically, once the investigation of a charge reveals that the suit has concluded, Regions should hold the charge in abeyance. Regions should also postpone indefinitely any hearing on a complaint alleging that a concluded suit is an unfair labor practice.

"Concluded" suits are those that were either dismissed on the merits by a court or withdrawn by the plaintiff prior to decision. The standard under which an ongoing suit may be found unlawful under Bill Johnson's is unaffected by the Supreme Court's grant of certiorari in BE&K. Regions should therefore continue to investigate charges that allege that an ongoing suit is unlawful under Bill Johnson's because it is baseless and retaliatory or because it is preempted or seeks an illegal object as described in footnote 5 of Bill Johnson's.

Finally, the circumstances of a particular case may suggest that the investigation or hearing should be pursued at this time, notwithstanding these instructions: for example, the lawsuit allegation may be consolidated with other related unfair labor practice allegations. In such a situation, the Region should consult with Advice as to how to proceed.

/s/
R.A.S.

cc: NLRBU
Release to the Public
MEMORANDUM OM 02-26

¹461 U.S. 731 (1983).

²329 NLRB No. 68 (September 30, 1999), enf'd 246 F.3d 619, rhg en banc denied (6th Cir. 2001).