Solomon NLRB Appointment Held Invalid

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By Lawrence E. Dubé

Aug. 7 — Lafe E. Solomon's 2010 appointment as the acting general counsel of the National Labor Relations Board became invalid once he received a presidential nomination to serve in the position, the U.S. Court of Appeals for the District of Columbia Circuit held Aug. 7.

Writing for the court, Judge Karen LeCraft Henderson said President Obama invoked the Federal Vacancies Reform Act when he appointed Solomon to act as the agency's chief lawyer. However, Henderson said the FVRA prohibited Solomon's continued service in the job after Jan. 5, 2011, when the president nominated him to serve a four-year term in the position.

The court denied enforcement of an NLRB order against SW General Inc., an ambulance company, because it was based on a complaint issued by Solomon during the period—Jan. 5, 2011, to Nov. 4, 2013—when he was improperly serving in the NLRB post. Henderson cautioned that other litigants who did not raise or preserve FVRA objections in their own NLRB cases will not likely “enjoy the same success.”

Issue Raised by Arizona Employer

The case before the court arose on SW General's petition to review an NLRB decision (360 N.L.R.B. No. 109, 200 LRRM 1217 (2014)) in which the board mostly affirmed the decision of an administrative law judge against the Arizona company, which does business as Southwest Ambulance.

A three-member board panel found the company violated the National Labor Relations Act by unilaterally eliminating longevity increases for emergency medical technicians, paramedics and nurses who are represented by an International Association of Fire Fighters local union.

SW General had filed exceptions to the ALJ decision, and argued to the board that the unfair labor practice complaint against the company was defective because it was issued on the authority of the acting general counsel. The board decision did not discuss the objection, but Henderson said that by filing its exceptions, the company preserved the issue for consideration and review by the court.

Appointment Under Federal Vacancies Reform Act

Solomon, an NLRB career lawyer who headed the board's office of representation case appeals, was appointed by Obama to serve as acting general counsel after then-General Counsel Ronald Meisburg resigned to return to private practice.

The president cited the FVRA, 5 U.S.C. § 3345(a), as authority for the action, and the agency argued to the appeals court that Solomon's appointment was permitted by Section 3345(a)(3) of the statute, which allowed the president to appoint as acting general counsel an NLRB employee with more than 90 days of service and pay at or above the GS-15 level.

The appeals court said Solomon “easily met” the qualifications when he was named acting general counsel, but SW General argued that another FVRA provision prevented Solomon from serving in the slot once the president nominated him for that office.

Dispute Over Interpretation of FVRA Provisions

FVRA Section 3345(b) prohibits an individual from being both the acting officer and the presidential nominee for the position unless he served as the “first assistant” to the office in question for at least 90 of the last 365 days or he was confirmed by the Senate to be the first assistant.

“Solomon was never a first assistant at all,” Henderson said, “so the exceptions plainly do not apply to him.”

The NLRB argued in the D.C. Circuit that Subsection (b)(1) only applies to a limited category of “first assistants” who take over a position under another FVRA provision, 5 U.S.C. § 3345(a)(1), not to federal employees like Solomon who received appointments under Section 3345(a)(3).

However, SW General argued Section 3345(b) applies to all acting officers, and the appeals court agreed.

Service as Acting General Counsel Limited by Statute

Henderson rejected the NLRB's reading of the statute and said “the plain language of subsection (b)(1) manifests that no person can serve as both the acting officer and the permanent nominee” unless the requirements of the subsection are satisfied.

Henderson said the court's reading of the FVRA was supported by Hooks v. Remington Lodging & Hospitality, LLC, 8 F. Supp. 3d 1178, 2014 BL 74425, 198 LRRM 2802 (D. Alaska 2014).

“Because Solomon was never a first assistant and the President nominated him to be General Counsel on January 5, 2011, the FVRA prohibited him from serving as Acting General Counsel from that date forward,” the court said.

Not Persuaded Appointment Flaw Was Harmless

The FVRA, 5 U.S.C. § 3348(d), provides that an action taken by an officer improperly holding an office covered by the statute “shall have no force and effect” and “may not be ratified.” But the court said the effect of the provision was that actions of an improperly serving acting general counsel would be voidable, not void.

The NLRB argued its final unfair labor practice order against SW General rendered harmless any defect in the general counsel's complaint against the company, but the court was not persuaded.

Henderson said the NLRB's general counsel has prosecutorial discretion and sets enforcement priorities for the agency. While a regional director signed the complaint, which did not require submission in advance to Solomon, the appeals court said, “we cannot be confident that the complaint against Southwest would have issued under an Acting General Counsel other than Solomon.”

The court also rejected the NLRB's argument that its order against SW General should be considered enforceable under the “de facto officer doctrine,” which may confer validity on the acts of an official whose election or appointment to office is later determined to be invalid. Henderson said the doctrine only applies in limited circumstances, and “does not bar Southwest from challenging Solomon's authority.”

Court Sees Narrow Ruling, Not Flood of New Cases

The appeals court denied enforcement of the NLRB order, but Henderson wrote “we emphasize the narrowness of our decision.”

The court held that Solomon served in violation of the FVRA from the time of his nomination until Nov. 4, 2013, when Richard F. Griffin became general counsel, but Henderson wrote “this case is not son of Noel Canning [NLRB v. Noel Canning, 134 S. Ct. 2550, 199 LRRM 3685 (2014)] and we do not expect it to retroactively undermine a host of NLRB decisions.”

Henderson said the court considered SW General's FVRA challenge because the company raised the issue in its exceptions to an ALJ decision as a defense to an ongoing enforcement proceeding.

“We doubt that an employer that failed to timely raise an FVRA objection—regardless whether enforcement proceedings are ongoing or concluded—will enjoy the same success,” Henderson said.

Judges Srikanth Srinivasan and Robert Leon Wilkins joined in the opinion.

Alison N. Davis of Littler Mendelson in Washington argued the case for SW General Inc. NLRB attorney Kellie J. Isbell argued for the board.

To contact the reporter on this story: Lawrence E. Dubé in Washington at ldube@bna.com

To contact the editor responsible for this story: Susan J. McGolrick at smcgolrick@bna.com

Text of the opinion is available at http://www.bloomberglaw.com/public/document/SW_GENERAL_INC_DOING_BUSINESS_AS_SOUTHWEST_AMBULANCE_PETITIONER_v.