In the wake of the Jan. 25 federal court ruling invalidating three of President Barack Obama's recess appointments to the National Labor Relations Board, corporations are left in a cloud of doubt. In fact, the "only certainty is there's a tremendous amount of uncertainty," veteran appellate attorney Andrew Pincus told Texas Lawyer affiliate CorpCounsel.com on Jan. 28.
The court decision leaves companies wondering how to handle pending NLRB appeals, whether to appeal recent rulings, and even whether to reopen cases that closed in 2012 under what has now been ruled an illegal board, said Pincus, a partner in Mayer Brown in Washington, D.C.
The broad language of the decision also calls into question some 29 other recess appointments, including that of Richard Cordray, the first director of the U.S. Consumer Financial Protection Bureau. And that, in turn, throws a cloud over whether the CFPB's new rules for financial institutions to protect home buyers from risky mortgages are legal, Pincus added.
The U.S. Court of Appeals for the D.C. Circuit on Jan. 25 dealt only with the NLRB appointments. It said they were unconstitutional because the Senate was not in full recess, and confirmation of the appointments by the Senate was required.
The ruling in favor of the Noel Canning company in Yakima, Wash., impacts every NLRB decision reached since January 2012, because every one involved at least one board member who was recess appointed. It primarily applies to board actions in unfair labor practice appeals or certification of unions.
NLRB chairman Mark Pearce issued a statement saying the board would continue functioning as usual until the matter is resolved.
"The Board respectfully disagrees with [the] decision and believes that the President's position in the matter will ultimately be upheld," Pearce said. "In the meantime, the board . . . will continue to perform our statutory duties and issue decisions."
Pearce also noted that similar questions about recess appointments have been raised in more than a dozen NLRB cases pending in other courts of appeals.?If the board continues business as usual, "The question is, what will those NLRB decisions be worth?" asked Ronald Meisburg, a partner in Proskauer Rose and a former general counsel of the NLRB. He also served as a recess-appointed member of the board for one year.
"Validity of any decision issued by the NLRB in the last year is now called into question, as well as the board's power to issue decisions going forward," Meisburg said.
Marshall Babson, a labor relations attorney at Seyfarth Shaw and a former member of the NLRB, says the agency and its acting general counsel, Lafe Solomon, have two key problems now.