Glacier Northwest, Inc. v. International Brotherhood of Teamsters

Issues

Does the National Labor Relations Act preempt an employer’s state tort claims against a labor union for intentionally destroying the employer’s property during a strategically-timed labor strike?

Oral argument:

January 10, 2023

Court below:

Washington Supreme Court

This case asks the Supreme Court to determine whether an employer can bring a tort claim in state court against a union or its members for intentionally destroying the employer’s property during a strike. The Court will decide if the National Labor Relations Act (“NLRA”), which allows employers and unions to tactically use “economic weapons” such as strikes to gain leverage during collective bargaining, preempts such tort claims. The parties agree that tort claims involving conduct which is “arguably protected” under the NLRA are preempted. Glacier Northwest contends that intentional destruction of private property is not “arguably protected” because it is unlawful. Glacier Northwest additionally argues that, even if intentional destruction of private property is “arguably protected,” a “local interest” exception to preemption applies. International Brotherhood of Teamsters Local 174 counters that intentional destruction of private property is “arguably protected” and that the “local interest” exemption does not apply. The Supreme Court’s decision could significantly impact labor law by opening the door to more frequent employer lawsuits and recalibrating the legal protections for activities that unions engage in to secure bargaining leverage.

Questions as Framed for the Court by the Parties

Whether the National Labor Relations Act impliedly preempts a state tort claim against a union for intentionally destroying an employer's property in the course of a labor dispute.

Facts

The National Labor Relations Act (“NLRA”) gives employees the right to collectively bargain and to undertake “concerted activities for… mutual aid or protection.” Glacier Nw. v. Int’l Bhd. of Teamsters Local Union No. 174 at 15. Concerted activities include the right to strike. Id. at 16. The NLRA also prohibits unfair labor practices, which include employer interference with concerted activities. Id. at 15–16. The National Labor Relations Board (“NLRB”) hears claims of unfair labor practices and can issue injunctive relief but cannot award damages for an injury caused by tortious conduct. Id. at 17-18.

Glacier Northwest, Inc. (“Glacier”) sells and delivers custom batches of concrete using “ready-mix” trucks that mix the concrete during transit. Id. at 2–3. Because concrete hardens quickly when mixing ceases, Glacier must deliver the concrete on the day of mixing and cannot let the concrete sit inside the truck for too long. Id. at 3.

On August 11, 2017, Glacier’s truck drivers in King County, Washington, who are part of a union called International Brotherhood of Teamsters Local 174 (“Local 174”), went on strike during negotiations over a new collective bargaining agreement. Id. Because Local 174 coordinated the strike to occur during Glacier’s prime concrete delivery time, many drivers’ trucks were full of concrete during the strike. Id. at 3–5. Several of the striking drivers returned their trucks to Glacier’s local concrete site without emptying them or notifying Glacier about the undelivered concrete. Id. at 4. The remaining workers at Glacier hastily removed the concrete from the trucks before it could solidify and damage the trucks. Id. at 3, 5, n.3. The undelivered concrete, left to harden, could not be salvaged for sale. Id. at 5.

Glacier sued Local 174, raising tort claims regarding the ruined concrete. Id. at 9. Local 174 responded by filing a complaint with the NLRB, alleging that the lawsuit constituted unlawful retaliation against concerted activities. Id. Local 174 then filed a motion to dismiss Glacier’s tort claims, contending they were preempted by the NLRA. Id. The trial court agreed and granted the motion. Id. at 10.

The Washington Court of Appeals reversed. Id. at 11. Citing the U.S. Supreme Court’s decision in San Diego Bldg. Trades Council v. Garmon, a pivotal case on preemption, the court stated that a claim is preempted by the NLRA when it involves conduct that is “arguably protected” under the NLRA; however, the court concluded that Local 174 did not engage in protected conduct when the truck drivers ruined Glacier’s concrete. Id. at 11, 21.

The Washington Supreme Court reversed the Court of Appeals’ decision. Id. at 13. The court also relied on Garmon but concluded that a walkout “is a type of strike possibly protected by” the NLRA. Id. at 16. The court emphasized the importance of deferring to the NLRB when an activity is even “arguably” subject to the NLRA due to the agency’s expertise. Id. at 17-18. The court further determined that the Court of Appeals erred in applying the “local interest” exception to preemption. Id. at 19. The court noted the focus of the local interest exception inquiry is whether intimidation and violence were present to give the state a compelling interest in asserting jurisdiction. Id. at 19–20. The court concluded that the destruction of the concrete was not intimidation or violence. Id. at 20.

The Washington Supreme Court remanded the case with instructions to dismiss Glacier’s claims. Id. at 43. The Supreme Court of the United States granted Glacier certiorari on October 3, 2022. Brief for Petitioner, Glacier Northwest, Inc. at 3.

Analysis

WHETHER STRATEGICALLY-TIMED STRIKES ARE “ARGUABLY PROTECTED” UNDER THE NLRA

Glacier maintains that the striking drivers intentionally destroyed Glacier’s property by leaving the concrete to harden in the trucks. Brief for Petitioner, Glacier Northwest, Inc. at 17. Glacier argues that because intentional property destruction is not “arguably protected,” preemption is not required in this case under the Garmon rule, which states a claim is preempted by the NLRA when it involves conduct that is “arguably protected” under the NLRA. Id. Glacier contends that the “arguably” language in Garmon requires Local 174 to show that the NLRB could decide in its favor. Id. According to Glacier, a mere “conclusory assertion” does not suffice to show that an activity is arguably protected; instead, Glacier argues that Local 174 must show that its interpretation of the NLRA is not “plainly contrary” to the NLRA’s text and has not been “authoritatively rejected” by courts or the NLRB. Id.

Glacier maintains Local 174 cannot meet this burden. Id. at 18–21. First, Glacier points to the language of the NLRA and argues that protecting intentional destruction of property does not align with the Act’s goal: encouraging collective bargaining. Id. at 18. According to Glacier, “concerted activity” should be interpreted in light of the specific activities mentioned in the NLRA. Id. Glacier contends that because the mentioned activities are all “lawful, orderly, and nondestructive” activities, tortious activities––such as destroying concrete––fall outside the scope of concerted activities and are not preempted. Id. Second, Glacier argues that precedent makes it clear that employees have no right under the NLRA to engage in unlawful conduct. Id. at 19. Although Glacier concedes striking is a lawful activity, it maintains that employees cannot deliberately time a strike to maximize property damage and then claim NLRA protection. Id. at 20–21. Glacier asserts that the NLRB itself has recognized that striking employees must take “reasonable precautions” to avoid damage to their employer’s property. Id. at 21. Glacier claims that where, as here, employees intentionally destroy property through a strategically timed strike, they are not taking reasonable precautions. Id. at 21.

Glacier points to the “strikingly similar” case of NLRB v. Marshall Car Wheel & Foundry Co., which involved employees who timed a strike to occur right when molten iron needed to be poured off at a plant, making it likely that the strike would result in serious property damage. Id. at 20. The Fifth Circuit Court of Appeal concluded that the strike was not protected, and Glacier argues for the same result here. Id. at 20. Glacier distinguishes “ordinary work stoppages” and their resultant economic effects from strikes deliberately timed to inflict maximum damage. Id. at 30–31. Glacier also contends that damage to a company’s property is different than causing mere losses in profits. Id. at 31. According to Glacier, the requirement of reasonable precautions would be meaningless if there were a “federally protected right” to intentionally cause property destruction. Id. at 32.

Finally, Glacier contends it is inconsequential that the NLRB General Counsel issued a complaint against Glacier for unfair labor practices after the Washington Supreme Court found preemption. Id. at 36. Glacier argues that the complaint amounts to an “unreasonable” assertion of a “regional director” and is insufficient to rebut the text of the NLRA and legal precedent. Id.

Local 174 counters that, by issuing a complaint against Glacier, the NLRB General Counsel signaled the NLRB’s belief that Local 174’s conduct was “actually protected” under the NLRA. Brief for Respondent, International Brotherhood of Teamsters Local Union No. 174 at 17. According to Local 174, this makes it certain that the striking drivers’ actions were at least “arguably protected.” Id.

Local 174 further argues that, because its interpretation is not “plainly contrary” to the language of the NLRA and has not been “authoritatively rejected” by courts or the NLRB, the striking workers’ conduct was “arguably protected.” Id. at 16. Local 174 argues that the General Counsel’s independent investigation and the resultant NLRB complaint against Glacier indicates there is sufficient evidence that “the charges have merit.” Id. at 18. Local 174 contends that if the charges have merit, they must not be “plainly contrary” to the NLRA’s language and must not have previously been “authoritatively rejected.” Id. Local 174 also points out that deferring to the NLRB is a mere “jurisdictional hiatus,” because if the NLRB determines Local 174’s conduct was not protected, Glacier can proceed on its tort claims in state court. Id. at 15-16.

Local 174 argues that the drivers engaged in the “mere act of stopping work,” and did not intentionally destroy Glacier’s property. Id. at 15, 33. Local 174 contends that strikes are protected even if the timing results in economic harm or makes such harm foreseeable. Id. at 21. First, Local 174 points to the language of the NLRA, which states a strike is protected even if it causes an “interruption of operations.” Id. Second, Local 174 cites several cases where opportunistically timed strikes were deemed protected, including a strike at a poultry plant and a strike at a cheese factory timed to maximize product spoilage. Id. at 22–23. According to Local 174, in both the prior cases and on the present facts, there was no “affirmative” act that caused physical damage; instead, the workers merely stopped working. Id. at 22, 24. Local 174 contends that if those examples were “actually protected,” the circumstances here must be at least “arguably protected.” Id. at 23.

Local 174 points out that showing an interpretation has not been “authoritatively rejected” is a low bar. Id. at 24. Local 174 claims that even if Glacier can distinguish the cases that Local 174 cites, Local 174 should prevail because its position is not “authoritatively rejected.” Id. at 24-25. Local 174 argues that Glacier has provided no good reason why its loss of concrete is different than the economic losses at issue in the poultry and cheese cases described in the paragraph above. Id. at 25. According to Local 174, inflicting economic loss is the motivating reason of any protected strike, so the “purpose” is not distinguishable. Id. at 26. Additionally, Local 174 contends striking workers are not required to minimize harm or to give more notice than that which was given here. Id. at 27-28. Finally, Local 174 rebuts Glacier’s argument that striking employees must take “reasonable precautions.” Id. at 28. Local 174 argues that “reasonable precautions” have only been required where there is a “danger of aggravated injury to persons or premises,” such as in the case Glacier cites involving molten iron. Id. at 28-29. Local 174 maintains that the truck drivers put no one at risk of injury with their actions. Id. at 29-30. Therefore, Local 174 concludes “reasonable precautions” were not necessary for the striking drivers’ actions to be “arguably protected.” Id.

THE LOCAL INTEREST EXCEPTION TO PREEMPTION

Glacier highlights that the local interest exception to preemption provides that where an activity implicates interests that are “deeply rooted in local feeling and responsibility,” states are not preempted from providing damages for injury caused by the activity. Brief for Petitioner at 23. Glacier argues that, even if Local 174’s intentional destruction of Glacier’s concrete is “arguably protected,” the local interest exception applies to exempt Glacier’s tort claims from preemption. Id. According to Glacier, tortious conduct––including intentional destruction of property––has long been recognized as an area of local interest for states. Id. Glacier argues that the NLRA is consistent with this long-recognized principle and maintains that, as the Supreme Court has “repeatedly recognized,” states have an interest in preventing property damage. Id. at 24. Glacier further contends that the exception is not limited to situations that involve violence but has also been applied in non-violent tortious contexts such as intentional infliction of emotional distress, libel, and trespass cases. Id. at 25–26, 28–29. Glacier points out that the NLRA cannot provide damages for injury caused by tortious activity, meaning the state has a heightened interest in hearing the case to provide damages and prevent further “disrespect for the law” from occurring. Id. at 26.

Local 174 responds that the local interest exception applies only where conduct is “arguably prohibited,” not where it is “arguably protected.” Brief for Respondent at 31–32. According to Local 174, a state cannot regulate “conduct that Congress intended to protect,” and that risk is always present when conduct is “arguably protected.” Id. Further, Local 174 argues that the remedy issue Glacier points to is illusory because if Local 174’s activity was indeed protected, Washington state could not provide damages anyway, and if the activity turns out to be unprotected, Glacier can then seek damages in state court. Id. at 32. Additionally, Local 174 contends that even if the local interest exception is extended to “arguably protected” cases, mere work stoppages would not be enough for the local interest exception to apply, since there must be “violence and imminent threats to the public order” for the exception to apply. Id. at 34.

Discussion

BALANCING EMPLOYER AND UNION BARGAINING POWER

Coalition for a Democratic Workplace et al. (“Coalition”), in support of Glacier, argues that authorizing unlawful methods of creating economic pressure would give unions an overwhelming bargaining advantage. See Brief of Amici Curiae Coalition For A Democratic Workplace et al. ("Coalition"), in Support of Petitioner at 18. While the Coalition acknowledges that the NLRA authorizes unions to inflict economic harm upon employers via strikes as a legitimate bargaining tactic, it argues that Congress assumed unions would be limited to lawful economic weapons. Id. at 17–18. The Coalition asserts that tortious intentional destruction of property is too powerful a weapon because employers would bear not just financial but also logistical and reputational harms. Id. at 18. The Coalition concludes that unions would use their newfound bargaining power to drive unfair substantive changes in collective bargaining agreements. Id. at 18.

Landmark Legal Foundation (“Landmark”), in support of Glacier, argues that the NLRA cannot authorize intentional property destruction because Congress intended to prevent industrial strife. See Brief of Amicus Curiae Landmark Legal Foundation, in Support of Petitioner at 2, 9. Landmark thus argues that tortious intentional destruction of property cannot be a legitimate bargaining tactic. Id. at 11. Landmark adds that preventing effective relief from torts encourages disrespect for the law and encourages employers to take matters into their own hands. Id. at 17.

United Brotherhood of Carpenters and Joiners of America et al. (“Brotherhood”), in support of Local 174, counters that the balance of bargaining power includes the right to strike and the incidental loss of perishable products. See Brief of United Brotherhood of Carpenters and Joiners of America and Service Employees International Union as Amici Curiae, in Support of Respondent at 24. The Brotherhood maintains that strikes inherently function by inflicting economic loss and pressure on employers. Id. at 23–24. The Brotherhood suggests that, because Glacier produces perishable concrete on an ongoing basis, any strike by the trucker’s union was bound to cause property damage. Id. at 24, 26. The Brotherhood concludes that recognizing tort liability would disincentivize strikes and erode the congressional balance of negotiating power in industries involving perishable products. Id. at 25.

Professors Matthew Bodie, Catherine Fisk, and Charlotte Garden et al. (“Professors”), in support of Local 174, argue that the NLRA structures the collective bargaining process to allow employers and unions to resort to economic weapons. See Brief of Amici Curiae Professors Matthew Bodie, Catherine Fisk, and Charlotte Garden et al. ("Professors"), in Support of Respondent at 7. The Professors note that the NLRA and its amendments impose only a few targeted restrictions on the use of economic weapons. Id. at 6, 8. The Professors assert that the threat of a sudden damaging strike powerfully incentivizes employers to agree to improvements in wages or working conditions. Id. at 8. The Professors argue that additional state-imposed limitations on unions’ right to engage in sudden strikes would violate Congress’ judgment and upset the congressionally sanctioned balance in bargaining power. Id. at 7, 13.

RESOLVING LABOR DISPUTES IN THE PROPER FORUM

The Coalition argues that depriving employers of their ability to bring tort claims arising out of labor disputes in state court leaves them entirely without recourse and undermines the states’ traditional role in protecting their citizens’ rights. See Brief of Coalition at 13–15, 19. The Coalition observes that the NLRB cannot award damages for torts, meaning that employers who suffer tortious harms and whose claims are preempted cannot recover. Id. at 13–15. The Coalition adds that intentional destruction of property in labor disputes imposes collateral harms on local communities, thus generating local interest. Id. at 19. According to the Coalition, local communities suffer from shortages of jobs, goods, and services that result from destructive labor disputes. Id. The Coalition adds that employers will pass on the cost of potential property damage to employees and consumers via decreased wages and increased prices. Id.

The Professors, in contrast, argue that the NLRA conferred primary jurisdiction on the NLRB to adjudicate labor disputes and resolve claims arising from use of economic weapons. See Brief of Professors at 17. The Professors assert that, following the Gilded Age, Congress intentionally stripped the courts of jurisdiction to decide the permissibility of labor strikes. Id. at 18. The Professors add that decades of NLRB precedent facilitate clear and nationally uniform application of labor law. Id. at 18, 28. Administrative Law, Constitutional Law, and Federal Courts Professors, in support of Local 174, add that the NLRB is the superior forum because it possesses unique expertise to adjudicate labor disputes. See Brief of Amici Curiae Administrative Law, Constitutional Law, and Federal Courts Professors, in Support of Respondent at 19–20.