Amicus Brief: Starbucks Corporation v. M. Kathleen McKinney

Washington, DC (February 28, 2024) – Today, the New Civil Liberties Alliance filed an amicus curiae brief at the Supreme Court in Starbucks Corp. v. McKinney, a case challenging a deferential legal standard that allows the National Labor Relations Board to enjoin a company’s conduct without showing that it likely broke the law. Instead, NLRB can initiate an administrative enforcement proceeding and then obtain a preliminary injunction in federal district court just by demonstrating that (1) its claims are not frivolous, and (2) those claims serve NLRB’s remedial purposes. The U.S. Court of Appeals for the Sixth Circuit upheld the injunction granted below due to prior circuit precedent. NCLA’s brief asks the Supreme Court to reject this textually baseless test, reverse the Sixth Circuit’s ruling, and require NLRB to satisfy the same injunction standard as every other litigant.

The Supreme Court has clarified, in many other contexts, that federal courts may not issue preliminary injunctions unless the party seeking the P.I. has met four requirements: (1) it is likely to succeed on the merits; (2) it would suffer irreparable injury absent an injunction; (3) the balance of equities favors an injunction; and (4) an injunction serves the public interest. The same test should apply here. Yet five federal circuits apply a relaxed standard when NLRB seeks a preliminary injunction, permitting it to punish an employer based on legal and factual allegations that do not meet the usual test. These courts uphold an injunction even if NLRB’s claims are more likely than not meritless and even when doing so disproportionately burdens the enjoined employer.

The National Labor Relations Act does not support this practice, and the special P.I. standard NLRB enjoys does not apply to any other federal agency. The unique test also defies the Fifth Amendment’s prohibition against the deprivation of property without due process of law. Under the Sixth Circuit’s approach, NLRB can obtain a punitive injunction that forces Starbucks to retain and pay unwanted employees for an indefinite period—resulting in a loss of the company’s property—without the agency ever having to prove even a likely violation of law.

This “reasonable cause” test employed by the lower courts exhibits improper judicial deference to NLRB’s legal theories, a problem NCLA is addressing separately in the pending Supreme Court case Relentless Inc. v. Department of Commerce. In fact, because the “reasonable cause” test is even more deferential to agencies than Chevron deference, and the Supreme Court has never endorsed the idea, the case for rejecting it is even stronger.

Once it secures a preliminary injunction under the inappropriately relaxed standard, NLRB has every incentive to drag out administrative proceedings, because it has already forced the employer to do what the Board wants. Meanwhile, the P.I. imposes mounting economic costs on the employer for the duration of the administrative proceedings, whose length is entirely within NLRB’s control. Capitulation is often a company’s only viable option to stanch the financial bleeding. NCLA asks the Supreme Court to eliminate this coercive dynamic and force NLRB to meet the traditional preliminary injunction standard rather than the Sixth Circuit’s preferential version.

NCLA released the following statements:

“By deferring to NLRB’s factual and legal theories, the Sixth Circuit allows the Board to obtain costly preliminary injunctions against employers even when the presiding judge concludes that the Board’s allegations are likely meritless, turning the constitutional principle on its head that the government may not deprive someone of property without due process of law.”
— Sheng Li, Litigation Counsel, NCLA

“The Sixth Circuit’s odd, NLRB-specific preliminary injunction standard sets an absurdly low bar for the Board to clear. The Supreme Court should overturn this non-statutory, judge-made test and instead require NLRB to satisfy the same factors that apply to preliminary injunction requests by (and against) every other federal agency.”
— Mark Chenoweth, President, NCLA

For more information visit the amicus page here.

ABOUT NCLA

NCLA is a nonpartisan, nonprofit civil rights group founded by prominent legal scholar Philip Hamburger to protect constitutional freedoms from violations by the Administrative State. NCLA’s public-interest litigation and other pro bono advocacy strive to tame the unlawful power of state and federal agencies and to foster a new civil liberties movement that will help restore Americans’ fundamental rights.

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Washington, DC (January 12, 2024) – Today, the U.S. Supreme Court took NCLA’s advice and agreed to hear Starbucks’s case against the National Labor Relations Board (NLRB) for depriving the company of property without due process of law via an administrative enforcement proceeding. NLRB used a preliminary injunction it obtained in federal district court without ever establishing that Starbucks likely broke the law. The U.S. Court of Appeals for the Sixth Circuit upheld the injunction per a textually baseless doctrine that allows NLRB to effectively punish an employer based on legal and factual allegations that fall far short of meeting the usual preliminary injunction standard. NCLA filed an amicus curiae brief in Starbucks Corp. v. McKinney, asking the Justices to grant cert, reverse the Sixth Circuit, and overturn NLRB’s special injunction standard.

The Supreme Court has clarified, in many different contexts, that federal courts may not issue preliminary injunctions unless the party seeking the P.I. has met four requirements: (1) it is likely to succeed on the merits; (2) it would suffer irreparable injury absent an injunction; (3) the balance of equities favors an injunction; and (4) an injunction serves the public interest. Yet, five federal circuit courts, including the Sixth Circuit below, apply a far more relaxed standard when NLRB seeks a preliminary injunction. These courts uphold an injunction if NLRB’s claims are not frivolous—even if they are more likely than not meritless—and where it serves NLRB’s remedial powers, even if it inflicts disproportionate burdens on the enjoined employer.

The National Labor Relations Act does not support this practice, and the special P.I. standard defies the Fifth Amendment’s prohibition against the deprivation of property without due process of law. Under the Sixth Circuit’s approach, NLRB can obtain a punitive injunction that forces Starbucks to retain and pay unwanted employees for an indefinite period—without the government having to prove even a likely violation of law.

Once it secures a preliminary injunction under this inappropriately relaxed standard, NLRB has every incentive to drag out proceedings, because it has already forced the employer to do what the Board wants. Meanwhile, the P.I. imposes mounting economic costs on the employer for the duration of the administration proceeding, which is entirely within NLRB’s control. Capitulation is often the company’s only viable option to stanch the bleeding. NCLA asked the Supreme Court to eliminate this coercive dynamic and will continue to stand strong against civil liberties violations by NLRB, the Department of Commerce, and other administrative agencies.

NCLA released the following statements:

“For years, NLRB has been able to obtain injunctions against employers whom it targets for administrative enforcement based on flimsy evidence and legal arguments that would not hold water in any other context. It then uses these injunctions to force targeted employers to settle on unfavorable terms. Several circuit courts have already closed this loophole by requiring NLRB to follow the same injunction standard that applies to everyone else. Now, the Supreme Court has an opportunity to end this abusive practice nationwide.”
— Sheng Li, Litigation Counsel, NCLA

“NLRB’s sui generis preliminary injunction standard is a judge-made departure from the norm. Like Chevron deference, which the Court will tackle next week in Relentless, it creates systematic judicial bias for the government. NCLA is delighted the Court will consider whether federal agencies should get equal footing with all other litigants—from Fortune 500 companies like Starbucks to smaller fry like NCLA’s Relentless clients.”
— Mark Chenoweth, President and Chief Legal Officer, NCLA

For more information visit the amicus page here.

ABOUT NCLA

NCLA is a nonpartisan, nonprofit civil rights group founded by prominent legal scholar Philip Hamburger to protect constitutional freedoms from violations by the Administrative State. NCLA’s public-interest litigation and other pro bono advocacy strive to tame the unlawful power of state and federal agencies and to foster a new civil liberties movement that will help restore Americans’ fundamental rights.

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Washington, DC (November 7, 2023) – The National Labor Relations Board (NLRB) has deprived Starbucks of property without due process of law via an administrative enforcement proceeding, utilizing a preliminary injunction it obtained without even establishing that the company likely broke the law. The U.S. Court of Appeals for the Sixth Circuit upheld the district court injunction per a textually baseless doctrine that allows an employer to be punished based on legal and factual allegations that fall far short of meeting the ordinary preliminary injunction standard. The New Civil Liberties Alliance has filed an amicus curiae brief urging the U.S. Supreme Court to hear the Starbucks Corp. v. McKinney case, reverse the Sixth Circuit’s error, and overturn the injunction.

The Supreme Court has made clear, in a variety of statutory contexts, that federal courts may not issue preliminary injunctions unless the party seeking the injunction has met four requirements. It must establish that: (1) it is likely to succeed on the merits; (2) it would suffer irreparable injury absent an injunction; (3) the balance of equities favors an injunction; and (4) an injunction serves the public interest. Yet, five federal circuit courts, including the Sixth Circuit, apply a far more relaxed standard when NLRB seeks a preliminary injunction against an employer. They uphold an injunction if NLRB’s claims are not frivolous—even if they are more likely than not meritless—and where it serves NLRB’s remedial powers, even if it inflicts disproportionate burdens on the employer.

The National Labor Relations Act does not support this practice, and it defies the Fifth Amendment’s guarantee that no property shall be taken without due process of law. Under the Sixth Circuit’s approach, NLRB can obtain a punitive injunction that forces Starbucks to retain and pay unwanted employees for an indefinite period—without the government having to prove even a likely violation of law. This judge-made departure from the usual preliminary injunction standard amounts to systematic judicial bias in favor of injunctions being sought by NLRB.

After securing a preliminary injunction under this inappropriately relaxed standard, NLRB has every incentive to drag out proceedings because it has already halted the conduct it opposes. Meanwhile, the injunction imposes mounting economic costs on the employer for the duration of the administration proceeding, which is entirely within NLRB’s control. Capitulation is often the company’s only viable option. NCLA asks the Supreme Court to eliminate this coercive dynamic, which exemplifies many deep-seated problems in the Administrative State.

NCLA released the following statements:

“Obtaining a preliminary injunction is often the whole ballgame in an NLRB administrative enforcement action. Such burdensome injunctions can last for as long as NLRB wants because the agency controls the pace of the enforcement proceeding. Yet, the Sixth Circuit hands out injunctions like Halloween candy. Under its atexual, judge-made standard, NLRB may obtain an extremely expensive injunction against an employer even if the district court concludes NLRB’s claims are most likely meritless. So, NLRB can bring meritless claims against an employer, get an injunction from a court, and use it to coerce an employer to admit to the meritless allegations.”
— Sheng Li, Litigation Counsel, NCLA

“The Starbucks v. McKinney case provides an excellent vehicle to correct a lopsided evil in American labor law. There is no good reason why NLRB—or any other federal agency—should be able to obtain a preliminary injunction under a flimsier standard than every other litigant must meet. Administrative law is chock-full of judge-made doctrines like this one that lack statutory support and defy due process of law. Congress never authorized such a rule, and the Constitution forbids this farce. It is high time for the High Court to right this wrong.”
— Mark Chenoweth, President and General Counsel, NCLA

For more information visit the amicus page here.

ABOUT NCLA

NCLA is a nonpartisan, nonprofit civil rights group founded by prominent legal scholar Philip Hamburger to protect constitutional freedoms from violations by the Administrative State. NCLA’s public-interest litigation and other pro bono advocacy strive to tame the unlawful power of state and federal agencies and to foster a new civil liberties movement that will help restore Americans’ fundamental rights.

Download the full document