A federal judge in Chicago on Friday seemed skeptical of a medical center's claim that National Labor Relations Board members and administrative judges are improperly insulated from removal by the president, an argument that has been raised in a series of cases filed this year claiming that the NLRB's structure is unconstitutional.
U.S. District Judge Jeffrey Cummings held a two-hour-long hearing on a motion by Alivio Medical Center, a nonprofit that serves Chicago's Hispanic community, to block an NLRB administrative case against the company from proceeding pending the outcome of its lawsuit challenging the agency's structure.
Alivio is accused in the board case of failing to bargain with a union before firing workers who allegedly provided false information to establish their legal authorization to work in the United States. The company, which faces a hearing before an administrative judge scheduled for later this month, says that federal immigration law required it to terminate the workers.
Alivio in its motion cited separate July rulings by federal judges in Texas temporarily blocking NLRB cases against rocket maker SpaceX and pipeline operator Energy Transfer. The judge in the SpaceX case said that removal protections for administrative judges and NLRB members were likely invalid, while the other decision addressed only administrative judges.
Cummings on Friday noted that the Texas judges said they were bound by a 2022 5th U.S. Circuit Court of Appeals decision in Jarkesy v. U.S. Securities and Exchange Commission, which said administrative judges at the SEC were not properly appointed.
But there are important distinctions between SEC and NLRB judges, Cummings said, and the Jarkesy ruling does not bind courts outside of the 5th Circuit, which covers Texas, Louisiana, and Mississippi.
"If I were sitting in San Antonio or Austin or Lubbock, I might feel the same way. But I'm here and I can disagree with the 5th Circuit," said Cummings, an appointee of Democratic President Joe Biden.
Cummings also said that the Denver-based 10th Circuit had recently rejected the conclusions in Jarkesy in a case involving the U.S. Consumer Product Safety Commission, and that split among appeals courts suggested that Alivio could not show the likelihood of success necessary to win a temporary injunction.
The U.S. Supreme Court in June affirmed a different part of the Jarkesy ruling that said SEC administrative proceedings violate defendants' right to a jury trial but did not take up arguments involving the agency's administrative judges.
Cummings said he planned to issue a ruling next week.
Alivio's lawsuit is one of more than a dozen making similar claims about the board's structure. The challenges grew out of a broader attack by conservative groups on the powers of federal administrative agencies, including the in-house proceedings that the NLRB and many other agencies rely on to enforce federal laws.
Scott Cruz, a lawyer for Alivio, maintained on Friday that NLRB judges and board members wield significant executive powers, and so the U.S. Constitution requires that they be held accountable to the president.
NLRB lawyer David Boehm countered that decades of U.S. Supreme Court precedent have upheld in-house agency proceedings, and said blocking the board case against Alivio would set dangerous precedent that would likely spur more challenges to the board's authority.
“Under their theory, any person with a case before the board can stop a proceeding from going forward and [unions and workers] wouldn't have any forum to adjudicate their rights,” Boehm said.
The case is Alivio Medical Center v. NLRB, U.S. District Court for the Northern District of Illinois, No. 1:24-cv-07217.
For Alivio: Grant Pecor of Barnes & Thornburg; Scott Cruz of UB Greensfelder
For the NLRB: David Boehm
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