SETON v. NATIONAL LABOR RELATIONS BOARD (2024)

ORDER

Consistent with this Court's Order granting a preliminary injunction in Space Exploration Technologies Corp. v. National Labor Relations Board, No. W-24-CV-00203-ADA, ––– F.Supp.3d ––––, 2024 WL 3512082 (W.D. Tex. July 23, 2024), and upon consideration of Plaintiff Ascension Seton's (“Ascension”) Motion for Preliminary Injunction (ECF No. 2) and the National Labor Relations Board's (“NLRB”) response in opposition (ECF No. 22), it is hereby ordered that the Motion for Preliminary Injunction is GRANTED.

The Court notes that the primary issue raised in Plaintiff's Motion—the constitutionality of removal protections for NLRB Members and administrative law judges (ALJs)—is currently on appeal at the Fifth Circuit. See Amazon.com Services LLC v. NLRB, No. 24-50761 (5th Cir. Sept. 30, 2024). This Court's decision in Space Exploration is also on appeal at the Fifth Circuit. See Space Exploration Techs. Corp. v. NLRB, No. 24-50627 (5th Cir. 2024). Upon the Fifth Circuit's ruling in either case, this Court will reconsider the Preliminary Injunction in light of the Fifth Circuit's guidance. In the interim, for the purpose of preserving the status quo and avoiding irreparable harm, this Court grants Plaintiff's Motion for Preliminary Injunction (ECF No. 2).

I. BACKGROUND

Ascension's Motion seeks to enjoin the NLRB's administrative proceedings against it. Pressingly, Ascension seeks to enjoin the administrative hearing scheduled for October 8, 2024, in NLRB causes 16-CA-307709 and 16-CA-308153. ECF No. 2-2 at 10.

In November and December of 2022, charges were filed with the NLRB alleging that Ascension committed unfair labor practices. Id. at 5. On April 17, 2024, the NLRB issued an order consolidating the cases and setting an ALJ hearing on October 8, 2024. Ascension filed its Motion for Preliminary Injunction on September 19, 2024, to enjoin the NLRB proceedings. ECF No. 2. The NLRB filed a response in opposition to Ascension's motion on October 3, 2024. ECF No. 22. The Court held a hearing on October 7, 2024, to hear the arguments of both parties. ECF No. 31.

II. LEGAL STANDARD

“A plaintiff seeking a preliminary injunction must establish that he is likely to succeed on the merits, that he is likely to suffer irreparable harm in the absence of preliminary relief, that the balance of equities tips in his favor, and that an injunction is in the public interest.” Winter v. Nat. Res. Def. Council, Inc., 555 U.S. 7, 20, 129 S.Ct. 365, 172 L.Ed.2d 249 (2008). These elements are not examined in isolation but balanced in consideration of each other. State of Texas v. Seatrain Int'l, S.A., 518 F.2d 175, 180 (5th Cir. 1975).

III. DISCUSSION

a. Plaintiff has shown a substantial likelihood of success on the Merits.

This Court finds that Ascension has shown a likelihood of success on the merits of one or more of its claims. This Court has previously determined that there was a substantial likelihood of success on the merits with regards to showing that NLRB ALJs and Members are unconstitutionally protected from removal. Space Expl., ––– F.Supp.3d at ––––, 2024 WL 3512082, at *3–4. Counts one and two of Ascension's complaint allege that NLRB ALJs and Members, respectively, are unconstitutionally insulated from removal. ECF No. 1 at ¶¶ 45–82. Ascension thereby presents the same issue the Court addressed in Space Exploration, and the Court sees no reason to depart from its prior determination or the reasoning set forth therein. See Space Exploration, ––– F.Supp.3d at ––––, 2024 WL 3512082, at *3.

The NLRB insists that even if the challenged removal restrictions are unconstitutional, Collins v. Yellen, 594 U.S. 220, 141 S.Ct. 1761, 210 L.Ed.2d 432 (2021) compels Ascension to show something it has not shown: that the President has sought to remove the ALJ assigned to this case. This Court agrees with the NLRB to the extent that Collins requires a court to determine whether an unconstitutional removal provision has caused, or is set to cause, harm to the plaintiff. However, the Court disagrees that Collins requires a showing that the President has sought to remove the ALJ assigned to this case. This same issue has been addressed in Energy Transfer, LP v. National Labor Relations Board, NO. 3:24-CV-198, ––– F.Supp.3d ––––, 2024 WL 3571494 (S.D. Tex. July 29, 2024). The court in Energy Transfer ultimately found that Collins did not require a plaintiff to show that the President has sought to remove the ALJ assigned to a case. See Energy Transfer, ––– F.Supp.3d at ––––, 2024 WL 3571494, at *4. Instead, Collins only required a court to determine whether an unconstitutional removal provision has caused, or is set to cause, harm to the plaintiff. Id. The court would ultimately conclude that “[f]or removal-restriction claims that seek relief before an insulated actor acts, it is not that Collins’s causal-harm requirement is altogether inapplicable, but rather that it is readily satisfied.” Id. This Court adopts the Energy Transfer court's reasoning that Collins’s causal-harm requirement is satisfied when a removal-restriction claim is brought before the insulated actor acts.

Ascension's alleged harm is not the threat of being subjected to a particular action, but rather, being forced to participate in a constitutionally defective administrative process. And it is the removal provisions that protect the NLRB ALJ's and Members that create the constitutional defect.

b. Plaintiff has sufficiently demonstrated that not issuing a preliminary injunction will result in an irreparable injury.

This Court also finds a likelihood of irreparable harm in the absence of preliminary injunctive relief. As the Supreme Court has stated, “being subjected to unconstitutional agency authority—a proceeding by an unaccountable ALJ․ is a here-and-now injury” that is “impossible to remedy once the proceeding is over.” Axon Enter., Inc. v. FTC, 598 U.S. 175, 191, 143 S.Ct. 890, 215 L.Ed.2d 151 (2023) (internal quotation marks omitted). In Axon, “[t]he claim, again, is about subjection to an illegitimate proceeding, led by an illegitimate decisionmaker.” Id. Ascension has made the same claim. Even though the agency's order could be vacated after the proceeding, a “separation-of-powers claim” challenging unconstitutional removal protections “is not about that order” but about avoiding “an illegitimate proceeding.” Id.

Ascension is currently scheduled for a hearing before an NLRB ALJ on October 8, 2024. ECF No. 2-2 at 2. This Court finds that subjecting Ascension to a hearing before a potentially unconstitutionally protected agency official satisfies the irreparable harm requirement.

The NLRB argues that Axon does not address injunctive relief and is narrowly tailored to jurisdiction over structural constitutional challenges. This Court acknowledges that Axon examined injury for jurisdictional purposes and not in the injunction context, but that does not change the Court's conclusion. This Court takes the Axon Court at its word when it stated that “being subjected to” “a proceeding by an unaccountable ALJ” is an injury that “cannot be undone.” Axon, 598 U.S. at 191, 143 S.Ct. 890. A harm that “cannot be undone” is by definition irreparable.

c. The balance of the harms and public interest weighs in favor of issuing a preliminary injunction.

Lastly, the Court finds that the balance of the harms and public interest weighs in favor of the injunction. Where the government is a defendant, the harm to the opposing party and public interest factors merge. Nken v. Holder, 556 U.S. 418, 435, 129 S.Ct. 1749, 173 L.Ed.2d 550 (2009). The government suffers no cognizable harm from stopping “the perpetuation of unlawful agency action.” League of Women Voters of U.S. v. Newby, 838 F.3d 1, 12 (D.C. Cir. 2016). Nor would an injunction preventing unlawful agency action “disserve the public interest.” Louisiana v. Biden, 55 F.4th 1017, 1022 (5th Cir. 2022). It is not in the public interest to have an increasingly expansive Executive Branch that “slip[s] from the Executive's control, and thus from that of the people.” Free Enter. Fund v. Pub. Co. Acct. Oversight Bd., 561 U.S. 477, 499, 130 S.Ct. 3138, 177 L.Ed.2d 706 (2010). Here, the balance of the harms to the opposing party and the public interest weighs in favor of granting a preliminary injunction.

IV. CONCLUSION

In conclusion, Ascension has met all the requirements for a preliminary injunction, and its Motion for Preliminary Injunction is hereby GRANTED.

IT IS ORDERED that all administrative proceedings in National Labor Relations Board Cases 16-CA-307709 and 16-CA-308153, including without limitation any hearing before an ALJ, are hereby stayed and enjoined in all respects pending further order of this Court.

Alan D Albright, United States District Judge