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D.C. Federal Court avoids challenge to Obama’s NLRB recess appointments

Posted in CFPB People

Until someone has standing to challenge President Obama’s recess appointment of Richard Cordray as Director of the Bureau, people with an interest in the issue have been following challenges to Obama’s three contemporaneous recess appointments to the NLRB. Last week, in the first of two cases making such a challenge, Judge Amy Berman Jackson avoided deciding the constitutional question, which she characterized as a “political dispute” without invoking the political question doctrine, and relied instead on procedural and substantive labor law grounds. Her opinion can be found here.

Plaintiffs in the case filed a motion in January seeking leave to amend their August 2011 complaint in order to add the recess appointment challenge and arguing, in effect, that the NLRB as currently constituted had no authority to enforce or implement the rule that was the focus of the dispute. While acknowledging that, generally speaking, leave to amend a complaint is freely granted, Judge Jackson ruled that this case fell within the futility exception. The NLRB rule plaintiffs had challenged had been validly promulgated by an NLRB operating with a quorum, any injuries that plaintiffs might suffer from future enforcement of the rule were speculative and not ripe for decision, and any such enforcement would be initiated under the National Labor Relations Act not by the Board itself but under delegated authority to the General Counsel or his designee, the appropriate NLRB regional director.

A second, more recently filed case challenging Obama’s NLRB recess appointments is pending in the Eastern District of New York. See Paulsen v. Renaissance Equity Holding LLC, No. 12-cv-350 (E.D.N.Y., filed Jan. 25, 2012).