Brooklyn Worker Dispute Seen as Test of Obama’s Labor Board Appointments

A dispute over working conditions at a Brooklyn apartment complex may be a test case for whether President Barack Obama’s appointments to the National Labor Relations Board are legal.

Lawyers for the Flatbush Gardens apartments, including Paul Clement, a solicitor general and acting attorney general for President George W. Bush now with the Washington law firm Bancroft PLLC, have asked a court to throw out the board’s complaint in the case.

“The Board lacked a quorum and has no authority to file the petition because three of its putative members have not been validly appointed,” Clement alleges in the filing.

Obama appointed three members to the board on Jan. 4 without seeking Senate confirmation, asserting that the chamber was in recess. A president is permitted to make appointments without confirmation during a recess, though Republicans dispute that was the case on Jan. 4.

In response to the appointments, some lawmakers said they would intensify their investigation of the NLRB, which retained a Democratic majority, and Republican presidential candidate Newt Gingrich called for stripping funding from the board because of Obama’s move.

NLRB Complaint

“The administration strongly believes that the president’s exercise of his recess appointment authority -- authority expressly granted to him by the Constitution and exercised by all recent presidents -- is valid and will be upheld by the courts,” White House spokesman Eric Schultz said today in an e- mail.

The Flatbush case was the subject of a hearing yesterday in U.S. District Court for the Eastern District of New York during which Judge Roslynn Mauskopf recused herself, citing personal reasons, Nancy Cleeland, an NLRB spokeswoman, said yesterday.

The Service Employees International Union 32BJ is seeking an injunction to end a lockout of 70 of its members. The union complained that the workers were blocked from their jobs in November 2010 after they refused to accept a 30 percent cut in pay and benefits. The union is seeking an order reinstating its members at their prior wages and alleges the company improperly concealed $37 million in payments to shareholders during negotiations.

‘Legitimate Board’

The NLRB, which mediates labor disputes, filed the complaint in federal court on Jan. 25.

The labor board started this year with two members, too few to make decisions or issue rulings. Obama then appointed Sharon Block, Richard Griffin and Terence Flynn. All had been nominated earlier, though the Senate hadn’t acted.

“The chairman has said, from his perspective, this is a legitimate board and they are doing their job,” Cleeland said.

In a separate lawsuit in Washington, trade groups, including the National Association of Manufacturers and the National Right to Work Legal Defense and Education Foundation Inc., today asked a federal judge to rule on the legality of the appointments, saying they were “invalid” and “threaten to harm” millions of employers and workers. The filing was related to a suit brought by the groups seeking to block a rule mandating companies notify workers of their rights to form a union.

Flatbush Gardens said in its filings that the Senate never adjourned. The president doesn’t have the authority to decide when the Senate is in session, it says.

‘Fundamental Principles’

“Our Constitution’s most fundamental principles of separation of powers prohibit one branch from overriding the determinations of another about its own proceedings,” the Flatbush lawyers wrote in their filing.

A Jan. 6 memo by the Justice Department concluded that a president can make recess appointments when lawmakers hold pro forma sessions without conducting business, such as on Jan. 4.

“They were certainly in a formal way in session, though the administration will take the view that this was more or less fiction,” said Jesse Choper, a law professor at the University of California at Berkeley, who isn’t involved in the case.

Challenges may continue until courts provide definitive guidance, Choper said in a telephone interview. If this case doesn’t serve as the test case, others will, he said.

The NLRB claims that no matter what the courts say about the recess appointments, the complaint against the Brooklyn complex should not be thrown out. The NLRB’s general counsel also had agreed to bring a complaint, which is enough authority even without the board, Cleeland, the NLRB spokeswoman, said.

“The employer is trying to raise this issue in the litigation,” said Matthew Nerzig, a spokesman for the union, said in an e-mail. “There are good reasons why the court does not need to consider the issue, but in the end it may do so.”

The legal filing was previously reported by Crain’s New York Business.

The cases are Paulsen v. Renaissance Equity Holdings LLC, 12cv350, U.S. District Court for the Eastern District of New York (Brooklyn), and National Association of Manufacturers v. National Labor Relations Board, 11-cv-01629, U.S. District Court, District of Columbia (Washington).

To contact the reporter on this story: William McQuillen in Washington at bmcquillen@bloomberg.net

To contact the editor responsible for this story: Jon Morgan at jmorgan97@bloomberg.net

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