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US Supreme Court asked to weigh in on challenge to NLRB's structure
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US Supreme Court asked to weigh in on challenge to NLRB's structure
Oct 17, 2024 12:27 PM

Oct 14 (Reuters) - An auto parts maker on Monday urged

the U.S. Supreme Court to block a National Labor Relations Board

administrative case from proceeding against it while the company

pursues claims that the agency's structure violates the U.S.

Constitution.

The emergency application by Yapp USA Automotive Systems,

which is accused of illegally interfering with a union election

at a Michigan plant, marks what is likely the first time the

high court has been asked to consider claims being made in a

mounting number of lawsuits that the NLRB's in-house enforcement

proceedings are illegal.

Yapp asked the Supreme Court to rule on its application by

Tuesday, when the company is scheduled to face a hearing before

an NLRB administrative law judge.

The application will be handled by conservative Justice

Brett Kavanaugh, who oversees requests arising from states

covered by the Cincinnati-based 6th U.S. Circuit Court of

Appeals, including Michigan. Kavanaugh could deny the

application, request additional briefing or refer it to the full

court for further action.

A federal judge in Michigan last month refused to block the

NLRB case against Yapp from proceeding, ruling that the company

was unlikely to prevail on its claims that the board's

administrative judges and its five members are improperly

shielded from at-will removal by the president. Yapp says that

because those officials wield executive power, the U.S.

Constitution requires that they be held accountable to the

president.

Yapp is appealing to the 6th Circuit, which on Sunday denied

the company's motion to stay the administrative case pending the

appeal.

An NLRB spokeswoman and lawyers for Yapp did not immediately

respond to requests for comment.

Nearly 20 other companies including Amazon.com ( AMZN ), Elon Musk's

SpaceX and pipeline operator Energy Transfer ( ET ) have filed similar

lawsuits attacking the NLRB's structure. Three judges in Texas

have temporarily blocked board cases from moving forward, while

at least four judges in other states have refused to do so.

The Texas judges, who are all appointees of Republican

former President Donald Trump, said they were bound by a 2022

5th U.S. Circuit Court of Appeals ruling in Jarkesy v. U.S.

Securities and Exchange Commission that said SEC administrative

judges were unconstitutionally insulated from removal. They said

that SEC judges are comparable to judges at the NLRB.

The Supreme Court affirmed the Jarkesy ruling on other

grounds in June and did not reach the issue of restrictions on

removal.

But the 6th Circuit, which is hearing Yapp's appeal, in a

separate 2022 case upheld removal protections for administrative

judges with the Federal Deposit Insurance Corporation.

U.S. District Judge Laurie Michelson in ruling against Yapp

last month said that the 6th Circuit decision made clear that

administrative judges can be shielded from at-will removal if

they only make non-final recommendations to agencies rather than

issuing final, binding decisions.

The case is Yapp USA Automotive Systems v. NLRB, U.S.

Supreme Court, No. 24A348.

For Yapp: Timothy Garrett of Bass, Berry & Sims; Matthew

Nelson of Warner Norcross + Judd

For the NLRB: Michael Dale

Read more:

US judge rejects auto parts maker's challenge to NLRB

structure

Amazon ( AMZN ) challenges US labor board's structure in lawsuit over

union election

NLRB, Macy's duel over US Supreme Court ruling's impact on

agency powers

US judge unlikely to block NLRB case pending challenge to

agency's powers

SpaceX wins block on US labor board case over severance

agreements

US judge blocks NLRB case against energy firm challenging

agency's structure

NLRB's Abruzzo hits back at 'low-road' companies challenging

agency's structure

SEC in-house judges violate right to jury trial, appeals

court rules

(Reporting by Daniel Wiessner in Albany, New York)

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