OPINION OF THE COURT
NEW PROCESS STEEL, L. P. V. NLRB
560 U. S. ____ (2010)
SUPREME COURT OF THE UNITED STATES
NO. 08-1457
NEW PROCESS STEEL, L. P., PETITIONER
v. NATIONAL LABOR RELATIONS BOARD
on writ of certiorari to the united states court of
appeals for the seventh circuit
[June 17, 2010]
Justice Stevens delivered the
opinion of the Court.
The Taft-Hartley Act, enacted in
1947, increased the size of the National Labor Relations Board
(Board) from three members to five. See 29 U. S. C. §153(a).
Concurrent with that change, the Taft-Hartley Act amended §3(b) of
the National Labor Relations Act (NLRA) to increase the quorum
requirement for the Board from two members to three, and to allow
the Board to delegate its authority to groups of at least three
members. See §153(b). The question in this case is whether,
following a delegation of the Board’s powers to a three-member
group, two members may continue to exercise that delegated
authority once the group’s (and the Board’s) membership falls to
two. We hold that two remaining Board members cannot exercise such
authority.
I
As 2007 came to a close, the
Board found itself with four members and one vacancy. It
anticipated two more vacancies at the end of the year, when the
recess appointments of Members Kirsanow and Walsh were set to
expire, which would leave the Board with only two members—too few
to meet the Board’s quorum requirement, §153(b). The four sitting
members decided to take action in an effort to preserve the Board’s
authority to function. On December 20, 2007, the Board made two
delegations of its authority, effective as of midnight December 28,
2007. First, the Board delegated to the general counsel continuing
authority to initiate and conduct litigation that would normally
require case-by-case approval of the Board. See Minute of Board
Action (Dec. 20, 2007), App. to Brief for Petitioner 4a–5a
(hereinafter Board Minutes). Second, the Board delegated “to
Members Liebman, Schaumber and Kirsanow, as a three-member group,
all of the Board’s powers, in anticipation of the adjournment of
the 1st Session of the 110th Congress.”
Id., at 5a. The
Board expressed the opinion that its action would permit the
remaining two members to exercise the powers of the Board “after
[the] departure of Members Kirsanow and Walsh, because the
remaining Members will constitute a quorum of the three-member
group.”
Ibid.
The Board’s minutes explain
that it relied on “the statutory language” of §3(b), as well as an
opinion issued by the Office of Legal Counsel (OLC), for the
proposition that the Board may use this delegation procedure to
“issue decisions during periods when three or more of the five
seats on the Board are vacant.” Id., at 6a. The OLC had
concluded in 2003 that “if the Board delegated all of its powers to
a group of three members, that group could continue to issue
decisions and orders as long as a quorum of two members remained.”
Dept. of Justice, OLC, Quorum Requirements, App. to Brief for
Respondent 3a. In seeking the OLC’s advice, the Board agreed to
accept the OLC’s answer regarding its ability to operate with only
two members,
id., at 1a, n. 1, and the Board in its
minutes therefore “acknowledged that it is bound” by the OLC
opinion. Board Minutes 6a
. The Board noted, however, that
it was not bound to make this delegation; rather, it had “decided
to exercise its discretion” to do so.
Ibid.
On December 28, 2007, the Board’s delegation
to the three-member group of Members Liebman, Schaumber, and
Kirsanow became effective. On December 31, 2007, Member Kirsanow’s
recess appointment expired. Thus, starting on January 1, 2008,
Members Liebman and Schaumber became the only members of the Board.
They proceeded to issue decisions for the Board as a two-member
quorum of a three-member group. The delegation automatically
terminated on March 27, 2010, when the President made two recess
appointments to the Board, because the terms of the delegation
specified that it would be revoked when the Board’s membership
returned to at least three members,
id., at 7a.
During the 27-month period in which the Board
had only two members, it decided almost 600 cases. See Letter from
Elena Kagan, Solicitor General, to William K. Suter, Clerk of Court
(Apr. 26, 2010). One of those cases involved petitioner New Process
Steel. In September 2008, the two-member Board issued decisions
sustaining two unfair labor practice complaints against petitioner.
See
New Process Steel, LP, 353 N. L. R. B.
No. 25 (2008);
New Process Steel, LP, 353
N. L. R. B. No. 13 (2008). Petitioner sought review
of both orders in the Court of Appeals for the Seventh Circuit, and
challenged the authority of the two-member Board to issue the
orders.
The court ruled in favor of the Government.
After a review of the text and legislative history of §3(b) and the
sequence of events surrounding the delegation of authority in
December 2007, the court concluded that the then-sitting two
members constituted a valid quorum of a three-member group to which
the Board had legitimately delegated all its powers. 564 F. 3d
840, 845–847 (CA7 2009). On the same day that the Seventh Circuit
issued its decision in this case, the Court of Appeals for the
District of Columbia announced a decision coming to the opposite
conclusion.
Laurel Baye Healthcare of Lake Lanier, Inc. v.
NLRB, 564 F. 3d 469 (2009). We granted certiorari to
resolve the conflict.[
Footnote
1] 558 U. S. ___ (2009).
II
The Board’s quorum requirements
and delegation procedure are set forth in §3(b) of the NLRA, 49
Stat. 451, as amended by 61 Stat. 139, which provides:
“The Board is authorized to
delegate to any group of three or more members any or all of the
powers which it may itself exercise. … A vacancy in the Board shall
not impair the right of the remaining members to exercise all of
the powers of the Board, and three members of the Board shall, at
all times, constitute a quorum of the Board, except that two
members shall constitute a quorum of any group designated pursuant
to the first sentence hereof.” 29 U. S. C. §153(b).
It is undisputed that the first
sentence of this provision authorized the Board to delegate its
powers to the three-member group effective on December 28, 2007,
and the last sentence authorized two members of that group to act
as a quorum of the group during the next three days if, for
example, the third member had to recuse himself from a particular
matter. The question we face is whether those two members could
continue to act for the Board as a quorum of the delegee group
after December 31, 2007, when the Board’s membership fell to two
and the designated three-member group of “Members Liebman,
Schaumber, and Kirsanow” ceased to exist due to the expiration of
Member Kirsanow’s term. Construing §3(b) as a whole and in light of
the Board’s longstanding practice, we are persuaded that they could
not.
The first sentence of §3(b), which we will
call the delegation clause, provides that the Board may delegate
its powers only to a “group of three or more members.” 61 Stat.
139. There are two different ways to interpret that language. One
interpretation, put forward by the Government, would read the
clause to require only that a delegee group contain three members
at the precise time the Board delegates its powers, and to have no
continuing relevance after the moment of the initial delegation.
Under that reading, two members alone may exercise the full power
of the Board so long as they were part of a delegee group that, at
the time of its creation, included three members. The other
interpretation, by contrast, would read the clause as requiring
that the delegee group
maintain a membership of three in
order for the delegation to remain valid. Three main reasons
support the latter reading.
First, and most fundamentally, reading the
delegation clause to require that the Board’s delegated power be
vested continuously in a group of three members is the only way to
harmonize and give meaningful effect to all of the provisions in
§3(b). See
Duncan v.
Walker,
533 U. S. 167, 174
(2001) (declining to adopt a “construction of the statute, [that]
would render [a term] insignificant”);
Market Co. v.
Hoffman,
101 U. S. 112, 115–116
(1879) (“[A] statute ought, upon the whole, to be so construed
that, if it can be prevented, no clause, sentence, or word shall be
… insignificant” (internal quotation marks omitted)). Those
provisions are: (1) the delegation clause; (2) the vacancy clause,
which provides that “[a] vacancy in the Board shall not impair the
right of the remaining members to exercise all of the powers of the
Board”; (3) the Board quorum requirement, which mandates that
“three members of the Board shall, at all times, constitute a
quorum of the Board”; and (4) the group quorum provision, which
provides that “two members shall constitute a quorum” of any
delegee group. See §153(b).
Interpreting the statute to require the
Board’s powers to be vested at all times in a group of at least
three members is consonant with the Board quorum requirement, which
requires three participating members “at all times” for the Board
to act. The interpretation likewise gives material effect to the
three-member requirement in the delegation clause. The vacancy
clause still operates to provide that vacancies do not impair the
ability of the Board to take action, so long as the quorum is
satisfied. And the interpretation does not render inoperative the
group quorum provision, which still operates to authorize a
three-member delegee group to issue a decision with only two
members participating, so long as the delegee group was properly
constituted. Reading §3(b) in this manner, the statute’s various
pieces hang together—a critical clue that this reading is a sound
one.
The contrary reading, on the other hand,
allows two members to act as the Board
ad infinitum, which
dramatically undercuts the significance of the Board quorum
requirement by allowing its permanent circumvention. That reading
also makes the three-member requirement in the delegation clause of
vanishing significance, because it allows a
de facto
delegation to a two-member group, as happened in this case. Under
the Government’s approach, it would satisfy the statute for the
Board to include a third member in the group for only one minute
before her term expires; the approach gives no meaningful effect to
the command implicit in both the delegation clause and in the Board
quorum requirement that the Board’s full power be vested in no
fewer than three members. Hence, while the Government’s reading of
the delegation clause is textually permissible in a narrow sense,
it is structurally implausible, as it would render two of §3(b)’s
provisions functionally void.
Second, and relatedly, if Congress had
intended to authorize two members alone to act for the Board on an
ongoing basis, it could have said so in straightforward language.
Congress instead imposed the requirement that the Board delegate
authority to no fewer than three members, and that it have three
participating members to constitute a quorum. Those provisions are
at best an unlikely way of conveying congressional approval of a
two-member Board. Indeed, had Congress wanted to provide for two
members alone to act as the Board, it could have maintained the
NLRA’s original two-member Board quorum provision, see 29 U.
S. C. §153(b) (1946 ed.), or provided for a delegation of the
Board’s authority to groups of two. The Rube Goldberg-style
delegation mechanism employed by the Board in 2007—delegating to a
group of three, allowing a term to expire, and then continuing with
a two-member quorum of a phantom delegee group—is surely a bizarre
way for the Board to achieve the authority to decide cases with
only two members. To conclude that Congress intended to authorize
such a procedure to contravene the three-member Board quorum, we
would need some evidence of that intent.
The Government has not adduced any convincing
evidence on this front, and to the contrary, our interpretation is
consistent with the longstanding practice of the Board. This is the
third factor driving our decision. Although the Board has
throughout its history allowed two members of a three-member group
to issue decisions when one member of a group was disqualified from
a case, see Brief for Respondent 20; Board Minutes 6a, the Board
has not (until recently) allowed two members to act as a quorum of
a defunct three-member group.[
Footnote 2] Instead, the Board concedes that its practice
was to reconstitute a delegee group when one group member’s term
expired. Brief for Respondent 39, n. 27.[
Footnote 3] That our interpretation of the delegation
provision is consistent with the Board’s longstanding practice is
persuasive evidence that it is the correct one, notwithstanding the
Board’s more recent view. See
Bowen v.
Georgetown
Univ. Hospital,
488 U. S. 204, 214
(1988).
In sum, a straightforward understanding of the
text, which requires that no fewer than three members be vested
with the Board’s full authority, coupled with the Board’s
longstanding practice, points us toward an interpretation of the
delegation clause that requires a delegee group to maintain a
membership of three.
III
Against these points, the
Government makes several arguments that we find unconvincing. It
first argues that §3(b) authorizes the Board’s action by its plain
terms, notwithstanding the somewhat fictional nature of the
delegation to a three-member group with the expectation that within
days it would become a two-member group. In particular, the
Government contends the group quorum requirement and the vacancy
clause together make clear that when the Board has delegated its
power to a three-member group, “any two members of that group
constitute a quorum that may continue to exercise the delegated
powers, regardless whether the third group member … continues to
sit on the Board” and regardless “whether a quorum remains in the
full Board.” Brief for Respondent 17; see also
id., at
20–23.
Although the group quorum
provision clearly authorizes two members to act as a quorum of a
“group designated pursuant to the first sentence”—
i.e., a
group of at least three members—it does not, by its plain terms,
authorize two members to constitute a valid delegee group. A quorum
is the number of members of a larger body that must participate for
the valid transaction of business. See Black’s Law Dictionary 1370
(9th ed. 2009) (defining “quorum” as the “minimum number of members
… who must be present for a deliberative assembly to legally
transact business”); 13 Oxford English Dictionary 51 (2d ed. 1989)
(“A fixed number of members of any body … whose presence is
necessary for the proper or valid transaction of business”);
Webster’s New International Dictionary 2046 (2d ed. 1954) (“Such a
number of the officers or members of any body as is, when duly
assembled, legally competent to transact business”). But the fact
that there are sufficient members participating to constitute a
quorum does not necessarily establish that the larger body is
properly constituted or can validly exercise authority.[
Footnote 4] In other words, that only
two members must participate to transact business in the name of
the group, does not establish that the group itself can exercise
the Board’s authority when the group’s membership falls below
three.
The Government nonetheless contends that
quorum rules “ordinarily” define the number of members that is both
necessary and sufficient for an entity to take an action. Brief for
Respondent 20. Therefore, because of the quorum provision, if “at
least two members of a delegee group actually participate in a
decision … that should be the end of the matter,” regardless of
vacancies in the group or on the Board.
Ibid. But even if
quorum provisions ordinarily provide the rule for dealing with
vacancies—
i.e., even if they ordinarily make irrelevant
any vacancies in the remainder of the larger body—the quorum
provisions in §3(b) do no such thing. Rather, there is a separate
clause addressing vacancies. The vacancy clause, recall, provides
that “[a] vacancy in the Board shall not impair the right of the
remaining members to exercise all of the powers of the Board.”
§153(b) (2006 ed.). We thus understand the quorum provisions merely
to define the number of members who must participate in a decision,
and look to the vacancy clause to determine whether vacancies in
excess of that number have any effect on an entity’s authority to
act.
The Government argues that the vacancy clause
establishes that a vacancy in the
group has no effect. But
the clause speaks to the effect of a vacancy in the
Board
on the authority to exercise the powers of the
Board; it
does not provide a delegee group authority to act when there is a
vacancy in the group. It is true that any vacancy in the group is
necessarily also a vacancy in the Board (although the converse is
not true), and that a group exercises the (delegated) “powers of
the Board.” But §3(b) explicitly distinguishes between a group and
the Board throughout, and in light of that distinction we do not
think “Board” should be read to include “group” when doing so would
negate for all practical purposes the command that a delegation
must be made to a group of at least three members.
Some courts have nonetheless interpreted the
quorum and vacancy provisions of §3(b) by analogizing to an
appellate panel, which may decide a case even though only two of
the three initially assigned judges remain on the panel. See
Photo-Sonics, Inc. v.
NLRB, 678 F. 2d 121,
122–123 (CA9 1982). The governing statute provides that a case may
be decided “by separate panels, each consisting of three judges,”
28 U. S. C. §46(b), but that a “majority of the number of
judges authorized to constitute a court or panel thereof … shall
constitute a quorum,” §46(d). We have interpreted that statute to
“requir[e] the inclusion of at least three judges in the first
instance,” but to allow a two-judge “quorum to proceed to judgment
when one member of the panel dies or is disqualified.”
Nguyen v.
United States,
539 U. S. 69, 82 (2003).
But §46, which addresses the assignment of particular cases to
panels, is a world apart from this statute, which authorizes the
standing delegation of all the Board’s powers to a small
group.[
Footnote 5] Given the
difference between a panel constituted to decide particular cases
and the creation of a standing panel plenipotentiary, which will
decide many cases arising long after the third member departs,
there is no basis for reading the statutes similarly. Moreover, our
reading of the court of appeals quorum provision was informed by
the longstanding practice of allowing two judges from the initial
panel to proceed to judgment in the case of a vacancy, see
ibid., and as we have already explained, the Board’s
practice has been precisely the opposite.
Finally, we are not persuaded by the
Government’s argument that we should read the statute to authorize
the Board to act with only two members in order to advance the
congressional objective of Board efficiency. Brief for Respondent
26. In the Government’s view, Congress’ establishment of the
two-member quorum for a delegee group reflected its comfort with
pre-Taft-Hartley practice, when the then-three-member Board
regularly issued decisions with only two members.
Id., at
24. But it is unsurprising that two members regularly issued Board
decisions prior to Taft-Hartley, because the statute then provided
for a Board quorum of two. See 29 U. S. C. §153(b) (1946 ed.).
Congress
changed that requirement to a three-member quorum
for the Board. As we noted above, if Congress had wanted to allow
the Board to continue to operate with only two members, it could
have kept the Board quorum requirement at two.[
Footnote 6]
Furthermore, if Congress had intended to allow
for a two-member Board, it is hard to imagine why it would have
limited the Board’s power to delegate its authority by requiring a
delegee group of at least three members. Nor do we have any reason
to surmise that Congress’ overriding objective in amending §3(b)
was to keep the Board operating at all costs; the inclusion of the
three-member quorum and delegation provisions indicate otherwise.
Cf. Robert’s Rules of Order §3, p. 20 (10th ed. 2001) (“The
requirement of a quorum is a protection against totally
unrepresentative action in the name of the body by an unduly small
number of persons”).
IV
In sum, we find that the Board
quorum requirement and the three-member delegation clause should
not be read as easily surmounted technical obstacles of little to
no import. Our reading of the statute gives effect to those
provisions without rendering any other provision of the statute
superfluous: The delegation clause still operates to allow the
Board to act in panels of three, and the group quorum provision
still operates to allow any panel to issue a decision by only two
members if one member is disqualified. Our construction is also
consistent with the Board’s longstanding practice with respect to
delegee groups. We thus hold that the delegation clause requires
that a delegee group maintain a membership of three in order to
exercise the delegated authority of the Board.
We are not insensitive to the
Board’s understandable desire to keep its doors open despite
vacancies.[
Footnote 7] Nor are
we unaware of the costs that delay imposes on the litigants. If
Congress wishes to allow the Board to decide cases with only two
members, it can easily do so. But until it does, Congress’ decision
to require that the Board’s full power be delegated to no fewer
than three members, and to provide for a Board quorum of three,
must be given practical effect rather than swept aside in the face
of admittedly difficult circumstances. Section 3(b), as it
currently exists, does not authorize the Board to create a tail
that would not only wag the dog, but would continue to wag after
the dog died.
The judgment is reversed, and the case is
remanded for further proceedings consistent with this opinion.
It is so ordered.
Footnote 1
Several other Courts of Appeals reached the
same conclusion as the Seventh Circuit, although not always
following the same reasoning. See
Northeastern Land Servs.,
Ltd. v.
NLRB, 560 F. 3d 36, 41 (CA1 2009);
Snell Island SNF LLC v.
NLRB, 568 F. 3d 410,
424 (CA2 2009);
Narricot Industries, L. P. v.
NLRB, 587 F. 3d 654, 660 (CA4 2009);
Teamsters
Local Union No. 523 v.
NLRB, 590 F. 3d 849, 852
(CA10 2009).
Footnote 2
When one member of a group is disqualified,
only two members actually participate in the decision. That
circumstance thus also presents the problem of the possible
inferiority of two-member decisionmaking. That the Board found it
necessary to reconstitute groups only when there was a vacancy, and
not when there was a disqualification, suggests that its practice
was driven by more than its belief in the “superiority of
three-member groups,”
post, at 10 (Kennedy, J.,
dissenting).
Footnote 3
It also has not been the Board’s practice to
issue decisions when the Board’s membership has fallen to two. For
about a 2-month period in 1993–1994, and a 1-month period in
2001–2002, the Board had only two members and did not issue
decisions. Brief for Respondent 5, n. 4. In 2005, the Board
did delegate its authority to a three-member group, of which two
members issued a few orders as a quorum during a 3-day period in
which the Board’s (and the group’s) membership fell below three.
Ibid. But the two-member Board at issue in this case,
extending over two years, is unprecedented in the history of the
post-Taft-Hartley Board.
Footnote 4
Nor does failure to meet a quorum requirement
necessarily establish that an entity’s power is suspended so that
it can be exercised by no delegee. The requisite membership of an
organization, and the number of members who must participate for it
to take an action, are two separate (albeit related)
characteristics. Thus, although we reach the same result, we do not
adopt the District of Columbia Circuit’s equation of a quorum
requirement with a membership requirement that must be satisfied or
else the power of any entity to which the Board has delegated
authority is suspended. See
Laurel Baye Healthcare of Lake
Lanier, Inc. v.
NLRB, 564 F. 3d 469, 475 (2009)
(“[T]he Board quorum provision establishes that the power of the
Board to act exists [only] when the Board consists of three
members. The delegee group’s delegated power to act … ceases when
the Board’s membership dips below the Board quorum of three
members” (citation omitted)). The Board may not, of course, itself
take any action absent sufficient membership to muster a quorum
(three), and in that sense a quorum requirement establishes a
minimum membership level. Our conclusion that the delegee group
ceases to exist once there are no longer three Board members to
constitute the group does not cast doubt on the prior delegations
of authority to nongroup members, such as the regional directors or
the general counsel. The latter implicates a separate question that
our decision does not address.
Footnote 5
In any event, if the analogy to the appellate
courts were correct, then one might have to examine each Board
decision individually. Petitioner’s case was not initially assigned
to a three-member panel and thereafter decided by two members after
one member had retired. Instead, by the time petitioner’s case came
before the Board, Member Kirsanow had long departed. In practical
terms, petitioner’s case was both assigned to and decided by a
two-member delegee group.
Footnote 6
We have no doubt that Congress intended “to
preserve the ability of two members of the Board to exercise the
Board’s full powers, in limited circumstances,”
post, at
12, as when a two-member quorum of a properly constituted delegee
group issues a decision for the Board in a particular case. But we
doubt “Congress intended to preserve” the pre-Taft-Hartley practice
of two members acting for the Board when the third seat was vacant,
post, at 11, because it declined to preserve the
pre-Taft-Hartley two-member Board quorum.
Footnote 7
Former Board members have identified turnover
and vacancies as a significant impediment to the operations of the
Board. See Truesdale, Battling Case Backlogs at the NLRB, 16 Lab.
Law. 1, 5 (2000) (“[I]t is clear that turnover and vacancies have a
major impact on Board productivity”); Higgins, Labor
Czars—Commissars—Keeping Women in the Kitchen—the Purpose and
Effects of the Administrative Changes Made by Taft-Hartley, 47
Cath. U. L. Rev. 941, 953 (1998) (“Taft-Hartley’s Achilles
heel is the appointment process… . In the past twenty years …
Board member turnover and delays in appointments and in the
confirmation process have kept the Board from reaching its true
potential”).
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