Sept 9 (Askume) – An auto parts maker will likely lose a lawsuit challenging the structure of the National Labor Relations Board, a federal judge in Detroit said on Monday, refusing to block the commission’s administrative proceedings against the company from proceeding.
U.S. District Judge Laurie Mitchelson ruled that a nearly century-old U.S. Supreme Court precedent upheld Yap Automotive Systems’ decision that the board’s administrative law judge and its five members were improperly protected from a claim of arbitrary removal by the president.
Michelson, appointed by Democratic former President Barack Obama, also said the board’s ability to order employers to compensate workers who suffer illegal labor practices does not violate the right to a jury trial under the Seventh Amendment of the U.S. Constitution.
Michelson rejected Yap’s motion to stop the board’s case from proceeding, and accused him of trying to fire a union supporter and engaging in other illegal conduct ahead of the 2023 union election at the Romulus, Michigan plant.
An NLRB spokesman declined to comment.
An attorney for Tenn. Yap did not immediately respond to a request for comment. The company filed a notice of appeal shortly after Mitchelson’s ruling and asked a judge to stay the board’s administrative case pending the outcome of the appeal.
At least 20 other companies, including Elon Musk’s rocket maker SpaceX, Starbucks, Amazon , Trader Joe’s and Macy’s, are challenging the NLRB’s structure or its enforcement authority in pending lawsuits and administrative cases .
Michelson’s ruling split two Texas judges who said in July that similar claims against the NLRB by SpaceX and pipeline operator Energy Transfer had merit.
The judges, all appointed by Republican former President Donald Trump, said they were bound by the 2022 decision of the 5th U.S. Circuit Court of Appeals in Jarkesy v. Securities and Exchange Commission , which held that an SEC administrative judge is unconstitutionally immune from removal from office. The U.S. Supreme Court upheld the Jarkesy ruling in June on other grounds but did not touch on the issue of the ban on deportations.
But the Ohio-based Sixth Circuit, which covers Michigan, upheld removal protections for FDIC administrative judges in a separate case in 2022.
Michelson said Monday that the ruling makes clear that administrative law judges are exempt from arbitrary removal if they only make non-final recommendations to agencies rather than issuing final, binding decisions.
“The NLRB ALJ fits that description,” she wrote.
McClesen also cited the 1935 U.S. Supreme Court decision in Humphrey Enforcer v. United States that said it was constitutional to lift restrictions on Federal Trade Commission members. The Supreme Court is currently considering a petition seeking to dismiss Humphrey Enforcer’s motion in a case involving the U.S. Consumer Product Safety Commission.
The case is Yapp USA Automotive Systems v. NLRB, U.S. District Court for the Eastern District of Michigan, No. 2:24-cv-12173.
Yap Representative: R. Michael Azzi of Warner Norcross & Judd
NLRB Representative: Michael Dell
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