LOCKE v. KARASS
After the Maine State Employees Association (a union representing state workers) negotiated a new collective bargaining agreement for certain employees, nonmembers voiced their disapproval with the agreement's requirement that they pay a "service fee" to the union as its exclusive bargaining agent. The service fee included an affiliation fee paid to the Service Employees International Union through a general pooling arrangement, meaning that the nonmembers were contributing funds to an affiliate for litigation not specifically for their own benefit. The nonmembers filed suit in the U.S. District Court for the District of Maine claiming that the service fee violated their First amendment rights. The district court granted summary judgment in favor of the union.
The U.S. Court of Appeals for the First Circuit affirmed, applying the Court's decision in Lehnert to determine that the nonmember employees' First Amendment rights were not implicated by the service fee. Under the Lehnert test, chargeable activities must (1) "be substantively related to bargaining and ultimately inure to the benefit of local union members, (2) be justified by the government's vital policy interest in labor peace and avoiding free riders, and (3) not significantly add to the burdening of free speech that is inherent in the allowance of agency."
Do union requirements that nonmember employees pay a service fee through a pooling arrangement, and used to fund litigation that may not specifically be for the benefit of those nonmembers, violate the First Amendment rights of those nonmember employees?
Legal provision: First Amendment
No. In a unanimous decision authored by Justice Stephen G. Breyer, the Supreme Court held that the First Amendment permits a local union to charge nonmembers for national litigation expenses so long as 1) the subject matter is of a kind that would be chargeable if the litigation were local and 2) the charge is reciprocal in nature (the contributing local union reasonably expects other local unions to contribute similarly). The Court reasoned that the fees paid by nonmembers of the Maine State Employees Association that funded national litigation expenses met this test and therefore did not violate nonmembers' First Amendment rights.
Justice Samuel A. Alito filed a separate concurring opinion joined by Chief Justice John G. Roberts. Alito noted the Supreme Court did not reach the question of what "reciprocity" means, acknowledging it was not contested by either party.
ORAL ARGUMENT OF W. JAMES YOUNG ON BEHALF OF THE PETITIONERS
Chief Justice Roberts: We will hear argument next in Case 07-610, Locke v. Karass.
Mr. Young: Mr. Chief Justice, and may it please the Court: This case addresses whether the First and Fourteenth Amendments permit public employers to compel nonunion employees to subsidize the union's expressive speech of a political nature in a public forum, specifically litigation in courts and before administrative agencies not involving their bargaining unit.
We submit that the answer to this question is no, a result supported by the Court's unanimous, unambiguous, and categorical holding in Ellis.
In Ellis, this Court held that, to avoid constitutional problems, nonmembers under the Railway Labor Act could not be forced to subsidize any litigation not arising within their bargaining unit, not even litigation to enforce another bargaining unit's agreement in bankruptcy proceedings.
Justice Scalia: But, of course, they wouldn't be subsidizing it if -- if, indeed, it is some kind of a -- essentially an insurance scheme.
They -- they contribute to the national union, and in exchange the national union defends their interest just as it defends the interest of other unions.
You didn't address that -- that pooling argument.
Mr. Young: I would respectfully disagree, Justice Scalia, but my answer to your question--
Justice Scalia: It doesn't seem to me fair to call it "subsidizing" if, in fact, that's what's going on.
Mr. Young: --Well, it is also not fair, Justice Scalia, to call it "insurance".
It's affiliation, and the answer to the question--
Justice Scalia: I don't know because that wasn't inquired into by the court below.
I guess we really -- we really don't know, do we, when -- whether the local union can make any demands upon the -- upon the national union for -- for litigation defense?
Mr. Young: --Well, I think we can rely, Justice Scalia, on the admissions contained in MSEA's brief, which clearly concedes that, in fact, SEIU has no enforceable obligations under its affiliation arrangement with MSEA.
Justice Kennedy: Well, if we don't call it "insurance", can we all it "pooling"?
Mr. Young: Well, of course, that -- that is what they call it, Justice Kennedy.
And -- and -- and pooling is -- is certainly something that we believe the Court rejected in Ellis when it set forth a categorical rule.
The pooling argument was raised in the briefs in Ellis, and this Court did not see fit to--
Justice Ginsburg: Mr. Young, I thought that in Ellis the litigation -- the Ellis Court said that that litigation did not have as its subject matter negotiation or administration of a collective bargaining contract.
Mr. Young: --I don't believe that's the case, Justice Ginsburg, because Ellis dealt with enforcing a bargaining agreement.
Justice Ginsburg: I'm quoting from -- I'm quoting from that decision at page 453.
The case involved litigation
"not involving negotiation or administration of a collective bargaining contract. "
Mr. Young: Well, of course, Justice Ginsburg, the -- some of the litigation did involve enforcing another bargaining unit's agreement in bankruptcy proceedings.
I don't know how that is not enforcing--
Justice Ginsburg: Well, are you saying the Court got it wrong?
I mean, the words that I'm quoting are from the opinion:
"Not involving negotiation or administration of a collective bargaining contract. "
Mr. Young: --Well, that -- that--
Justice Ginsburg: That's the only thing that could be germane.
If it doesn't relate to that, then your case is solid.
Mr. Young: --Well, I'm trying -- I'm -- I'm trying to find the specific language, Justice Ginsburg, and I apologize for my inadequacy in this regard.
But I think the point that we -- I think the point that we would rely on in Ellis in -- in -- in the very paragraph that you referred to is the specificity with which this Court discussed what was chargeable.
It referred to the contract, for instance.
It referred to the exclusive representative twice; not an exclusive representative, but the exclusive representative.
It referred to the bargaining unit not less than five times in that single paragraph in discussing what was permissible under the Railway Labor Act.
Justice Alito: Do you want to stand or fall on the all-or-nothing argument that nonmembers can never be required to pay for any extra-unit litigation expenses, or do you have an -- an additional argument?
Mr. Young: Well, no, Justice Alito.
We believe -- we believe that the -- the Ellis standard is the constitutional standard as both principal opinions in Lehnert discuss.
In -- in Lehnert, Justice Blackmun specifically recognized it in his -- in his plurality opinion; and Justice Scalia himself said there was good reason -- good cause to treat Ellis as stating the constitutional rule.
Justice Souter: Well, do you take -- do you take that as -- as -- as meaning that the union couldn't buy litigation insurance?
Mr. Young: Real insurance, Justice Souter?
I think that -- obviously that would be a--
Justice Souter: Some of those -- some of those premiums are going to subsidize the defense in -- in -- in cases beyond this bargaining unit.
In fact, most of it will.
Mr. Young: --Well -- but the distinction, Justice Souter, I think is discussed in the brief, amicus brief, filed by Pacific Legal Foundation.
For one thing, it would not be the labor union that would be -- another labor union receiving those insurance funds.
It would be a third-party insurer, presumably.
That would be--
Justice Souter: So -- so in your view, then, even if the agreement with the -- with the parent union in this case involved an explicit obligation on the part of the parent to come in and defend in -- if litigation arose in this unit, that would still be bad?
Mr. Young: --It would add the -- the insult of the--
Justice Souter: Well, I'm not interested in insults.
Is it -- is it constitutional, or isn't it?
Mr. Young: --We believe it would not be if the international affiliate were the insurer, Justice Souter.
Justice Souter: Then -- and -- and -- and you do take the position that a -- a genuine insurance policy issued by an insurer would not violate the constitutional standard?
Mr. Young: That -- that is the -- that is our argument, Justice Souter.
Chief Justice Roberts: Even though -- even though there may be a great disconnect between the premiums and the needs of the particular unit?
I mean, let's say the particular unit has -- I don't know -- has always had a history of good relations with the employer.
It has never had to call upon litigation in 20 years, and they don't anticipate it, and yet their insurance premiums rise dramatically because of very hostile and extended litigation by another unit.
Do you -- do you concede that case?
Mr. Young: I -- I don't think -- well, I don't think I would concede the premise of your question, Mr. Chief Justice.
The -- and I think that point is -- is discussed fairly thoroughly in Pacific Legal Foundation's brief.
A rate setting in an insurance context is -- is radically different than the affiliations fee setting in this context.
Rate -- and -- and much more about insurance than, frankly, I know; but it -- it certainly is--
Justice Scalia: Yes, but it's based on the experience of the whole -- the whole cohort of insureds.
Mr. Young: --It's also--
Justice Scalia: And the Chief Justice's question says: Can a -- can a -- a local that is certainly on the basis of past experience not going to need this insurance nearly as much as other locals -- can it enter into an insurance arrangement with other locals to buy the insurance for all of the locals even though it knows that it won't benefit very much from that insurance policy?
Mr. Young: --I'm sorry.
Justice Scalia: That was -- he was trying to help you.
Mr. Young: And I'm sorry, Chief Justice Roberts.
Justice Scalia: You should have said, yes, Chief Justice.
Mr. Young: And -- and I -- and I appreciate the help, Mr. Chief Justice, and your pointing that out, Justice Scalia.
My -- I -- I misunderstood the question, and I apologize.
Yes, Mr. Chief Justice.
The -- the -- our point would be, however, that in that type of relationship and I -- as I said, that's--
Justice Stevens: Does that mean that each time they buy an insurance policy they have to investigate which locals are going to get the most benefit out of it?
Mr. Young: --Well, I don't think that's a -- that's a decision for the locals.
That's the insurer setting rates, and -- and I -- I don't know of a market, quite honestly, Justice Stevens, for that type of insurance.
Justice Stevens: Would you give one answer to the Chief Justice on the facts he gave and a different one if the record showed that everybody got a proportional benefit out of the group policy?
Mr. Young: I don't -- no, Justice Stevens.
I don't think my question -- my answer would differ.
I think, however--
Justice Stevens: So your answer doesn't depend, then, on the facts that he included in that question?
Chief Justice Roberts: He is not trying to help you.
Justice Stevens: I'm not sure he was, either.
Mr. Young: --Well, one looks for it where one can find it, Justice Stevens and Mr. Chief Justice.
The differing -- I think that the distinction has to be made here between insurance on the one hand and affiliation.
There -- in -- in the insurance context you have--
Justice Stevens: Does that mean all insurance policies are bad?
Mr. Young: --No, no, no.
I -- I -- I concede insurance, Justice Stevens.
I -- my point -- if it is true insurance, insurance where there is mutuality of obligation.
The difficulty that this Court, I believe, found in the Ellis case when it set a bright-line test was that it was public -- and I -- and I think can be discerned from the Court's other cases, including Glickman -- is we're talking about public speech, speech of a political nature in a public forum.
Justice Souter: Well, there was -- there was mutuality of obligation in the hypothesis that I gave you in which the agreement with the parent union required an affirmative obligation of the parent union to come in and defend if litigation arose.
And you said that still would not be constitutional.
Mr. Young: And I -- and I--
Justice Souter: So the -- so the criterion has got to be something other than mutuality of obligation, right?
Mr. Young: --And it assuredly is, Justice Souter.
Justice Souter: And what is the other distinction?
Mr. Young: The other distinction has to be that it is not -- it is -- the problem also arises from the nature of the forced relationship.
As this Court has recognized in cases such as Ellis and Abood, allowing the agency shop at all works an infringement on First Amendment rights.
Justice Souter: We -- we -- we start with that premise, but what is the other distinction, then?
If it is not mutuality of obligation, what -- what is the -- what is the -- the -- the -- the point that separates the -- the sheep from the goats here?
Mr. Young: Well, the mutuality of obligation coupled with true rate setting in the sense that there is a -- there is--
Justice Souter: What -- what is -- what has rate setting got to do with -- with your basic point?
Your basic point, as I understand it, is that some of the money that's being taken from the -- from the local union and in our example subsidized by the service fee is being used to subsidize litigation for other unions.
And that is, it seems to me, exactly true in the insurance case.
Some of those premiums will subsidize litigation -- speech -- involving speech in -- in other union bargaining areas.
What's the distinction?
Mr. Young: --Well, the distinction, Justice Souter, would be that there is -- it doesn't seem to me that there is a -- there is a larger pool created than just a union litigation pool in the insurance context.
Furthermore, the -- the -- the money, in fact, is spread about--
Justice Souter: I don't know whether that's true or not.
If you buy labor litigation insurance I suppose it is not.
Don't they set their rates with respect to the experience in labor litigation, not in -- on their experience with automobile accidents.
Mr. Young: --I don't know of an insurance company that's quite that specific, Justice Souter, nor have I ever heard of labor -- labor union insurance -- labor litigation insurance.
So I'm not sure that such a market actually exists.
Justice Souter: Neither do I.
Mr. Young: Certainly there is not on this record that would suggest so, sir.
Justice Kennedy: I did want to understand your position.
Suppose there is a statewide contract for public employees and one union brings a suit to interpret a provision of that collective bargaining agreement having to do with overtime or holidays or something.
And then it notifies the other union, we're going to have to drop this litigation because we can't afford it.
Even though it ultimately may affect you down the line, you're not a party.
I don't see the harm in allowing the other union to subsidize or contribute -- use whatever verb you want -- that litigation -- that litigation.
Mr. Young: Well, of course if the other union--
Justice Kennedy: What -- what -- what harm are we trying to prevent here?
Mr. Young: --Well, obviously First Amendment harm, Justice Kennedy.
But I think understanding -- if I understand your hypothetical--
Justice Kennedy: The First Amendment can be -- can be a sword or a shield.
This union wants to use it as a sword in order to promote, in order to protect its rights under the collective bargaining agreement.
I don't see the harm.
Mr. Young: --Excuse me, Justice Kennedy.
I'm sorry for interrupting you.
Certainly the union has the right to associate as it sees fit.
The First Amendment protects that right.
We are not suggesting that it doesn't have the right to go out and ask other labor unions to contribute to its litigation activities.
What the First Amendment -- the -- the First Amendment right to not speak is -- is involved when, in the words of the Ninth Circuit in one of these cases,
"they seek to mulch from the unwilling moneys for their speech activities in a public forum. "
Justice Breyer: What I don't understand about--
Mr. Young: I'm sorry, Justice Breyer.
Justice Breyer: --Finish because there's something--
Mr. Young: Thank you, sir.
And my point would be under the hypothetical as I understand it, you posed a union in -- within the State under the same bargaining agreement being asked to support for litigation under one of the other locals.
I can think of a number of cases where that's actually the case, two locals under one bargaining agreement just in my own experience.
And so you're not suggesting something that's unusual.
I think under that circumstances that would fall squarely within Ellis' rule.
It involves the bargaining agreement.
It may not involve the specific bargaining unit, but it is concerning the bargaining agreement.
Justice Kennedy: That's not quite the hypothetical.
Let's say there are two bargaining agreements but they're identical, and that this litigation that's underway will have persuasive force for the union that's thinking about entering, and then the union decides that it is going to enter to help the union involved in the suit, and the members of the, of the contributing union object and you say they have a First Amendment right.
That's your point?
Mr. Young: Yes, Justice Kennedy.
Justice Kennedy: I don't see why the objects of collective bargaining the, objects of union -- of the union, are not being fulfilled.
Mr. Young: Because that goes beyond the free rider rationale which justifies the agency shop in the earlier cases such as Hansen and Street.
The free rider that the Congress was concerned with -- and of course, it's been adopted through Abood to apply to the States -- the free rider that Congress was concerned with is the free rider that is required to accept the union's services and refuses to subsidize those services.
And the -- this Court in discussing that in terms of lobbying and public relations activities found that the relationship was too attenuated.
Obviously judicial decisionmaking and administrative decisionmaking is good for its persuasive effect in many different contexts.
But that -- that relationship was found to be too attenuated in Ellis and with regard to litigation and certainly in Lehnert with regard to public relations--
Justice Breyer: --That's the part I don't understand.
It's not your fault.
I don't understand it in the cases either.
What First Amendment right are we talking about?
There is an individual who, under the agency shop, pays dues to a union.
Now, suppose the union uses some of that money in a way that has nothing to do with politics, nothing to do with speech, but it doesn't happen to benefit that particular member.
For example, you can have a central union headquarters 4,000 miles away where there's a librarian who's doing research on a matter that will help lots of people, but nobody in this area.
Or you could have a program to commemorate the people who were hurt in the State of Hawaii at a union uprising or strike of some kind where nobody in this particular area is ever going to go.
Now, both of those activities are totally legitimate union activities that have nothing to do with politics.
But this particular place won't benefit from them.
Okay, what in the First Amendment prohibits the union from paying for such an activity out of general union dues assessed on everybody?
And why would the First Amendment prohibit such a thing?
Mr. Young: --Under Lehnert, Justice Breyer, the expenditures which you posit would be chargeable and are not at issue here.
Justice Breyer: Fine.
If they are chargeable because they have nothing to do with politics, perfectly legitimate, why isn't it also chargeable to pay for the costs of a lawsuit which has nothing to do with politics, totally for a union purpose, it just doesn't happen to benefit that person who's miles away in a different local?
Mr. Young: Because benefit has never been the touchstone.
And under Ellis and under Lehnert and certain pluralities--
Justice Breyer: I don't want you to tell me about cases.
I'm abstracting from -- I want to know the reasoning.
I want to know why.
Mr. Young: --Because we are talking about public -- political speech of a public nature.
Justice Breyer: I said there is no politics in any of these expenditures.
42 bishops would swear there is nothing here that has anything to do with politics.
Justice Alito: Why does it have to be political speech?
Isn't it enough that it is simply speech that certain people don't want to subsidize, or speech, so that the commemoration in Hawaii may be something that 99.999 percent of the population would find very commendable, but someone is being forced to pay for that?
Mr. Young: And I may--
Justice Breyer: But that's the reasoning that you seem to accept and I guess all human activity is banned.
Because to my knowledge, all human activity takes place through speech with a few exceptions that are not here relevant.
Justice Scalia: Well, it isn't banned.
It's just -- just -- you know, you don't force the nonunion member who indeed may be anti-union to pay for it.
And he doesn't want to subsidize the union librarian.
He doesn't like unions here.
He doesn't like unions in Hawaii.
And for the government to force him to -- to support the union is, I thought, part of the reasoning behind--
Justice Stevens: I'd be interested in your comments on this dialogue.
Mr. Young: --I'd be happy to jump in here somewhere, Justice Stevens.
I appreciate the colloquy.
And I think the distinction -- getting back to the point Justice Alito raised, and the sharp distinction that has been made in the compelled speech and compelled dues cases is between the activities -- certainly in the compelled union dues cases, is activities for which nonmembers are compelled to accept the union as bargaining representative.
Justice Ginsburg: But why isn't litigation -- what I don't understand is how you draw a line between the -- the negotiation of an agreement, where Lehnert said this kind of pooling is okay, and the enforcement of the agreement.
I mean, we're not talking about litigation unrelated to collective bargaining.
It is only litigation that deals with the meaning of a term in the contract, whether what the employer has done was an unfair labor practice, whether there has been a contractual violation.
Mr. Young: For the -- I'm sorry, Justice Ginsburg.
For the agreement, for the unit, we concede that the union may charge for that public speech of a political nature in a public forum.
We have no dispute over charging for enforcing or -- or -- enforcing the collective bargaining agreement.
That is not our dispute.
The dispute here is only over expenditures on behalf of other bargaining units, where we believe Ellis said it was too attenuated, but because it is not -- my point would be that the litigation which is acceptably chargeable -- I think the presumptive -- I think the default value in this Court's decisionmaking on litigation is that it's nonchargeable.
However, the Court has drawn a narrow exception for that public speech in public forum which is related to the union's duties as, not related to but in performance of the union's duties as bargaining agent the duties for which law imposes the union as a bargaining agent.
Justice Ginsburg: I don't understand why enforcing, one thing is making the agreement and there you agree as you must because of our Lehnert decision you can't have these pooling arrangements.
What's the difference between negotiating an agreement and litigation to enforce it.
Mr. Young: I think that would go back as far as Justice Marshall and Marbury.
It would be an empty right if the union were able to negotiate an agreement it wouldn't be permitted to enforce.
Justice Ginsburg: Begins begins that's, that's my point.
I can't see the difference between saying pooling is okay when we're dealing with negotiating an agreement, but it's not okay when we're dealing with enforcing it.
Mr. Young: The distinction is, Justice Ginsburg, that the negotiation of the agreement does not occur in a public forum, whereas litigation does, and that's the distinction we would draw.
Chief Justice Roberts: I thought the distinction you were drawing was whether or not the collective bargaining agreement applies to the particular union.
If it's a different unit with a different agreement I thought you were saying that that can't be charged, but if it's the bargaining agreement that binds the particular unit, I thought you said that was chargeable.
Mr. Young: Mr. Chief Justice, I'm sorry if I was confusing.
I thought I was very specific.
It is chargeable for litigation involving the bargaining agreement.
We don't dispute that.
Chief Justice Roberts: Of the particular unit.
Mr. Young: Of the particular unit.
That is not in dispute here.
Chief Justice Roberts: And I suppose you would also concede that if the bargaining agreement is exactly the same, you know a number of units have exactly the same bargaining agreement, which I would suppose is a not uncommon situation, but litigation with respect to the terms of the bargaining agreement even though it happens to involve a different unit is also chargeable to the particular unit.
Mr. Young: No, Mr. Chief Justice, we would not concede that.
We believe that this Court in Ellis drew a bright line, and I think that's clear in Ellis' discussion of the mutual aid pact which was not chargeable in Ellis, found not chargeable in Ellis.
The distinction that I think this Court has drawn or that should I would respectfully suggest should be drawn is that -- is a narrow one.
It's consistent with strict scrutiny and this Court's jurisprudence in that area.
Only for speech which is narrowly related to the union's duties as bargaining agent and performance of those duties can public speech -- can charging nonmembers for public political speech in a public forum be justified.
Justice Stevens: Does that mean, because I want to be sure -- you exclude the librarian example of Justice Breyer?
Mr. Young: The librarian I think would fall under the general Lehnert test.
Justice Stevens: So which side?
You have to be clear with me.
Mr. Young: There were a lot of sides there, Justice Stevens.
Justice Stevens: I understand you to be saying they could not charge the nonmember for the expenses of the Hawaiian librarian.
Mr. Young: I think it was the Hawaiian commemoration that Justice Breyer referred to that I think I had to rethink, because it was a public speech in a public forum.
The librarian researching bargaining issues at the union headquarters in downtown Washington or -- well, in downtown Washington of the international affiliate I think is chargeable under Lehnert.
Justice Stevens: The librarian in Hawaii researching something that the plaintiff has no interest in spending money on, would that be prohibited.
Mr. Young: Well, here, Justice Stevens, we are simply talking about of course the international affiliate.
As far as cross-unit affiliation, I'm not sure.
I think that would fall under again, general, Lehnert's general test.
Justice Kennedy: Could you tell us two hypotheticals.
One is the librarian, two is the public celebration.
Would nonunion, would participating unions be allowed to contribute to either of those activities?
Mr. Young: Well, of course they'd be allowed to.
Can they force nonmembers--
Justice Kennedy: Against nonmembers?
Against members, there has to be a pro-ration, they has to be a pro-ration.
A with the librarian, B with the celebration.
Mr. Young: --The public celebration, no; the librarian, I believe so, yes.
Justice Souter: You have several times mentioned the public forum as having a significance in drawing the line and I'm not sure I follow you there.
Why did you say that?
Mr. Young: Well, I think -- well, Justice Souter, that arises from the Court's determinations on things like public relations and lobbying and the distinction it makes, the distinction for instance in Lehnert between the teacher's voice articles and the reserve public education program.
The distinction drawn from that, the different, differing results is that where internal union communications regarding nonpolitical matters were treated as chargeable by a majority of this Court and where the, outward looking speech activities is treated as not chargeable.
Justice Souter: Let me ask you this.
If an employer and a union local decided that you know they would really let the sunshine in and they would conduct their collective bargaining in a theater with microphones and anybody could drop in and hear, would that change the chargibility of, as against the dissenting nonmembers.
Mr. Young: No Justice Souter because the speech would still be directed at the public employer not ex -- I would like to reserve the balance of my time, Mr. Chief Justice.
Chief Justice Roberts: Thank you counsel.
ORAL ARGUMENT OF JEREMIAH A. COLLINS ON BEHALF OF THE RESPONDENTS
Mr. Collins: Mr. Chief Justice and may it please the Court: When this Court in Abood described the kinds of expenditures that bargaining agents are are required to engage in and that necessitate a rule that requires all represented employees including objecting nonmembers to pay their share services of lawyers is what the court first mentioned.
The single narrow question presented in this case is whether a local bargaining agent that's confronted with the need to pay for those services of lawyers to draw upon legal expertise in bargaining related matters is required to go it alone rely solely on its open resources and its own expertise or--
Chief Justice Roberts: But that's not what we are talking about.
It doesn't have to go it alone.
It simply can't force members of another unit that can decide they are happy to support it but the members who don't want to support it who don't like unions, they can't be forced to pay for it if it does not relate to their collective bargaining agreement.
Mr. Collins: --But the question Mr. Chief Justice whether that, I should add if that unit wants to not neither go it alone nor give a free ride to objecting nonmembers can they avail itself.
Chief Justice Roberts: If the litigation is not germane to the unit where people object to that unit's collective bargaining agreement they are not free riding on anything.
Mr. Collins: They are free riding on the same thing that Lehnert says they cannot free ride on.
Lehnert as Mr. Young acknowledges certainly holds that as a general proposition when a local union bargaining agent is determining how to finance germane expenditures that it will incur germane to its unit, it can either obviously go it alone rely on its own resources or it can enter into an affiliation relationship where it will pay an affiliation fee the -- of which will be measured by the total chargeable expenditures incurred by the National Union in other bargaining units as well as when it's the local's own unit.
What Lehnert teaches is that that situation cannot fairly be described as requiring the objective nonmember to subsidize other units.
Chief Justice Roberts: What if there is no -- I guess I'm getting into the Solicitor General's position here.
What if the unit with the objecting members does not have a right to call upon the pool?
Either, or has never called upon the pool and it's unlikely that it will.
Isn't there, it's not simply subsidization.
It's their compelled fees being used for something that doesn't benefit their collective bargaining arrangement.
Mr. Collins: There are three problems with that contention by the Solicitor General which the petitioners have adopted for the first time in their reply brief.
The first problem was precisely that.
It was not raised in the Court of Appeals, it's not raised in the petition for certiorari.
The second problem is I should add it's not been raised in any other post Lehnert case and I think the reason this issue is not being raised is it's understood I think correctly that Lehnert itself did not solve a situation where the kind of showing that the solicitor general and now with the Petitioners would require.
In Lehnert where this court did approve pooling of a wide range of expenses the court simply referred to the fact that the union in that case had a unified membership structure which as the court put it under which so many unions operate and the court talked about the essence of an affiliation relationship between that locals can draw on international for services but there was no record, this was no showing, this was no finding, there was no discussion of any notion that that local union in Lehnert had an enforceable right for any--
Chief Justice Roberts: Exactly -- I'm sorry.
I was just going to say exactly so I regard that issue as still open.
It was not addressed at all in Lehnert.
Mr. Collins: --It was raised in the reply brief in Lehnert.
The Petitioners in Lehnert complained that a problem with pooling is that there are no guarantees and no standards.
That -- that's why there's a discussion that's reflected in Justice Scalia's separate opinion, a discussion of the fact that it was acknowledged that there is no contractual relationship, but that there were certain customs and -- and practices.
But there was no evidence and certainly no determination by this Court--
Justice Ginsburg: But what did the Court mean in Lehnert when it said there must be some indication the payment is for service that may ultimately inure to the benefit of members of the local union by virtue of their membership in the parent organization?
Mr. Collins: --What -- what the Court meant by that, I believe, Justice Ginsburg, is that -- well, look at the examples the Court gave of what does not -- or the Court referred to certain kinds of payments a local union could make which are not part of an affiliation fee payment.
The Court talks about direct payments to other locals.
The Court -- the other example given was a payment to a -- a national union that wasn't required by affiliation but was like a charitable contribution.
What the Court did not dispute in Lehnert is that, to the extent that an affiliation fee is providing a pool of resources used by the national union for otherwise chargeable services, the potential availability of those services does satisfy the inurement requirement.
Justice Alito: Suppose, let's say, that one or more locals someplace else in the country are involved in very, very expensive litigation; and, as a result, the international assesses all of the locals a fee to pay -- to pay for that litigation but at the same time adopts a position that it is extremely unlikely in the future that the international will ever subsidize any other local union litigation expenses.
Would the local -- would a -- would a local union not involved in that litigation -- would they -- would it be permissible for them to charge their nonmembers?
Mr. Collins: If it were a special assessment for a specific purpose, I think under -- it is not embraced by Lehnert's rationale.
It might not well not be chargeable, because what Lehnert -- Lehnert does not arise in a vacuum.
Lehnert talks about the typical affiliation fee relationship.
And there have been various submissions, treatise articles about that.
So the notion is that a National Union charges an affiliation fee for all of the various services it provides, and local unions can draw upon those resources as needed.
If you then talk about a special assessment--
Justice Alito: Well, if you concede that, then aren't you conceding there has to be some standard by -- under which to assess whether the local union that is being required to pay the fee for extra-unit litigation expenses is getting something back in return?
Mr. Collins: --I think not, Your Honor, for -- for two reasons.
First, I do think that Lehnert did approve--
Justice Alito: It's not necessary for there to be any standard under which to assess that they are getting anything back in return?
If it's clear they are not getting anything back in return, it's still okay?
Mr. Collins: --Not beyond -- and again the question isn't presented, but not beyond what Lehnert found necessary.
Lehnert found it important -- and I would say necessary to its decision -- that the union in that case had what Lehnert described as a typical, unified, membership-affiliation-fee arrangement; and it talks about a typical affiliation fee where locals pay money to go to the pools of otherwise chargeable expenditures of the national union.
Chief Justice Roberts: So if you have a situation where there is a provision in the collective bargaining agreement that the union thinks requires the employer to provide air conditioning in the plant, the local up in Nome, Alaska has to support that extra -- extra-unit litigation even though it will never have any benefit for it?
Mr. Collins: Just as Lehnert plainly holds that local would have to support the negotiation of that provision in the first place in Nome, Alaska.
That's the holding of Lehnert.
The question is whether litigation is different, and there is no way that litigation is different in any principled way as relates to the ruling.
Chief Justice Roberts: I thought it meant -- I didn't think Lehnert held that the unit would have to support that type of extra-unit litigation.
I mean, I--
Mr. Collins: Well, I may have misconstrued your -- it was litigation over--
Chief Justice Roberts: --Yes.
Yes, there is a provision that is ambiguous, which frequently happens, and the union says that requires air conditioning, and the company says no, and there is a big fight about that.
Mr. Collins: --Well, I think my answer is still correct, Your Honor.
Lehnert does not hold -- well, it does not provide the answer as to litigation; but Lehnert says if the union in the first instance says we want to go to Nome, Alaska and negotiate something about air conditioning, that that, even though it only affects the unit in Nome, Alaska, becomes part of the pool of chargeable expenditures that all units can be part of.
Chief Justice Roberts: Well, sure, because that negotiation is germane to the Nome, Alaska collective bargaining agreement, if they are negotiating it there for that unit.
Mr. Collins: But the litigation is equally germane.
Petitioners do not dispute that litigation can be germane and chargeable within a particular unit.
They acknowledge that; there is no dispute about that.
So both the negotiation of the air conditioning right in Nome, Alaska and the enforcement of that negotiated agreement through litigation are equally germane within the unit; the same interests are involved--
Justice Souter: But aren't they, aren't they equal chargeable?
Isn't the unspoken premise of your argument and what Lehnert is getting at -- they are not only germane, but isn't there an unspoken premise that just as the union will support -- the union of the dissident objectors in negotiating a collective bargaining agreement, the union will also presumably support them if litigation is necessary later on to enforce it?
So that the so-called standard by which the union's obligation to support the litigation and the unit that includes the dissidents is not somehow precisely spelled out.
The assumption is that they do have some obligation to support the litigation if it comes to the dissidents' unit.
And isn't that -- isn't that the point of your argument?
Mr. Collins: --That's correct, Your Honor, and I want to make clear when the Court spoke in Lehnert of the essence of an affiliation agreement, an affiliation agreement is a contractual relationship.
We would certainly view that as creating a covenant of good faith and fair dealing that the national union will deal fairly with its various units.
Justice Souter: Which is a covenant, in effect, of support.
Mr. Collins: That's correct, and it's actually quite analogous in that regard to the duty of fair representation that, let's say an unaffiliated local union owns to its objecting nonmembers.
Chief Justice Roberts: Do you think as a covenant of support you have -- however many -- about a thousand individual units.
You think each of those, you have a covenant to support them when they all get -- get involved in separate litigation?
You can't possibly.
Mr. Collins: --No, Mr. Chief Justice, what I said was a covenant of good faith and fair dealing.
Chief Justice Roberts: So it's quite unlike, for example, insurance.
If you have insurance and you as the unit have a particular obligation, you have a right to have that covered.
There is no similar right here.
Mr. Collins: --That's -- that's correct, Your Honor.
The First Amendment does not create a rate setting rule for unions.
And the reason for that is--
Justice Souter: Okay, so there is no, there is no covenant of support.
There is what?
A covenant of support if the litigation in the local unit that includes the dissidents has wide significance, and therefore could affect other units?
Is that what the -- is that what the obligation is?
Mr. Collins: --No, Justice Souter.
I would not--
Justice Souter: Is this any obligation at all?
You said okay, there is an obligation of some kind of fair dealing.
Given the question that we've got, that doesn't matter unless the fair dealing relates at some point to support for litigation, right?
Mr. Collins: --That the--
Justice Souter: Right?
Mr. Collins: --Yes.
Justice Souter: Okay.
Mr. Collins: That the National Union--
Justice Souter: And how do we articulate what that obligation is?
If it's not covenant to support regardless of what the litigation is, how do we articulate what the degree of the obligation of support is?
Mr. Collins: --The way I would articulated it, and then I would like to take a step backward and compare it to the nonaffiliated situation.
I would articulate it as follows, that there is no any First Amendment requirement, that there is in reality in the affiliation agreement simply a covenant of good faith and good dealing that one local will be treated with respect to litigation needs as others would be treated.
Justice Souter: Yes, but the trouble with saying that is exactly the point that the Chief Justice raised.
You don't take the position that no matter what the litigation is, the parent union has got to support it.
Therefore, how do we identify the litigation that they will support?
How do we know that they have any obligation at all?
Mr. Collins: They -- they don't have a First Amendment obligation, but, Your Honor, that is true in the case of agency fees all together.
We have to take a step back and remember that we are trying to perform an exercise the court has said can't be done to perfection of trying to distinguish between making individuals who object support collective bargaining activities not support other things.
In Hudson itself, in the basic situation -- let's assume there is no affiliation agreement, simply a local union, a fee is charged based on the percentage of expenses in the prior year that went for chargeable activities, including, let's say, litigation.
That creates no guarantee that when the year -- in the year that we are now in, when fees are being paid, that if litigation is demanded, requested by a nonmember or anyone else, that that local union will provide--
Justice Souter: Well, it doesn't create a guarantee expressed like the terms of an insurance policy, but there is, in fact, a local practice to which one can refer.
And it seems, it would seem reasonable in a case like that to say, okay, you can force the dissident to pay a fair share on the expectation that the same kind of enforcement litigation will take place if there is a dispute this year or next year.
We don't have, as I understand it, a clear sort of expectation standard when we are talking about affiliation agreements that involve a parent and many, many other locals.
And the point here, it seems to me, is to determine whether there is any obligation at all whether the dissident is getting anything or can expect to get anything for the fee.
And what I want to know is how do we describe that obligation?
Mr. Collins: --I think, at most, the obligation is parallel to the duty of fair representation in the sense that the entity that's responsible for determining what services are going to be provided to the employees has to treat, in the case of the local union members and nonmembers in the unity plea, in the case of the national union it's a different affiliated entity fairly -- the reason--
Chief Justice Roberts: So we are talking about an infringement on the objecting members' first amendment rights, and your answer is trust us, we'll treat you fairly?
I understand that it's a different answer if you say you've got a right.
We can impose the contribution requirement on you, even though you object to it because under this agreement, you have a right to call upon our services.
That's a different case.
But if your answer is simply trust us we'll treat you fairly, that's not the usual standard we apply to infringements of First Amendment rights.
Mr. Collins: --But I have two answers to that, Mr. Chief Justice.
First, it is essentially the answer that's supplied under Hudson, where the court says simply use the prior year's percentages.
We don't know whether this year we'll have the same percentage breakdown.
We also don't know whether this year the union will have enough money to provide any particular service or not.
But we don't--
Chief Justice Roberts: That's different.
That's a little bit more stringent than saying trust us.
That's saying let's look at the last year and we'll figure it out.
Mr. Collins: --But we look at the -- but -- but we look at the national union typical affiliation type arrangement, as the court described it in Lehnert, and what we understand is this is a union that's not making a profit, it's not piling up fees and putting them somewhere.
It exists to provide services to local affiliates.
Those affiliates, if they are not provided with services, it's not just the nonmember, the objector who's being harmed, the members want those services by definition.
Justice Ginsburg: But couldn't it be, couldn't the national say, local, you have asked for assistance with such-and-such litigation.
We think your case is what this Court sometimes calls a bad vehicle.
We don't want to finance your litigation, the issue is important and we are going to wait for a case that presents it in a better light, is more likely to win.
Mr. Collins: Absolutely, Your Honor, that's one thing a national union can properly do.
Another thing a national union can properly do is to say we've just had an unexpected economic crisis, all of a sudden midterm we have to change our priorities and we are going to have to protect people from a lot of layoffs.
But the second point I want to make--
Justice Scalia: The issue is not whether that's a fair thing for the national union to do.
The issue is whether the person who is being compelled against his will to pay dues to the union is getting anything back for that compelled payment.
And even though the national union may be acting in an entirely fair fashion, given its national objectives, the -- the compelled payment is not doing what our cases seem to say it must do.
It has to be paying for services rendered.
Mr. Collins: --What -- the value the -- the objector is getting is not have a guarantee of services.
He has the potential for services far beyond what could ever be paid for out of the local's own affiliation fees.
And I would add if a national union were to act in some improper way in terms of how it doles out assistance -- and by the way, one doesn't see cases on this, it's really not in the nature of how national unions operate, because again, we are talking about members and nonmembers equally in terms of who's going to get benefits.
So it's not a problem in the real world of national unions treating a particular local unfairly for some reason and not giving them services that are given to others.
There are certainly a lot of judgments involved, as Justice Ginsburg's question elicited.
But if a national union were to treat affiliates unfairly, it's quite possible that if and when that occurred, that it might have implications under a number of possible causes of actions and including possibly the right to object.
Justice Scalia's opinion in Lehnert noted that if and when services aren't provided, there might be ground for objection.
The question here is is this a basis under the First Amendment to have a prophylactic rule that says we are so concerned that even though we have no rule under Hudson that provides assurance that an unaffiliated local union will provide any particular services to its members and nonmembers, we have such a concern that somehow national unions won't deliver the goods, that we are going to set up the hierarchy of either guarantees, standards, which if the issue had been presented here and we had created a record, we would show the Court -- I think no union in this country has and for good reason, both because of the virtual infinitude of legitimate factors one could consider also because of the constant changes in needs of local unions--
Justice Alito: If certain -- if certain fees are are being assessed on the theory that this is a pooling arrangement, I don't understand why you're resisting any effort to impose any standards or any inquiry as to whether it's really a pooling arrangement?
Mr. Collins: --Because, Your Honor -- and the reason I started my argument by saying there is really two choices, a local union goes it alone or has the arrangement that we have here, is that it simply would not be possible in the nature of things to have a set of standards and guarantees that would be meaningful in any way to govern how national unions provide services to locals.
A standard of basic fairness and equal treatment is one thing, but to try to say -- and one could tick off, I suppose, 50 things we'll consider.
We'll consider whether it's going to be an important precedent, whether it's the kind of thing a local can't afford on its own, whether it's important now that we have pressing economic problems and everyone is being laid off, is this a good test case or a bad test case, how broad will the implications of this be.
One could list 50 factors, but they wouldn't guide any inquiry in a meaningful way.
Chief Justice Roberts: So if we determine as a matter of First Amendment law that such a requirement is necessary, then you lose, because you're saying we can't possibly fashion the test?
Mr. Collins: Then we lose and so does the union in Lehnert lose.
There was no -- it was acknowledged that there was nothing like that.
Chief Justice Roberts: Lehnert didn't address the question of litigation.
Mr. Collins: Well, but if -- but there has been no argument made that would explain why if you -- if one can pool -- if the union negotiates an agreement with a very controversial provision that a nonmember has a very legitimate objection to, Lehnert holds that can be pooled.
Lehnert does not say the standard--
Justice Alito: Your argument seems to be that the whole analogy of a pooling arrangement is invalid.
That was unrealistic, because there really is no way of telling whether any of these things is a pooling arrangement.
There is no standard that could possibly be articulated that would be meaningful to determine whether something that is labelled a pooling arrangement really is in any way a pooling arrangement.
That seems to me argument.
That would seem to cut against the whole idea of pooling arrangements not only for litigation expenses, but for everything else.
Mr. Collins: --I have two responses to that, Justice Alito.
First, the -- if one had to have the kinds of either guarantees or meaningful enforceable standards that are implied in your question, then in the nature of the beast, it could not be done by national unions, and we would be in a system then when all that can happen is that a local union has to rely solely on its own resources, solely on its own expertise.
And it's doing that despite, as Judge Lynch pointed out in the concurrence, despite the dire impact that can have on its ability to represent people and it's doing it--
Justice Scalia: Well, it doesn't have to do that.
It can use the money of its union members any way it wants.
It can contribute to the national all of their money if it wishes.
We are only talking about that portion of the union income which comes from people who don't want to join the union.
Mr. Collins: --Well, then it either has to allow for -- the union has to either conclude we are going to support all of our germane activities, all of our chargeable activities through our own funding and our own resources, and if that's just inadequate and therefore litigation needs to be conducted, we can't do it; the employer knows that so it can take advantage of us in bargaining; we are just going to have to live with it; or we can say our members will pay for that but the nonmembers won't, because the only solution other than using the local's own money is to pay a fee to the national.
And as I've indicated in Lehnert as in this case, the arrangement is not one that provides guarantees--
Justice Kennedy: Well, one of the difficulties it seems to me is the Petitioner's position with the sort of all or nothing approach.
But you seemed to be taking the mirror position of that.
Your argument is all or nothing on your side.
I don't get much help from either side as to what the standard should be.
I know germane is obviously a malleable word, but we are looking to see if there is some test that we can use that's not all or nothing.
Mr. Collins: --Well--
Justice Kennedy: I haven't heard from either side yet what that would be.
Mr. Collins: --The -- the question, Justice Kennedy, is whatever the test is if it's satisfied as to expenditures within the unit where the services are provided, can those services be pooled or is there a different test that has to be applied to the pooling?
My submission is that Lehnert makes clear there is no separate test.
As to what the test is within -- and therefore, as to the question presented here, one doesn't need to decide on the actual test that will be applied within the local because as your separate opinion and Justice Scalia's separate opinion in Lehnert made clear, even under the narrower statutory duties test there could still be pooling; the definition as to what can be pooled would simply be different.
I'd only note on the question of whether the tests should be germaneness with the two additional prongs as held in Lehnert, or the statutory duties test, that again is a question that's not presented here.
As I just indicated it doesn't affect the concept of pooling.
There has also been no confusion, contrary to Petitioner's contention, under the Lehnert test.
The only issue that's given the courts difficulties is the specific issue here as to why the plurality in Lehnert seemed to indicate that litigation might be in a different status under pooling.
So there is no basis in this case for reconsidering the basic Lehnert test of chargeability.
I will simply note, however, that the statutory duties test which -- for which Petitioners argue really doesn't make the situation clearer than the -- than the germaneness test because the Government -- both the germaneness test and the statutory duties test acknowledge that the union's right to charge objecting nonmember stems from its function as exclusive bargaining representative; but there is no way to sustain logically the notion that that means that only those things that are done in that exclusive representative capacity are chargeable; because the same Government interests that allow for charging when the union is acting as the exclusive bargaining agent have to also allow for charging for those things that are necessary in order for the union to play that role, and to enforce that role which includes things like the headquarters; it includes things like litigation to enforce an agreement, even though in those areas when performing those functions, the union very often does not have an exclusive representational duty or duty of fair representation.
Justice Breyer: Is there a rule or a reg somewhere in the Labor Department that says if the national union takes its money from its local, spends it in a way that has nothing to do with politics whatsoever, zero -- but either wastes it or they build too big a building, or they do something that doesn't benefit Local Number 432, does 432 have any remedy?
Mr. Collins: There is no Labor Department regulation.
Justice Breyer: There is no remedy at all.
Mr. Collins: No, and I--
Justice Breyer: So union members who are being gypped, they just have to put up with it.
Mr. Collins: --I would say there would be a breach of covenant of faith and fair dealing under the affiliation relationship in some of those situations; and of course if a union used an illegal basis for determining whether it would provide services to the--
Justice Breyer: Right.
Are you saying you could bring a lawsuit or not?
Mr. Collins: --You could bring a lawsuit alleging that the union violated its covenant of good faith and fair dealing to its affiliates, if the union acted on the basis of say, race, for example, you could certainly bring a lawsuit then.
Justice Breyer: So either -- in these cases everybody in the union whether they're forced or not, has this kind of remedy or nobody does?
Mr. Collins: Right.
And the reason for that is -- what we always have to understand here, is the interest in seeing to it that a local union that pays an affiliation fee will receive services in a fair way from the national is an interest that's shared equally by the members and the nonmembers.
It's not something that creates a First Amendment concern.
Chief Justice Roberts: Well, that's not right.
Again we have to postulate that we are dealing with nonmembers who don't like unions at all.
So while the members may think this is perfectly fair, the nonmembers whenever their money is forced to be used for union activities, it's unfair.
Mr. Collins: But a -- a member equally with a nonmember would, Mr. Chief Justice, have the view that if it's predictable year after year that for some reason his local doesn't get services from the national union, the national union sends it elsewhere, that member is going to be no more happier -- happy than the nonmember.
That's why those things don't happen in the real world.
That's why we certainly don't need a prophylactic rule and there would certainly be no First Amendment basis for a prophylactic rule that requires the union to establish what no union in this country to my knowledge has, which is either a clear guarantee or specific standards for providing services.
Chief Justice Roberts: Thank you, Mr. Collins.
Mr. Young, you have four minutes.
REBUTTAL ARGUMENT OF W. JAMES YOUNG ON BEHALF OF THE PETITIONERS
Mr. Young: Thank you, Mr. Chief Justice.
I think it's appropriate to note the apocalyptic predictions that are suggested from the rule that the Petitioners are advancing are avoidable by easily -- readily available alternatives.
International unions would of course be free to make loans to local affiliates engaged in massive litigation or other speech activities where they think it's appropriate.
But the alternative is not between prohibiting pooling arrangements which have no standards, no enforceability and no predictability, and allowing the nonmembers to become free riders on legitimate litigation expenditures funded through the international affiliate.
The choice is between a malleable -- a malleable unpredictable and ultimately unenforceable agreement and a standard which would allow the international to subsidize such litigation and allow the true -- only the costs of that litigation to be extracted from nonmembers.
Justice Breyer: And the case -- the case that says that a union member, person forced into the union agency shop -- and I guess a lawyer who has to pay to be an integrated bar and I guess a doctor who has to join a medical association -- the case that says that these people have a First Amendment right to get back money that's being wasted, is what?
Mr. Young: We don't suggest that there is such a right, Justice Breyer.
Justice Breyer: So unless it's political in your view, you don't have that right?
Mr. Young: Unfortunately no, Justice Breyer.
Chief Justice Roberts: The test is not whether it's political, is it?
It's not a negative test.
It's an affirmative requirement in which the burden is on the union that they have to show the expenditure is germane to the particular collective bargaining agreement?
Mr. Young: Yes, Mr. Chief Justice, that's exactly correct, and -- and the test in determining whether or not it is a -- can be charged across bargaining unit lines is a bright-line test of whether it is a speech activity.
Chief Justice Roberts: Well, do you have a response to Justice Kennedy's concern?
Do you have a fallback position or are you also in the all or nothing--
Mr. Young: I'm afraid you've got two principled advocates before you Mr. Chief Justice who are holding firm to their positions.
I would however like to address one more point.
I think it's appropriate to recall, get us back again to the focus on this is compelled speech subject to the Court's strict scrutiny jurisprudence.
The test suggested by MSEA is that a union's activities are subject to a, subject to the duty of fair representation and to the covenant of good faith and fair dealing under the duty of fair and/or under the duty of fair represent which of course is that wide range of reasonableness cannot be sustained where this court's standard is the least restrictive means.
Chief Justice Roberts: --Thank you counsel.
The case is submitted.