Thursday, June 17, 2010


The Supreme Court is finally getting around to deciding some of the more important cases of the Term (Monday's decisions were too boring to mention), and today it came out with the New Process Steel case and determined the fate of hundreds of NLRB decisions.

The question was, can the National Labor Relations Board operate with just two members? The normal membership of the Board is five members, and a quorom is normally three. So you might think that the Board couldn't operate with just two.

But, the Board's organic statute allows the Board to delegate its powers to a three-member group, and then provides that a quorom of such a group shall be two. Presumably, the idea here was for the Board to be able to authorize itself to meet in panels of three, the way an appellate court with many judges does routinely. So if the Board authorized a panel of three to consider a case, and then one of the members was disqualified, the remaining two could decide the case.

But the Board faced an unusual situation: toward the end of 2007, the Board was down to four members -- and two of their terms were expiring shortly. It would soon be down to two members, below the quorom of three.

So the Board delegated its powers to three of the members, including one whose term was expiring, and then claimed, when it was down to two members, that those two constituted a quorom of the group of three! The remaining two members thereby decided almost 600 cases, while the President and the Senate squabbled about whom to add to the Board as new members.

By a 5-4 vote, the Supreme Court has now squashed this maneuver. While recognizing that the Board's action rested on a "textually permissible" reading of the organic statute, the Court effectively said that it just couldn't believe that Congress intended the Board to be able to operate with just two members on a long-term basis. The statutory provision for a two-member quorom of a three-member group was for unusual circumstances, not for hundreds of cases over a period of years, the Court believed.

I have to give this one to the dissenters. I expect the Court is right that Congress didn't intend the Board to operate routinely with just two members, but it probably didn't intend the Board to cease functioning either. Congress probably didn't anticipate that the full Board membership would fall to just two members.

The question is how the statute Congress wrote applies to this unforeseen circumstance. The statute permits delegation of the Board's power to any three members and permits two of those three to constitute a quorom. That's what the Board did. As the dissenters observed, the Board's action was "a thoughtful and considerate exercise of its reasonable discretion when it was confronted with two imperfect alternatives."

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