Kerwin v. Starbucks Corp.

1

ELIZABETH KERWIN, Petitioner, v. STARBUCKS CORPORATION, Respondent.

Civil Action No. 22-cv-12761

United States District Court, E.D. Michigan, Southern Division

March 6, 2023

OPINION & ORDER DENYING RESPONDENT'S EMERGENCY MOTION FOR STAY (DKT. 38)

MARK A. GOLDSMITH United States District Judge.

Before the Court is Respondent Starbucks Corporation's emergency motion (Dkt. 38) to stay this Court's February 23, 2023 order for injunctive relief (Dkt. 36) awarded to Petitioner Elizabeth K. Kerwin-Regional Director for the Seventh Region of the National Labor Relations Board (NLRB or Board)-under § 10(j) of the National Labor Relations Act (NLRA), 29 U.S.C. § 160(j). For the reasons that follow, the Court denies Starbucks's motion.^[1]

I. BACKGROUND

On February 23, 2023, this Court found that Kerwin had shown reasonable cause to believe that Starbucks had violated §§ 8(a)(3) and (1) of the NLRA at its store on Main Street in Ann Arbor, Michigan based on its termination of Hannah Whitbeck, an employee involved with Workers United's union activities. See 2/23/23 Op. &amp Order at 4-8. Since her termination Starbucks has offered to reinstate Whitbeck, and she accepted interim reinstatement. See Br. in Supp. Mot. at 16.

This Court determined that certain injunctive relief was just and proper to restore the parties to the status quo pending the Board's proceedings on this matter. 2/23/23 Op. &amp Order at 8-14. Consistent with the relief ordered by the administrative law judge (ALJ) who adjudicated this dispute see ALJ Decision at 34-36 (Dkt. 1-4), the Court ordered that Starbucks (i) offer reinstatement to Whitbeck, (ii) cease and desist from discharging employees for engaging in protected activities and from violating employees' rights under § 7 of the NLRA “[i]n any like or related manner,” (iii) post physical copies of the Court's order for injunctive relief, and (iv) read aloud the Court's order-all at the Ann Arbor location. See 2/23/23 O. for Inj. Relief.^[2]

Starbucks now requests that this Court either (i) stay its injunction order pending the outcome of Starbucks's appeal to the United States Court of Appeals for the Sixth Circuit, or (ii) modify the order and extend the compliance deadline by 30 days to allow the Sixth Circuit to rule on Starbucks's motion to stay in that court. See Br. in Supp. Mot. at 24.^[3]

II. ANALYSIS

In determining whether to grant a stay, a court considers four interrelated factors: “(1) the likelihood that the party seeking the stay will prevail on the merits of the appeal; (2) the likelihood that the moving party will be irreparably harmed absent a stay; (3) the prospect that others will be harmed if the court grants the stay; and (4) the public interest in granting the stay.” Commonwealth v. Beshear, 981 F.3d 505, 508 (6th Cir. 2020) (punctuation modified). “[A] stay is an intrusion into the ordinary processes of administration and judicial review,” and “the heavy burden for making out a case for such extraordinary relief rests on the moving party.” Kentucky v. Biden, 23 F.4th 585, 593 (6th Cir. 2022) (punctuation modified).

A. Likelihood of Success on Merits

“To demonstrate a likelihood of success on the merits, the movant must show, at a minimum, serious questions going to the merits.” Dodds v. United States Dep't of Educ., 845 F.3d 217, 221 (6th Cir. 2016) (punctuation modified). It is insufficient to show a mere “possibility of success” on the merits. McKinney v. Starbucks Corp., 2022 U.S. App. LEXIS 24999, at *6 (6th Cir. Sept. 6, 2022).

Starbucks raises multiple challenges to the injunctive relief granted to Kerwin. For the reasons that follow, Starbucks is not likely to prevail on the merits of any of its arguments. This Court is particularly persuaded by McKinney, where Starbucks allegedly perpetrated the same harms as those at issue here-violations of §§ 8(a)(3) and (1) based on unlawful terminations- and the Sixth Circuit denied Starbucks's motion to stay the grant of very similar relief because Starbucks was not likely to succeed on the merits. See id. at *11.

i. Whether Reading Remedy is Appropriate

Starbucks submits that a reading remedy is “generally not ordered by the NLRB in a single employee discharge case,” and it argues that this case is not the extraordinary dispute that merits that relief. Br. in Supp. Mot. at 4. In Starbucks's view, this relief is appropriate in unusual circumstances, but not in the absence of evidence that Starbucks “has committed widespread unfair labor practices, is a ‘recidivist,'” or subjects union activities “to an on-going chill.” Id. at 8-9.

As Kerwin and Workers United's case law demonstrates, § 10(j) injunctive relief generally-and reading remedies in particular-are properly awarded even where a single employee or no employees at all have been terminated.^[4]

Further, the scenario presented by this dispute-where Kerwin has shown reasonable cause to believe that Starbucks violated the NLRA less than a year ago, and where it appears that Starbucks decisionmakers remain in the same positions of power-is distinguishable from the one Sixth Circuit case cited by Starbucks where public reading requirements were found improper. See Sysco Grand Rapids, LLC v. Nat'l Lab. Rels. Bd., 825 Fed.Appx. 348, 359 (6th Cir. 2020) (denying enforcement of public reading remedy, given “the passage of several years and the 30% turnover in [respondent] employees” as well as the retirement of senior manager who had voiced anti-union sentiment) (punctuation modified).

Starbucks also improperly discounts the risk of chill to employees foregoing their rights under the NLRA by ignoring facts and legal theories presented by Kerwin, including that (i) Whitbeck was a public and influential member of the unionization effort, see 2/2/23 Op. & Order at 2, 6-8; and (ii) the termination of union supporters-especially when the union is newly organized-can “have an inherently chilling effect on other employees,” Ahearn v. Jackson Hosp. Corp., 351 F.3d 226, 239 (6th Cir. 2003).

ii. Whether Reading Implicates First Amendment Concerns and Property Rights

Starbucks insists that a reading remedy implicates First Amendment concerns, in continued reliance on Sysco, 825 Fed.Appx. at 359. Br. in Supp. Mot. at 5-8. This Court has already explained why that case is distinguishable and why Starbucks's argument lacks merit. See 2/23/23 Op. & Order at 14 n. 7.

Starbucks also argues for the first time that the requirement that Starbucks allow a Board agent to attend each reading “impairs Starbucks'[s] right to exclude persons from its property.” Br. in Supp. Mot. at 7. The case cited by Starbucks casts no doubt on the propriety of allowing government agents to attend one-time reading events in aid of enforcing federal law. See Cedar Point Nursery v. Hassid, 141 S.Ct. 2063, 2080 (2021) (finding that state regulation allowing labor organizations to regularly access employer's property to solicit union support constituted taking).

iii. Whether the Cease-and-Desist Order Goes Beyond Status Quo

Starbucks argues that the cease-and-desist order goes beyond the status quo because it enjoins Starbucks (i) from “discharging any partners at the Main Street store, not just Whitbeck,” and (ii) from interfering with employees' exercise of § 7 rights. Br. in Supp. Mot. at 9-10. In Starbucks's view, this order “go[es] beyond the allegations alleged in the underlying complaint in terms of the employees they purport to reach” and improperly seeks to “regulate future conduct.” Id. at 10 (emphasis in original).

In fact, the Board's initial complaint sought to address harms beyond the single termination of Whitbeck, as the Board alleged that Whitbeck “assisted and supported” Workers United in its labor activities and that Starbucks terminated her “to discourage employees from engaging” in protected activities. Board Compl. at 2 (Dkt. 1-3). An order “directing Starbucks to cease unlawful behaviors” is appropriate to protect the Board's remedial powers as to all employees at the store where Starbucks terminated a union supporter. McKinney v. Starbucks Corp., No. 2:22-cv-2292-SHL-CGC, 2022 WL 5434206, at *21-*22 (W.D. Tenn. Aug. 18, 2022) (granting in part Board's petition for § 10(j) injunction). This relief “[a]chiev[es] the status quo between Starbucks” and its employees and mitigates the “reasonable apprehension” that, absent interim protection, “the efficacy of the NLRB's final order may be nullified and the administrative procedures rendered meaningless.” Id. at *21 (punctuation modified). For this reason, a cease-and-desist order- including an order applicable to future conduct-is a “‘standard'” form of § 10(j) relief. 2/23/23 Op. & Order at 10 (quoting Paulsen v. PrimeFlight Aviation Servs., Inc., 718 Fed.Appx. 42, 45 (2d Cir. 2017)). Courts regularly approve cease-and-desist orders granting the relief ordered here, including the cessation of § 7 violations based on the discharge of employees in violation of § 8(a).^[5]

iv. Whether Cease-and-Desist Order Conflicts with Normal § 10(j) Processes

Starbucks asserts that the Court's cease-and-desist order “short circuit[s]” the requirement under § 10(j) that the Board issue a complaint before it seeks an injunction because it allows the Board to initiate proceedings based on the unlawful discharge at the Ann Arbor store pursuant to the Court's order. Br. in Supp. Mot. at 10-11.

This argument-raised here for the first time before this Court-appears to be a challenge applicable to all cease-and-desist orders included in § 10(j) injunctions. But this form of relief is “standard,” Paulsen, 718 Fed.Appx. at 45, and is expressly envisioned by § 10(j), see 29 U.S.C. § 160(c) (stating that the Board, upon concluding that a respondent has...