Station Casinos sues over labor board proceedings’ constitutionality

Station Casinos on Tuesday filed a constitutional challenge to National Labor Relations Board proceedings, seeking a way to stop several union-busting allegations in litigation by alleging the federal agency lacks the authority to prosecute claims against businesses like them.

The locals casino operator filed a lawsuit against the administrative agency and its leaders in the U.S. District Court in Nevada, records show. The company seeks a temporary and permanent injunction to halt pending proceedings in the nation’s top labor relations court.

“Station Casinos has taken the extraordinary step of suing the NLRB because the NLRB system has failed it and many other companies and, more importantly, threatens to deprive Station Casinos’ team members of their right to choose whether to be represented by a union or not,” the company said in a news release.

The case comes several months after the commencement of NLRB trial hearings related to an April 2021 complaint. Attorneys for the National Labor Relations Board argued that Red Rock Resorts — the parent company of the Station Casinos brand — used the COVID-19 pandemic layoffs to undermine Culinary Local 226 union-affiliated workers and union representation in the company.

The court filing is the latest in a back-and-forth battle of wills between Station Casinos, whose controlling owners are Frank and Lorenzo Fertitta, and Culinary. The union has tried to collectively bargain at several unionized Station properties for years, but they have not signed a contract. Some properties have even reversed their interest in union representation — though some of those actions are subject of unfair labor practice allegations in the NLRB trial.

Representatives for the NLRB did not respond to a request for comment by publication time. In a statement responding to the lawsuit, Culinary Secretary-Treasurer Ted Pappageorge said executives, including the Fertittas, are expected to testify in the ongoing NLRB proceedings.

“Across the country, corporate tactics aimed at weakening worker rights and protections are being exposed and dismantled, as most courts have seen through these meritless arguments and rightly rejected them,” Pappageorge said in a statement. “We expect the same outcome in Station Casinos’ baseless lawsuit.”

An NLRB decision in June ordered Red Rock Resorts to bargain with Culinary at Red Rock casino because it engaged in union-busting tactics before workers voted on representation. The company said it appealed that decision in the D.C. Court of Appeals.

Lawsuit details

In Tuesday’s lawsuit, attorneys for Station Casinos argue that Article II of the Constitution — which establishes the executive branch — requires that NLRB board members and administrative law judges be removable by the president. But, the president cannot remove them and instead they can only be removed for “good cause.”

In other claims, the attorneys also argue the NLRB proceedings deprive Station Casinos the right to a jury trial and challenges the fairness of allowing the agency to “act as prosecutor, judge and jury, all in the same case.”

In a typical case for the agency tasked with refereeing labor-related disputes and providing make-whole remedies, NLRB’s regional directors issue complaints related to unfair labor practice allegations. Administrative law judges issue decisions and recommend orders, which can be appealed to the Board, made up of presidential appointees. Board decisions can also be appealed in the U.S. Court of Appeals.

This argument has been made elsewhere. In July, an NLRB proceeding regarding claims against tech billionaire Elon Musk’s SpaceX were temporarily blocked while the rocket maker’s challenge to the agency’s structure goes through the courts.

Culinary officials said changes to administrative law hearings could have consequences for labor.

“In today’s lawsuit, Station Casinos argues that the President of the United States should be able to fire NLRB Board Members and NLRB administrative law judges at the President’s discretion and without cause, giving the President power to appoint people who will carry out their agenda,” Pappageorge said. “The ramifications of such an extreme argument by Station Casinos are unprecedented and dangerous, and we adamantly reject them.”

Ruben Garcia, a labor law professor at UNLV’s Boyd School of Law, said challenges to the NLRB structure have come regularly through the agency’s nearly 90 years of practice. The future of Station’s case may depend on the outcome of SpaceX’s and other similar challenges.

“It’s not the end of the agency in this one case, but it will make things — in these cases anyway — longer and more drawn out,” Garcia said, “which is ultimately why there’s no representation or no contract at a lot of these properties.”