NLRB v. Servette, Inc.

Background

A wholesale distributor in Los Angeles supplied candy and specialty items to supermarket chains. During a union strike, Local 848 asked supermarket managers to stop handling the distributor’s products and warned that handbills asking customers not to buy those items would be passed out; in some cases handbills were distributed. The distributor charged the union with violating two parts of the labor law that bar inducing individuals to refuse to handle goods and that bar threats or coercion to force someone to stop dealing in another’s products. The National Labor Relations Board dismissed the complaint, the federal Court of Appeals set that dismissal aside, and the Supreme Court then agreed to review the case.

Reasoning

The Court addressed whether the union’s appeal to managers was unlawful inducement and whether the handbills were protected publicity. The Court said the word “individual” does include supermarket managers, but the union’s request here asked managers to exercise their managerial judgment rather than to stop performing their employment duties, so it was not the kind of inducement subsection (i) forbids. The Court explained that the 1959 amendments were meant to close loopholes, not to outlaw voluntary appeals to persons who have authority to choose. The Court also held that the proviso protecting truthful publicity covers products distributed by a wholesaler, so the handbills were protected, and warnings that handbills would be given were not unprotected threats.

Real world impact

The ruling lets unions truthfully inform the public about goods distributed by a company in a labor dispute and permits asking store managers to stop carrying those goods when managers lawfully decide to do so. At the same time, explicit threats or coercion to force an employer to cease dealing remain unlawful, leaving a separate protection against coercive conduct.