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Donohue v. Milan

United States Court of Appeals, Second Circuit

November 18, 2019

DANNY DONOHUE, AS PRESIDENT OF THE CIVIL SERVICE EMPLOYEES ASSOCIATION, INC., LOCAL 1000, AFSCME, AFL-CIO, CIVIL SERVICE EMPLOYEES ASSOCIATION, LOCAL 1000, AFSCME, AFL-CIO, JOHN DELLIO, INDIVIDUALLY AND ON BEHALF OF ALL OTHERS SIMILARLY SITUATED, MICHAEL BOULERIS, INDIVIDUALLY AND ON BEHALF OF ALL OTHERS SIMILARLY SITUATED, MAUREEN ALONZO, INDIVIDUALLY AND ON BEHALF OF ALL OTHERS SIMILARLY SITUATED, MARCOS DIAMANTATOS, INDIVIDUALLY AND ON BEHALF OF ALL OTHERS SIMILARLY SITUATED, Plaintiffs-Appellees,
v.
CARLOS MILAN, IN HIS OFFICIAL CAPACITY AS DIRECTOR OF EMPLOYEE RELATIONS AND EMPLOYEE SAFETY, NEW YORK STATE THRUWAY AUTHORITY AND NEW YORK STATE CANAL CORPORATION, HOWARD P. MILSTEIN, INDIVIDUALLY AND IN HIS OFFICIAL CAPACITY AS CHAIRMAN OF NEW YORK STATE THRUWAY/CANAL CORPORATION BOARD OF DIRECTORS, DONNA J. LUH, INDIVIDUALLY, E. VIRGIL CONWAY, IN HIS OFFICIAL CAPACITY AS BOARD MEMBER OF NEW YORK STATE THRUWAY/CANAL CORPORATION BOARD OF DIRECTORS, RICHARD N. SIMBERG, INDIVIDUALLY, BRANDON R. SALL, INDIVIDUALLY, J. DONALD RICE, JR., INDIVIDUALLY, JOSE HOLGUIN- VERAS, INDIVIDUALLY, NEW YORK STATE THRUWAY AUTHORITY, Defendants-Appellants, THOMAS J. MADISON, JR., INDIVIDUALLY AND IN HIS OFFICIAL CAPACITY AS EXECUTIVE DIRECTOR OF THE NEW YORK STATE THRUWAY AUTHORITY AND THE NEW YORK STATE CANAL CORPORATION, Defendants. DANNY DONOHUE, AS PRESIDENT OF THE CIVIL SERVICE EMPLOYEES ASSOCIATION, INC., LOCAL 1000, AFSCME, AFL-CIO, CIVIL SERVICE EMPLOYEES ASSOCIATION, INC., LOCAL 1000, AFSCME, AFL-CIO, WILLIAM COLEMAN, INDIVIDUALLY AND ON BEHALF OF ALL OTHERS SIMILARLY SITUATED, WILLIAM MILLER, INDIVIDUALLY AND ON BEHALF OF ALL OTHERS SIMILARLY SITUATED, JOHN METZGIER, INDIVIDUALLY AND ON BEHALF OF ALL OTHERS SIMILARLY SITUATED, JACK WIEDEMAN, INDIVIDUALLY AND ON BEHALF OF ALL OTHERS SIMILARLY SITUATED, Plaintiffs-Appellees, JOHN DELLIO, INDIVIDUALLY AND ON BEHALF OF ALL OTHERS SIMILARLY SITUATED, MICHAEL BOULERIS, INDIVIDUALLY AND ON BEHALF OF ALL OTHERS SIMILARLY SITUATED, MAUREEN ALONZO, INDIVIDUALLY AND ON BEHALF OF ALL OTHERS SIMILARLY SITUATED, MARCOS DIAMANTATOS, INDIVIDUALLY AND ON BEHALF OF ALL OTHERS SIMILARLY SITUATED, NEW YORK STATE THRUWAY EMPLOYEES LOCAL 72, JOSEPH E. COLOMBO, GEORGE E. SAVOIE, DAVID M. MAZZEO, INDIVIDUALLY AND ON BEHALF OF ALL OTHERS SIMILARLY SITUATED, Plaintiffs,
v.
CARLOS MILAN, INDIVIDUALLY AND IN HIS OFFICIAL CAPACITY AS DIRECTOR OF EMPLOYEE RELATIONS AND EMPLOYEE SAFETY, NEW YORK STATE THRUWAY AUTHORITY AND NEW YORK STATE CANAL CORPORATION, BRIAN U.STRATTON, INDIVIDUALLY AND IN HIS OFFICIAL CAPACITY AS DIRECTOR OF THE NEW YORK STATE CANAL CORPORATION, HOWARD P. MILSTEIN, INDIVIDUALLY AND IN HIS OFFICIAL CAPACITY AS CHAIRMAN OF NEW YORK STATE THRUWAY AUTHORITY/CANAL CORPORATION BOARD OF DIRECTORS, E. VIRGIL CONWAY, INDIVIDUALLY AND IN HIS OFFICIAL CAPACITY AS BOARD MEMBER OF THE NEW YORK STATE THRUWAY/CANAL CORPORATION BOARD OF DIRECTORS, NEW YORK STATE THRUWAY AUTHORITY, NEW YORK STATE CANAL CORPORATION, DONNA J. LUH, INDIVIDUALLY AND IN HER OFFICIAL CAPACITY AS VICE-CHAIRMAN NEW YORK STATE THRUWAY/CANAL CORPORATION BOARD OF DIRECTORS AND IN HER OFFICIAL CAPACITY AS VICE-CHAIR OF THE NEW YORK STATE THRUWAY AUTHORITY BOARD OF DIRECTORS, RICHARD N. SIMBERG, INDIVIDUALLY AND IN HIS OFFICIAL CAPACITY AS BOARD MEMBER OF THE NEW YORK STATE THRUWAY/CANAL CORPORATION BOARD OF DIRECTORS AND IN HIS OFFICIAL CAPACITY AS BOARD MEMBER OF THE NEW YORK STATE THRUWAY AUTHORITY, BRANDON R. SALL, INDIVIDUALLY AND IN HIS OFFICIAL CAPACITY AS BOARD MEMBER OF NEW YORK STATE THRUWAY/CANAL CORPORATION BOARD OF DIRECTORS AND IN HIS OFFICIAL CAPACITY AS BOARD MEMBER OF THE NEW YORK STATE THRUWAY AUTHORITY, J. DONALD RICE, JR., INDIVIDUALLY AND IN HIS OFFICIAL CAPACITY AS BOARD MEMBER OF THE NEW YORK STATE THRUWAY/CANAL CORPORATION BOARD OF DIRECTORS, JOSE HOLGUIN-VERAS, INDIVIDUALLY AND IN HIS OFFICIAL CAPACITY AS BOARD MEMBER OF NEW YORK STATE THRUWAY/CANAL CORPORATION BOARD OF DIRECTORS AND IN HIS OFFICIAL CAPACITY AS BOARD MEMBER OF THE NEW YORK STATE THRUWAY AUTHORITY, Defendants-Appellants, THOMAS J. MADISON, JR., INDIVIDUALLY AND IN HIS OFFICIAL CAPACITY AS EXECUTIVE DIRECTOR OF THE NEW YORK STATE THRUWAY AUTHORITY AND THE NEW YORK STATE CANAL CORPORATION, Defendant. NEW YORK STATE THRUWAY EMPLOYEES LOCAL 72, JOSEPH E. COLOMBO, GEORGE SAVOIE, DAVID M. MAZZEO, INDIVIDUALLY AND ON BEHALF OF ALL OTHERS SIMILARLY SITUATED, Plaintiffs-Appellees
v.
NEW YORK STATE THRUWAY AUTHORITY, HOWARD P. MILSTEIN, INDIVIDUALLY AND IN HIS OFFICIAL CAPACITY AS CHAIRMAN OF THE NEW YORK STATE THRUWAY AUTHORITY, THOMAS RYAN, IN HIS OFFICIAL CAPACITY, E. VIRGIL CONWAY, IN HIS OFFICIAL CAPACITY AS BOARD MEMBER OF THE NEW YORK STATE THRUWAY AUTHORITY, BRANDON R. SALL, IN HIS OFFICIAL CAPACITY AS BOARD MEMBER OF THE NEW YORK STATE THRUWAY AUTHORITY, JOHN F. BARR, IN HIS OFFICIAL CAPACITY AS DIRECTOR OF ADMINISTRATIVE SERVICES OF THE NEW YORK STATE THRUWAY AUTHORITY, DONNA J. LUH, IN HER OFFICIAL CAPACITY AS VICE-CHAIR OF THE NEW YORK STATE THRUWAY AUTHORITY BOARD OF DIRECTORS, RICHARD N. SIMBERG, IN HIS OFFICIAL CAPACITY AS BOARD MEMBER OF THE NEW YORK STATE THRUWAY AUTHORITY, J. DONALD RICE, JR., IN HIS OFFICIAL CAPACITY AS BOARD MEMBER OF THE NEW YORK STATE THRUWAY AUTHORITY, JOSE HOLGUIN-VERAS, IN HIS OFFICIAL CAPACITY AS BOARD MEMBER OF THE NEW YORK STATE THRUWAY AUTHORITY, Defendants-Appellants, THOMAS J. MADISON, JR., INDIVIDUALLY AND IN HIS OFFICIAL CAPACITY AS EXECUTIVE DIRECTOR OF THE NEW YORK STATE THRUWAY AUTHORITY, JOHN M. BRYAN, IN HIS OFFICIAL CAPACITY AS CHIEF FINANCIAL OFFICER AND TREASURER OF THE NEW YORK STATE THRUWAY AUTHORITY, JOSEPH BRESS, INDIVIDUALLY AND IN HIS OFFICIAL CAPACITY AS CHIEF NEGOTIATOR OF THE NEW YORK STATE THRUWAY AUTHORITY, HOWARD GLASER, INDIVIDUALLY AND IN HIS OFFICIAL CAPACITY AS DIRECTOR OF STATE OPERATIONS AND SENIOR POLICY ADVISOR TO THE GOVERNOR OF NEW YORK, DONALD R. BELL, INDIVIDUALLY AND IN HIS OFFICIAL CAPACITY AS DIRECTOR OF MAINTENANCE AND OPERATIONS OF THE NEW YORK STATE THRUWAY AUTHORITY, Defendants.

          Argued: March 13, 2019

         In this appeal, we consider whether State Employees Bargaining Agent Coalition v. Rowland, which held that union activity is protected by the First Amendment right to freedom of association and that heightened scrutiny applies to employment decisions that target an employee "based on union membership," 718 F.3d 126, 134 (2d Cir. 2013), extends to agency fee payors (AFPs), who are not union members, based solely on the fact that AFPs are represented by a union during collective bargaining. We hold that First Amendment protections apply to union members but do not extend to AFPs based on union representation alone. We therefore VACATE and REMAND the District Court's order as it applies to AFPs but AFFIRM the District Court's order as it applies to union members.

          Beth A. Bourassa (Christopher W. Meyer, Norma G. Meacham, Monica R. Skanes, on the brief), Whiteman Osterman & Hanna LLP, Albany, NY, for Defendants-Appellants.

          Aaron E. Kaplan (Daren J. Rylewicz, Jennifer C. Zegarelli, on the brief), Civil Service Employees Association, Inc., Albany, NY, for Plaintiffs-Appellees in Donohue et al. v. Milan et al., 17-2832-cv, Donohue et al. v. Milan et al., 17-2833-cv.

          Gregg D. Adler (Nicole M. Rothgeb, on the brief), Livingston, Adler, Pulda, Meiklejohn & Kelly, P.C., Hartford, CT, for Plaintiffs- Appellees in N.Y. State Thruway Emps. Local 72 et al. v. N.Y. State Thruway Authority et al., 17-2834-cv.

          Before: WESLEY, LOHIER, and SULLIVAN, Circuit Judges.

          LOHIER, Circuit Judge:

         In State Employees Bargaining Agent Coalition v. Rowland, we held that union activity is protected by the First Amendment right to freedom of association and that heightened scrutiny therefore applies to employment decisions that target an employee "based on union membership." 718 F.3d 126, 134 (2d Cir. 2013). Many of the plaintiffs in this case are union members and thus clearly enjoy First Amendment protections based on their voluntary association with a union. But a small subset of the plaintiffs are non-union members called agency fee payors (AFPs). The main question here is whether, in light of Rowland, the AFPs' First Amendment rights are protected solely because the AFPs are represented by a union during collective bargaining.

         In an order granting summary judgment in favor of the Plaintiffs, the United States District Court for the Northern District of New York (Scullin, J.) interpreted our decision in Rowland to mean that strict scrutiny applies to a public employer's decision to fire both union members and AFPs because they are represented by unions during collective bargaining. Donohue v. Madison ("Donohue I"), No. 1:13-CV-918 (FJS) (CFH), 2017 WL 2171276, at *3-6 (N.D.N.Y. Apr. 14, 2017). The District Court ultimately certified its order for interlocutory appeal pursuant to 28 U.S.C. § 1292(b). Donohue v. Madison ("Donohue II"), No. 1:13-CV-918 (FJS) (CFH), 2017 WL 3206326, at *4-5 (N.D.N.Y. July 27, 2017). On appeal, we conclude that the AFPs' First Amendment right to association was not protected solely because the AFPs were represented by the union during collective bargaining. We therefore VACATE and REMAND the District Court's order as it applies to AFPs but AFFIRM the District Court's order as it applies to union members.

         Background

         1. Facts

         The New York State Thruway Authority (the Authority) finances, reconstructs, and operates the New York State Thruway and New York's canal system. For a number of years, the Authority faced significant financial pressures, including mounting debt due to the repair of aging infrastructure and rising health insurance costs for employees. In response, the Authority implemented cost-saving measures, including freezing salary increases for its non-unionized employees from 2009 to 2012. In 2012 the Authority's credit rating fell as it prepared to finance a replacement for the Tappan Zee Bridge. The Authority sought recurring operational cost reductions from its union- represented employees by getting concessions from its unions during negotiations over new collective bargaining agreements (CBAs).

         The Authority recognized three unions as the bargaining agents for four separate bargaining units of employees. New York law and the CBAs made anyone who accepted an Authority position in a bargaining unit a "union- represented" employee. See N.Y. Civ. Serv. Law § 204(2). Union-represented employees in turn were divided into two groups: union members who had signed a union membership card; and AFPs, who were not union members but were still represented by unions in collective bargaining. In accordance with then-governing law, see Abood v. Detroit Bd. of Educ., 431 U.S. 209, 235-42 (1977), overruled by Janus v. Am. Fed'n of State, Cty., & Mun. Emps., 138 S.Ct. 2448 (2018), AFPs were obligated to pay fees to support collective bargaining but could object to having their fees used to support the unions' political and ideological projects and, if they objected, receive a prorated refund.[1]

         Beginning in 2012, the Authority warned both the unions and union- represented employees that layoffs might result from the unions' refusal to make certain concessions with respect to the CBAs. After talks broke down, the Authority, true to its word, implemented a reduction in force (RIF). The RIF terminated only union-represented employees-218 union members ...


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