Petrochem Insulation, Inc. v. National Labor Relations Board

United States Court of Appeals

FOR THE DISTRICT OF COLUMBIA CIRCUIT

Argued November 13, 2000 Decided January 26, 2001

No. 99-1530

Petrochem Insulation, Inc.,

Petitioner

v.

National Labor Relations Board,

Respondent

United Association of Journeymen and Apprentices of the

Plumbing and Pipe Fitting Industry of the United States and

Canada, AFL-CIO, Locals 62, et al.,

Intervenor

On Petition for Review and Cross-Application

for Enforcement of an Order of the

National Labor Relations Board

Lawrence W. Marquess argued the cause for petitioner.

With him on the briefs was Darin L. Mackender.

Heather L. MacDougall and Daniel V. Yager were on the

brief of amici curiae LPA, Inc. and Associated Builders and

Contractors, Inc.

Anne Marie Lofaso, Attorney, National Labor Relations

Board, argued the cause for respondent. With her on the

brief were Leonard R. Page, General Counsel, Aileen A.

Armstrong, Deputy Associate General Counsel, and David S.

Habenstreit, Supervisory Attorney.

Peter D. Nussbaum argued the cause and filed the brief for

intervenor.

Before: Edwards, Chief Judge, Williams and Tatel,

Circuit Judges.

Opinion for the Court filed by Circuit Judge Tatel.

Tatel, Circuit Judge: The National Labor Relations Board

found that petitioner committed an unfair labor practice by

bringing a RICO suit against unions that opposed construc-

tion and other permits sought by non-union contractors. The

Board ordered petitioner to pay the legal fees the unions

incurred in defending the suit. Because we agree with the

Board that the unions' activities were protected by the Na-

tional Labor Relations Act, and because the Board's finding

that petitioner's lawsuit was both unmeritorious and retaliato-

ry is supported by substantial evidence, we deny the petition

for review and grant the Board's cross-application for en-

forcement.

I

In the 1980's, construction unions in Northern California

began filing environmental objections to zoning and construc-

tion permits sought by non-union developers and contractors.

Among other things, the unions objected to inconsistencies

between construction proposals and regional development

plans, to the failure to prepare required environmental impact

reports, and to use permits for facilities that the unions

predicted would cause surrounding areas to exceed air pollu-

tion limits under the Clean Air Act. An internal union report

explained: "we have seen irresponsible companies build pro-

jects which have caused more pollution than should be per-

mitted. We are now threatened with construction moratori-

ums in many counties in California." Report by Tom Hunter

& Ray Foreman, Participation in the Permit Process 1 (1987)

("Union Report"). Asserting that "the burden of these mora-

toriums falls on the construction worker," id. at 1, the unions

described their goal in the permitting processes as "advocat-

ing regulatory action which will force construction companies

to pay their employees a living wage, including health and

other benefits, and to meet their responsibilities to the com-

munity and the environment." Id. at 2. A San Francisco

newspaper article further explained that to prevent nonunion

contractors from continuing to hire out-of-state workers at

$10-$12 an hour less than prevailing union wages, "the unions

are arguing [to local governments] that the economic rewards

of development are lost when local people aren't hired at the

prevailing wage. Consequently, environmental shortcomings

such as traffic and pollution should weigh heavy [sic] against

such projects being approved, according to the union line of

reasoning." See Bradley Inman, Unions Launch Attack on

State Homebuilders, S.F. Examiner & Chron., May 31, 1987,

at F1.

A non-union California-based corporation, petitioner Petro-

chem Insulation, Inc. installs, repairs, and removes thermal

insulation in construction and maintenance projects. Accord-

ing to Petrochem, several contractors, seeking to avoid union

permit protests, informed Petrochem that it could neither bid

for nor perform subcontract work on their Northern Califor-

nia construction projects. In response, Petrochem filed suit

in the United States District Court for the Northern District

of California, charging that twenty-one named unions, by

filing environmental objections, were delaying and "threaten-

ing to delay" construction projects "unless and until the

project developers and/or general contractors agreed to boy-

cott open-shop contractors such as Petrochem." Compl. at

23, Petrochem Insulation, Inc. v. N. Cal. & N. Nev. Pipe

Trades Council, No. C-90-3628 (N.D. Cal. filed Dec. 20,

1990). According to the complaint, the unions' actions violat-

ed section 8(e) of the National Labor Relations Act. 29

U.S.C. s 158(e). Instead of seeking relief under the NLRA,

however, the complaint claimed that the union permit objec-

tions amounted to criminal extortion under both state and

federal law and charged that the extortion in turn constituted

a predicate act under the Racketeering and Corrupt Organi-

zation Act. 18 U.S.C. ss 1961-1968. Alleging that the un-

ions had injured Petrochem both by preventing it from ob-

taining contracts and by damaging its goodwill and business

reputation, the complaint sought treble damages pursuant to

RICO section 1964(c). 18 U.S.C. s 1964(c).

The district court dismissed the complaint, finding the

RICO claims preempted because the alleged predicate act

rested on a violation of the NLRA. Order Dismissing Compl.

Without Prejudice, Petrochem Insulation, Inc., No.

C-90-3628, at 12 (N.D. Cal. filed Apr. 30, 1991). Petrochem

sought leave to file an amended complaint realleging the same

conduct but claiming this time that the unions had violated

sections 1 and 2 of the Sherman Antitrust Act, 15 U.S.C.

ss 1, 2, in addition to RICO. Petrochem based this RICO

claim on a different provision of the NLRA, 29 U.S.C. s 186,

which prohibits employers from making payments to unions.

Although the district court denied leave to file the amended

complaint, finding it facially inadequate, the court permitted

Petrochem to file a second amended complaint provided that

the company complied with four specific guidelines for plead-

ing antitrust claims. Order Den. Recons. & Den. Leave to

File First Am. Compl., Petrochem Insulation, Inc., No.

C-90-3628, at 2-3 (N.D. Cal. filed July 30, 1991). The court

also instructed Petrochem that should it again allege a RICO

violation, its complaint had to conform to the court's "Stand-

ing Order re: RICO Actions." Id. at 3.

Petrochem filed a second amended complaint, again alleg-

ing RICO and Sherman Act violations. The district court

dismissed, this time with prejudice, finding that the complaint

failed to conform to the court's instructions and was legally

inadequate for several other reasons. Mem. & Order Grant-

ing Defs' Mot. to Dismiss, Petrochem Insulation, Inc., No.

C-90-3628 (N.D. Cal. filed Mar. 9, 1992). The Ninth Circuit

affirmed in an unpublished opinion, and the Supreme Court

denied certiorari. Petrochem Insulation, Inc. v. United

Ass'n of Journeymen & Apprentices of the Plumbing and

Pipe Fitting Indus., 8 F.3d 29 (9th Cir. 1993), cert. denied,

510 U.S. 1191 (1994).

The NLRB General Counsel then filed a complaint alleging

that by bringing a suit "without merit ... to retaliate"

against the unions for engaging in concerted activity protect-

ed by NLRA section 7, Petrochem committed an unfair labor

practice in violation of NLRA section 8(a)(1). 29 U.S.C.

s 158(a)(1). Granting the General Counsel's motion for sum-

mary judgment, the Board found Petrochem's lawsuit not

only without merit but also "motivated by an intent to retali-

ate against the Unions' protected concerted activity on behalf

of its members and other employees." Petrochem Insula-

tion, Inc., 330 N.L.R.B. No. 10, 1999 WL 1065426, at *7 (Nov.

19, 1999). The Board ordered Petrochem to cease filing such

lawsuits or otherwise interfering with employees in the exer-

cise of their section 7 rights. The Board also ordered the

company to reimburse the unions for the legal expenses they

had incurred. Id.

Petrochem petitions for review and the Board, supported

by union intervenors, cross-applies for enforcement. The

company challenges each of the Board's key findings: (1) that

the unions' participation in permit proceedings was protected

by section 7; (2) that Petrochem's suit was meritless; (3) that

the suit was retaliatory; and (4) that attorneys' fees were

warranted. We consider the first of these arguments in

Section II and the others in Section III. We affirm Board

findings "unless they are unsupported by substantial evidence

in the record considered as a whole, or unless the Board

acted arbitrarily or otherwise erred in applying established

law to the facts." Reno Hilton Resorts v. NLRB, 196 F.3d

1275, 1282 (D.C. Cir. 1999) (internal quotations and citations

omitted).

II

We can easily dispose of Petrochem's argument that the

unions' permit objections were unprotected by section 7. In

relevant part, section 7 states: "Employees shall have the

right to self-organization, to form, join, or assist labor organi-

zations, to bargain collectively through representatives of

their own choosing, and to engage in other concerted activi-

ties for the purpose of collective bargaining or other mutual

aid or protection." 29 U.S.C. s 157.

Petrochem first argues that unions, as opposed to employ-

ees, enjoy no section 7 rights. In support, it points to the

Supreme Court's statement in Lechmere, Inc. v. NLRB that

"the NLRA confers rights only on employees, not on unions

or their non-employee organizers." 502 U.S. 527, 532 (U.S.

1992). As both the Board and union intervenors correctly

respond, however, Lechmere holds only that non-employee

union representatives have no affirmative NLRA right to

trespass on employer property when they could reach the

employees through usual off-site channels. Indeed, Lechmere

goes on to make clear that when employees are inaccessible,

non-employee union representatives enjoy section 7 rights to

enter employer property. See id. at 537. Of course, we face

no question in this case of union access to private property.

Under such circumstances, the Board has held, as it did here,

that it would be a "curious and myopic" reading of the Act's

core provisions "to hold that, although employees are free to

join unions and to work through unions for purposes of 'other

mutual aid or protection,' the conduct of the unions they form

and join for those purposes is not protected by the Act."

BE & K Constr. Co., 329 N.L.R.B. No. 68, 1999 WL 883851,

at *12 (Sept. 30, 1999). We cannot imagine a more reason-

able interpretation of section 7. See Lucile Salter Packard

Children's Hosp. at Stanford v. NLRB, 97 F.3d 583, 592 (D.C.

Cir. 1996) (assuming that unions possess section 7 rights).

Petrochem next argues that even if unions sometimes enjoy

section 7 protection, the Board had no basis for concluding

that the petitioning activity in this case "was clearly protect-

ed." Petrochem Insulation, Inc., 1999 WL 1065426, at *4.

In so concluding, the Board relied on the unions' statement

that they were intervening before state environmental and

other regulatory permit proceedings in order to "force con-

struction companies to pay their employees a living wage,

including health and other benefits." Union Report at 2. In

view of this objective, the Board found the unions engaged in

a form of "area-standards activity"--concerted activity pro-

tected by section 7 because of the "legitimate interest" unions

have in "protecting the employment standards [they have]

successfully negotiated from the unfair competitive advantage

that would be enjoyed by an employer whose labor cost

package was less than those of employers subjected to the

area contract standards." See Petrochem Insulation, Inc.,

1999 WL 1065426, at *4 (internal quotation omitted). If

successful, the Board found, the unions "would not only

expand union job opportunities for current union members

but also would improve their ability to bargain for higher

wages by mitigating employer resistance based on concerns

about being undercut by non-union competitors." Id.

According to Petrochem, no record evidence supports the

Board's finding that the unions were promoting employment

standards they had negotiated in Northern California. In

particular, Petrochem argues that because the unions object-

ed to permits before projects had begun, the Board had no

idea what wages and benefits actually would have been.

Although this is true, we fail to see how the fact that

construction had not yet started has anything at all to do with

whether, in participating in permitting proceedings, the un-

ions were seeking to protect area standards. Surely nothing

in the NLRA prevents unions from obtaining commitments

from employers about wages and benefits for future jobs.

Citing a 1973 Board decision, Petrochem also argues that

the unions must prove that the terms and conditions of

employment maintained by the employers against whom they

targeted their area standards activity were below those nego-

tiated by the unions. Because the company failed to make

this argument until its reply brief, however, it is not properly

before us. Corson & Gruman Co. v. NLRB, 899 F.2d 47, 50

n.4 (D.C. Cir. 1990) ("We require petitioners and appellants to

raise all of their arguments in the opening brief to prevent

'sandbagging' of appellees and respondents and to provide

opposing counsel the chance to respond."). Even so, Petro-

chem itself supplied the very information it now claims is

missing. The San Francisco newspaper article, see supra at

3, at F1, which Petrochem attached to its answer to the

General Counsel's amended complaint to the Board, reports:

"the prevailing union wage for plumbers is $22.72 per hour.

Hunter [a union official] claims that some contractors are

paying 'out-of-state workers $10-$12 an hour.' "

In its final attempt to convince us that the union permit

challenges were unprotected by section 7, Petrochem points

to NLRA section 8(b)(4)(ii)(B), 29 U.S.C. s 158(b)(4)(ii)(B),

which makes it unlawful for labor organizations to "threaten,

coerce, or restrain" any person engaged in commerce where

"an object thereof" is "forcing or requiring any person ... to

cease doing business with any other person, or forcing or

requiring any other employer to recognize or bargain with a

labor organization as the representative of his employees."

Id. According to the company, the union petitioning activity

violated section 8(b)(4)(ii)(B) because it coerced developers to

cease doing business with Petrochem and other non-union

companies.

The Board rejected this argument, relying on DeBartolo

Corp. v. Fla. Gulf Coast Bldg. & Constr. Trades Council,

where the Supreme Court interpreted section 8(b)(4)(ii)(B)'s

coercion ban as not barring handbilling that urged consumer

boycotts of secondary employers. Any other interpretation of

section 8(b)(4), the Court warned, would pose "serious ques-

tions ... under the First Amendment." See 485 U.S. 568,

575 (1988). Concluding here that petitioning the government

qualifies as political expression, the Board stated "in order to

avoid the potentially serious First Amendment problems that

would result if the Unions' governmental petitioning were

found to constitute 'coercion' under Section 8(b)(4)(ii)(B), we

shall follow DeBartolo and conclude that such conduct is

lawful and, hence, protected by the Act." 1999 WL 1065426,

at *5. The Board emphasized that it was not deciding

"whether the Unions' petitioning could be found to be coer-

cive for 8(b)(4) purposes if, as [Petrochem] alleges, the Un-

ions had filed, or threatened to file, 'sham' petitions and

meritless environmental objections with a secondary objec-

tive." Id. at *5. Pointing out that the California federal

district court had found that Petrochem failed to identify a

single meritless objection to any construction project, the

Board concluded that all of the petitioning was protected by

the First Amendment and thus not barred by section

8(b)(4)(ii)(B). Again, we cannot imagine a more reasonable

interpretation of the Act. See NLRB v. United Food &

Commercial Workers Union, Local 23, 484 U.S. 112, 123

(1987) (explaining that courts must defer to the NLRB's

"interpretation of the NLRA as long as its interpretation is

rational and consistent with the statute").

III

Having found no basis for upsetting the Board's conclusion

that the permitting activity was protected by section 7, we

turn to Petrochem's arguments that its lawsuit did not violate

section 8(a)(1). 29 USC s 158(a)(1). To constitute an unfair

labor practice, Petrochem's lawsuit must have both lacked

merit and have been brought to retaliate against the unions'

exercise of section 7 rights. See Summitville Tiles, Inc., 300

N.L.R.B. 64, 65 (1990).

Considering the first question--Did the company's lawsuit

lack merit?--the Board relied on Bill Johnson's Restaurants,

Inc. v. NLRB: "If judgment goes against the employer in the

state court ... or his suit is withdrawn or is otherwise shown

to be without merit, ... the Board may then proceed to

adjudicate the ... unfair labor practice case[, t]he employer's

suit having proved unmeritorious...." 461 U.S. 731, 747

(1983). The Supreme Court, in other words, equates failing

in state court with lacking merit, and the Board has found

that reasoning applicable to failure in federal court as well.

See BE & K Construction Company, 1999 WL 883851 at *8

(finding that there is "no reason not to regard the rulings of

the federal courts ... as equally determinative on the ques-

tion of whether the [employer's] federal court lawsuit lacked

merit"). Applying the Bill Johnson's standard here, the

Board found Petrochem's suit meritless because the Califor-

nia federal district court dismissed it and the Ninth Circuit

affirmed. 1999 WL 1065426, at *4.

Petrochem argues that instead of relying on Bill Johnson's,

the Board should have applied the more rigorous standard

used to determine whether a suit is so baseless as to rob a

plaintiff of normal "Noerr-Pennington" antitrust immunity.

See Professional Real Estate Investors, Inc. v. Columbia

Pictures Industries, Inc., 508 U.S. 49, 60-61 (1993) (defining

"sham" litigation as a lawsuit, brought with the intent to

interfere directly with the business of a competitor, that is so

objectively baseless that "no reasonable litigant could realis-

tically expect success on the merits" and that therefore fails

to receive Noerr-Pennington immunity). The company bases

this argument on a sentence from Professional Real Estate

Investors: "[B]y analogy to [the antitrust] sham exception,

we held [in Bill Johnson's] that even an improperly motivated

lawsuit may not be enjoined under the National Labor Rela-

tions Act as an unfair labor practice unless such litigation is

baseless." 508 U.S. at 59 (internal quotations omitted). As

the Board points out, however, see Petrochem Insulation,

Inc., 1999 WL 1065426, at *3, this passage concerns when an

active lawsuit can be "enjoined"; Bill Johnson's establishes a

different standard for determining whether an adjudicated

lawsuit was meritless. Compare Bill Johnson's, 461 U.S. at

744 (finding that baseless litigation can be enjoined as an

unfair labor practice), with id. at 747 ("If judgment goes

against the employer in the state court, however, or if his suit

is withdrawn or is otherwise shown to be without merit, ...

the Board may then proceed to adjudicate the ... unfair

labor practice case."). Under the standard for adjudicated

litigation, like Petrochem's, if the employer lost, the lawsuit is

deemed unmeritorious.

We understand that this sets the bar for sham litigation--

litigation not protected by the First Amendment--lower than

in Noerr-Pennington cases; on proof of retaliation, employer

suits that are better than baseless under Noerr-Pennington

(ones for which "there is any realistic chance that the plain-

tiff's legal theory might be adopted," id. at 747), may evident-

ly be classified as sham litigation after the employer-plaintiff

loses. Perhaps the Supreme Court will one day create a

uniform standard for sham litigation governing both NLRA

and non-NLRA cases (or explain why the First Amendment

protects erring litigants less in the NLRA context than

others), but until that day the language in Bill Johnson's

must control.

This brings us to the second question and the only tricky

issue in this case: Did Petrochem file its lawsuit to retaliate

against the unions for engaging in section 7 protected activi-

ties? Answering affirmatively, the Board relied on three

factors: (1) Petrochem filed the lawsuit "in direct response"

to the unions' participation in the permit proceedings; (2) the

lawsuit had no merit; and (3) Petrochem sought RICO and

antitrust treble damages instead of pursuing only compensa-

tory damages under the NLRA. See 1999 WL 1065426, at *6.

We agree with Petrochem that the first factor cannot

support the Board's retaliatory motive finding. Every law-

suit seeking to recover damages caused by union activity is,

by definition, filed "in direct response" to that activity. Yet

not all meritless suits against unions or employees amount to

unfair labor practices. Otherwise, Bill Johnson's would not

have required the Board to determine whether unmeritorious

lawsuits were filed for retaliatory reasons. Because the

Board's directly-in-response-to factor exists in every case, it

cannot help distinguish those suits that amount to unfair

labor practices from those that do not.

Challenging the second basis for the Board's finding, Petro-

chem argues that considering the loss of its suit as evidence

of retaliatory motive collapses the first prong of the unfair

labor practice analysis (lack of merit) into the second (retalia-

tion). This is true, but also precisely what Bill Johnson's

permits: "The employer's suit having proved unmeritorious,

the Board would be warranted in taking that fact into account

in determining whether the suit had been filed in retaliation

for the exercise of the employees' s 7 rights." 461 U.S. at

747. Calling this language dicta, Petrochem urges us to

ignore it, arguing that it threatens to deter employers from

exercising their First Amendment right to petition the gov-

ernment through litigation. We share this concern, particu-

larly if Bill Johnson's is read literally to mean, for example,

that an employer who files a colorable lawsuit could be guilty

of an unfair labor practice simply because the suit happens to

lose, and the Board, relying on the loss, concludes that the

suit was meritless and therefore retaliatory. We need not

face this issue, however, for although we are bound by Bill

Johnson's, this case does not involve a colorable, or even just

an unsuccessful, lawsuit. The Board found that Petrochem's

suit was utterly meritless:

[Petrochem's] lawsuit was found not just to have lacked

merit--that would be a charitable characterization of its

outcome. The lawsuit's claims did not even get to a jury

... because it was unable to plead a legally cognizable

cause of action, notwithstanding that the District Court

provided ... three opportunities to do so. This degree

of failure undermines [Petrochem's] claim that it filed the

suit to defend its legally protectable interests and dem-

onstrates instead its retaliatory purpose.

1999 WL 1065426, at *6 (internal quotations and citations

omitted). Thus, whatever merit Petrochem's First Amend-

ment argument might have in the abstract, it has no applica-

bility where, as here, the employer's suit was completely

without merit.

Citing a law review article that mentions in one sentence

the possibility of RICO and antitrust suits against unions, see

Stanley J. Brown & Alyse Bass, Corporate Campaigns: Em-

ployer Responses to Labor's New Weapons, 6 Lab. Law. 975,

983 (1990), Petrochem asserts that its suit was novel, not

baseless. "Novel" may well be one way to describe the

company's suit. Novelty, however, is not necessarily inconsis-

tent with meritlessness; indeed, in view of the district court's

total rejection of the suit, we agree with the Board that

describing it as meritless would be "charitable." Not only did

the district court dismiss the company's first two complaints,

but the many reasons it gave for dismissing the second

amended complaint with prejudice demonstrate that, in the

court's view, the suit had absolutely no merit. In particular,

the court gave three independent reasons for dismissing the

RICO claim: (1) Petrochem's theory that the manner in

which the unions collected money to support their petitioning

activity somehow violated NLRA section 186 was not only

contrary to Ninth Circuit precedent but also unsupported by

section 186's text, Mem. and Order Granting Defs' Mot. to

Dismiss, at 5-6; (2) even if the unions' activities did violate

section 186, Petrochem would nonetheless have lacked stand-

ing to challenge such a violation, id. at 8; and (3) the

company failed to comply with the district court's specific

orders for filing RICO claims, id. at 11. The court gave two

reasons for dismissing the Sherman Act section 1 claim: (1)

Petrochem failed to identify the parties to and contents of any

alleged contract, combination, or conspiracy in restraint of

trade, thus violating the specific instructions the court gave

when rejecting the company's first amended complaint, id. at

12; and (2) Petrochem failed to plead an injury to competition

resulting from the alleged contracts, id. at 16. Apparently

unconvinced even by the company's allegations of its own

injuries, the court noted, "[a]t most, [the complaint] alleges

that [Petrochem] could not submit bids to four projects out of

the approximately 93 projects identified in the complaint. It

does not allege that [Petrochem] actually submitted a low bid,

nor that any project awarded [the company] was withdrawn."

Id. at 17. Dismissing Petrochem's Sherman Act section 2

claim, the court found: (1) the company failed to identify the

contractors who allegedly combined with the unions to mo-

nopolize the construction market, id. at 23; and (2) despite

having "premised its monopolization claim upon the theory

that [the unions] engaged in sham petitions and baseless

environmental objections," and having been warned by the

court that it needed to provide factual support for that claim,

Petrochem failed to identify a single meritless objection "or

allege why such objection should be considered meritless,"

id. at 25.

Had Petrochem offered some reason other than the novelty

of its approach to believe that, notwithstanding the district

court's firm rejection of its claims, the suit was nevertheless

not without merit, we would of course have taken it into

consideration. But in the absence of any such explanation

and in view of the reasons the district court gave for dismiss-

ing Petrochem's complaints, we have no basis for questioning

the Board's assessment of the company's litigation.

Petrochem also challenges the Board's third basis for infer-

ring retaliatory motive: the company's effort to obtain treble

damages by trying to convert labor law claims into RICO and

antitrust actions. As the Board saw it, seeking treble dam-

ages undermined Petrochem's claim that it filed suit not to

retaliate, but to "recover the economic losses caused by the

Unions' illegal conduct." Pet'r Br. at 40. The Board ex-

plained:

It was the selection of the RICO and antitrust claims,

with their provisions for treble damages, which under-

scores the [company's] retaliatory intent. [Petrochem]

had available a less drastic means of recovering its

alleged losses; it could have filed suit in Federal district

court under Section 303 of the Act to recover its actual

damages by alleging as unlawful what it now argues was

unprotected conduct, i.e., that the Unions' conduct violat-

ed Section 8(b)(4). Instead, its RICO and antitrust

claims constituted an attempt to obtain three-times its

actual damages. In comparable circumstances where an

employer has sought punitive damages in addition to

alleged actual damages, the Board has inferred retaliato-

ry intent. We draw the same inference here.

1999 WL 1065426, at *6 (citations omitted).

Petrochem argues that the Board should not have drawn

any inferences from its decision to seek a remedy expressly

authorized by federal law. Had this been the sole basis for

the Board's decision, Petrochem's argument might have some

appeal. The record is clear, however, that the Board did not

rely solely on Petrochem's request for treble damages. The

Board specifically stated that "retaliatory motive can be

inferred, in part, from the treble damages [Petrochem]

sought." Id. (emphasis added). Because the Board's princi-

pal finding was that Petrochem's suit was utterly meritless, it

was not improper for the Board to cite the company's decision

to seek treble damages as additional evidence of retaliatory

motive. Cf. Diamond Walnut Growers, Inc. v. NLRB, 53

F.3d 1085, 1089 (9th Cir. 1995) (finding the fact that an

employer sought punitive damages in its suit against a union

to be evidence that the suit was retaliatory); Kline v. Cold-

well Banker & Co., 508 F.2d 226, 235 (9th Cir. 1974) (charac-

terizing antitrust treble damages as punitive).

Given the special deference we owe NLRB findings of

motive, Reno Hilton Resorts, 196 F.3d at 1282 (citing Laro

Maintenance Corp. v. NLRB, 56 F.3d 224, 229 (D.C. Cir.

1995)), we find the lawsuit's complete lack of merit together

with Petrochem's effort to obtain treble damages sufficient to

support the Board's finding of retaliatory motive. Of course,

were the circumstances different--for example, had the suit

not been so meritless--our view might be different. See

NLRB v. International Union of Operating Engineers, Local

520, 15 F.3d 677, 679-80 (7th Cir. 1994) (finding that although

the employer's original lawsuit was ultimately dismissed on

the basis of a privilege and so was deemed meritless under

Bill Johnson's, the suit was not retaliatory because it was not

entirely without merit). But on the facts of this case, we

have no basis for upsetting the Board's determination that

Petrochem filed suit in retaliation for the unions' exercise of

section 7 rights.

Last, Petrochem challenges the requirement that it "reim-

burse the Unions for all legal and other expenses incurred in

defending against [Petrochem's] lawsuit." 1999 WL 1065426

at *7. Section 10(c) of the NLRA authorizes the Board, upon

finding an unfair labor practice, to "take such affirmative

action ... as will effectuate the policies of [the Act]." 29

U.S.C. s 160(c). Not only does the Board have broad discre-

tionary power under this section to fashion remedies that

effectuate the policies of the Act, but the Board's exercise of

its discretion is subject to quite limited judicial review. See

Fibreboard Paper Prod. Corp. v. NLRB, 379 U.S. 203, 216

(1964). We will not disturb a remedy ordered by the Board

"unless it can be shown that the order is a patent attempt to

achieve ends other than those which can fairly be said to

effectuate the policies of the Act." See Va. Elec. & Power Co.

v. NLRB, 319 U.S. 533, 540 (1943).

Petrochem argues that the fee award violates the "Ameri-

can rule," under which "attorney's fees are not ordinarily

recoverable in the absence of a statute or enforceable con-

tract providing therefor." Fleischmann Distilling Corp. v.

Maier Brewing Co., 386 U.S. 714, 717 (1967). As the Board

correctly explains, however, the fee award in no way conflicts

with the American rule because the award responds not to

the company's loss of its suit, but to the fact that the suit

itself amounted to an "illegal act." See Local 32B-32J, Serv.

Employees Int'l Union v. NLRB, 68 F.3d 490, 496 (D.C. Cir.

1995) (finding that an award of attorneys fees did not violate

the American rule because the litigation that the fees were

incurred in defending against was itself illegal); Gibson

Greetings, Inc. v. NLRB, 53 F.3d 385, 394 (D.C. Cir. 1995)

("The NLRB can award a union the costs and fees it incurs in

defending against an employer's baseless, retaliatory lawsuit

... if it determines that the filing or maintenance of the

lawsuit was an unfair labor practice."). Indeed, Bill John-

son's expressly authorizes the Board to award attorneys' fees

in just such situations: "If [a labor law] violation is found, the

Board may order the employer to reimburse the employees

whom he had wrongfully sued for their attorney's fees and

other expenses." 461 U.S. at 747.

IV

We deny Petrochem's petition for review and grant the

Board's cross-application for enforcement.

So ordered.