Reply Brief — Valley Health System, LLC, dba Desert Springs Hospital Medical Center, et al., Petitioners v. National Labor Relations Board

No. 24-370

IN THE

Supreme Court of the United States=

_______________

VALLEY HEALTH SYSTEM, LLC, DBA DESERT SPRINGS

HOSPITAL MEDICAL CENTER, ET AL.,

Petitioners,

v.

NATIONAL LABOR RELATIONS BOARD,

Respondent.

_______________

On Petition For Writs Of Certiorari

To The United States Court Of Appeals

For The Ninth Circuit

_______________

REPLY BRIEF FOR PETITIONERS

_______________

PROLOY K. DAS

Counsel of Record

FORD HARRISON, LLP

185 Asylum Street, Suite 820

Hartford, CT 06103

(860) 760-1077

pdas@fordharrison.com

THOMAS KEIM

FORD HARRISON, LLP

100 Dunbar Street

Spartanburg, SC 29306

EUGENE SCALIA

JONATHAN C. BOND

GIBSON, DUNN & CRUTCHER LLP

1700 M Street, N.W.

Washington, D.C. 20036

TAMMIE RATTRAY

FORD HARRISON, LLP

401 E. Jackson Street

Tampa, FL 33602

Counsel for Petitioners

i

RULE 29.6 STATEMENT

The corporate-disclosure statement in the petition

for writs of certiorari remains accurate.

ii

TABLE OF CONTENTS

Page

I.

THIS CASE SQUARELY PRESENTS THE

QUESTION WHETHER THE BOARD’S

INTERPRETATION OF THE NLRA IS

ENTITLED TO DEFERENCE ...............................3

II. THE BOARD’S DEFENSE OF CHEVRON

DEFERENCE IN DISGUISE SHOULD BE

REJECTED ........................................................7

III. THE BOARD’S ASSERTED VEHICLE

CONCERNS PROVIDE NO REASON TO

DENY REVIEW................................................10

iii

TABLE OF AUTHORITIES

Cases ............................................................... Page(s)

Agostini v. Felton,

521 U.S. 203 (1997) .............................................. 10

Beth Israel Hospital v. NLRB,

437 U.S. 483 (1978) ................................................ 8

Bethlehem Steel Co.,

136 N.L.R.B. 1500 (1962)....................................... 6

Chevron U.S.A. Inc. v. Natural Resources

Defense Council, Inc.,

467 U.S. 837 (1984) ............................................ 1, 4

Cutter v. Wilkinson,

544 U.S. 709 (2005) ................................................ 5

Ford Motor Co. v. NLRB,

441 U.S. 488 (1979) ................................................ 8

Hospital Menonita de Guayama, Inc. v.

NLRB, No. 24-138 (Dec. 16, 2024)........................... 6

Litton Financial Printing Division v. NLRB,

501 U.S. 190 (1991) ................................................ 6

Local Joint Executive Board v. NLRB,

657 F.3d 865 (9th Cir. 2011) .................................. 6

Loper Bright Enterprises v. Raimondo,

603 U.S. 369 (2024) .......................... 1, 5, 7, 8, 9, 11

iv

Cases (continued) ........................................ Page(s)

Motor Vehicle Manufacturers Association of

United States, Inc. v. State Farm Mutual

Automobile Insurance Co.,

463 U.S. 29 (1983) .................................................. 7

NLRB v. Curtin Matheson Scientific, Inc.,

494 U.S. 775 (1990) ................................................ 8

NLRB v. Erie Resistor Corp.,

373 U.S. 221 (1963) ................................................ 8

NLRB v. Truck Drivers Union,

353 U.S. 87 (1957) .............................................. 8, 9

Republic Aviation Corp. v. NLRB,

324 U.S. 793 (1945) ................................................ 8

Statutes

National Labor Relations Act,

29 U.S.C. § 151 et seq. ............................................ 3

29 U.S.C. § 158 ................................................. 6

29 U.S.C. § 186 ................................................. 6

1

IN THE

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No. 24-370

VALLEY HEALTH SYSTEM, LLC, DBA DESERT SPRINGS

HOSPITAL MEDICAL CENTER, ET AL.,

Petitioners,

v.

NATIONAL LABOR RELATIONS BOARD,

Respondent.

On Petition For Writs Of Certiorari

To The United States Court Of Appeals

For The Ninth Circuit

REPLY BRIEF FOR PETITIONERS

The Ninth Circuit sustained the National Labor

Relations Board’s rulings based expressly on deference to the agency’s interpretation of a federal statute.

That approach is irreconcilable with Loper Bright Enterprises v. Raimondo, 603 U.S. 369 (2024), which did

away with deference under Chevron U.S.A. Inc. v.

Natural Resources Defense Council, Inc., 467 U.S. 837

(1984), and made clear that courts should construe

statutes for themselves—not outsource that responsibility to the Executive. The Ninth Circuit lacked the

benefit of Loper Bright—because it refused petitioners’ request to await this Court’s then-imminent decision. It thus now falls to this Court to set aside the

court of appeals’ erroneous judgments.

2

Far from diminishing the need for this Court’s intervention, the Board’s resistance to review cements

it. The Board’s principal tack is to deny that the decisions below have anything to do with deference. The

plain terms of the Ninth Circuit’s opinions refute that

implausible description. The Board’s contrary account

rests on a footnote the court added when amending one

of its opinions that hypothesized how the court would

rule absent deference. But that belated backfilling

changes nothing about the court of appeals’ explicitly

deference-driven reasoning, which the court left undisturbed. And in any event it provides no basis to presuppose that the Ninth Circuit would actually reach the

same result without deference. The footnote simply

cites a prior panel decision, which at most would bind a

future three-judge panel but not the en banc court.

The en banc court had no occasion to consider the underlying statutory issue without deference because, at

the time it acted on petitioners’ rehearing petition,

Chevron still controlled. That the Board tries to evade

review by disguising the decisions below is further

confirmation that they should be set aside.

The Board’s revisionist reading is irrelevant, moreover, because the agency promptly gives the game away.

Despite insisting that deference played no role below,

the Board contends that its entitlement to Chevronstyle deference in construing its organic statute was

unaltered by Loper Bright. That contention cannot be

squared with this Court’s decision, which repudiated

the premises that underlay Chevron for all agencies,

the NLRB included. Although Loper Bright preserved

Congress’s ability to confer policymaking discretion, it

leaves no room for giving an agency the final say on the

correct interpretation of a federal statute.

3

More troubling still, the Board’s argument reveals

that it still does not accept Loper Bright and seeks to

preserve Chevron by another name. The Board thus

opposes review not because the Ninth Circuit’s reliance on deference was harmless, but because it will be

helpful to the agency going forward. Its submission

shows that, unless and until checked by this Court,

this agency (and likely others) will continue invoking

Chevron in sheep’s clothing. This Court should reject

that gambit and make clear that Loper Bright brooks

no agency-specific exceptions.

The simplest disposition is summary vacatur of

the decisions below, with explicit instructions that

Chevron-style deference to the Board’s statutory interpretations is impermissible under Loper Bright.

Alternatively, the Court should set the case for argument. Either way, the petition should be granted.

I.

THIS CASE SQUARELY PRESENTS THE QUESTION

WHETHER THE BOARD’S INTERPRETATION OF

THE NLRA IS ENTITLED TO DEFERENCE

A. The Ninth Circuit explicitly relied on binding

deference to the Board’s interpretations of the National

Labor Relations Act (NLRA), 29 U.S.C. § 151 et seq.

Pet. App. 6a, 68a-70a. But that mode of deference is

squarely foreclosed by Loper Bright, so the decisions

below must be set aside. The Board principally seeks

to avoid review by rewriting those rulings, asserting

that “they did not depend on any deference to the

Board.” Br. in Opp. 11. That assertion is untenable.

The Ninth Circuit stated expressly that it was relying on deference to the Board’s reading of the NLRA.

The court first recited the doctrine of deference that it

applied: The Board’s reading controls so long as it re-

4

flects “a permissible interpretation of the NLRA.” Pet.

App. 68a. The court explained that “[t]he Board’s interpretation of the NLRA is permissible so long as it

is not ‘manifestly contrary’ to the NLRA,” id. at 70a

(citation omitted)—a deferential standard if ever one

existed. And it held that the deference thus described

was implicated here “[b]ecause the NLRA is ambiguous regarding dues checkoff,” so the court would “defer

to the Board’s interpretation ‘as long as it is rational

and consistent with the Act.’” Id. at 68a-69a (citations

omitted); see id. at 69a (citing Ninth Circuit precedent

that in turn cited Chevron, supra). That deferencebased rationale was hardly a surprise: It was precisely the standard that the Board had advocated.

See, e.g., 22-1804 Resp. C.A. Br. 10, 30-37.

B. The Board now posits a completely different justification for the decisions below, contending that they

have nothing to do with deference. The Board cites (Br.

in Opp. 11) a footnote the panel added in amending one

of its opinions stating that, “if we interpreted the statute ourselves, the result would not change.” Pet. App.

69a n.2 (emphasis added). But that below-the-line

dictum does not alter the explicit deference-based rationale of the court’s decisions, which it left intact.

Even on its own terms, moreover, the panel’s added

footnote provides no basis to ignore the court’s express

and (after Loper Bright) erroneous reliance on deference. The panel stated that, absent deference, it would

have been bound by a prior three-judge panel decision

adopting the Board’s current view on when duescheckoff duties expire. Pet. App. 69a n.2. But that prior

decision would not bind the en banc court. The Board’s

conjecture (Br. in Opp. 11) that eliminating deference

could not make a difference here is thus unfounded.

5

The en banc court never had occasion to pass on

that underlying statutory issue. Petitioners sought rehearing en banc, but the court of appeals denied their

petition before Loper Bright was decided, when Chevron still controlled. (Petitioners had also asked the

Ninth Circuit to await Loper Bright, 22-1804 Pet. C.A.

Reh’g Pet. 3-7, but the court declined, Pet. App. 59a,

69a n.2—depriving itself of the benefit of this Court’s

impending direction.) At that time, whether the

Board interpretation of the NLRA to which the panel

had deferred embodied the “single, best meaning” of

the statute (Loper Bright, 603 U.S. at 400) was academic. The Board should not be permitted to insulate

a deference-driven victory from review based on the

happenstance that this Court decided Loper Bright after the court of appeals denied rehearing en banc but

before petitioners sought review in this Court.

C. How the court of appeals will ultimately resolve the underlying statutory issue on remand without the distorting effect of deference has no bearing on

the question now before this Court: whether the Ninth

Circuit erred by according Chevron deference to the

Board’s reading of the NLRA. As a “court of review, not

of first view,” Cutter v. Wilkinson, 544 U.S. 709, 718 n.7

(2005), the Court need not and should not attempt to

preview how further proceedings will unfold simply to

conclude that court of appeals should not have applied

deference and must decide the issue de novo.

In all events, the Board certainly has not shown

that the dues-checkoff issue is foreordained in its favor.

The Board itself maintained the opposite position for

half a century. Pet. App. 72a (O’Scannlain, J., specially

concurring) (“For 49 years, an employer could unilaterally cease dues checkoff after the applicable collective

6

bargaining agreement expired.”). And that prior,

longstanding Board position is sound. See Pet. 10-15.

The relevant NLRA provision makes it unlawful

for an employer “to refuse to bargain collectively with

the representatives of his employees.” 29 U.S.C.

§ 158(a)(5). This Court has held that an employer can

violate that provision by unilaterally changing a term

or condition of employment without bargaining to

impasse—for some terms, even after the parties’ contract expires. See Litton Financial Printing Division v.

NLRB, 501 U.S. 190, 198-199, 206-207 (1991). But as

the Board formerly explained, that is not true of every

term—particularly those like dues-checkoff provisions that are “created by,” and cannot even exist before the formation of, the contract. Bethlehem Steel

Co., 136 N.L.R.B. 1500, 1502 (1962); see Pet. 12-15.

In response, the Board recites conclusions from

the prior Ninth Circuit decision the panel mentioned.

Br. in Opp. 13-14 (citing Local Joint Executive Board

v. NLRB, 657 F.3d 865, 874-876 (2011)). Its only further support is that Congress specifically provided

that dues-checkoff provisions “shall not be irrevocable

. . . beyond the termination date of the” contract. Id.

at 14 (quoting 29 U.S.C. § 186(c)(4)). But that if anything undercuts the Board’s position by making clear

that dues-checkoff obligations are not eternal.

The Court should not leave standing rulings that expressly applied deference based on self-serving Board

speculation that the court below would endorse the

agency’s latest swerve. It should vacate so that court

can decide the issue de novo. See Hospital Menonita

de Guayama, Inc. v. NLRB, No. 24-138 (Dec. 16, 2024)

(granting, vacating, and remanding in same posture).

7

II. THE BOARD’S DEFENSE OF CHEVRON DEFERENCE

IN DISGUISE SHOULD BE REJECTED

The Board’s effort to distance the decisions below

from Chevron is ultimately misdirection because the

agency swiftly pivots to advocating robust deference to

the Board’s interpretations of the NLRA. Br. in Opp.

11-13. The Board asserts that it is exempt from Loper

Bright altogether. Id. at 13. That assertion is startling

and only underscores the need for this Court’s intervention. Denying review in the face of that contention

would likely embolden the agency (and others) to continue demanding deference—simply swapping the

Chevron label for a parochial, agency-specific alias.

The Board’s position that deference to the NLRB

was not “affected” by Loper Bright (Br. in Opp. 13) is

also wrong. It urges that Loper Bright acknowledged

that Congress can (within constitutional limits) grant

an agency “a degree of discretion” and that exercises

of such discretion (within judicially identified boundaries) are reviewed under the “reasoned decisionmaking” standard. Id. at 12 (quoting Loper Bright,

603 U.S. at 394-395, in turn citing, inter alia, Motor Vehicle Manufacturers Association of United States, Inc.

v. State Farm Mutual Automobile Insurance Co.,

463 U.S. 29 (1983)). But the Board cites no NLRA provision conferring that kind of discretion. And such policymaking or factfinding discretion is far removed from

the deference the Ninth Circuit accorded and the Board

seeks: “‘power further to define’ and engage in ‘future

interpretation’ of the Act.” Id. at 13 (emphasis added;

citation omitted); see Pet. App. 70a (holding that court

must defer to “the Board’s interpretation” of the NLRA

“so long as it is not manifestly contrary to the [Act]”

(emphasis added; internal quotation marks omitted)).

8

The Board points instead to decisions of this Court

before and after Chevron positing that “Congress in the

NLRA had ‘assigned to the Board the primary task of

construing’ the NLRA.” Br. in Opp. 12 (quoting Ford

Motor Co. v. NLRB, 441 U.S. 488, 495 (1979), and collecting cases). But those decisions likewise do not rest

on any NLRA provision expressly delegating the kind

of discretion Loper Bright contemplated. Rather, to the

extent those cases accorded deference akin to Chevron,

they are bottomed on the same fiction as Chevron: the

“presumption” that “statutory ambiguities are implicit delegations to agencies.” 603 U.S. at 399. The

cases the Board collects inferred an implied delegation

to the Board to decide what the Act means from the

NLRA’s use of “general prohibitory language,” NLRB

v. Curtin Matheson Scientific, Inc., 494 U.S. 775, 786

(1990) (quoting Beth Israel Hospital v. NLRB, 437 U.S.

483, 500 (1978), in turn quoting Republic Aviation

Corp. v. NLRB, 324 U.S. 793, 798 (1945)), and from

terms the NLRA itself “did not purport to define,” Ford

Motor Co., 441 U.S. at 495; see, e.g., NLRB v. Erie Resistor Corp., 373 U.S. 221, 236 (1963) (treating Act’s

“general provisions” as “giv[ing] the Board a question

to answer,” and “the courts will give respect to that answer” (internal quotation marks omitted)); NLRB v.

Truck Drivers Union, 353 U.S. 87, 96 n.28 (1957) (stating that “[t]here is an area plainly covered by the language of the Act and an area no less plainly without it”

and that Congress left the area in between—i.e. where

it is ambiguous—to the Board (citation omitted)).

Loper Bright flatly rejected that fictional premise:

“[A]n ambiguity is simply not a delegation of lawinterpreting power.” 603 U.S. at 399 (citation omitted).

The Court (echoing Chevron itself) explained that “am-

9

biguities may result from an inability on the part of

Congress to squarely answer the question at hand.”

Ibid. Loper Bright squarely held that Congress’s “inability” to resolve an issue does not “necessarily reflect

a congressional intent that an agency, as opposed to a

court, resolve the resulting interpretive question.”

Ibid. But that too-complicated-for-Congress rationale

is precisely how some of the Board’s cited cases justified treating opaque, general statutory language as

implicitly authorizing the Board to define the Act’s

scope. See, e.g., Truck Drivers, 353 U.S. at 96 n.28

(“Congress could not catalogue all the devices and

stratagems for circumventing the policies of the Act.

Nor could it define the whole gamut of remedies to effectuate these policies in an infinite variety of specific

situations.” (citation omitted)).

The Board thus seeks to revive the same deference

Loper Bright repudiated—at least for itself. But

Chevron did not establish deference only for the Environmental Protection Agency. This Court invoked

Chevron’s disproven, defunct premises in prior cases

involving the Board—and many agencies besides. By

the same token, Loper Bright did not dismantle deference only for the National Marine Fisheries Service,

whose rule was at issue. Litigants should not have to

fight agency-by-agency to eliminate deference that

never properly belonged to the Executive. The Board’s

defense of agency-specific enclaves of Chevron equivalents undermines Loper Bright’s core tenet that ultimate responsibility for interpreting federal statutes

rests with the Judiciary, not the Executive. Far from

providing a reason to deny review, the Board’s bold

defense of NLRB deference thus only highlights the

importance of granting review here.

10

III. THE BOARD’S ASSERTED VEHICLE CONCERNS

PROVIDE NO REASON TO DENY REVIEW

The Board’s fallback arguments against review

are insubstantial. It suggests (Br. in Opp. 14) that

petitioners “failed to preserve” any argument regarding the question presented by failing to raise it soon

enough. But the question presented concerns whether

Loper Bright, which postdated all of the proceedings

below, forecloses deference to the Board’s interpretations of the NLRA on the dues-checkoff issue. In the

lower courts, petitioners and the courts were bound by

then-controlling precedents, including Chevron and

its NLRB equivalents. In fairness to the Ninth Circuit, it could not ignore those precedents in anticipation that they would soon be overturned. See, e.g.,

Agostini v. Felton, 521 U.S. 203, 237 (1997). Moreover, petitioners’ rehearing petition asked the court of

appeals to await Loper Bright, but the court declined.

The Board further suggests that petitioners

“waived” their argument based on Loper Bright by

urging the Ninth Circuit “‘to defer’ to the Board’s reasoning in” Bethlehem Steel. Br. in Opp. 14 (quoting

Pet. App. 69a n.2). But petitioners have argued all

along that that interpretation, which prevailed for 49

years, should still control because it is “correct as a

matter of law” and reflects “the most reasonable” reading of the statute. 22-1804 Pet. C.A. Br. 7, 12, 14 (emphases added; capitalization altered). That petitioners

also argued that Bethlehem Steel deserved deference

under then-current precedent, e.g., id. at 25, simply

reflected the state of existing law. And in seeking rehearing petitioners reiterated that, if Chevron were

overturned and deference to the Board were eliminated, “[a] de novo statutory construction analysis”

11

would yield petitioners’ reading. 22-1804 Pet. C.A.

Reh’g Pet. 13; see id. at 7-13.

*****

The question presented here was asked and answered in Loper Bright: Courts must “exercise their

independent judgment in deciding whether an agency

has acted within its statutory authority.” 603 U.S. at

412. They thus cannot defer to a putatively “‘permissible’ interpretation” tendered by an agency “that is

not the one the court * * * concludes is best” because,

“[i]n the business of statutory interpretation, if it is

not the best, it is not permissible.” Id. at 400. The

court of appeals, applying pre-Loper Bright law, upheld the Board’s interpretation as “permissible” because it is not “‘manifestly contrary’ to the NLRA.”

Pet. App. 70a (citation omitted). That conclusion contravenes Loper Bright and cannot stand.

The petition for writs of certiorari should be

granted. The rulings below should be summarily vacated with instructions that the Board’s interpretations of the NLRA are not entitled to controlling deference. Alternatively, the Court should set the case

for argument to address that question.

12

Respectfully submitted.

PROLOY K. DAS

Counsel of Record

FORD HARRISON, LLP

185 Asylum Street, Suite 820

Hartford, CT 06103

(860) 760-1077

pdas@fordharrison.com

THOMAS KEIM

FORD HARRISON, LLP

100 Dunbar Street

Spartanburg, SC 29306

March 14, 2025

EUGENE SCALIA

JONATHAN C. BOND

GIBSON, DUNN & CRUTCHER LLP

1700 M Street, N.W.

Washington, D.C. 20036

TAMMIE RATTRAY

FORD HARRISON, LLP

401 E. Jackson Street

Tampa, FL 33602