The U.S. Court of Appeals for the Seventh Circuit (IL, IN, WI) has upheld a National Labor Relations Board (“NLRB”) decision that a grocery chain using nonunion construction contractors unlawfully ejected building trade council representatives handing out handbills adjacent to properties leased by the chain.
The case involved peaceful handbilling by representatives of the Milwaukee Building and Construction Trades Council urging a consumer boycott of Roundy’s in front of 26 Roundy’s stores in the Milwaukee area. The dispute concerned 23 of those stores, where Roundy’s leased the store and held only a nonexclusive easement over the common areas, including where the handbilling took place just outside its stores. The union representatives did not engage in picketing and did not block access to or from the stores. The handbills accused Roundy's of saving money by using cheap labor to build and remodel its stores without passing the savings on to customers, asked customers not to patronize the store, and pointed out savings that could be achieved by shopping at competitor stores. Roundy’s ejected the handbillers, in some cases with the help of the police. The NLRB found that Roundy’s actions violated Sec. 8(a)(1) of the National Labor Relations Act (“NLRA”) for discriminatorily prohibiting the union handbilling while permitting nonunion solicitations and distributions on the property.
In agreeing with the NLRB, the court noted that an employer has no right to exclude union representatives engaged in NLRA-protected activity from areas where it lacks an exclusionary property interest. The court upheld the NLRB’s rule that the employer must meet a threshold burden of showing a sufficient property interest. The question in this case was “whether Roundy's met its burden of showing, under Wisconsin law, that its nonexclusive easements gave it an exclusionary interest to oust the peaceful handbillers from the common areas.”
To answer that question, the court examined Wisconsin law and the terms of the easements set forth in Roundy’s leases. It noted that Roundy’s interest in the common areas around its stores was limited to a maintenance obligation and a nonexclusive easement. Also, although Roundy’s had a practice of ejecting “undesirables” from those areas, no lease explicitly authorized it to do so and there is no evidence that landlords were aware of the practice. The court found that Roundy’s has rights to the extent of its nonexclusive use in the easements and can enjoin third parties when they “unreasonably interfere” with their intended use. The ultimate question, said the court, is “whether the handbillers’ actions unreasonably interfered” with the purpose of the easements, which the court found to be providing ingress and egress to its stores in a manner conducive to the commercial businesses that share the common areas.
The court found that Wisconsin law recognizes a distinction between a property owner’s and a nonexclusive easement owner’s right to exclude unwanted visitors from common areas, and that the NLRB properly applied Wisconsin law in concluding that the handbillers here did not unreasonably interfere with Roundy’s use of its easement. The court expressly limited its holding to the facts that the handbillers were engaged in peaceful conduct protected by the NLRA and the absence of any evidence that they were disruptive or that “customers were inconvenienced or disconcerted by their presence.”
Given those findings, the court concluded that Roundy’s failed to meet its burden of proving a state property interest sufficient to remove the handbillers, and it granted enforcement of the NLRB’s decision.
Roundy’s, Inc. v. NLRB, Case Nos. 10-3921 and 11-1292 (7th Cir., 3/9/12).
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