No Credible Threat, No Standing: Fifth Circuit Clarifies Employer Standing in Pre-Enforcement Challenges to NLRB Guidance

Introduction

Burnett Specialists v. Cowen concerns five Texas-based staffing companies’ attempt to halt future enforcement of National Labor Relations Board (“NLRB”) policies that, in their view, impermissibly restrict employer speech about unionization. The challenged policy was Memorandum GC 22-04, issued by then–General Counsel (GC) Jennifer Abruzzo, which announced an intention to ask the Board to overturn Babcock & Wilcox and to impose disclosure requirements whenever employers convene “captive-audience” meetings or “corner” individual employees to discuss union matters.

The plaintiffs sought declaratory and injunctive relief in the Eastern District of Texas, alleging First Amendment, Administrative Procedure Act (APA), and ultra vires violations. The district court dismissed for lack of jurisdiction, ruling that (1) the NLRA bars direct review of GC charging decisions, (2) the NLRA provides an exclusive review scheme that precludes immediate challenges, and (3) plaintiffs lacked Article III standing.

On appeal, the Fifth Circuit focused on standing. While the appeal was pending, the Board formally overruled Babcock in Amazon.com Services LLC, and the new Acting GC, William Cowen, rescinded Memorandum GC 22-04, arguing the case was now moot. Nonetheless, the panel (per Judge Patrick Higginbotham, joined by Judge Carl Stewart) affirmed on the narrower ground that the staffing companies never had standing in the first place; Judge Haynes would have remanded for a fresh mootness inquiry and otherwise concurred in the jurisdictional analysis.

Summary of the Judgment

• Disposition: Affirmed; complaint properly dismissed under Fed. R. Civ. P. 12(b)(1) for lack of standing.
• Holding: Employers who neither currently face a “credible threat” of NLRB enforcement nor demonstrate a concrete intent to engage in arguably proscribed conduct cannot satisfy Article III injury-in-fact requirements for a pre-enforcement First Amendment challenge.
• Key Points:
  • The mere existence of a GC memorandum, even one signaling a change in prosecutorial priorities, does not by itself create standing.
  • Future enforcement is too speculative when it depends on (i) whether employees will attempt to unionize, (ii) whether the employer will hold meetings in a particular manner, and (iii) whether an employee will file an unfair-labor-practice charge that the GC chooses to prosecute.
  • Because standing fails, the court declined to reach mootness, preclusion, or merits (First Amendment/APA) issues.

Analysis

Precedents Cited and Their Influence

1. Babcock & Wilcox Co., 77 NLRB 577 (1948)
   Recognized employers’ right to compel attendance at anti-union meetings. GC Abruzzo’s memorandum urged overruling Babcock; the Board later did so in Amazon.com Services LLC. The case provided the backdrop but not the dispositive issue—standing was.
2. Amazon.com Services LLC, 373 NLRB No. 136 (2024)
   Overrules Babcock; requires advance notice and voluntariness for employer meetings. Its issuance narrowed, but did not moot, the dispute; the panel noted its standards differ from Abruzzo’s, underscoring the speculative nature of enforcement.
3. Clapper v. Amnesty Int’l USA, 568 U.S. 398 (2013) and Glass v. Paxton, 900 F.3d 233 (5th Cir. 2018)
   Established that injury-in-fact cannot rest on an “attenuated chain of possibilities.” The Fifth Circuit applied this to find no “certainly impending” enforcement.
4. Speech First, Inc. v. Fenves, 979 F.3d 319 (5th Cir. 2020) & Texas State LULAC v. Elfant, 52 F.4th 248 (5th Cir. 2022)
   Recognize chilled-speech standing where policies facially restrict speech and credible threat is presumed. The panel distinguished them, pointing to “compelling contrary evidence” that the NLRB was not poised to prosecute.
5. Contender Farms, L.L.P. v. USDA, 779 F.3d 258 (5th Cir. 2015) & Texas Med. Ass’n v. HHS, 110 F.4th 762 (5th Cir. 2024)
   Recognize standing where plaintiffs are direct objects of a regulation. The court found those cases inapposite because the staffing companies were “not currently the object” of the GC memorandum—no union campaign, no planned meetings.

Legal Reasoning

The court employed the standard tripartite standing test (injury in fact, causation, redressability). Its analysis centered exclusively on injury in fact.

1. Absence of Intent to Engage in Regulated Conduct
   Plaintiffs pled only that they “would” address employees “if” a union drive occurred. The court deemed this hypothetical and insufficient under Lujan v. Defenders of Wildlife.
2. No Credible Threat of Enforcement
   Even if plaintiffs someday held such meetings, enforcement required multiple contingencies: an employee charge, GC discretion, and Board adjudication. Reliance on independent third-party actions renders a threat too remote (Clapper).
3. Chilled-Speech Framework Not Satisfied
   The court revisited its own “three-prong chilled-speech test” (intent, arguable regulation, substantial threat). Plaintiffs failed all three prongs.
4. Presumption of Enforcement Rebutted
   Where a policy facially forbids speech, courts sometimes presume threat. But the memorandum did not impose a flat ban; moreover, the acting GC expressly represented that no complaint would issue absent other violations. These “compelling contrary” representations dispelled the presumption.

Impact of the Decision

• Heightens Standing Threshold for Employers
  Employers cannot short-circuit the NLRA’s administrative processes merely by pointing to GC policy statements; they must show specific, imminent enforcement risk.
• Signals Judicial Deference to Labor-Board Enforcement Gatekeepers
  The unreviewable nature of GC complaint decisions (29 U.S.C. §160) continues to insulate strategic memoranda from immediate judicial review.
• Guides Future Pre-Enforcement Challenges
  Litigants challenging federal policies must allege concrete plans to violate or be regulated by the rule—and should gather evidence (e.g., scheduled meetings, union petitions) before filing suit.
• Administrative Law Repercussions
  The opinion implicitly cautions agencies that policy memoranda, without more, may avoid APA scrutiny unless coupled with mandatory, binding effects.

Complex Concepts Simplified

• Captive-Audience Meeting: An employer-mandated meeting, on paid work time, where management addresses employees about unionization.
• Cornering an Employee: One-on-one employer approach during job duties, potentially coercive, to discuss union rights.
• General Counsel Memorandum: A policy document from the NLRB’s chief prosecutor announcing enforcement priorities; not itself a binding Board rule.
• Pre-Enforcement Challenge: Lawsuit seeking to invalidate a law or policy before any prosecution occurs, requiring proof of credible threat.
• Standing vs. Mootness: Standing asks whether plaintiff had injury when suit was filed; mootness asks whether a live controversy still exists. The court resolved the former and declined to reach the latter.
• Larson/Ultra Vires Claim: A suit alleging that an official acted beyond statutory authority, thus stripping sovereign immunity.

Conclusion

Burnett Specialists v. Cowen delivers a pointed reminder that Article III’s “case or controversy” prerequisite remains a formidable gatekeeper for litigants seeking to pre-empt potential government enforcement. Even in the contentious realm of labor-management speech, federal courts will require more than apprehension and policy disagreement; plaintiffs must show a concrete intention to act, and a credible, non-speculative threat that the government will pounce. By rejecting standing here, the Fifth Circuit preserves the NLRA’s administrative architecture and places the onus on employers to wait—at least until a union campaign materializes—before hauling the Board into federal court. Going forward, litigants will need detailed, contemporaneous evidence of planned conduct and likely enforcement—or risk dismissal at the courthouse door.