State of California v. Safeway Inc., et al.

NCLC filed twice in this case: once on the merits and once supporting en banc review.

NCLC urged the Ninth Circuit to reconsider its decision that a 2003 mutual aid agreement between California supermarkets was subject to antitrust liability. The supermarkets entered into a pact through which, among other things, they agreed to lock out union employees within 48 hours of a strike and to share revenues in the event of a strike to counteract the unions' potentially divisive whipsaw strike tactics. The Ninth Circuit held that the supermarkets' agreement violated the Sherman Act and was not exempted by a nonstatutory exemption for employer actions in labor disputes. In its brief, NCLC argued that mutual aid pacts are consistent with national labor policy and are commonly used in multi-employer bargaining. NCLC warned that restricting mutual aid agreements undermines employers' ability to fairly negotiate labor disputes.

NCLC previously filed a brief with the Ninth Circuit panel arguing that the NLRB, not antitrust courts, should police the legality of the collective bargaining process.

The Ninth Circuit, disagreeing with NCLC and two other circuits, found that the mutual aid pact is not protected from antitrust scrutiny under the nonstatutory labor exemption because, in this situation, there were no direct consequences for the labor market. The Court found that the use of revenue sharing is not consistent with the history of labor law and policy and that there are other economic weapons for employers to use in labor disputes, such as lockouts and replacement workers.

In a partial victory, the Court analyzed the pact at issue in this case and found that it was not a per se violation of the Sherman Act. The unique features of the mutual aid pact – limited duration, scope, and number of competitors – suggested that the employers maintained incentives to compete, thus the agreement was not per se illegal. Finally, the Court noted that there was no evidence of an actual anticompetitive impact on pricing.
 

Amicus brief on the merits filed 12/10/08. Decided 8/17/10. Amicus brief urging en banc review filed 10/12/10. En banc review granted 2/11/11. Decided 7/12/11.