Here is a short summary of the right-to-work movement’s legal strategy in the aftermath of its victory in Janus v. AFSCME1: If you can’t kick a man when he’s down, when can you kick him? For within weeks of Janus’s pronouncement that the First Amendment forbids public sector unions to collect agency fees from objecting employees,2 right-to-work groups filed a flood of class action lawsuits seeking the refund of millions of dollars’ worth of fees that were paid in the years before Janus was even decided,3 when such fees were indisputably lawful.4 Commentators have observed that these retroactive refund suits threaten to bankrupt unions around the nation.5
In Compelled Subsidies and the First Amendment,6 Professors William Baude and Eugene Volokh argue that “Janus makes it likely” that public sector unions will indeed be liable under 42 U.S.C. § 1983 for refunds of money they collected in years before Janus was even issued.7 We think otherwise, and this Response explains why.
We start in Part I by presenting a vision of the world as it would exist if Baude and Volokh are right. It turns out that imposing financial liability on public sector unions for conduct that was perfectly lawful when it took place (because both state law and judicial precedent authorized the unions to collect fair-share fees8) is a kind of maneuver that cannot be neatly confined to the context of union fee refunds.
In Part II, we explain why this unsavory state of affairs is hardly necessary. In fact, the law requires otherwise. In particular, we describe three legal arguments that should stop the union-refund suits from getting off the ground: careful application of the doctrine of civil retroactivity; defenses that were available against the most closely analogous tort at common law, including that unions acted in good faith reliance on existing law; and ordinary principles of class action certification.
I. What if Unions Can Be Sued for Following the Law?
The consequences of retroactive reparations in the wake of newly announced rules of constitutional law cannot be confined to the unions. Under existing law, a number of persons within the meaning of § 1983 do not receive qualified immunity.9 If courts are required to award retroactive damages for breaches of new rules of constitutional law, these actors, too, could be successfully sued for damages awards simply because they followed state laws — even if those laws are endorsed by binding United States Supreme Court precedent.
Consider private prison guards. The Court held in Richardson v. McKnight10 that they are not entitled to qualified immunity, reasoning that private prison guards were not similarly situated to state employees in light of what the Court called “competitive market pressures.”11 The Court has also rejected qualified immunity for local governments.12 To be sure, local governments do receive tremendous insulation from liability for constitutional violations.13 Still, when a municipal ordinance violates the Federal Constitution, local governments may not rely on qualified immunity as an additional layer of protection from liability.
It is one thing to say that defendants such as private prison guards and local governments are liable for violating the Constitution, even if the precise contours of that right were not clearly established at the time of the violation. It is quite another, however, to conclude that these types of defendants are liable for following state law in the wake of new rules of constitutional law. Consider the context of same-sex marriage, for example. In the 1972 case of Baker v. Nelson,14 the Supreme Court summarily dismissed an appeal from a state court ruling that rejected a gay couple’s contention that they had a constitutionally protected right to marry.15 It was not until 2015, in Obergefell v. Hodges,16 that the Supreme Court reached the opposite conclusion, holding that same-sex couples must be permitted to marry.17 And at that time, many states still had laws on the books that prohibited same-sex marriage. Under Baude and Volokh’s view of the law, thousands of same-sex couples could potentially sue local governments for retroactive damages suffered during the years that they could not get married.
Another context that helps make plain the consequences of retroactive damages for new constitutional rules is the Supreme Court’s Eighth Amendment jurisprudence, which depends heavily on “evolving standards of decency.”18 In Miller v. Alabama,19 the Supreme Court held for the first time that it violates the Eighth Amendment to impose on juveniles mandatory sentences of life without the possibility of parole.20 Is it the law that those who received such sentences could seek reparations from local governments where local district attorneys enforced life without parole sentences, even if those sentences were entirely consistent with state law and federal precedent at the time? Is it the law that private prison guards who imprisoned these juvenile offenders must pay thousands of dollars in reparations as well? Or suppose the Supreme Court were to rule at some future point that the death penalty is unconstitutional. Could reparations be sought from municipalities where local district attorneys successfully sought the death penalty, a practice then consistent with most states’ laws21 and extant Supreme Court precedent?22
These concerns are even more salient at this current moment in the life of the doctrine of qualified immunity. Indeed, Baude has written a highly persuasive and influential account of why the doctrine of qualified immunity, as it exists today, likely cannot be reconciled with § 1983’s text and history.23 Jurists and scholars alike are wrestling with that claim, and a cloud of doubt hangs over the doctrine.24 If qualified immunity were found to be unlawful, the consequences of retroactive damages for new constitutional rights would be all the more explosive, as the class of defendants who could be sued for such damages would grow exponentially. Police officers, municipal clerks, government-employed prison officials, and others would all be on the hook to pay costly damage awards out of pocket for engaging in perfectly lawful conduct, simply because they failed to predict that the Supreme Court would (at some unknown future point) change the law.
An illustration may help drive home the point. Until the Supreme Court’s holding in Carpenter v. United States25 that the collection of cell site location data from private cell phone providers constitutes a search under the Fourth Amendment,26 thousands of police officers investigated criminal suspects by taking the commonplace step of collecting and using this data without a warrant. Prevailing law in as many as thirty-three states allowed this investigative practice, so officers in these states had little reason to fear a lawsuit.27 Nonetheless, if the Court pares back qualified immunity and Baude and Volokh are correct about retroactive liability, all of these officers would find themselves personally liable for thousands of dollars in damages. On Baude and Volokh’s view, the fact that the officers were merely following existing state law — and the fact that they obviously could not predict the Supreme Court’s later decision to overturn that law — would be no defense.
To hold that damages are available under these circumstances would, then, have consequences for local governments, private entities, and potentially enormous numbers of government officials all acting under the color of state law. Such a holding would also raise important questions about notice and fairness. But that is not all. The availability of such damages might also have consequences for future plaintiffs who are seeking to vindicate constitutional rights. Scholars like Professors Richard Fallon and John Jeffries have discussed that the creation of overly broad constitutional remedies can chill the development of constitutional rights, as judges attempt to calibrate the effect of their decisions on competing constitutional values.28 Permitting retroactive damages for altogether new rules of constitutional law is a blunt tool, and it is conceivable that if this tool lurked behind new constitutional rights, fewer such rights would be identified. It is easy to imagine some Justices getting cold feet in Carpenter, for example, if recognizing a reasonable expectation of privacy in cell phone location data necessitated the imposition of personal liability on tens of thousands of police officers for conduct that was entirely lawful when undertaken.
II. Why the Union-Refund Suits Should Fail
We suspect persons of all political orientations would be troubled if private and government actors alike could be sued personally for damages because they followed prevailing law at Time One without predicting that the Supreme Court would later change the law at Time Two. Fortunately, the law does not require that outcome. In the context of the union-refund suits in particular, three legal principles operate to cut off the massive refund liability sought by right-to-work groups: the Supreme Court’s civil retroactivity doctrine, context-specific defenses that are available to bar § 1983 liability, and Rule 23 class action requirements.
The foundational premise on which the union-refund lawsuits rest is that “under standard civil retroactivity doctrine, Supreme Court decisions supposedly state the true law as it has always been, rather than changing the law.”29 Baude and Volokh argue that the upshot of this rule is that “courts must treat the involuntary collection of agency fees before Janus as unconstitutional.”30 However, a close examination of the rationale underlying civil retroactivity doctrine — and a close reading of Janus itself — reveals a strong argument that Janus’s rule should not be applied to pre-Janus conduct to begin with.
As Baude and Volokh correctly observe,31 the Supreme Court has established the general presumption that “[w]hen this Court applies a rule of federal law to the parties before it, that rule is the controlling interpretation of federal law and must be given full retroactive effect.”32 The reason for this rule is a basic concern for treating like persons alike: if the Court were to give the litigants in the case before it the retroactive benefit of a new rule, then fairness requires giving the same benefit to all similarly situated persons.33 To use the union fee setting as an example, it would seem unfair for the Court to “selective[ly] appl[y]”34 Janus’s new rule so as to award Mark Janus himself a refund for fees he paid before June 27, 2018, only to deny the same relief to other similarly situated objecting workers on the ground that the law does not apply retroactively as to them.
All of this is easy enough to understand. But the Court’s endorsement of full civil retroactivity is only a presumption: as Harper v. Virginia Department of Taxation35 itself held, the critical condition precedent to retroactivity is that the Court must first apply the new rule of federal law “to the parties before it.”36 A leading treatise accordingly explains that Harper “did not hold that all decisions of federal law must necessarily be applied retroactively” and that “the Court has not renounced the power to make its decisions entirely prospective, so that they do not apply even to the parties before it.”37 Justice Kennedy made a similar observation in a concurring opinion just two years after Harper.38
The possibility of a prospective-only application of Janus — which would stop the refund class actions in their tracks — is one of the most surprising aspects of Justice Alito’s majority opinion in the case. For despite having a chance to make the new rule fully retroactive simply by holding that Janus himself should get a refund for fees he previously paid, the majority steered clear from awarding any backward-looking remedy.39
If anything, the opinion is most fairly read to suggest that the new rule forbidding collection of agency fees applies only in the future. Immediately after observing that “[i]t is hard to estimate how many billions of dollars have been taken from nonmembers and transferred to public-sector unions in violation of the First Amendment,” the Court did not say anything about the union’s obligation to pay back those fees.40 Instead, the Court framed its ruling as a forward-looking one: “Those unconstitutional exactions cannot be allowed to continue indefinitely.”41 Then, in the concluding section of the opinion, the majority again framed its holding as a prospective rule instead of a retroactive one: “For these reasons, States and public-sector unions may no longer extract agency fees from nonconsenting employees.”42 Given the Supreme Court’s seemingly intentional refusal to announce a retrospective rule in Janus itself, lower courts considering post-Janus refund claims would be well within reason to dismiss them on the ground that Janus established a uniform forward-looking rule of conduct only.
If courts nevertheless decide to apply the new rule announced in Janus retroactively, the unions should still prevail due to the availability of certain defenses, most notably their good faith reliance on existing state and constitutional law. To their credit, Baude and Volokh acknowledge this possibility, admitting that two lower courts relied on the good faith defense to dismiss retroactive union-refund claims brought in the aftermath of Harris v. Quinn,43 a predecessor case to Janus involving home health care workers.44 Baude and Volokh are skeptical of these rulings, however, on the ground that they lack “clear authority” or “endorse[ment] [from] the Supreme Court.”45
It is true that the Supreme Court has never formally recognized a good faith defense that private defendants may raise against § 1983 actions. However, neither has the Court rejected such a defense; it has instead reserved the question three times.46 Moreover, five Justices expressed support for the private-party good faith defense in Wyatt v. Cole47 without any disagreement from the majority,48 and every court of appeals to consider the question has concluded that it exists.49
Baude and Volokh suggest that the lower court decisions recognizing the good faith defense have nonetheless erred by fashioning the defense as a bar to liability that is categorically available to all private defendants in every § 1983 claim,50 rather than a defense whose availability depends on the particular nature of the underlying constitutional violation.51 As Baude has written elsewhere, the Supreme Court’s recognition of § 1983 defenses originally turned on a comparison to “the individual elements of particular common-law torts,” not the broader notion that a defense available in one tort setting could serve as “evidence of a more general [defense] . . . export[able] to other claims.”52 Or as the Court framed the inquiry in Wyatt: if the defendants were “shielded from tort liability when Congress enacted [§ 1983,] we infer from legislative silence that Congress did not intend to abrogate” the defenses that would have been available to them against “the most closely analogous torts.”53
Still, in light of the uniform consensus in the courts of appeals and the support of at least five Justices in Wyatt, district courts may find themselves bound to rule that the unions enjoy a general good faith defense without regard to the most closely analogous tort. Nor would the outcome change even if a court were to conclude otherwise,54 because public sector unions would have enjoyed a good faith defense against the most analogous tort at common law. In fact, a close examination of common law tort analogues reveals that unions should enjoy an additional defense that independently precludes liability: the fact that they did not act maliciously in the course of relying on state agency fee laws.
The critical first step in this analysis is to identify the common law tort that is most analogous to the constitutional violation alleged by the objecting workers who seek a refund. That violation, of course, is the one announced in Janus, so it makes sense to look to Janus’s own characterization of the unlawful conduct as a point of reference when searching for the analogous tort. And once one does so, it is apparent that the defining feature of this particular constitutional violation is that a private party (the union) has utilized a state law “procedure [that] violates the First Amendment” — that is, the private party has used a state-created legal process to “automatically deduct” a portion of each “nonmember’s wages” and transfer it to the union.55
Indeed, it is this very fact — the unions’ reliance on a state statute authorizing collection of agency fees — that enables objecting union workers to sue under § 1983 at all. Baude and Volokh put it best: “[t]he state statutes authorizing the collection of agency fees are” what amount to the “unconstitutional state action” that is challengeable under § 1983.56 It is thus critical to treat these statutes as the focal point of a § 1983 inquiry into the most analogous tort, for if the statutes didn’t exist, no § 1983 claim would either.
With the role of the state’s statutorily prescribed procedure for obtaining objecting workers’ wages front and center, it becomes clear that the most analogous tort against the unions is the common law tort of abuse of process, which is a “cause of action against private defendants for unjustified harm arising out of the misuse of governmental processes.”57 In fact, there is a close parallel between the constitutional tort at issue in the Janus refund claims and the claim in Wyatt, which also relied on the abuse of process tort analogy.58 In Wyatt, the plaintiff filed a § 1983 claim against a private-party defendant for utilizing a state law replevin procedure that resulted in the state wrongfully transferring the plaintiff’s property to the defendant. Just so, here: the plaintiffs are objecting workers who seek relief against a private party defendant (their union) because the union utilized a state law procedure to wrongfully transfer the workers’ property. In both situations, the party seeking to obtain property belonging to another was automatically entitled to such property as a matter of law upon the completion of certain basic administrative requirements.59
To be sure, abuse of process tort claims typically involve allegations of misuse of judicial procedures (as in Wyatt) rather than statutory procedures. But that distinction is of no consequence for purposes of identifying the proper analogy. The canonical definition of the tort at common law entails the “unjustifiable employment of the processes of the law.”60 A statute creating a process by which party X acquires the legal right to party Y’s property constitutes a “process of law” whether party X is required to obtain court approval for the property transfer or whether party X is entitled to the transfer so long as it follows administrative procedures set forth in the statute.61 Indeed, many cases explicitly recognize the availability of an abuse of process claim arising out of misuse of administrative (as opposed to judicial) process.62
Baude and Volokh argue that the most analogous tort may sound in restitution or unjust enrichment rather than abuse of process.63 They analogize the unions’ receipt of agency fees to a situation where a government illegally assesses a tax on a citizen; in that circumstance, the taxpayer is often entitled to restitution of her tax payment.64 But that unremarkable rule seems to miss the most salient aspect of the objecting workers’ refund claim: that some other private party, not the government, has used a state-sanctioned process to wrongfully obtain their property.
This distinction between private and government beneficiaries is not a mere formality. One can see the equity in eliminating the government’s ability to claim good faith reliance on an illegal tax law of its own creation as an excuse to keep unlawfully withheld tax receipts. The Restatement explains, after all, that “one of the cornerstones of the law of restitution and unjust enrichment” is that a defendant “is not permitted to profit by his own wrong.”65 But that rationale is not implicated when a private party relies on a law that was passed by the people’s chosen representatives (who were in turn acting in reliance on an on-point Supreme Court decision).
Alternatively, objecting workers may argue that the more analogous tort is conversion. This, too, is an uncomfortable fit. To start, there is disagreement over whether money is even a proper subject of a conversion action if it is not specifically earmarked or differentiated.66 More glaringly, the tort of conversion fails to include as an element the crucial feature of the First Amendment violation identified in Janus (the very feature that enables objecting workers to sue in light of § 1983’s state action requirement): the existence of a state law process to transfer the plaintiff’s property to the defendant. In fact, conversion is often defined by reference to unlawful, wrongful, or unauthorized conduct67 — an element that would seem lacking by definition where the defendants receive property only in reliance on state agency fee laws.68
If abuse of process is indeed the best tort law analog, then the second step in the analysis is to determine whether the defenses available to an abuse of process action would benefit the unions here. At common law, an abuse of process claim would fail if the plaintiff could not show both malice and the lack of probable cause.69 So unions can defeat liability if either element is not satisfied.
We start with the probable cause element because that has been the subject of lower court rulings thus far.70 At common law, probable cause was present where the “combination of facts and proofs [would] fairly lead the reasonable mind to the belief” that the defendant’s action was proper.71 This meant that liability was foreclosed when a defendant acted with a good faith belief in the lawfulness of a statute.72 And in the agency fee context, a reasonable person had every reason to believe that the collection of such fees was lawful before Janus, given that state law authorized it and the Supreme Court had upheld the practice decades earlier in Abood v. Detroit Board of Education.73
Baude and Volokh respond that perhaps this reliance was unfounded. Because a pair of earlier Supreme Court opinions questioned the continued vitality of state agency fee laws, they argue, “the courts may well conclude that unions were knowingly gambling on the continued validity of Abood.”74 But expecting the unions to predict when, exactly, they could no longer rely in good faith on Abood’s settled rule is a dangerous exercise. True, the Court referred to Abood as an “anomaly” in its 2012 decision in Knox v. SEIU, Local 1000,75 but it also said in that case that Abood’s permission of agency fees was “justified by the interest in furthering ‘labor peace’” — hardly the kind of language that would inform private actors that the case was no longer worthy of reliance.76 The Court then had the opportunity to overrule Abood in its 2014 decision in Harris v. Quinn, but chose not to.77 Does that mean continuing to collect agency fees was in good faith or bad faith? And does it matter that for a period of several months after Justice Scalia’s death in February 2016, public sector unions might have reasonably anticipated a friendly fifth vote to uphold Abood in the form of Judge Garland? Asking private actors to engage in all of this guesswork before following the existing law is surely a worse approach than a bright-line rule that says it is always good faith to rely on a law that is explicitly blessed by a controlling Supreme Court decision — unless and until that decision is overturned.78
In any case, even if one accepted the argument that unions somehow acted in bad faith when they followed decades-old state law and Supreme Court precedent, that would prove at most the lack-of-probable-cause element of the abuse of process tort. But once one acknowledges that § 1983 defendants should be entitled to raise the defenses that were available as against the most analogous common law tort,79 it becomes clear that the union-refund plaintiffs must also show that the unions acted with malice in the course of collecting agency fees.80 After all, prior to § 1983’s enactment, a plaintiff seeking to sue a private defendant for wrongfully using a legal process to obtain the plaintiff’s property would lose unless the defendant acted with malice, a concept then understood to mean acting with an “evil or unlawful purpose.”81 Like the lack-of-probable-cause requirement, this malice element was so “well established” that “Congress would have specifically so provided had it wished to abolish the doctrine.”82
Yet there is no allegation in the union-refund suits that the public sector union defendants used the state agency fee procedure for some evil ulterior purpose — for example, to punish or coerce nonmembers based on their views, as opposed to collecting fees for the purpose of bargaining on behalf of all workers (nonmembers included83) and representing them in grievance procedures against the employer.84 Courts should accordingly dismiss the refund actions for this independent reason, separate and apart from any good faith defense.
Section 1983 suits seeking massive classwide refund liability should fail for another reason: they do not satisfy the commonality and predominance requirements for certification as a class action under Rule 23 of the Federal Rules of Civil Procedure.85
Recall the Supreme Court’s explanation that defendants in § 1983 claims should be able to raise the same defenses as would have been available under the analogous tort at common law.86 We have argued that the proper analogy is to the abuse of process tort, to which the good faith defense (and a lack of malice defense) was widely recognized at common law. However, should courts agree with Baude and Volokh’s view that these § 1983 claims are not sufficiently analogous to tort claims that invite such a defense, unions can still invoke the class action certification requirements of Federal Rule of Civil Procedure 23 to limit retroactive liability.
Suppose, for example, that a court were to conclude that unjust enrichment is the proper tort law analogue and that a good faith defense is not available as a result. Even then, it would remain the case that other unjust enrichment–specific defenses would be available. To that point, the very first defense that the Restatement identifies as against an unjust enrichment claim is that the recipient of the payment at issue was not unjustly enriched.87 As the Restatement explains, “the recipient may defend by showing that some or all of the benefit conferred did not unjustly enrich the recipient when the challenged transaction is viewed in the context of the parties’ further obligations to each other.”88
Public sector unions will have strong arguments on the merits that they were not unjustly enriched by objecting workers’ agency fee payments given two “further obligations” that the unions owe to those workers in exchange for those payments: the duty to bargain on their behalf and the duty to represent them in grievance procedures. The former duty results in what is on average an 11% wage premium for unionized workers, an amount that far exceeds (and thus renders “just”) the typical 2% agency fee.89 In addition, the latter duty can be viewed as a kind of litigation insurance that obligates the union to defend each objecting worker against any employer action that violates the worker’s rights under the collective bargaining agreement.
To overcome this defense, an objecting worker would need to show both that she would have earned at least the same net wage premium in the absence of a union funded by agency fees and that she did not benefit from the union’s duty to represent her in employer grievances. Those propositions, however, are highly fact bound with respect to each objecting worker. While some objecting workers may have been high performers who could have individually negotiated an equivalent wage premium, others might have earned less in the absence of an adequately funded union to bargain collectively on their behalf.90 Likewise, some objecting workers may have received valuable representation directly from the union in disputes with their employer; others may have benefitted indirectly from the union’s representation of a similarly situated worker.
Rule 23’s commonality and predominance requirements exist precisely to keep these kinds of fact-dependent, case-by-case inquiries out of class action litigation. As to commonality, the Supreme Court has explained that “[w]hat matters . . . is not the raising of common ‘questions’ — even in droves — but, rather, the capacity of a class-wide proceeding to generate common answers apt to drive the resolution of the litigation.”91 Assuming that the unjust enrichment analogue is correct, litigating objecting workers’ refund allegations as a class will do nothing to answer the crucial liability question of whether a union actually provided offsetting value to any individual worker via a union-negotiated wage premium or grievance representation. The Court’s observation in Wal-Mart Stores, Inc. v. Dukes92 thus seems apt here, too: “Dissimilarities within the proposed class are what have the potential to impede the generation of common answers.”93
The problem is even clearer with respect to the predominance inquiry.94 The Supreme Court has held that this requirement involves asking whether “the common, aggregation-enabling, issues in the case are more prevalent or important than the non-common, aggregation-defeating, individual issues.”95 By “individual issues,” Rule 23 refers to issues for which “members of a proposed class will need to present evidence that varies from member to member.”96 That, of course, is precisely what characterizes the crux of unjust enrichment liability, as each member of the proposed class would need to present evidence regarding how much she would have earned individually in the absence of an adequately funded union (including the possibility that she would have had to negotiate her salary individually based on her performance97) as well as evidence proving that she did not benefit from any of the representation services provided by the union to her or a similarly situated employee. In the absence of such proof for each and every proposed class member, there is simply no way to know if agency fees collected by the union were “unjust” or not.
Similar problems exist for certifying a § 1983 class action if a court were somehow to deem conversion the best analog. As noted earlier, liability for the tort of conversion is precluded unless the plaintiff can establish that the defendant “wrongfully” obtained the plaintiff’s property, a showing that at a minimum involves proof that the defendant’s interference was “unwarranted.”98 But even assuming that it can be “wrongful” or “unwarranted” for a union to follow a state law agency fee procedure, how is a court to know if the collection of agency fees from every member of the proposed class of objecting workers was “wrongful” or “unwarranted” without knowing whether the objecting workers actually benefitted from the union’s representation? It seems highly inequitable to hold a defendant liable for converting a plaintiff’s money if the defendant actually provided substantial remunerative benefits (such as a much larger wage increase or legal representation in a dispute with the employer) to the plaintiff in exchange. The point is not to suggest that all objecting workers were better off because of the union, but rather that there is no way to know without precisely the kind of individualized factfinding and evidentiary inquiry that deprive the class action device of its utility.
There is blood in the water, and right-to-work groups are closing in. Classwide demands for the refund of upwards of eight figures’ worth of agency fees collected before Janus was decided could be a deathly blow to organized labor. As we have explained, however, these suits should fail due to the best reading of Janus as itself establishing a prospective-only rule, the unions’ good faith conduct and lack of malice, and the lack of class action commonality and predominance. Such an outcome would be more than legally correct; it would help prevent the sweeping consequences of imposing liability on a host of other defendants — municipal clerks, prison officials, police officers, and others — who simply followed the law on the books. 99
* Acting Professor of Law, University of California, Davis, School of Law.
** Associate Professor of Law, Emory University School of Law; Visiting Associate Professor of Law, University of Chicago Law School.
Recommended Citation: Aaron Tang & Fred O. Smith Jr., Can Unions Be Sued for Following the Law?, 132 Harv. L. Rev. F. 24 (2018), https://harvardlawreview.org/2018/11/can-unions-be-sued-for-following-the-law/.