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Seventh Circuit Deflates Scabby the Rat's Ego and What It Means for Employers

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"Scabby the Rat" reared its inflatable rodent head last month in the United States Court of Appeals for the Seventh Circuit (Wis., et al).

On Feb. 14, 2019, the appellate court held that a Grand Chute, Wisconsin zoning ordinance banning all private signs on public rights-of-way permitted town officials to order Local 330 of the Construction and General Laborers' Union to deflate the labor icon without violating the union's First Amendment rights. This ruling creates a glimmer of hope for employers in what has otherwise been a frustrating and ineffective battle to curb an annoying union tactic.

Scabby the Rat, dubbed after unions' disparaging term "scab" to describe strikebreakers, is an inflatable cartoon rat ranging between 6 and 30 feet tall, utilized by unions to publicize disputes with employers. The rat was first spotted in 1990. Scabby has its own Facebook page and Twitter account, and has even crossed oceans to participate in labor-management disputes at an oil refinery in Scotland and a brewery in Australia.

No stranger to litigation, Scabby has survived employer attempts to eradicate union inflatables on the grounds that the rodent constitutes unlawful picketing, an unlawful secondary boycott, or violates local zoning laws. The National Labor Relations Act (NLRA) prohibits conduct found to "threaten, coerce, or restrain" a secondary employer not directly involved in a primary labor dispute, if the object of that conduct is to cause the secondary to cease doing business with the primary employer. The National Labor Relations Board (Board) and federal courts have long issued rulings holding that inflatables like Scabby fall on the non-coercive side of the spectrum, along with stationary handbilling, and/or are symbolic speech protected by the First Amendment.

For instance, in Sheet Metal Workers Local #15 (Brandon Regional Hospital), 356 N.L.R.B. 1290, 190 LRRM 1377 (N.L.R.B. 2011), the Board found a mock funeral staged by the union in front of a hospital was coercive, but declined to address the legality of the accompanying rat balloon display. However, the U.S. Court of Appeals for the District of Columbia Circuit reversed the Board, holding that the mock funeral, complete with faux coffin and Grim Reaper in costume, was not coercive. On remand, the Board found that Scabby, stationary and silent, was not coercive. Clearly, labor strife must come with a thick skin.

Grand Chute took another approach. The municipal zoning enforcement officer ordered Local 330 to take down Scabby and his pal "Fat Cat" (another beloved union inflatable that depicts a snarling cat symbolizing management) from outside a car dealership, where a masonry company working at the dealership was alleged to be paying substandard wages and benefits. The union had placed the rat directly across from the dealership, along the frontage road for a major local thoroughfare, as union members engaged in informational picketing.

The Seventh Circuit affirmed U.S. District Judge William C. Griesbach's conclusions that the town's signage ordinance was content-neutral, protected the town's interest in keeping public ways clear and distraction-free, left the union with alternate means to communicate its message, and was applied in an even-handed manner. Notably, the zoning officer successfully distinguished the Fire Department's folding easel, also placed on a public right-of-way, and used to advertise the Department's "Fill the Boot" campaign for the Muscular Dystrophy Association arguing that the easel was not a "sign" because it was not tethered to the ground. The Seventh Circuit accepted this argument, and held enforcement of the ordinance against Scabby did not violate the union's constitutional rights.

Employers facing union demonstrations should consider consulting with local authorities regarding inflatables or other displays placed on public rights-of-way, to determine whether they violate facially neutral and regularly enforced local regulations. But employers should not consider Scabby exterminated just yet, even if their municipality has applicable content-neutral ordinances. The municipality may not have enforced the ordinance as "systematic[ally]" as did Grand Chute's zoning officer, who testified he removed approximately 150 signs per year between 2016-2018. Application of a facially neutral ordinance can result in First Amendment violations if enforced in a disparate manner. That means towns that ignore the ordinance when it comes to birthday or holiday inflatables will be hard-pressed to deflate Scabby.

Other federal courts reviewing like ordinances have come down in Scabby's favor. For example, the Sixth Circuit in Tucker v. City of Fairfield, 398 F.3d 457 (6th Cir. 2005), issued a preliminary injunction barring enforcement of an ordinance prohibiting "structures" in a public right of way against Scabby. Judicial constraints aside, on a practical level, a municipality may be reluctant to intervene in a labor dispute, depending on the local political climate. Scabby may even be back to fight another day in Grand Chute, which subsequently amended its ordinance to include an exception for inflatables. The court found no ripe controversy over the amended ordinance. This is not the last we will see of Scabby. Rats.

Posted In: Wisconsin; National Labor Relations Act (NLRA); National Labor Relations Board (NLRB)

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