Legal Update: Federal Courts Rule in Small Business’ Favor

June 1, 2022

Courts issue two rulings agreeing with NFIB amicus briefs

Legal Update: Federal Courts Rule in Small Business’ Favor

Across the nation, the NFIB Small Business Legal Center is involved in dozens of court cases concerning the rights of small businesses. Recently, two federal courts issued rulings in favor of small business interests. In both cases, NFIB filed amicus briefs advocating for the rights of small businesses owners and urging for the eventual outcome.

Texas v. Yellen.

On April 8, the U.S. District Court for the Northern District of Texas ruled that the federal government unconstitutionally tried to prevent Texas, Louisiana, and Mississippi from using American Rescue Plan Act (ARPA) funds for tax relief. ARPA made funds available to states if and only if those states agreed not to pass any laws or take any administrative actions that would decrease their net revenue. NFIB filed an amicus brief arguing this mandate was unconstitutional and small businesses needed tax relief following the COVID-19 pandemic and shutdowns. “This decision is great news for small businesses who are still recovering from the financial damage caused by the pandemic,” said Karen Harned, Executive Director of NFIB’s Small Business Legal Center. “Small businesses are managing various challenges right now including rising inflation and worker shortages and will benefit greatly from tax relief. We are glad the Court agreed that such a mandate was unconstitutional.”

FDRLST Media, LLC, v. National Labor Relations Board (NLRB).

On May 20, the United States Court of Appeals for the Third Circuit ruled that a reasonable employee would not view an obviously comedic tweet as threatening or otherwise interfering with employees exercising their right to unionize under the National Labor Relations Act (“NLRA”). The case examined a complaint to the NLRB that the content of a tweet constituted an “unfair” labor practice. The complaint came from another twitter user, someone entirely unaffiliated with FDRLST Media. The NLRB proceeded with enforcement actions against FDRLST Media. NFIB filed an amicus brief arguing that only an “aggrieved” person may file an unfair labor practice charge. While this was not the primary rationale for the Third Circuit’s verdict, the Court’s decision did state that the lack of evidence that any FDRLST Media employee actually felt threatened by the tweet weighed against the NLRB’s initial ruling. “It is outrageous that this case even had to go to court in the first place — the tweet in question obviously was a joke,” said Karen Harned. “The employer in the case should not have had to take time and money away from his business to defend itself. NFIB will continue to fight to ensure that the nation’s labor laws are not exploited to harass small businesses.”

The NFIB Small Business Legal Center protects the rights of small business owners in the nation’s courts. NFIB is currently active in more than 40 cases in federal and state courts across the country and in the U.S. Supreme Court.

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