A former senior National Labor Relations Board ethics officer testified in a sworn affidavit that the agency’s Office of Inspector General (OIG) incorrectly failed to recommend civil or criminal action against NLRB general counsel Lafe Solomon in a conflict of interest investigation.
The OIG acts as an independent body to investigate claims of ethical misconduct against NLRB members. It launched an investigation in 2012 into Solomon’s conduct in a potential NLRB lawsuit against Wal-Mart, according to legal documents obtained by the Daily Caller.
Solomon’s alleged misconduct in the Wal-Mart case stemmed from his ownership of stock in the company, which he inherited from his mother when she died in July 2011.
The OIG concluded that Solomon, whom President Barack Obama appointed NLRB’s Acting General Counsel in June 2010, violated conflict of interest law, but that “extenuating and mitigating circumstances” — including an adversarial relationship with a co-worker — should shield him from criminal prosecution.
That co-worker, former NLRB Designated Agency Ethics Official (DAEO) Gloria Joseph, strongly disagreed with the OIG’s recommendation to allow Solomon to avoid responsibility, according to her sworn affidavit dated November 29, 2012.
“The Inspector General’s conclusion that my actions in this matter were influenced by a strained relationship between Mr. Solomon and myself is incorrect,” Joseph wrote in her affidavit.
“While there may be circumstances that warrant mitigating the remedy for an ethics violation, the circumstances cited by the IG do not fit the bill,” Joseph claimed in a separate memorandum cited in that affidavit.
Joseph was replaced in her position at the NLRB in August 2012, during the OIG investigation.
Prompted in part by Joseph’s claims, the legal advocacy group Cause of Action sent a Dec. 7 request to the Department of Justice for a new investigation into the Solomon case. Cause of Action claimed that the OIG “shifted the blame away from Solomon” in order to resolve a case that has caused turmoil within the NLRB and a headache for the Obama administration.
The case dates back to January 2012, when the NLRB considered suing Wal-Mart over allegations that it violated federal labor laws with its social media policy.
Despite holding more than $15,000 in Wal-Mart stock, Solomon attended a meeting in his office with the NLRB’s Division of Advice on Jan. 23. Solomon expressed in the meeting his desire for the NLRB to delay the lawsuit and instead “reach out” to Wal-Mart to encourage the company to change its social media policy.
Solomon “directed his subordinates to contact the Wal-Mart representatives to attempt to reach a resolution,” according to the OIG.
It wasn’t until one week later, on Jan. 30, that he disclosed his Wal-Mart stake to the deputy general counsel of the NLRB. The deputy general counsel informed him that he would need to obtain a waiver to participate in the case.
Joseph denied Solomon’s waiver request. Solomon sold his Wal-Mart stock on February 27.
Wal-Mart changed its social media policy, and the NLRB never pursued a lawsuit against the company.
Republican congressman John Kline, chairman of the U.S. House Committee on Education and the Workforce, requested an OIG investigation into Solomon’s conduct on April 13. The subsequent OIG investigation lasted several months.
“We find that Mr. Solomon did in fact participate personally and substantially, as the Acting General Counsel, in the case involving Wal-Mart’s social media policy knowing that he owned Wal-Mart stock valued at $15,000.00 or more, and that the case involving Wal-Mart’s social media policy would have a direct and predictable effect on that financial interest,” according to the OIG report.
The OIG, however, determined that Solomon did not intentionally try to personally enrich himself.
The report also found that “extenuating and mitigating circumstances,” including an “adversarial” relationship between Solomon and Joseph that corrupted the NLRB ethics office, should clear Solomon of civil or criminal liability.
“[T]he environment at the NLRB in which this violation occurred was dysfunctional and adversarial,” according to the OIG report.
Despite determining that Solomon knowingly committed an ethical violation, the OIG report blamed the NLRB’s ethics program for failing to stop him.
“That everything failed to stop Mr. Solomon is evidence of a complete failure of the NLRB’s standards of conduct program with regard to the Office of the General Counsel,” according to the OIG report.
The report also concluded that Joseph was at fault, since she “should have taken steps to provide counseling to Mr. Solomon on his ethical duties” after she received his waiver request.
The OIG report seemed to indicate that Solomon’s “dysfunctional and adversarial relationship” with Joseph was the reason he failed to disclose his conflict of interest in the first place.
“Mr. Solomon’s failure to timely submit a waiver request or seek ethics counseling and the Director of Administration/DAEO’s failure to offer to meet with and counsel Mr. Solomon are evidence of a complete lack of communication between the two of them,” according to the OIG report.
The report highlighted an email Joseph sent Solomon on Jan. 20, three days before Solomon attended the meeting in question.
“Lafe, What is the status of your nomination? Did it expire when Congress went out or is it one of the ones that Reid carried over? No crisis. I was just trying to figure out when a new 210 day period would begin to run. Gloria,” Joseph emailed Solomon.
Joseph sent Solomon a follow-up email fourteen minutes later declaring, “Never mind. I found the answer.”
The OIG wrote that “questioning him on when his time as Acting General Counsel might end,” was evidence of “the adversarial nature of that situation,” and suggested that Joseph “appears to have been looking for a justification to deny [Solomon] the waiver.”
Joseph strongly disputed the OIG’s conclusions in a sworn affidavit dated Nov. 29, 2012.
“The IG’s report wrongly concluded that I relied on my own personal views in reviewing Solomon’s waiver request, rather than consulting the relevant analytical framework,” she testified.
“The Inspector General’s conclusion that my actions in this matter were influenced by a strained relationship between Mr. Solomon and myself is incorrect. In fact, during the entire period when I served as the Designated Ethics Official at the NLRB, I endeavored to maintain a professional relationship with Solomon,” Joseph testified.
Joseph went into greater detail in an Oct. 1 memorandum she provided to Cause of Action.
“[T]the IG improperly used mitigating, extenuating, and aggravating circumstances in characterizing that violation, and therefore failed to place sufficient emphasis on Lafe Solomon’s personal responsibility,” Joseph claimed.
“[T]he IG’s (report) does not put sufficient emphasis on personal responsibility and seeks to share this responsibility with others. In the end, it is the individual employee who is responsible for behaving ethically,” she added.
“Moreover, the cited ‘extenuating circumstances,’ even if accurately described, would not have made a difference to the outcome as Mr. Solomon had already acted in violation of the statute by the time he asked for the waiver.”
“The conclusion that there was a ‘complete failure of the NLRB’s ethics program with regard to the operations of the Office of the General Counsel’ is inaccurate,” Joseph explained. “An ethics program is only as strong as the willingness of employees to adhere to its standards. When the person at the highest level of the agency, who is fully aware of his ethical obligation, chooses to ignore that obligation, the fault lies with the person and not with the program.”
“Rules were in place to avoid a conflict. They were simply ignored by the occupants of the General Counsel’s office. That is their failing, not the ethics program’s.”
“The notion that personal motives played a role in an ethics decision is simply wrong and not supported by the facts,” Joseph said.
The OIG released a report to the Education and Workforce Committee on November 19, concluding that “NLRB personnel did not engage in misconduct” but that “the Agency’s public affairs activities could benefit from more closely defined policies.”
Lafe Solomon has not been charged either criminally or civilly in the case, and he continues to serve as Acting General Counsel of the NLRB.
An NLRB spokesperson declined to comment. The OIG of the NLRB does not comment on pending or closed investigations.