Union Threatens to Block Apple, Inc. “Spaceship” with Environmental Lawsuit

Perhaps the Service Employees International Union-United Service Workers West deserves grudging praise and respect for refusing to bow to American idols.

Few groups have the gumption to challenge or criticize Apple, Inc., one of America’s most admired corporations. Apple generally gets away with commercial activity that the Left would slam relentlessly if practiced by other large corporations.

For example, Apple is proceeding mostly unhindered with its plan to build a massive complex called Apple Campus 2 in Cupertino, a city located in Silicon Valley and within the San Francisco Bay Area. The region is notorious for traffic congestion and anti-growth sentiment.

Apple Campus 2 ("the Spaceship"), as depicted on the web site of the City of Cupertino.

Apple Campus 2 (“the Spaceship”), as depicted on the web site of the City of Cupertino.

Local fans of Apple commonly refer to the edifice – first proposed to the Cupertino City Council in 2011 by Steve Jobs – as “the spaceship.” An article in the October 16, 2013 San Jose Mercury-News explained why a “2.8-million-square-foot behemoth beside Interstate 280” that would normally be tangled in significant controversy is able to move forward without excessive hassle:

During a public-comment session, most speakers wholeheartedly supported Apple, not surprising since Cupertino is a veritable company town, with Apple offices spread far and wide. “As my mom used to say, ‘don’t bite the hand that feeds you,'” longtime resident Carol Baker told the council. “If we don’t honor Apple with this building, they’ll leave. There’s no reason for them to stay here and be loyal to a community that doesn’t support them. But if they left, it would be a disaster for the city.”

Not many corporations get to be “honored” in a San Francisco Bay Area community with “a four-story ring of curved glass housing up to 14,200 employees.” Apple gets that privilege.

There is a sour note among the hymns of praise, however, and it comes from a union. The Service Employees International Union-United Service Workers West (SEIU-USWW) wants to organize the employees of Security Industry Specialists, which provides security services for some of the celebrated high-tech firms of Silicon Valley – Google, eBay, Twitter, and Apple.

SEIU-USWW has targeted these high-profile companies using the traditional strategies of a union corporate campaign, including protests at shareholders’ meetings, paid advertising and public relations, social media, informational pickets, letters from local politicians, and filing unfair labor practice complaints with the National Labor Relations Board.

Now the SEIU-USWW is turning to what might be the most powerful weapon in the union organizing arsenal in California – “greenmail,” or environmental permit extortion through exploitation of the California Environmental Quality Act (CEQA).

The union submitted a short warning letter dated July 19, 2013 in response to the City of Cupertino’s Draft Environmental Impact Report (DEIR) for the Apple Campus 2. It then submitted another letter dated October 2, 2013 in response to the Final Environmental Impact Report. The Silicon Valley Business Journal recognized what was happening:

What about CEQA? Is anyone going to challenge this thing on environmental grounds? Actually, maybe. But don’t look at the Santa Clara/San Benito Building and Trades Council (the group, headed by Neil Struthers, is a vocal supporter of the project, which is using union labor.)

Buried in public comment documents is a response from an attorney for SEIU-United Service Workers West. That union has protested on behalf of security guards stationed at the Google campuses in Mountain View. (They are actually subcontractors of Security Industry Specialists.)

“…USWW is a stakeholder in this Project, and worker and labor organizations like USWW have a long history of engaging in the California Environmental Quality Act (“CEQA”) process to secure safe working conditions, reduce environmental impacts, and maximize economic benefits,” wrote Gideon Kracov, an attorney for the union. (Kracov is leading a CEQA challenge of an expansion at Los Angeles International Airport on behalf of SEIU-USWW.)

Kevin Dayton, who heads up Labor Issues Solutions and blogs about what he calls union “greenmail,” called the comment “a shot across the bow.”

“Anyone can reasonably speculate that the union would use CEQA as leverage to get security workers organized,” he told me.

At the October 15, 2013 Cupertino City Council meeting at which the Apple Campus 2 project was approved, a representative of the SEIU-USWW expressed an ominous warning in front of a sea of supporters.

Is the threat credible? As referenced in the Silicon Valley Business Journal article, the Los Angeles attorney who is handling the Apple 2 Campus environmental comments for SEIU-USWW filed a CEQA lawsuit on behalf of SEIU-USWW on May 29, 2013. That lawsuit challenges the approval of the Los Angeles International Airport (LAX) Specific Plan Amendment Study based on alleged violations of CEQA. The SEIU-USWW is trying to organize employees of companies such as Aviation Safeguards and Menzies Aviation that provide contract services for airlines at LAX.

The Service Employees International Union- United Service Workers West has 30 days after the City of Cupertino files its Notice of Determination (that the city council approved the project) to file a lawsuit against the city based on alleged deficiencies in the environmental review under the California Environmental Quality Act (CEQA). Will the “iconic” Apple spaceship be stopped by professional union organizers for security guards?


Anticipation High for Apple Spaceship Approval, But Questions Linger – Silicon Valley Business Journal – October 14, 2013

Cupertino Council Clears Huge Apple ‘Spaceship’ Campus for Liftoff – San Jose Mercury-News – October 16, 2013

SEIU-USWW Letter on Draft Environmental Impact Report for Apple 2 Campus

SEIU-USWW Letter on Final Environmental Impact Report for Apple 2 Campus

SEIU United Service Workers West v. City of Los Angeles et al.

Security Industry Specialists – Union Facts (Corporate Site)

Security Industry Specialists: Another Bad Apple Contractor, But Right Here at Home – Stand for Security Blog of SEIU – February 21, 2013

USWW Security Officers Stand Up to SIS Security Contractor at Apple Shareholder – March 2, 2013

Apple Security Officers Demand Company’s Support in Organizing – Labor’s Edge Blog of California Labor Federation – March 5, 2013

SEIU Protests at GoogleMountain View Voice – June 6, 2013

Security Officers, Netroots Nation Activists Call on Google to Help Fight Silicon Valley Income Inequality – Stand for Security Blog of SEIU – June 20, 2013

Outside the Gates: Unions Versus Big TechSF Weekly – July 3, 2013

Security Officers Seeking to Reduce Income Inequality Praise Tech Company’s Decision to Choose Socially Responsible Contractor (Yelp) – Stand for Security Blog of SEIU – September 12, 2013

Unions to Protest Outside Twitter TomorrowSF Weekly – October 9, 2013

Protesters at LAX Allege Unsafe Working Conditions, Unfair Labor PracticesDaily Breeze – March 21, 2012

Kevin Dayton is the President & CEO of Labor Issues Solutions, LLC, and is the author of frequent postings about generally unreported California state and local policy issues at Follow him on Twitter at @DaytonPubPolicy.

Union Environmental Appeal of San Jose Infill High-Rise Fools No One

Today (Tuesday, August 13, 2013) construction trade unions either showed exceptional arrogance or exceptional foolishness when they chose to exploit the California Environmental Quality Act (CEQA) against a high-profile “infill” project in downtown San Jose.

For the past few years, some California state legislators have wanted to discourage CEQA actions meant to advance objectives unrelated to environmental protection. Even Democratic legislative leaders such as California State Senate President pro Tem Darrell Steinberg (D-Sacramento) are seeking minor CEQA amendments to reduce obstacles to infill development, which is regarded by some as a wise planning strategy for the environment.

Under these circumstances, it was astonishing to see the Santa Clara-San Benito Counties Building and Construction Trades Council appeal the San Jose Planning Director’s approval of a downtown 23-story residential “infill” project called One South Market Street. The appeal was filed by the law firm of Adams Broadwell Joseph & Cardozo and based on alleged CEQA violations and planning and zoning code violations.

No one was fooled. San Jose Mayor Chuck Reed declared “It’s not really about the environment … it’s abuse of the environmental process.” And Councilman Johnny Khamis complained that the city council had two abusive back-to-back CEQA objections on its agenda, one with an anti-competitive motive and one with a union motive.

In the end, the city council rejected the union appeal, although two council members voted to support the unions. One of them was San Jose City Councilman Xavier Campos, who is the brother of Assemblywoman Nora Campos, who is married to Neil Struthers, who spoke at the meeting in support of the CEQA appeal as the head of the Santa Clara-San Benito Counties Building and Construction Trades Council.

Groundbreaking for the project had already occurred in a ceremony on June 25, 2013. No one up to that point had indicated any concerns about permitting or environmental review. But on that same day, the law firm for construction unions submitted an objection letter. The unions formally appealed various aspects of the project on July 9 and July 12.

In an August 13, 2013 article about the appeal (Union Challenging Downtown San Jose High-Rise), the Silicon Valley Business Journal indicated that the union objections to the project were not necessarily related to environmental concerns.

So what’s going on? Sources told me the union appears to be trying to send a message after several key subcontracts on the job were delivered to non-union contractors out of Sacramento.

“The Building Trades are not opposed to more high-rises downtown. What we are opposed to is this developer generating more profits at the expense of local workers and the environment,” Neil Struthers, CEO of the Santa Clara & San Benito Counties Building & Construction Trades Council, told me in an email.

He added: “No project should be given the ability to avoid the requirements every other developer must meet as it relates to water quality, affordable housing and traffic mitigation. Someone needs to stand up to those that have the power to gain preferential treatment from local government.”

Reportedly the contractor most objectionable to the unions is a large electrical company that works on major commercial projects throughout Northern California. Its headquarters is in Sacramento, but it has a Bay Area office in Hayward, 25 miles away from downtown San Jose via Interstate 880. Construction companies in Northern California capable of working on a 23-story high rise building tend to have a regional market – these are not hometown plumbers.

Because the City of San Jose has provided tax and fee waivers with financial value to the developer, One South Market Street is regarded under California law as a public works project. All construction companies – both union and non-union – must pay state-mandated construction wage rates (“prevailing wages”) to their trade workers on this project. In California, state prevailing wage rates always duplicate the wage rates in the applicable union collective bargaining agreements for that trade in that geographical region.

In other words, local hiring or wage rates are not legitimate issues. Control of the workforce is the issue.

Presumably, the Santa Clara-San Benito Counties Building and Construction Trades Council will continue to interfere with the project (perhaps with a lawsuit) until the developer (Market Street Tower Venture, LLC, on behalf of Essex OSM REIT, LLC) agrees to sign a Project Labor Agreement or some other contract giving unions a monopoly on construction of the building.

The One South Market Street CEQA appeal shows that unions have a strong economic interest in stopping any proposals that compromise the obstructive power of CEQA. It should not be a surprise that construction trade unions are reportedly the primary obstacle to Senator Steinberg’s very modest CEQA reform bill, Senate Bill 731, but apparently Senator Steinberg was surprised, according to the August 5, 2013 article from California Forward: CEQA Roundup: Have Negotiations Really Stalled?

Steinberg himself seems to have been surprised by the opposition on the part of some labor leaders, in particular, who have pushed back against his most basic goal: Updating the CEQA process for infill projects. While the Senate leader has tried from the start to write a bill that would drive more of this type of development across the state, sources say some labor leaders view the coming infill wave as the source of a steady stream of jobs – and they are wary of losing CEQA as a tool they can use to reach project labor agreements with developers.

Reform of the California Environmental Quality Act is not an environmental issue. It’s a labor issue.

News Media Coverage

San Jose Denies ‘Greenmail’ Environmental Appeals on High-Rise ProjectSan Jose Mercury-News – August 13, 2013

San Jose Council Says ‘No’ to Union’s CEQA Challenge of One South MarketSilicon Valley Business Journal – August 13, 2013


Staff Report on Appeal of Santa Clara-San Benito Counties Building and Construction Trades Council to One South Market Street Project (includes June 25, July 9, and July 12 letters from law firm of Adams Broadwell Joseph & Cardozo)

Initial Study/Mitigated Negative Declaration for One South Market Street and Mitigation Monitoring or Reporting Program for One South Market Street

Union Challenging Downtown San Jose High-RiseSilicon Valley Business Journal – August 13, 2013

California Senate Bill 731 – CEQA reform for infill development projects

CEQA Roundup: Have Negotiations Really Stalled? – California Forward – August 5, 2013

KT Properties One South Market Street

Background on One South Market Street from Silicon Valley Business Journal

CEQA Works – the coalition of environmental groups and labor unions opposed to CEQA reform

Kevin Dayton is the President & CEO of Labor Issues Solutions, LLC, and is the author of frequent postings about generally unreported California state and local policy issues at Follow him on Twitter at @DaytonPubPolicy.