In Ashland Facility Operations, LLC v. NLRB, the US Court of Appeals for the Fourth Circuit considered whether statements by a third party, rather than an employee, employer or union, made months before a union election, tainted the election results. Key litigated issues were whether:

The employer, Ashland Facility Operations (Ashland Facility), employs certified nursing assistants (CNAs) at its skilled nursing facility near Richmond, Virginia. In February 2010, after an African-American CNA alleged that money had been stolen from her purse, six members of the nursing staff, five of whom were also African-American and one of whom was Caucasian, were required by their supervisors to empty their purses so the supervisors could check for the missing money. One of the CNAs was also required to remove her shoes, and one or two others were required to remove their jackets. After the CNAs complained to Ashland Facility's executive director, the two supervisors who had initiated the search were terminated.

A few months later, King Salim Khalfani, the executive director of the Virginia State Conference NAACP, sent a letter to Ashland Facility's executive director complaining about Ashland Facility's allegedly discriminatory treatment of its African-American employees, and later held a press conference where he stated that the CNAs subjected to the search were treated like "chattel enslaved captives." At the press conference:

Khalfani's claims were published in a weekly newspaper with wide circulation in the Richmond, Virginia area and broadcast on several television and radio news programs.

The same day as the press conference, Khalfani set up a meeting between representatives of the United Food and Commercial Workers International Union, Local 400 (union) and three of the CNAs. On September 21, 2010, the union filed a petition to represent a bargaining unit of all regular full-time and part-time CNAs, restorative aides, activity aides and maintenance employees. The union also asked the president of the Hanover County NAACP to draft a letter endorsing the union, which she did on October 27, 2010. At the November 3, 2010 election, 31 votes were cast for representation and 28 were cast against the union.

Ashland Facility filed exceptions to the election, alleging that the union's campaign was based in whole or in substantial part on unlawful appeals to racial prejudice. After a hearing, an NLRB administrative law judge (ALJ) overruled Ashland Facility's objections and certified the union as the exclusive bargaining representative of the named bargaining unit. The NLRB affirmed the ALJ's recommendation. However, Ashland Facility refused to bargain with the union, stating it believed the election was invalid.

The union filed a charge against Ashland Facility, asking the NLRB to compel Ashland Facility to negotiate. In response, the NLRB's Acting General Counsel filed a complaint against Ashland Facility, alleging it had engaged in unfair labor practices in violation of the NLRA. Ashland Facility admitted that it had refused to bargain with the union, but claimed it was not required to do so because the election was invalid. The three-member panel heading the NLRB's judicial functions (Board) granted the Acting General Counsel's motion for summary judgment and ordered Ashland Facility to bargain with the union. Ashland Facility petitioned the Fourth Circuit for review, arguing the Board should have set aside the election results because they were improperly tainted by Khalfani's allegedly racially inflammatory comments. The NLRB filed a cross-application for enforcement of the Board's order.

On December 14, 2012, the Fourth Circuit issued an opinion in the case, denying Ashland Facility's petition for review and granting the Board's application for enforcement of its order requiring Ashland Facility to bargain with the union.

Ashland Facility argued:

On the first issue, although conduct by a union or its agents can be a basis for setting aside election results when threats, acts of coercion or other improprieties materially affect the election results, the court found the Virginia NAACP was not the union's apparent agent. Ashland Facility drew parallels to the court's prior decision in NLRB v. Kentucky Tennessee Clay Co., in which the Fourth Circuit found two employees were apparent agents of the union when professional union organizers had delegated tasks to those unpaid employee organizers, including having authorization cards signed by other employees, distributing union literature and helping to plan union meetings, and the one union official in the case was only minimally involved in the campaign.

In this case, by contrast, the union had three employees who were all actively involved in the campaign. In addition, Khalfani had no involvement in the union organizing campaign after June 2010, more than two months before the union filed its petition to represent the bargaining unit (the start of the "critical period"). In Kentucky Tennessee Clay Co., however, the apparent agents were actively involved in the campaign throughout the critical period.

On the second issue, the Fourth Circuit held that Sewell did not apply to the case because:

In holding that Sewell was inapplicable to third-party comments, the Fourth Circuit joined the US Courts of Appeals for the Ninth and Eleventh Circuits, and chose not to follow the US Court of Appeals for the Seventh Circuit. The Fourth Circuit found Sewell's burden-shifting approach was not suited to third-party appeals to prejudice because:

The court also noted that even if Khalfani's comments were inflammatory and could be the basis for overturning the election, the comments were made prior to the critical period, and generally prepetition conduct is only considered when it is similar to objectionable conduct occurring during the critical period. Since Ashland Facility failed to identify any conduct occurring during the critical period similar to Khalfani's comments, his statements could not provide a basis for setting aside the election.

Finally, the court dismissed Ashland Facility's claim that it was denied due process of law because the ALJ improperly limited the temporal scope of Ashland Facility's subpoena to the Virginia NAACP and failed to enforce the subpoena before certifying the election. The court found the restriction was not improper and there was no requirement that an ALJ enforce an order sua sponte.

In light of the court's decision in Ashland Facility Operations, LLC v. NLRB, employers in the Fourth Circuit should be aware that the NLRB's Sewell standard does not apply to third-party conduct. Under the Fourth Circuit's decision, inflammatory third-party appeals to racial prejudice can only invalidate a representation election if the appeals made a rational, uncoerced expression of free choice impossible.