U.S. Supreme Court justices reportedly signaled support for Starbucks Corp (NASDAQ:SBUX) in a legal battle over rehiring seven workers at a Memphis cafe.
The workers were terminated as they pursued unionization, a move contested by the coffee chain. The justices heard arguments in Starbucks' appeal against a lower court's ruling, which favored the U.S. National Labor Relations Board (NLRB) ordering the reinstatement of the terminated employees.
Related: US Supreme Court To Weigh Starbucks Challenge Over Fired Baristas
The case revolves around the legal standard for issuing a preliminary injunction under the National Labor Relations Act. Starbucks argues for a stringent evaluation, contrasting with the NLRB's stance, reported Reuters.
As per the report, some justices appeared to agree that courts, not the NLRB, should have the primary role in determining the likelihood of success in a case before issuing an injunction.
Starbucks alleges that a stricter evaluation by lower courts would have yielded a different outcome in this case, highlighting discrepancies in the application of legal standards.
About 400 Starbucks locations in the U.S. have unionized, involving over 10,000 employees, amidst accusations of unfair labor practices from both sides.
The Supreme Court is expected to pronounce its verdict on the case by the end of June.
Price Action: SBUX shares are trading lower by 0.03% at $87.85 at the last check Wednesday.
Disclaimer: This content was partially produced with the help of AI tools and was reviewed and published by Benzinga editors.
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