Former Employees of Henderson v. U.S. Sec
| Decision Date | 25 March 2003 |
| Docket Number | SLIP OP. 03-35. Court No. 01-00883. |
| Citation | 265 F.Supp.2d 1346 |
| Parties | FORMER EMPLOYEES OF HENDERSON SEWING MACHINES, Plaintiffs, v. UNITED STATES SECRETARY OF LABOR, Defendant. |
| Court | U.S. Court of International Trade |
Robins, Kaplan, Miller & Ciresi L.L.P., (Charles A. Hunnicutt) for Former Employees of Henderson Sewing Machines, plaintiffs.
Robert D. McCallum, Jr., Assistant Attorney General; David M. Cohen, Director, Commercial Litigation Branch, Civil Division, United States Department of Justice (Lucius B. Lau, Assistant Director, and John N. Maher); Louisa M. Reynolds, Office of the Solicitor, United States Department of Labor, for the United States, defendant, of counsel.
BEFORE: Senior Judge NICHOLAS, TSOUCALAS.
Plaintiffs, Former Employees of Henderson Sewing Machines ("plaintiffs") move pursuant to USCIT R. 56.1 for judgment upon the. agency record or, in the alternative, for a re-remand of this case for further investigation, challenging the United States Secretary of Labor's ("Labor") determinations entitled: (1) Notice of Neg ative Determination on Remand of Henderson Sewing Machine Company, Inc. Andalusia, Georgia ("Negative Deter mination II"), 67 Fed.Reg. 18,927 (April 17, 2002); and (2) Notice of Determina tions Regarding Eligibility To Apply for Worker Adjustment Assistance and NAF TA Transitional Adjustment Assistance ("Negative Determination I"), 66 Fed. Reg. 47,240 (Sept. 11, 2001). Specifically, plaintiffs contend that Labor erred in denying plaintiffs' certification of eligibility for trade adjustment assistance on the basis that plaintiffs did not produce an article, plaintiffs did not qualify as support service workers and Henderson did not produce an article affected by increased imports that contributed importantly to plaintiffs' separation from Henderson.
The Court has jurisdiction over this matter pursuant to 19 U.S.C. § 2395(c) (2000) and 28 U.S.C. § 1581(d)(1) (2000).
In reviewing a challenge to Labor's determination of eligibility for trade adjustment assistance, the Court will uphold Labor's determination if it is supported by substantial evidence on the record and is otherwise in accordance with law. See 19 U.S.C. § 2395(b) (2000); Former Employ ees of Marathon Ashland Pipeline v. Chao, 26 CIT ___;, ?___;, 215 F.Supp.2d 1345, 1350 (2002) (citing Woodrum v. Don ovan, 5 CIT 191, 193, 564 F.Supp. 826, 828 (1983), affd, Woodrum v. United States, 737 F.2d 1575 (Fed.Cir.1984)); Former Employees of Barry Callebaut v. Herman, 25 CIT ___;, ___;, 177 F.Supp.2d 1304, 1308-09 (2001). Pursuant to 19 U.S.C. § 2395(b), Labor's findings of fact are conclusive if they are supported by substantial evidence. See 19 U.S.C. § 2395(b). "Substantial evidence is something more than a `mere scintilla,' and must be enough reasonably to support a conclusion." Cerami ca Regiomontana, S.A v. United States, 10 CIT 399, 405, 636 F.Supp. 961, 966 (1986), affd, 810 F.2d 1137 (Fed.Cir.1987); see also Consolidated Edison Co. v. NLRB, 305 U.S. 197, 229, 59 S.Ct. 206, 83 L.Ed. 126 (1938). "Additionally, `the rulings made on the basis of those findings [must] be in accordance with the statute and not be arbitrary and capricious, and for this purpose the law requires a showing of reasoned analysis.'" Former Em ployees of Marathon Ashland, 26 CIT at —, 215 F.Supp.2d at 1350 ().
Moreover, although "`the nature and extent of the investigation are matters resting properly within the sound discretion of [Labor,]'" Former Employees of Galey & Lord Indus, v. Chao, 26 CIT___;,___;, 219 F.Supp.2d 1283, 1286 (2002) (quoting Former Employees of CSX Oil & Gas Corp. v. United States, 13 CIT 645, 651, 720 F.Supp. 1002, 1008 (1989) (citation omitted)), "`[g]ood cause [to remand] exists if [Labor's] chosen methodology is so marred that [Labor's] finding is arbitrary or of such a nature that it could not be based on substantial evidence.'" Former Employees of Galey & Lord Indus., 26 CIT at—, 219 F.Supp.2d at 1286 (). "However, in evaluating the evidence underlying [Labor's] conclusions, the court may consider only the administrative record before it." Former Employees Marathon Ashland, 26 CIT at —, 215 F.Supp.2d at 1350.
I. Labor's Decision to Deny Plaintiffs Trade Adjustment Assistance
On June 29, 2001, Henderson's vice president signed a petition for trade adjustment assistance ("TAA") under Section 221(a) of the Trade Act of 1974, as amended (that is, 19 U.S.C. § 2271(a) (2000)), which was filed with Labor on behalf of plaintiffs who were separated from employment with Henderson on June 22, 2001.1 See Admin. R. at 1.
In response to the petition, Labor initiated an investigation to determine whether plaintiffs were entitled to TAA. During the investigation, Labor: (1) reviewed the June 29, 2001, petition and accompanying attachments, see Def.'s Resp. Opp'n Pls.' Mot. J. Agency R. ( ) at 2; (2) sent a "Business Confidential Data Request" form to Henderson, see Admin. R. at 11-13 (confidential version); and (3) "surveyed [Henderson's] major decupling customers." Def.'s Resp. Opp'n at 3; see also Admin. R. at 14-17 (confidential version). The June 29, 2001, petition signed by Henderson's vice president described plaintiffs' jobs at Henderson as "accounting"2 and indicated a response of "textile industry" to a question asking for "a description of the articles (products) produced by the firm ... [to] include such information as the common and technical names of the articles, [as well as] the method of manufacture." Admin. R. at 1. On July 16, 2001, Henderson's vice president completed the "Business Confidential Data Request" form providing sales and employment data, but no production data. See Admin. R. at 11 (confidential version). Additionally, Henderson's vice president indicated that Henderson manufactures sewing machine parts. See id.; see also Admin. R. at 3.
Subsequent to the investigation, Labor in its "Findings of the Investigation" revealed in pertinent part that
[w]orkers [that is, the plaintiffs in this action] at the Henderson Sewing Machine Company, Inc. in Andulusia, Alabama were engaged in accounting services for the company. The subject firm is involved in sales and distribution of industrial sewing machine parts.
. . . . . . .
A survey was conducted for the major declining customers of the subject firm [that is, Henderson].
None of the customers increased import purchases of parts for sewing machines, while decreasing purchases of the subject firm [that is, Henderson].
Admin. R. at 18-19. Moreover, on August 29, 2001, Labor determined that the plaintiffs formerly employed at Henderson were not eligible to receive worker adjustment assistance under section 223 of the Trade Act of 1974 (that is, 19 U.S.C. § 2273 (2000)). See Admin. R. at 20-21. Labor reasoned that:
The investigation revealed that the workers of [Henderson] did not produce an article within the meaning of Section 223(3)[sic]3 of the Trade Act of 1974 [that is, 19 U.S.C. § 2272(a)(3) (2000)]. [Labor] has consistently determined that the performance of services does not constitute production of an article, as required by the Trade Act of 1974, and this determination has been upheld in the [United States] Court of Appeals.
Workers of [Henderson] may be certified only if their separation was caused importantly by a reduced demand for their services from a parent firm, a firm otherwise related to the subject firm by ownership, or a firm related by control. Additionally, the reduction in demand for services must originate at a production facility whose workers independently meet the statutory criteria for certification and the reduction must directly relate to the product impacted by imports. These conditions have not been met for workers performing services at [Henderson].
Admin. R. at 20-21. Labor sent notices of its decision to plaintiffs on September 10, 2001, see Admin. R. at 23-24, and published its notice of the negative determination on September 11, 2001. See Negative De termination I, 66 Fed.Reg. at 47,241.
On October 15,2001, one of the plaintiffs in this action (that is, Cobb), filed a letter along with enclosures, deemed a summons and complaint, stating in pertinent part that "[Cobb] started part time in 1980 working as [an] account receivable clerk [at Henderson], and within two-three years was asked to go full time ... [and] was then changed to [an] account payable clerk[.]" Cobb further stated that Henderson "does not produce products, [but] ... res[ells] commercial sewing machines and parts to sewing factories." Subsequently, in Cobb's "Amended Affidavit in Support of Motion to Proceed in Forma Pauperis," Cobb stated that "Henderson R&D Dept. does produce parts for use on commercial sewing machines."
On December 7, 2001, this Court granted Labor's consent motion for voluntary remand and ordered Labor to conduct a further investigation and to make a redetermination as to whether petitioners are eligible for. certification for worker adjustment assistance benefits. During the remand investigation, Labor: (1) contacted various customers of Henderson, see Admin. R. at 33, 34, 36, 37, 38 (confidential version); (2) sent a "Business Confidential Data Request" form to Henderson, see id. at 29-32; and (3) "contacted Mr. Henderson, the company vice-president, who responded in writing." Def.'s Resp. Opp'n at 6; see also Admin R. at 39 (confidential version). In response to the remand investigation, the following occurred: (1) the various customers of Henderson responded that Henderson was "involved in sales and distribution of sewing machines and parts[,]' Def.'s Resp. Opp'n at 5, see Admin. R....
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