UNITED ELEC., RADIO & MACH. WKRS. OF AMER. v. US

• Citation: 11 CIT 590,669 F. Supp. 467
• Decision Date: 13 August 1987
• Docket Number: Court No. 86-11-01409.
• Parties: UNITED ELECTRICAL, RADIO AND MACHINE WORKERS OF AMERICA, United Electrical, Radio and Machine Workers of America, Local 610, Plaintiffs, v. UNITED STATES, Defendant.
• Court: U.S. Court of International Trade

669 F. Supp. 467

11 CIT 590

UNITED ELECTRICAL, RADIO AND MACHINE WORKERS OF AMERICA, United Electrical, Radio and Machine Workers of America, Local 610, Plaintiffs, v. UNITED STATES, Defendant.

Court No. 86-11-01409.

United States Court of International Trade.

August 13, 1987.

United Elec., Radio and Mach. Workers of America, (Robin Alexander, on the motion), Neighborhood Legal Services Ass'n, (John Stember, on the motion), and Nat. Employment Law Project, (Elizabeth Athos, on the motion) for plaintiffs.

Richard K. Willard, Asst. Atty. Gen., David M. Cohen, Director, Commercial Litigation Branch (Sheila N. Ziff, Washington, D.C., on the motion) for defendant.

MEMORANDUM OPINION

CARMAN, Judge:

Plaintiffs commenced this action to challenge the determination by the Secretary of Labor (Labor) denying certification of eligibility to apply for adjustment assistance. Plaintiffs seek an order requiring Labor to withdraw its redetermination of May 29, 1987 and allow plaintiffs' counsel access to the confidential business information contained in the supplemental administrative record while the matter is on remand before Labor.

Defendant contends plaintiffs are not entitled to access to the confidential business information on remand because the nature of the agency's investigation is factfinding, and the agency's own regulations prohibit disclosure of confidential information. The appropriate remedy according to the defendant is that the matter should be submitted upon briefs for review pursuant to 19 U.S.C. § 2395 after plaintiffs have obtained access to the confidential documents under an appropriate protective order.

In opposition, plaintiffs contend that Labor is to conduct an adjudication on the record after a hearing thus mandating application of the procedural safeguards of 5 U.S.C. §§ 554, 556, 557.

BACKGROUND

Adjustment assistance for workers and firms displaced by changes in trade policy was originally provided in the Trade Expansion Act of 1962. The assistance was believed necessary to prevent or eliminate the adverse effects on employment due to increases in imports of a given type of product. 1974 U.S.Code Cong. & Admin. News 7273. Because the provisions of this Act had not been very effective in attaining its objectives, Congress enacted the Trade Act of 1974 (1974 Act), 88 Stat. 2019 (codified as amended at 19 U.S.C. §§ 2271-2394 (1980 & Supp.1987)). This Act was intended to provide, in an expeditious manner, maximum benefits to workers, firms, and communities effected by increased imports. The assistance was made available with "eased qualifying criteria and a streamlined petitioning process." S.Rep. 93-1298, 93d Cong., 2d Sess. 131 (1974), U.S.Code Cong. & Admin.News 1974, pp. 7186, 7273.¹

With respect to benefits for workers, the 1974 Act provides for the filing of a petition with Labor for certification of eligibility to apply for adjustment assistance. The petition may be filed by a group of workers, by their certified or recognized union, or by their duly authorized representative. Upon receipt of the petition, Labor must promptly publish notice in the Federal Register that the petition has been received and an investigation has been initiated. 19 U.S.C. § 2271(a).

The investigation is initiated by the Office of Trade Adjustment Assistance (OTAA). The director is empowered to "initiate, or order to be initiated, such investigation as he determines to be necessary and appropriate." 29 C.F.R. § 90.12 (1986).

The 1974 Act also provides for a public hearing if a request is made by a person found to have a substantial interest in the proceedings within 10 days of the publication of notice in the Federal Register. At the hearing, the interested persons are entitled to be present, to produce evidence, and to be heard. 19 U.S.C. § 2271(b). Eligibility to apply for adjustment assistance is determined in accordance with 19 U.S.C. § 2272 which provides in pertinent part as follows:

(1) that a significant number or proportion of the workers in such workers' firm or an appropriate subdivision of the firm have become totally or partially separated, or are threatened to become totally or partially separated,

(2) that sales or production, or both, of such firm or subdivision have decreased absolutely, and

(3) that increases of imports of articles like or directly competitive with articles produced by such workers' firm or an appropriate subdivision thereof contributed importantly to such total or partial separation, or threat thereof, and to such decline in sales or production.

For purposes of paragraph (3), the term "contributed importantly" means a cause which is important but not necessarily more important than any other cause.

19 U.S.C. § 2272.

Similarly, Labor's regulations provide for a public hearing when an appropriate request is duly made. There are additional provisions governing the order of testimony of witnesses at the hearing, the admission of evidence, the opportunity for oral argument, and the submission of briefs. See 29 C.F.R. § 90.13.

It is also provided by 19 U.S.C. § 2395(a) that a worker, group of workers, certified or recognized union, or authorized representative aggrieved by a final determination may, within 60 days after notice of such determination, commence a civil action in this Court. Upon review, this Court is bound to uphold the findings of fact by Labor if supported by substantial evidence. 19 U.S.C. § 2395(b).

FACTS

On January 23, 1986, the United Electrical, Radio and Machine Workers of America, Local 610 (petitioners) filed a petition with Labor for certification of certain workers and former workers at the Union Switch & Signal Division of American Standard, Inc. (Company). Notice that a petition had been received was published in the Federal Register on February 11, 1986. The notice provided that interested parties could request a hearing. No hearing was held or requested.

On August 4, 1986, Labor issued a determination denying certification. 51 Fed. Reg. 30446 (Aug. 26, 1986). Petitioners' request for reconsideration was subsequently denied. 51 Fed.Reg. 34272 (Sept. 26, 1986).

Pursuant to § 2395(a), plaintiffs commenced this action to challenge the final determination of Labor. This Court then approved a stipulation by the parties providing for release of the confidential information contained in the administrative record filed with the Court.

After pleadings were filed, defendant learned that Labor had inadvertently failed to investigate certain of the claims set forth in the administrative petition. Defendant filed a motion for remand in order to provide plaintiffs an opportunity to be present, produce evidence, and be heard at a public hearing as provided by 19 U.S.C. § 2271(b). In granting the motion, the Court ordered that the case be remanded for further investigation; that a public hearing be held; that Labor maintain any confidential materials provided by the petitioners in the confidential portion of the administrative record; that Labor report back the results of its investigation and determination within 45 days; and that briefs be filed thereafter.

Pursuant to the order of remand, a public hearing was held on April 16, 1987. Thirteen witnesses provided by the petitioners testified and submitted documentary evidence in support of their claims. The OTAA then wrote to the Company and requested specific responses to seven questions involving evidence raised by the petitioners at the public hearing. Labor obtained additional material by subpoena from the Company. From the record and papers filed in this case, it appears that information provided by petitioners upon remand resulted in the certification of three sections of the plant (60 out of approximately 500 workers).

It is interesting to note that in the initial investigation, the Company represented that it imported no foreign products. Record at 69. At the public hearing upon remand, however, petitioners offered evidence that not only was the Company importing a large portion of components formerly manufactured at the domestic plant, but also that the Company was attempting to conceal this fact. Supplemental Record, item 28.

In order to prepare a brief and additional affidavits in response to the Company's answers, petitioners' counsel sought to obtain copies of the confidential material from Labor. While there is some dispute as to what transpired next, it is clear that Labor refused and continues to refuse plaintiffs access to the confidential materials. Labor also refused to agree to a protective order contending that plaintiffs were not entitled to the confidential materials on the administrative level.

On June 1, 1987, plaintiffs filed an application for an order to show cause seeking access to the confidential and public portions of the agency record and an order requiring Labor to withhold its redetermination pending full consideration of plaintiffs' briefs. The Court issued the order to show cause and ordered that Labor refrain from issuing or making public its decision until such time as the Court had an opportunity to rule on the substantive issues raised by the plaintiffs' application. At the time the order was issued, the redetermination had been issued but had not yet been published in the Federal Register. In accordance with the order, Labor has not published the redetermination.

DISCUSSION

Defendant contends that Labor's refusal to disclose the confidential information in accordance with its regulations did not violate procedural due process since the investigation conducted by Labor is strictly one of a factfinding, non-adversarial nature. According to the defendant, this Court has no authority upon remand to supersede valid regulations of the agency and direct Labor to disclose confidential information to the plaintiffs.

In opposition, plaintiffs contend that the 1974 Act requires an adjudicatory hearing which satisfies the requirements of 5 U.S.C. §§ 554, 556, 5...