Former Employees Invista v. Sec. of Labor

• Decision Date: 18 June 2009
• Docket Number: Slip Op. 09-60.,Court No. 07-00160.
• Citation: 626 F.Supp.2d 1301
• Parties: FORMER EMPLOYEES OF INVISTA, S.A.R.L., Plaintiffs, v. U.S. SECRETARY OF LABOR, Defendants.
• Court: U.S. Court of International Trade

626 F.Supp.2d 1301

FORMER EMPLOYEES OF INVISTA, S.A.R.L., Plaintiffs, v. U.S. SECRETARY OF LABOR, Defendants.

Slip Op. 09-60.

Court No. 07-00160.

United States Court of International Trade.

June 18, 2009.

COPYRIGHT MATERIAL OMITTED

Ruskin Moscou Faltischek, P.C. (Thomas A. Telesca), for Plaintiffs.

Tony West, Assistant Attorney General; Jeanne E. Davidson, Director, and Patricia M. McCarthy, Assistant Director, Commercial Litigation Branch, Civil Division, U.S. Department of Justice (Carrie A. Dunsmore); Stephen R. Jones, Office of the Solicitor, U.S. Department of Labor, Of Counsel; for Defendant.

OPINION

RIDGWAY, Judge.

In this action, former employees of the Chattanooga, Tennessee plant operated by Invista, S.a.r.l. ("the Workers") contest the determinations of the U.S. Department of Labor denying their petition for certification of eligibility for trade adjustment assistance ("TAA") and alternative trade adjustment assistance ("ATAA"). The determinations at issue include the Labor Department's original denial of the Workers' petition, as well as the agency's denial of the Workers' request for reconsideration, and the agency's negative determination on remand. See 72 Fed.Reg. 7907, 7909 (Feb. 21, 2007) (notice of denial of petition); 72 Fed.Reg. 15,169 (March 30, 2007) (notice of denial of request for reconsideration); 73 Fed.Reg. 32,739 (June 10, 2008) (notice of negative determination on remand).

Now pending before the Court is the Workers' Renewal of their Motion for Judgment Upon the Agency Record. See generally Plaintiffs' Memorandum in Support of Motion for Judgment Upon Agency Record ("Pls.' Brief); Plaintiffs' Memorandum in Support of Renewal of the Motion for Judgment Upon Agency Record ("Pls.' Renewal Brief); Plaintiffs' Memorandum in Further Support of Renewal of the Motion for Judgment Upon Agency Record ("Pls.' Reply Brief). The Government opposes the Workers' motion, maintaining that the Labor Department's denial is supported by substantial record evidence and is otherwise in accordance with law. See generally Defendant's Memorandum in Opposition to Plaintiffs' Motion for Judgment Upon the Agency Record ("Def.'s Brief).

Jurisdiction lies under 28 U.S.C. § 1581(d)(1) (2000).¹ For the reasons set forth below, this matter must be remanded to the Labor Department once again, for further consideration.

I. Background

The trade adjustment assistance laws are generally designed to assist workers who have lost their jobs as a result of increased import competition from—or shifts of production to—other countries, by helping those workers "learn the new skills necessary to find productive employment in a changing American economy." Former Employees of Chevron Prods. Co. v. U.S. Sec'y of Labor, 26 CIT 1272, 1273, 245 F.Supp.2d 1312, 1317 (2002) (quoting S.Rep. No. 100-71, at 11 (1987)); see generally Former Employees of BMC Software, Inc. v. U.S. Sec'y of Labor, 30 CIT 1315, 1316-20, 454 F.Supp.2d 1306, 1307-11 (2006) (detailing history and policy underpinnings of trade adjustment assistance programs).

TAA programs entitle eligible workers to receive benefits that may include employment services (such as career counseling, resume-writing and interview skills workshops, and job referral programs), vocational training, job search and relocation allowances, income support payments, and a health insurance coverage tax credit. See generally 19 U.S.C. § 2272 et seq. (2000 & Supp. II 2002). In addition, older workers may be eligible for a wage insurance benefit, known as alternative trade adjustment assistance ("ATAA").²

The trade adjustment assistance laws are remedial legislation and, as such, are to be construed broadly to effectuate their intended purpose. UAW v. Marshall, 584 F.2d 390, 396 (D.C.Cir.1978) (noting "general remedial purpose" of TAA statute, and that "remedial statutes are to be liberally construed"); see also Fortin v. Marshall, 608 F.2d 525, 526, 529 (1st Cir. 1979) (same); Usery v. Whitin Machine Works, Inc., 554 F.2d 498, 500, 502 (1st Cir.1977) (emphasizing "remedial" purpose of TAA statute); BMC, 30 CIT at 1320-21 n. 9, 454 F.Supp.2d at 1311 n. 9 (collecting additional cases).

Moreover, "[b]ecause of the ex parte nature of the certification process, and the remedial purpose of the [TAA] program," the Labor Department is obligated to "conduct [its] investigation[s] with the utmost regard for the interest[s] of the petitioning workers." Local 167, Int'l Molders and Allied Workers' Union, AFL-CIO v. Marshall, 643 F.2d 26, 31 (1st Cir.1981); see also BMC, 30 CIT at 1321, 454 F.Supp.2d at 1312 (collecting additional cases). Thus, while the Labor Department is vested with considerable discretion in the conduct of its investigations of trade adjustment assistance claims, "there exists a threshold requirement of reasonable inquiry." Former Employees of Hawkins Oil & Gas, Inc. v. U.S. Sec'y of Labor, 17 CIT 126, 130, 814 F.Supp. 1111, 1115 (1993); see also BMC, 30 CIT at 1321, 454 F.Supp.2d at 1312 (and authorities cited there). Courts have not hesitated to set aside agency determinations which are the product of perfunctory investigations. See BMC, 30 CIT at 1321 n. 10, 454 F.Supp.2d at 1312 n. 10 (cataloguing numerous opinions criticizing Labor Department's handling of TAA cases).

II. The Facts of This Case

Until their termination on January 31, 2007, the Workers in this case were employed as part of the Nylon Apparel Filament Fibers Group at the Chattanooga, Tennessee plant operated by Invista, S.a.r.l. At the time of their termination, the Workers processed orders for nylon apparel filament fiber ("apparel fiber") in support of apparel fiber production at a related plant in Monterrey, Mexico. See A.R. 2; 73 Fed.Reg. at 32,739; see also Pls.' Brief at 4; Def.'s Brief at 6-7.³ The apparel fiber had been manufactured at the Chattanooga plant, until domestic production ceased and all such production was shifted to the Monterrey, Mexico site in 2004. See A.R. 5-6, 45-46; 73 Fed. Reg. at 32,739-40. Since that shift, only nylon performance filament fiber ("performance fiber") has been produced at the Chattanooga plant. See C. S.A.R. 8.

The 2004 shift in production to Mexico led to widespread layoffs of production workers and support personnel at the Chattanooga plant. See C. S.A.R. 7-8. Invista management filed a petition for TAA and ATAA benefits on behalf of the terminated workers, which the Labor Department granted. Specifically, the Labor Department certified as eligible for TAA and ATAA all Invista workers "engaged in employment related to the production of," inter alia, apparel fiber "who became totally or partially separated from employment on or after June 7, 2003, through two years from the date of certification [i.e., two years from August 20, 2004]." See 69 Fed.Reg. 54,320, 54,321 (Sept. 8, 2004) (original certification) (emphasis added); A.R. 5-6 (TAA/ATAA certification of Invista, S.a.r.l., dated Aug. 20, 2004); S.A.R 35-36 (confirming that 2004 TAA/ATAA certification expired on August 20, 2006).

As indicated by the language of the certification itself (quoted above), the Invista employees covered by the 2004 TAA/ATAA certification included not only those engaged in the actual production of apparel fiber, but also more than one hundred service workers who had supported that production in various capacities. See A.R. 1-2; 30-32, 45; C. S.A.R. 7-8; 73 Fed. Reg. at 32,739-40.

The Workers at issue here survived the 2004 lay-offs, and continued their work at the Chattanooga site in support of apparel fiber production, even after that production shifted to Mexico. See A.R. 1-2; 30-32, 45; 73 Fed.Reg. at 32,739-40. However, on November 14, 2006—a mere three months after the 2004 TAA/ATAA certification expired—the Workers were notified that they would be terminated effective January 31, 2007. See A.R. 35, 45-46.

In mid-December 2006, Invista's Plant Manager filed the pending TAA/ATAA petition on behalf of the Workers, who include a Product Coordinator as well as three Customer Service Representatives. See A.R. 1-3, 36-37; see also 69 Fed.Reg. at 54,321; 73 Fed.Reg. at 32,739 (noting that TAA/ATAA petition was filed December 15, 2006). In the TAA/ATAA petition, the Plant Manager attested that the Workers' terminations were "a continuation of the shift in production to Mexico as described in [the 2004 TAA/ATAA certification] that expired August 20, 2006." See A.R. 2; see also 73 Fed.Reg. at 32,739. The Plant Manager further explained that—notwithstanding the 2004 shift in production to Mexico—"all orders [for apparel fiber had] continued to be processed from the United States" up to that time, but that such work was now going to be transferred to "CSR's [i.e., Customer Service Representatives] located in South America." See A.R. 2. The TAA/ATAA petition also noted that two of the subject Workers were age 50 or older, that their skills "are not easily transferable," and that "[c]ompetitive conditions within the industry are adverse." Id.

The Labor Department denied the Workers' TAA/ATAA petition. See 72 Fed.Reg. at 7909 (denying TAA/ATAA petition on grounds that "[t]he workers' firm does not produce an article as required for certification"); A.R. 30-32. The Labor Department stated that, to be eligible for TAA benefits, workers seeking certification "must work for a `firm' or appropriate subdivision that produces an article domestically and there must be a relationship between the workers' work and the article produced by the workers' firm or appropriate subdivision." See A.R. 30-31 (citing 19 U.S.C. § 2273). The Labor Department found that the Workers "were engaged in marketing activities," that "domestic production of an article within ... [Invista's] Nylon Apparel Filament Fibers Group [had] ceased more than one year [before]," and that the petitioning Workers thus "were not in support of domestic production within the requisite one year period." See A.R. 31. The Labor...