Former Employees of Tyco v. U.S. Dept. of Labor

• Decision Date: 16 September 2004
• Docket Number: Slip Op. 04-118.,Court No. 02-00152.
• Parties: FORMER EMPLOYEES OF TYCO ELECTRONICS, FIBER OPTICS DIVISION, Plaintiffs, v. UNITED STATES DEPARTMENT OF LABOR, Defendant.
• Court: U.S. Court of International Trade

350 F.Supp.2d 1075 FORMER EMPLOYEES OF TYCO ELECTRONICS, FIBER OPTICS DIVISION, Plaintiffs,
v.
UNITED STATES DEPARTMENT OF LABOR, Defendant. Slip Op. 04-118. Court No. 02-00152. United States Court of International Trade. September 16, 2004.

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Williams Mullen, P.C., (Jimmie V. Reyna, Francisco J. Orellana) Washington, DC, for Plaintiffs.

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Peter D. Keisler, Assistant Attorney General, David M. Cohen, Director, Commercial Litigation Branch, Civil Division, United States Department of Justice, Jeanne E. Davidson, Deputy Director, Commercial Litigation Branch, Civil Division, United States Department of Justice, Stephen Carl Tosini, Attorney, Commercial Litigation Branch, Civil Division, United States Department of Justice, Jayant Reddy, Office of the Solicitor, United States Department of Labor, for Defendant, of counsel.

OPINION

CARMAN, Judge.

This matter comes before the Court on Plaintiffs', Former Employees of Tyco Electronics, Fiber Optics Division, Glen Rock, Pennsylvania, ("Former Employees"), application for attorneys fees and other expenses under the Equal Access to Justice Act ("EAJA"), 28 U.S.C. § 2412 (2000). The EAJA states that "[e]xcept as otherwise specifically provided by statute, a court shall award to a prevailing party other than the United States fees and other expenses ..., incurred by that party in any civil action ... brought by or against the United States ..., unless the court finds that the position of the United States was substantially justified or that special circumstances make an award unjust." 28 U.S.C. § 2412(d)(1)(A). Former Employees' application is made in connection with this Court's final decision in Former Employees of Tyco Elecs. v. United States, 318 F.Supp.2d 1354 (CIT 2004) ("Tyco III"), which sustained the United States Department of Labor's certification of Plaintiffs as eligible to apply for North American Free Trade Agreement-Transitional Adjustment Assistance ("NAFTA-TAA"). Because the Court finds that Labor's position during this litigation was not substantially justified, Plaintiffs' application for fees and expenses under the EAJA is granted with certain modifications discussed below.

BACKGROUND

Although the detailed background facts and procedural history of this action have been articulated by the Court in its earlier opinions, see Tyco III, at 1354-55; Former Employees of Tyco Elecs. v. United States Dep't of Labor, 264 F.Supp.2d 1322, 1323-26 (CIT 2003) ("Tyco II") (denying Plaintiffs' second motion for judgment on the agency record and remanding the case to Defendant); Former Employees of Tyco Elecs. v. United States Dep't of Labor, 259 F.Supp.2d 1246, 1248 (CIT 2003) ("Tyco I") (granting Defendant's second motion to file remand results of out time, denying Plaintiffs' motion for certification, and granting Plaintiff's request for fees pursuant to USCIT R.16(f)), it is necessary for the Court to review the development of this action again so that it may determine whether or not the Government's position was substantially justified under the EAJA. See Luciano Pisoni Fabbrica Accessori Instrumenti Musicali v. United States, 837 F.2d 465, 467 (Fed.Cir.1988) ("Substantial justification is to be decided case-by-case on the basis of the record ... and is reached by examination of the government's position and conduct through the EAJA `prism.'" (internal quotation marks and citations omitted)).

A. Plaintiffs' Petition for NAFTA-TAA Benefits.

In July 2001, Former Employees sought certification for NAFTA-TAA benefits pursuant to 19 U.S.C. § 2331,¹ based on

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their belief that their job loss was a result of an increase in imports from Mexico and a result of a shift in production of fiber optic components to Mexico. Pub. Admin. R. at 2, 53. The Pennsylvania Department of Labor and Industry initiated a preliminary investigation and denied the Former Employees' petition based on insufficient import information regarding like products and Tyco Electronics' initial survey response. Conf. Admin. R. at 12-14.

B. Administrative Proceedings at the Department of Labor.

1. Labor's Initial Investigation.

Labor initiated an investigation of the Former Employee's NAFTA-TAA certification eligibility petition in September 2001. Investigations Regarding Certifications of Eligibility to Apply for NAFTA Transitional Adjustment Assistance, 66 Fed.Reg. 48,708 (Sept. 21, 2001). Labor's initial investigation consisted of one form letter requesting information about Former Employees' job separation from company officials at Tyco Electronics. Conf. Admin. R. at 33-34. Labor denied the Former Employees' NAFTA-TAA petition on the grounds that imports from Mexico did not contribute importantly to the Former Employees' separation and there was no shift in production to Mexico. Notice of Determinations Regarding Eligibility To Apply for Worker Adjustment Assistance and NAFTA Transitional Adjustment Assistance, 66 Fed.Reg. 53,250, 53,252 (Oct. 19, 2001). Based on Tyco Electronics' response to the form letter, Labor determined that the predominant cause of Former Employees' job separation was a shift in production to an affiliated Tyco Electronics facility in Harrisburg, Pennsylvania. Pub. Admin. R. at 19.

2. Former Employees' Motion for Administrative Reconsideration.

Former Employees filed a motion for administrative reconsideration of Labor's negative NAFTA-TAA determination, asserting again that their job separation was caused by a shift in production to Mexico. Id. at 54. Based upon additional information provided during a conference call with Tyco Electronics company officials, Labor denied Former Employees' request for administrative reconsideration. Tyco Elecs. Fiber Optics Div., Glen Rock, Pa.; Notice of Negative Determination Regarding Application

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for Reconsideration, 67 Fed.Reg. 5,299 (Feb. 5, 2002). Labor stated that only "a negligible portion of the plant production was shifted to Mexico during the relevant period." Pub. Admin. R. at 69.

C. Litigation Before This Court.

Appearing pro se, Former Employees filed a complaint in this Court challenging Labor's negative determination. Pls.' Compl. at 1 (Jan. 30, 2002). Plaintiffs' counsel was appointed by the Court to represent the Former Employees pro bono. Former Employees of Tyco Elecs. v. United States, No. 02-00152 (Ct. Int'l Trade April 16, 2002) (order granting Plaintiffs' motion to proceed in forma pauperis).

1. The First Voluntary Remand.

Immediately after the Former Employees filed their first Rule 56.1 Motion for Judgment on the Agency Record, Defendants sought Plaintiffs' consent to a voluntary remand. See Def.'s Mot. for Voluntary Remand at 2. In seeking a voluntary remand, Defendant stated that "[a]fter review of the administrative record in light of the arguments [Plaintiffs] made in their Rule 56.1 motion, defendant seeks a remand to Labor to conduct a further investigation and make a redetermination." Id.

This Court granted Defendant's request for a voluntary remand and ordered that Defendant conduct a remand investigation and submit remand results by October 7, 2002. Former Employees of Tyco Elecs. v. United States, No. 02-00152 (Ct. Int'l Trade Aug. 6, 2002) (order granting voluntary remand) ("Voluntary Remand Order"). The Voluntary Remand Order, which was drafted and submitted by Defendant with its motion, mandated that Labor "conduct further investigation, [and] collect further evidence, including evidence from the plaintiffs." Id. at 1. Labor failed to timely comply with the Voluntary Remand Order and did not submit a remand determination to this Court on or before October 7, 2002.

On October 17, 2002, Plaintiffs submitted certain information to Defendant's counsel for use in the remand determination. Tyco I, 259 F.Supp.2d at 1248 (citing the parties' Timeline Stipulation, Jan. 29, 2003). On November 12, 2002, Plaintiffs contacted Defendant to inquire about the status of the remand investigation. Id. At that time, Defendant's counsel informed Plaintiffs' counsel that the remand investigation had not started. Id.

2. Labor's First Remand Determination Filed Out of Time.

After Plaintiffs' counsel contacted Defendant, Defendant filed a motion for leave to file the remand results out of time. Id. In January 2003, Defendant filed a second motion for leave to file the remand results out of time. Id. Labor's remand determination was filed with the Court on January 17, 2003, more than five months after the matter had been remanded to Labor. See Tyco Elecs., Fiber Optics Div.; Glen Rock, PA; Notice of Negative Determination on Reconsideration on Remand, 68 Fed.Reg. 5,655 (February 4, 2003) ("First Remand Results"). This Court accepted the First Remand Results out of time and awarded Plaintiffs' attorney's fees for expenses incurred as a result of Defendant's delay under USCIT Rule 16(f). Tyco I, 259 F.Supp.2d at 1250-53.

3. Labor's First Remand Investigation and Determination.

In the conducting the first remand investigation, Labor contacted Tyco Electronics officials and asked for sales figures for the relevant time period. Pub. Supplemental Admin. R. at 2. Tyco Electronics reported declining sales in the latter part

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of the relevant time period. Conf. Supplemental Admin. R. at 5. Based on the reported declining sales, Labor surveyed two major Tyco Electronics customers regarding their imports of like products during the relevant time period. Pub. Supplemental Admin. R. at 17. According to Labor, the surveys revealed that one customer did not increase its imports of like products or products competitive with the items produced at the Glen Rock plant. Id. at 18. The other customer reported no direct import purchases during the relevant period and a "relatively low" amount of indirect imports during the latter part of the relevant period. Id. Based on these findings, Labor "affirm[ed] the original notice of negative determination of eligibility." I...