International Union, United Automobile, Aerospace & Agricultural Implement Workers of America, UAW, Local 834 v. Donovan

8 Ct. Int'l Trade 13, 592 F. Supp. 673, 8 C.I.T. 13, 1984 Ct. Intl. Trade LEXIS 1917
CourtUnited States Court of International Trade
DecidedJuly 10, 1984
DocketCourt No. 81-6-00762
StatusPublished
Cited by15 cases

This text of 8 Ct. Int'l Trade 13 (International Union, United Automobile, Aerospace & Agricultural Implement Workers of America, UAW, Local 834 v. Donovan) is published on Counsel Stack Legal Research, covering United States Court of International Trade primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
International Union, United Automobile, Aerospace & Agricultural Implement Workers of America, UAW, Local 834 v. Donovan, 8 Ct. Int'l Trade 13, 592 F. Supp. 673, 8 C.I.T. 13, 1984 Ct. Intl. Trade LEXIS 1917 (cit 1984).

Opinion

Re, Chief Judge:

Plaintiff, on behalf of its members who were employed at the Heintz Division, Philadelphia, Pennsylvania (Heintz) plant of the Kelsey-Hayes Company (Kelsey-Hayes), challenges the Secretary of Labor’s denial of certification of eligibility for worker adjustment assistance benefits under the Trade Act of 1974, 19 U.S.C. §§ 2101-2487 (1982). The Secretary determined that plaintiffs petition did not satisfy the eligibility criteria of section 222(3) of the Act, 19 U.S.C. § 2272(3). Specifically, he found that imports of articles “like or directly competitive” with those produced by Kelsey-Hayes did not contribute importantly to the separation from employment of plaintiffs members. 46 Fed. Reg. 17,928-29 (1981).

After a review of the administrative record, and upon consideration of the arguments of the parties, the court holds that the Secretary’s denial of certification is supported by substantial evidence, and is in accordance with law.

On July 22, 1980, plaintiff, on behalf of its members, filed a petition with the Secretary for certification of eligibility for trade adjustment assistance benefits. The petition was consolidated with one filed by employees from the Kelsey-Hayes’ Romulus, Michigan plant because both groups produced the identical article, automotive wheels. Subsequently, the Secretary commenced an investigation and published a notice of the receipt of plaintiffs petition and of the investigation. 45 Fed. Reg. 58,269-70 (1980).

Section 222 of the Act provides, in pertinent part, that the Secretary shall certify a petitioning group of workers as eligible for trade adjustment assistance benefits if he determines:

(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.

Id.

Plaintiff contended that increased imports of automobiles and automotive parts “contributed importantly” to the decline in sales and production at the Heintz plant, and ultimately to the separation from employment of its members, thereby entitling them to certification.

[15]*15The Secretary’s investigation disclosed that the Heintz plant employees produced automotive component parts for sale to manufacturers of cars and trucks. In particular, they produced wheels and major automotive body parts, such as fenders, doors and hoods, primarily for use as original equipment in the manufacture of new cars and trucks. A small percentage of the total production of wheels and body parts at the Heintz plant was for the replacement or aftermarket.

As to wheels, the Secretary’s investigation showed that Kelsey-Hayes produced wheels, identical to those made at the Heintz plant, at some of its other plants located in Canada and Mexico, as well as, the United States. The production from the Canadian and Mexican plants was dedicated primarily to sales in markets other than the United States. Imports by Kelsey-Hayes amounted to a relatively small proportion of its total domestic production of wheels during the period January 1978 through May 1980.

The Secretary’s investigation further disclosed that, each year from 1975 through 1978, domestic production of wheels for motor vehicles increased in value, with a 3.4% increase from 1977 to 1978. From 1978 to 1979, however, production of wheels decreased in value by 9.9%.

The investigation also revealed that imports of automotive wheels increased in value each year from 1975 through 1978. Yet, from 1978 to 1979, imports decreased in value by 12.1%. Moreover, during the first three quarters of 1980, wheel imports continued to decrease in value. Indeed, imports decreased by 35.4% compared to the same period in 1979.

As part of his investigation, to determine the level of imports of wheels and major body parts during the period under investigation, the Secretary conducted a survey of those customers of Kelsey-Hayes who accounted for the majority of sales from the Heintz plant. The survey revealed that these customers increased purchases of wheels from both domestic and foreign sources in model year 1980 as compared to model year 1979, and projected decreased purchases from both sources in model year 1981 compared to 1980. The survey also indicated that, as to total purchases, customer reliance on imports remained virtually unchanged during the January 1978 to May 1980 period.

As to major automotive body parts, the Secretary’s investigation revealed that imports of these component parts were negligible during the period under investigation. The Secretary’s customer survey confirmed this finding, and evidenced a strong preference among the automobile manufacturers for domestic sources for body parts because of their close geographical proximity to the car and truck assembly plants. Since automotive body parts must be made according to specifications for each make and model vehicle, the automobile manufavturers have found it easier to monitor and test the accuracy and quality of the components by using domestic sup[16]*16pliers of parts. The American automobile manufacturers also indicated that they found it'economically advantageous to buy parts from domestic sources because the shipping charges made it cost prohibitive to import the identical parts from foreign manufacturers.

Based on these findings, the Secretary concluded that plaintiffs petition failed to satisfy the third criterion of section 222, stating that “with respect to wheels, a survey of customers indicated that increased imports did not ‘contribute importantly’ to worker separations at the firm. With respect to [major body components, such as] hoods, fenders and doors, United States imports are negligible.” Hence, on March 20, 1981, the Secretary issued a negative determination on the petition. 46 Fed. Reg. 17,928-29 (1981).

Plaintiff then sought administrative reconsideration, claiming that the Secretary erred on two grounds in his interpretation of the “contributed importantly” criterion found in section 222(3). First, plaintiff maintained that increased imports of wheels, previously manufactured in the United States, and now produced by Kelsey-Hayes in Canada and Mexico, resulted in a reduced demand for the wheels produced at the Heintz plant, and the subsequent separation of the workers. Second, plaintiff claimed that increased imports of wholly assembled cars caused a down-turn in sales of one of Kelsey-Hayes’ primary customers, General Motors, which resulted in a reduced demand for Kelsey-Hayes’ wheels and body components, and led to the separation from employment of plaintiffs members.

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8 Ct. Int'l Trade 13, 592 F. Supp. 673, 8 C.I.T. 13, 1984 Ct. Intl. Trade LEXIS 1917, Counsel Stack Legal Research, https://law.counselstack.com/opinion/international-union-united-automobile-aerospace-agricultural-implement-cit-1984.