FORMER EMPL OYEES OF

MERRI L LCORPORATI ON, Pla int if fs , v. UN I TE D ST AT ES, De fe nd ant. SLIP OP . 07-46 UNITED STAT ES COURT OF INTERNATIONAL TRADE

B E F ORE : G RE GOR Y W. C ARM AN , J UDGE Court No. 03-00662

[The Depar

tment of L abor’ s second a nd third remand r esults are rema nded for further proce eding s consistent with this opi nion.] Dated: Ma rch 28, 2007 Whit e & Ca se (F ra

nk H. Mo rg an) fo r t

he pla int if

fs
. Pe te r D . K e isl e r, As sis tant A tto rn e y Ge ne ra l; Je ann e E. Da

vid so n, Di re c tor , U .S. D e p artm e n to f

J u s t i c e , C i v i l D i v i s i o n , C o m m e r c i a l L i t i g at i o nB r an c h ; P atr i c i a M
. M c C arth y, Assistant Director , U.S. Depar tment of J ustice Civil Divis ion, Comm erc ial L itigation B ranc h; (C he ry l L . E va ns , St e ph e n C. To sin i) , f

or the de fe nd ant.
O P I NI ON & O R D ER C ARM AN , J UDGE : This matter come s befor e this Court for consider ation of the sec ond and third re mand re sults denying Plaintiffs, the F ormer E mploy ees of Merr ill C orporation,
cer tification for Tr ade A djustment Assist ance (“TAA”) , which we re issued by the United States De pa rtme nt o f L a

bo r ( “ De fe nd ant” or

“ L a bo r” ). Th e se c on d r e mand re su lts we re pu

bli sh e d in the Fe dera l Reg ister on Dec ember 7, 2005. Merr ill C orp., St. Paul, MN, 70 Fed. Reg . 72,857 (De p’t L abor D ec. 7, 2005) (notice of neg ative dete rmination on rec onsideration on re mand) (“se cond re mand re sults”). The third re mand re sults were not published in the F eder al Reg isterCourt No. 03- 00662 Pag e 2

L abor ha s actua lly

filed five a dminist rative r ecords in this case, the labe ling of which 1 cause s confusion. On Nove mber 12, 2003, L abor f iled a conf

idential and public “A dminist rative Record.” On April 5, 2004, L abor f iled a conf

idential and public “Supplementa l Administ rative Record.” On Fe bruar

y 1, 2005, L abor f

iled a public and c onfidential “A dminist rative Rec ord” and a public a

nd confide ntial “Supplemental Administrative Recor d.” The Fe bruar y 2005 Administrative Record a

nd Supplemental Administrative Record a ppear identical to the ea

rlier fi lin g s o f t

he same tit le s, e xce pt t

hat th e Sup ple me nta l A dmi nis tr ativ e Re c or d la c ks do c ume nt 6 (Notice of Ne g ative De termination on Reconsider ation on Remand) of the April 2004 filing . On November

17, 2005, L abor f

iled a public and c onfidential “Supplementa l Administ rative Record.” The Nove mber 2005 Supplemental Administrative Rec ord diffe rs completely from the April 2004 and F ebrua

ry 2005 Supplemental Administrative Records. L astly , on August 28, 2006, L abor f

iled the public and c onfidential “Sec ond Supplemental Administrative Record.” Throughout this document, unless otherwise noted, this Court’s re fer ence s to the Supplemental Record a re to the N ovember

2005 Supplemental Administrative Record, a nd ref ere nces to the Ad m i n i s tra t i v e R ec o rdar e t o th e 2 0 0 3 fi l i n g. but were included in L abor’ s Second Supplemental Administrative Recor d. (2d Suppl. Admin. 1 R. at 19.) Plaintiffs challeng e L abor’ s determination in ea ch re mand to deny Plaintiffs’ claim for
cer tification under the Trade Act of 1974 ( “Tra de Ac t”), 19 U.S.C. §§ 2291-2298 (2000)
. Ce rt if ic atio n und e r t

he Tr a de Ac t w ou ld e nti tle Pla int if fs to c e rt a in b e ne fi ts a c c or de d to e lig ibl e dis pla c e d w or

ke rs . As set forth be low, this Court hol ds that the second a nd third remand r esults are not
su pp or te d b y su bs tanti a l e vid e nc e on

the re c or d. Ac c or din g ly , th is m atte r i s RE M AN DE D to L abor f or fur ther a ction consistent with this opi nion.Court No. 03- 00662 Pag e 3

This Court issued a rema

nd order afte r L abor’ s consent motion for voluntary rema nd, 2 wh ic h w ou ld b e de no te d “ Me rr ill I .” Se e F or me r E mpl oye e s o f M e rr ill Cor p. v. Un ite d St ate s, Slip Op. 04-2, 2004 Ct. I ntl. Trade L EXI S 2 (CI T J an. 4, 2004). B ACKG ROUND The fa cts of this case wer e set for th in Former

Employ ees of

Merr ill C orp. v. United State s, 29 CI T _

_, 38 7 F . Su

pp . 2 d 1 33 6 ( 20 05 ) ( “ Me rr ill I I ” ). Th is C ourt pr e sume s f

amil iari ty 2 with that opinion but, for convenienc e, provide s limi ted fa cts here in. Merr ill C orporation is a communications and document se rvice s company providingprinting[,] phot ocopying a nd document mana g ement ser vices to the financ ial, leg al and c orporate marke ts. Merrill’s servic es integrate traditional composition, im ag ing a

nd printing se rvice s with online document manag ement and distribution technolog y for the pr epar ation and distribution of business-tobu sin e ss c omm

un ic atio n mate ri a l. (Confidential Admin. R. at 12.) Amongthe documents that Mer rill Corporation (“Me rrill”) provides its clients are “SEC compliance doc uments, annual re ports and other financ ial documents, and pr omotional materials.” ( Confidential Admin. R. at 13.) Pla int if fs we re pa

rt of Me rr ill ’s F ina

nc ia l D oc ume nt S e rv ic e s ( F DS) g ro up . Pl a int if fs ’ application for

TAA stated that the separ ated e mploy ees pr oduced “ ty peset a nd html [ sic] financ ial, corpor ate [and] lega l documents for pr inting and f iling with the [Securities and Ex chang e Commissi on (“SEC”)].” (A dmin. R. at 2.) Ty pesetter s at Merr ill rece ived fax ed, elec tronic, and ha

rd copy documents, which the y

then ty ped, edited, a

nd formatted to mee t customer a

nd SEC specifications. Onc e the doc uments were finalized, Merrill filed them elec tronically

with the SEC. Merrill also provided printed c opies of SEC filings at the
c us tom e r’ s r e qu e st.Court No. 03- 00662 Pag e 4

The Tr ade A ct provides f or judicial re view of L abor’ s elig ibilit y deter minations. 19 3 U.S.C. § 2395(a) (2000) . Section 2395 states that “[a] worker, group of wor kers, . . . a g g rieve d by a fi na l de te rm inatio n o f t

he Se c re tary

of L a bo r u nd e r s e c tio n 2 27 3 o f t

his tit le
. . . ma

y , w ith in six ty day s after

notice of suc h deter

mination, commence a

civil action in the United States Court of International Trade for r eview of such dete rmination.” I d. In 2 00 3, Me rr ill e lim inate d Pl a int if fs ’ p os iti on s a

nd sh if te d th e ir wo rk to a Me rr ill fa c ili ty in India. As a r esult, Plainti ffs filed a n application for

TAA. L abor de nied Plaintiffs’ application afte r findingthat Plaintiffs’ former employ er did not produc e an “ article ” as r equire d for
cer tification under the Trade Act. Notice of De terminations Reg ardingEligibility to Apply for W o rk er Ad j u s tm en tAs s i s t an ce an d

NA FT A T ran s i t i o n al Ad j u s tm en tAs s i s t an ce , 6 8 Fe d
. R eg. 43,372 (De p’t L abor July 22, 2003) (notice of neg ative dete rmination) (“ Initial Determination”)
. After voluntary

rema nd, L abor uphe ld its I nitial Determination. Mer rill Corp., St . Paul, MN; Notice of Neg ative De termination on Reconsider ation on Remand, 69 F ed. Reg . 20,645 (De p’t L abor A pr. 16, 2004) ( neg ative re mand deter mination). Plainti ffs then sought judicial reviewof L abor’ s neg ative Initial Determination. 3 Af te r L a bo r r e qu e ste d a

nd wa s gra nte d v olu nta ry re mand , F or

me r E mpl oye e s o f M e rr ill Cor p. v. Un ite d St ate s, Slip Op . 0 4- 2, 20 04 Ct. Intl . T ra de L EX I S 2 ( CI T Jan. 4, 20 04 ), and a g a in deter mining that Plaintiffs wer e inelig ible for TAA, in Merr ill I I , this Court held that printed
matte r i s an a

rt ic le fo r p ur

po se s o f t he Tr a de Ac t. M e rr ill I I , 3 87 F . Su pp . 2 d at 13 44 . T his Court also ruled that commer cial value is not an acc eptable sta ndard f or dete rmining what constitutes an “a

rticle” for pur

poses of the Tr ade A ct. I d. Fur ther, this Court rejec ted L abor’ s contention that bec ause it cla ssified Merr ill as a servic e provide r the for mer e mploy ees w ere there by ineligible f

or assistance under the Trade Act. I d. at 1345. As this Court stated, “the Trade Act does not limit eligibility to only those ‘ar ticles’ produc ed by

manufa cturingfac iliti es.”Court No. 03- 00662 Pag e 5

I d. L astly , this Court held that L abor f ailed to conduc t a re asonable inquiry and re manded the
c a se fo r f ur the r i nv e sti g atio n. I d. at 13 45 -4 6. On re mand , th is C ourt

dir e c te d L a

bo r t o deter mine whether

(1) Plaintiffs we re e ng ag ed in “pr oduction” of pr inted matter or other a rticles; (2) the volume of ar ticles produce d by

Plaintiffs; (3) Merr ill’s customers c ontrac ted for the production of pr inted matter; (4) sales or pr oduction (o r b oth ) h ave de c re a se d; ( 5) the re ha s b e e n o r i s li ke ly to b e an in c re a se in imports of articles like or direc tly competitive with Merr ill’s articles; (6) a ny inc re a se in i mpo rt s c ontr ibute d im po rt antl y to P la int if

fs ’ s e pa ratio n f ro m Me rr ill and to its decline in sales or production; and (7) there was shift in production to a fore ign c ountry

of ar ticles like or dire ctly

competitive with Merr ill’s articles, and i f s o , t o w h atc o un tr

y. I d. at 1346.

RE M AND RESULTS & P A R TI ES ’ C ONT E NT I ONS I. Se c ond R e m and In the sec ond rema

nd results, L abor de fined the sc ope of its investig ation as cove ringthe period fr om J une 2002 through May 2003. Second Remand Results, 70 Fe d. Reg . at 72,857. L a bo r s tate d th at Since no produc tion took place at the subje ct fa cility duringthe re levant per iod, [L abor] investigated whethe r the subjec t worker s supported produc tion at an aff iliated, domestic production fa cility duringJ une 2002 through May 2003, whether sales and/or

production dec lined at that produc tion facility , and whe ther inc re a se d im

po rt s d ur ing the re le va

nt p e ri od c ontr ibute d im

po rt antl y to t ho se de c lin e s. I d. L abor f

ound “that produc tion at all five printingfac iliti es dec rea sed duringJ une 2002 throug h May

2003 from June 2001 through Ma y 2002 levels.” I d. Howeve r, L abor c oncluded that Pla int if

fs sh ou ld n ot b e c e rt if

ie d f or TAA b e ne fi ts e ve n th ou g h th e ir job s w e re un dis pute dly
se nt t o Ind ia . I d. L a

bo r b a se d it s d e c isi on

on the fi nd ingthat Pla int if

fs “ c re ate d e le c tr on icCourt No. 03- 00662 Pag e 6

documents for

printing a

nd filing w ith the Securities and Exchang e Commissi on (SEC).” I d. L abor w ent on to state that it has consistently maintained that “e lectronic cre ations are not ‘ar ticles’ for the purposes of

the Tra de Ac t unless they are embodied in a phy sical medium.” I d. As a re sult, L abor ma intained that Plaintiffs did not produce a n article as re quired by

the Tra de Act. I d. In a dd iti on , L a

bo r f ound that “ the re are no art ic le s whic h a re ‘l ike ’ o r ‘ dir e c tly competitive’ to any

single ‘ar ticle’ c reated by

Merr ill because eac h elec tronic file is a unique document which is c reated for the sole purpose of satisfying a

specific customer’ s particular need
at a pa rt ic ula r p oint in tim e .” I d. at 72 ,8 58 . “ Sin c e the re are no art ic le s whic h a re lik e or dir e c tly competitive with those produce d by the subject c ompany ,” L abor c oncluded that “ there cannot be any imports, much less increa sed imports” as r equire d by the Tra de Ac t. I d. L abor e x plained that “it is not enoug h for the pr ocess to be ‘ like or direc tly competitive.’” I d. Although L abor de termined that Plaintiffs “c ould be viewe d as supportingproduction of
an ar ticle” ( i.e., SEC filings printed in book for m at the customer’ s reque st), L abor f ound that “no printingwas tra

nsfer red to a nother c ountry ,” and “ [t ]herefor e, ther e wa s no shift of production of a

n article .” I d.

A. Plaintiffs’ Contentions In th e ir c omm e nts to t

he se c on d r e mand

re su lts , Pl a int if

fs a lle g e that L a

bo r f a ile d to addre ss severa l of the issues it was direc ted by this Court t o examine and “ha s not conducted a n adequate investig ation or provided a rea soned basis for

its decision.” (Pls.’ Comments on the Dep’ t. of L abor’ s 2d Remand Dete rmination (“Pls.’ 2d Remand Resp.” ) 2.) Plaintiffs ar gue thatCourt No. 03- 00662 Pag e 7

L abor’ s conclusion that there are no “like or dire ctly competitive” a

rticles (id. at 7) is not
su pp or te d b y statut e or le g isl ativ e his tor

y and “ ir ratio na lly dis c ri min ate s b e tw e e n s imi larl y situated worke rs” ( id. at 8). Plaintiffs insist t hat neither the Tra de Ac t nor its legislative history “limits adjustm ent assistance to worker s that produce commodity (i.e., non-c ustom made) products.” ( I d. at 8.) Pla int if fs a lso su bmi t th at th e a dmi nis tr ativ e re c or d– a lth ou g h n ot a s c omp le te a s it sh ou ld be–is sufficie nt to establish that Pl aintiffs ar e elig ible for TAA ce rtification. (I d. at 10.) B ased
u p o nth e r e ma

n d r e s u lt s , Pl a inti f

f s d e d u c e th at L a

b o r “ c o n d u c te d it s an a ly s is to ar

r iv e [at] a particula r re sult.” (I d. at 12.) Ac cording ly , Plaintiffs urg e this Court “to set L abor’ s deter mination aside and orde r L abor to c ertify them as elig ible for tra de adjustment assistance .” (I d.) L astly , Plaintiffs take issue with holes detec ted in L abor’ s investigation and explanation. Spe c if ic a lly , Pl a int if

fs c onte nd

that L a bo r f a ile d to re c on c ile the a g e nc y ’s de fi nit ion of “ dir e c tly
c omp e tit ive ” wi th t

he fa c ts o f t

he matte r b e fo re thi s Co ur t. ( I d. at 13 -1 4. ) A c c or din gto Plaintiffs, the elec tronic docume nts transmitted from India to the United States ar e in an e arlier stag e of pr ocessingthan printed doc uments. (I d. at 14.) Plaintiffs claim that the imports of the elec tronic docume nts have a n economic impac t on them identical as though the documents ha d been pr inted. (I d.) F urther, Plaintiffs c omplain that L abor f ailed to “grapple [] with whether the
e le c tr on ic ve rs ion

of the do c ume nts in q

ue sti on c a us e d th e de c lin e in p ro du c tio n at Me rr ill ’s U. S. fa c ili tie s. ” (I d. ) P la int if

fs purp or t th at th is i s im

po rt ant b e c a

us e “ Me rr ill ’s c us tom e rs may we llCourt No. 03- 00662 Pag e 8

Plaintiffs also set forth a numbe r of a rguments conce rningthe def inition of “article” for 4 purposes of the Trade Act and L abor’ s findings the reon. ( Pls.’ 2d Remand Resp. 2-7.) Plaintiffs’ arguments are larg ely mooted by

L abor’ s third remand r esults. To the extent that the arguments conce rningthe def inition of “article” are rele vant, they will be addre ssed in the c onte xt of the thi rd re mand re su lts
. have sw itc he d f

ro m pu rc ha sin gpr int e d d oc ume nts pr od uc e d in the U. S. t o e le c tr on ic do c ume nts produce d in India.” ( I d.) 4

B. Def

endant’ s Contentions L a bo r’ s und e rl yingpr e mis e in t he re ply to t he se c on d r e mand

re su lts is that an a

rt ic le
mus t be tang ibl e fo r p ur

po se s o f t he Tr a de Ac t. ( De f. ’s Re sp . to Pls. ’ R e mand Comme nts (“D ef.’ s 2d Remand Reply”) 7, 9.) L abor suppor ts its s econd r emand de termination that Pla int if fs did no t pr od uc e an a rt ic le fo r p ur

po se s o f t he Tr a de Ac t by

statin gthat “ Me rr ill
e xpla ine d to L a

bo r t hat it ha d c e a se d p ri nti ngof

[sic ] fi na nc ia l do c ume nts at it s St. Pa ul, Minnesota[,] fac ility

in 2001, before the per iod of investigation in thi s case , and that Mer rill had not shifted any

printing duties ove rsea s.” (I d. at 3.) B ased upon the fore g oing, L abor pr esumes that Plaintiffs could not have be en involved in the produc tion of printed matter dur ing the period of investig ation. (I d. at 7.) L abor a lso argues that Plaintiffs’ ac tiviti es did not result in the “cr eation of a

new objec t.” (I d. at 8.) L abor c ontinues that even if the elec tronic transmissions of SEC filings and other corpor ate r ecor ds from India to the United States could be considere d article s for purpose s of the Tr a de Ac t th os e “ tr ans mis sio ns are no t ‘ lik e or dir e c tly c omp e tit ive ’ w ithe le c tr on ic tr ans mis sio ns of

dif fe re nt d ata

be c a us e e a c h tr ans mis sio n is un iqu e .” (I d. at 9- 10 .) B e c a us e “[o] ne fina

ncial re port ca

n never be substituted for anothe r,” L abor a ssever ates that PlaintiffsCourt No. 03- 00662 Pag e 9

L abor did not spec ify

from what y ear

of the Code of

Fe dera l Regulations it quot ed. 5 L abor did not spec ify

from what y ear

of the United States Code it quoted. 6 have not met the r equire ment “that ‘like’ [articles] remain ‘substantially identical in inhere nt or intrinsic char acte ristics.’” ( I d. at 10 (quoting29 C.F.R. § 90.2) .) 5 L abor c oncludes by

stressingthat this Court l acks the authority to cer tify Plaintiffs as elig ible for TAA. (I d. at 11.) [N] o statute allows the Court to direc t L abor to c ertify plaintiffs as elig ible for TAA. Any

order direc ting L abor to c ertify petitioners as e ligible to re ceive TAA would violate 28 U.S.C. § 2643(c)( 2). Section 2643(c )(2) expressly prohibits the Court fr om gra nti ng“ an in

jun c tio n o r i ssu [ing ] a wri t of mand amus in a

ny c ivi l action commenc ed to re view any final dete rmination of the Secr etar y of L abor under se ction 223 of the Tr ade A ct of 1974.” (I d. at 11 (quoting28 U.S.C. § 2643(c)(2) ) .) 6

II. Thir d Re m and In th e thi rd

re mand , th is C ourt

a sk e d L a bo r t o r e c on sid e r t

he se c on d r e mand

re su lts in light of L abor’ s decision in L ands’ End, ASubsidi ary of Sear s Roebuck & Co., Bus. Outfitters CAD Oper ations, Dodg eville, WI , 71 Fe d. Reg . 18,357 (De p’t L abor A pr. 11, 2006) ( notice of revised de termination on rema nd) (“ L ands’ End” ). F ormer E mploy ees of Merr ill C orp. v. United S t at e s , S l i p O p . 0 6
- 7 2 , 2 0 0 6 C t . In t l
. T r a d e LE X IS 6 9 ( C IT M a y 1 7 , 2 0 0 6 ) ( “ M e r

r i l l III ” )
. In L ands’ End, L abor a cknowledg ed that “the re a re ta ng ible and intang ible article s” and that

“ [s]of tw are and sim ila r i nta ng ibl e g oo ds that w ou ld h ave be e n c on sid e re d a rt ic le s . . . if embodied in a phy sical medium will now be consider ed to be a rticles re g ardle ss of their method of tr ans fe r. ” L and s’ En d, 71 F e d. Re g . at 18 ,3 57 . Sp e c if ic a lly , th is C ourt

or de re d L a

bo r t oCourt No. 03- 00662 Pag e 10

deter mine whether

Plaintiffs produce a

n “intang ible article ” as c ontemplated in L ands’ End a nd to p ro vid e “ a

tho ro ugh a

nd re a so ne d e xplanatio n” fo r i ts d e c isi on . M e rr ill I I I , 2 00 6 Ct . Intl
. Trade L EXI S 69, at *1-2. In compliance with this C ourt’s orde r, L abor issued the third remand results on August 24, 2006. (2d Suppl. Admin. R . at 19.) In its thi rd re mand re sults, L abor de termined “ that Merr ill provides a servic e, incidenta l to which Plaintiffs produce an intang ible article .” (Thir d Remand Results 3 (2d Suppl. Admin. R. at 21) (e mphasis added) .) L abor c ontinued that under L ands’ End “ the incidental pr oduction of an a rticle doe s not chang e [L abor’ s] t reatment of worke rs who wor k for a firm that produc es
an ar ticle incidental to providinga ser vice.” (I d.) L abor r eiterated its policy that “wor kers who work for a firm that pr ovides a ser vice, suc h as sales a

nd repa ir, are not eligible f or TAA benef its.” (I d.) L abor a dded “that an ar ticle is cre ated incide ntal to the provision of [a] service does not make the service firm a pr oduction firm.” ( I d. at 4 (2d Suppl. Admin. R. at 22).) L a bo r a lso a do pte d th e re a so nin gof the se c on d r e mand

re su lts : Even if the Plaintiffs did produc e an a rticle for purposes of the Trade Act, they would not be elig ible to apply for TAA bec ause the re w as neither a shift of pr od uc tio n to a

qu a lif ie d c ountr y no r i nc re a se d im

po rt s o f a rt ic le s li ke or

dir e c tly c o mp e t i t i v e w i thth o s e p r o d u c e d atth e s u b j e c tf a c i l i ty. (I d. at 5.) L abor c oncluded that its revise d policy as stated in L ands’ End ha s no eff ect on Plaintiffs’ claim and that Plaintiffs ar e not elig ible for TAA.

A. Plaintiffs’ Contentions Plaintiffs first argue that L abor’ s third remand de termination violates this Court’s prior rulingin Merrill I I . (Pls.’ Comments on t he De p’t of L abor’ s 3d Remand Dete rmination (“Pls.’Court No. 03- 00662 Pag e 11

3d Remand Resp.”) 2.) Plaintiffs contend that L abor imprope rly relied upon the ag ency ’s finding that Merr ill is a ser

vice pr ovider whe n assessingPlaintiffs’ elig ibilit y for TAA. (I d.) Plaintiffs point out that thi s Court ruled in Merr ill I Ithat the designation of a c ompany as a ma nufac turing fac ility was not re quired by

the Tra de Ac t as a pre requisite to TAA e ligibility . (I d.) Next, P laintiffs asser

t that the rec ord does not support L abor’ s finding that Merrill did not g ener ate r evenue from SEC filings. Plaintiffs point to confidential information in the re cord that indicates that Mer

rill produced a

nd sold “article s such as a nnual re ports and investment prospec tuses . . . to its clients.” (I d. at 4.) Plaintiffs also refute L abor’ s char acte rization of the court’s holdingin Forme r Employ ees of Ga le Group, Inc. v. U.S. Sec’ y of L abor, 29 CI T __, 403 F. Supp. 2d 1299 (2005) . Plaintiffs
a dv anc e that th e c ourt

in G a le Gr ou

p h e ld t hat th e fo rm e r e mpl oye e pla int if fs in t hat c a se provided a

service and we re, the ref

ore, not e ligible f

or TAA. ( Pls.’ 3d Remand Resp. 5.) Such holding, Plaintiffs urg e, is inapposite in this case, in which L abor a g ree s that Plainti ffs produc ed
an ar ticle, albeit an intang ible article . (I d.) Plaintiffs contend that L abor’ s position cannot be
rec onciled “w ith past prece dent and this Court’s clea r re asoning .” (I d.) Plaintiffs nex t take issue with L abor’ s analy sis of “like or dire ctly competitive” a s the terms apply

in the Trade Act. Plaintiffs submit that L abor’ s “position is absurd, unfounded a nd writes a limitation into a remedia l statute that is meant to be construe d broadly .” (I d. at 6.) Plaintiffs add that “L abor’ s position i s flatly inconsistent with the L ands’ End de termination that
serve d as the ba sis for the Court’s re mand.” ( I d.) Plaintiffs equate the financ ial rec ords produce d by

Merr ill with t he designs of customer log os in L ands’ End a nd argue that both ar e unique. Plaintiffs imply , there fore , that they should be found elig ible for TAA just as the forme rCourt No. 03- 00662 Pag e 12

worke rs in L ands’ End w ere . Plaintiffs question “[w] hy L abor de parte d from the r easone d conclusion in L ands’ End to its nonsensical one in this case.” ( I d. at 7.) Pla int if fs c on c lud e by

ur g ingthi s Co ur

t to c e rt if y the m a s e lig ibl e fo r T AA . A c c or din gto Plaintiffs, further r emand would be futile, and the r ecor d sufficie ntly establishes that they

are elig ible for TAA. (I d. at 8-9.)

B. Def

endant’ s Contentions In s up po rt

of the thi rd re mand re su lts , L a

bo r s tate s th at “ [w]or

ke rs wh o in c ide nta lly produce intang ible article s in association with the provision of a se rvice are not eligible f or TAA.” (De f.’s Response to Pls.’ Remand Comments (“De f.’s 3d Remand Re ply”) 6.) L abor explains t hat it interprets L ands’ End a s standing f or the proposition that the for mer e mploy er “must produce article s, and may not simpl y

produce article s incident to the provision of a service .” (I d. at 7.) L abor ne x t repe ats its argument that beca use the fina

ncial re cords on whic h Plaintiffs worke d wer e unique ther e ar e no ar ticles that are “substantially equivalent f

or commer cial purp os e s. ” (I d. at 9 ( qu otatio n a nd c itatio n o mitte d) .) L a

bo r r e a so ns that Pla int if

fs ’ s itu atio n is unlike that in L ands’ End be cause the L ands’ End w orker s “we re involved in the pr oduction of clothing–a

tang ible article that can be worn by any person of the cor rec t siz e, re g ardle ss of any
e mbr oid e ry , a

nd wh ic h a re ‘s ub sta nti a lly e qu iva le nt f

or c omm e rc ia l pu

rp os e s. ’” (I d. at 9 (quoting29 C.F.R. § 90.2).) L abor c oncludes by

reiter atingthat this Court l acks the authority to cer tify Plaintiffs as elig ible for TAA. (I d.)Court No. 03- 00662 Pag e 13 J URI S DI CT I ON & S TA N D A R D O F REVIEW Th is C ourt

ha s e xclu siv e jur isd ic tio n to re vie w f ina l de te rm inatio ns by

L a bo r “ wi th
re sp e c t to the e lig ibi lity

of wo rk e rs fo r” TAA. 28 U. S.C. § 1 58 1( d) (1 ) ( 20 00 ). Suc h r e vie w i s based upon the administrative re cord be fore the Court. For mer Employees of

Rohm & Ha as Co. v. Chao, 27 CI T 116, 122, 246 F. Supp. 2d 1339 (2003) ; see a lso 28 U.S.C. § 2640(c) (2000). In r e vie wi ngL a

bo r’ s d e te rm inatio ns , th e a g e nc y ’s fi nd ing s o f f a c t are c on c lus ive “ if supported by

substantial evidence .” 19 U.S.C. § 2395(b) (2000) . “Substantial evidenc e” must be sufficie nt to reasona

bly support the ag ency ’s conc lusion and must be more than a “mer e scintilla.” Ceramica Reg iomontana, S.A. v. United States, 10 CI T 399, 405, 636 F. Supp. 961 (1986), a ff’ d, 810 F.2d 1137 ( Fe d. Cir. 1987) (quotation and c itation omit ted); ac cord F ormer Employ ees of

Swiss I ndus. Abrasive s v. United States, 17 CI T 945, 947, 830 F. Supp. 637 (1993). While L abor ha s wide latitude in conduc ting its investigations, itmust make a
r e a s o n a b l e i n qu i r y . F o r m e r E mp l o y e e s o f

E l e c . D at a

S y s . C o r p . v . U
. S
. S e c ’ y

o f La b o r , 2 8 C IT __, 350 F. Supp. 2d 1282, 1291 (2004) ( “EDS”) ; Forme r Employ ees of Sun Appare l of Tex. v. U. S. Sec’y

of L abor, Slip Op. 04-106, 2004 Ct. Int’l Trade L EXI S 105, at *22-23 (CI T Aug . 20, 2004). I f L abor f

ails to undertake a re asonable inquiry , the investig ation cannot be sustained upon substantial evidence befor e the Court. Sun Appar el, 2004 Ct. Int’l Trade L EXI S 105, at *23. Fur ther, this Court owes L abor no de fer ence if its investigation wa s inadequate. EDS, 350 F. Supp. 2d at 1291; For

mer Employees of

Hawkins Oil & Gas, Inc. v. U. S. Sec’ y of L abor, 17 CI T 126, 130, 814 F. Supp. 1111 (1993)
. Although the Trade Act delimits this C ourt’s re view of L abor’ s findings of fac t, the statute is silent with reg ard to this Court’s revie w of L abor’ s leg al conc lusions. S ee F ormerCourt No. 03- 00662 Pag e 14

Employ ees of

Murra y Eng ’g , Inc. v. Chao, 28 CI T ___, 346 F. Supp. 2d 1279, 1282 (2004) (“Mur ray I ”); F ormer E mploy ees of Murra y Eng ’g , Inc. v. Chao, 28 CI T __, 358 F. Supp. 2d 12 69 , 1 27 1 ( 20 04 ) ( “ Murr ay I I ” ). Ab se nt i ns tr

uc tiv e langua g e in t

he a pp lic a ble statut e
conce rningjudicial revie w, cour ts may look to the Administ rative Proc edure Act (“ APA”), 5 U. S.C. §§ 70 1– 70 6 ( 20 00 ), fo r guid anc e . M ur ra y I I , 3 58 F . Su

pp . 2 d a t 12 71 . T he APA provides for

judicial revie w of a g ency decisions, 5 U.S.C. § 702, provided the statutes do not prec lude such, 5 U.S.C. § 701(a) . Reviewingcourts ar e instructed by the APA to “set a side ag ency action, finding s, and conc lusions found to be–(A) a rbitrar y , capr icious, an abuse of discretion, or othe rwise not in ac corda nce w ith law . . . .” 5 U.S.C. § 706(2)(a ). Thus, “‘ the ruling s made on the ba sis of those finding s [of fact must] be in accor dance with the statute and not be ar bitrary and ca pricious, and f

or this purpose the law

require s a showingof re asoned analy sis.’” F ormer E mploy ees of Gen. Ele c. Corp. v. U.S. Dep’ t of L abor, 14 CI T 608, 611 (1990) ( quoting Int’l Union v. Marshall, 584 F .2d 390, 396 n.26 (D.C. Cir. 1978)). “In revie wingan ag ency ’s construc tion of a statute that it administers, this court addre sses two questions outlined by the Supreme Court in Chevron [U.S.A., Inc. v. Natural Res. De f. Council, Inc., 467 U.S. 837 (1984)].” U.S. Steel Group v. United States, 225 F.3d 1284, 1286 (F ed. Cir. 2000). This Court first must determine “ whether Congr ess has dire ctly

spoken to the prec ise question at issue.” Chevr on, 467 U.S. at 842. I f congressional intent is clea r, both the courts and the ag ency

“must g ive ef

fec t to the unambiguously expressed intent of Cong ress.” I d. at 842-43 (f

ootnote omitted); acc ord Household Cre dit Serv., Inc. v. Pfenning , 541 U.S. 232, 239 (2004).Court No. 03- 00662 Pag e 15

I f the statute is silent or ambiguous conce rningthe issue bef ore it, the sec ond question the court must assess is whethe r the a g ency ’s interpre tation “is based on a permissible construc tion of the statute.” Chevron, 467 U.S. at 843. I f C on g re ss h a s e xplic itl y le ft a g a p f or the a g e nc y

to f ill , th e re is a

n e xpre ss de le g atio n o f a

uth or ity to t he a g e nc y to e luc idate a

sp e c if ic pr ov isi on

of the statut e by re gulatio n. Suc h le g isl ativ e re gulatio ns are g ive n c ontr oll ingwe ight u nle ss they are arbitra

ry , capr icious, or manife stly contra ry to the statute. Sometimes the leg islative deleg ation to an ag ency on a par ticular que stion is i mplicit rather than expli cit. In such a c ase, a court may

not substitute its own construction of a statutory provision for a r easona

ble interpre tation made by the administrator of a

n a g e n c y. I d. at 843-44 (f

ootnotes omitt ed).

“ To surv ive jud ic ia l sc rutiny , a n a g e nc y ’s c on str

uc tio n n e e d n ot b e the on ly re a so na ble interpre tation or eve n the most reasona ble interpre tation. Rather, a c ourt must defer to an ag ency ’s re asonable interpre tation of a statute e ven if the c ourt might have pre fer red a nother.” Koyo Seiko Co., L td. v. United States, 36 F.3d 1565, 1570 (F ed. Cir. 1994) (c itations omi tted). Neve rtheless, c ourts are the final a rbiters of statutory

construction and “ are not obliged to stand aside a nd rubber -stamp their a ffirma nce of administrative dec isions that they deem inconsistent with a statutory

mandate or

that frustra

te congressional policy

underly ing a statute.” SEC v. Sloan, 436 U.S. 103, 118 (1978) (quotation and c itation omit ted).

D I S CUS S I ON I. Background of T rade Ac t Th e Tr a de Ac t pr ov ide s a ssi sta nc e to w or

ke rs wh o w e re dis pla c e d f ro m th e ir job s d ue to incre ases in “imports of a rticles like or dire ctly

competitive with article s produce d by” theCourt No. 03- 00662 Pag e 16

displaced w orker s or due to a shift of production outside the United States. 19 U.S.C. § 2272(a) (Supp. I I 2002). Displace d worke rs will qualify for a ssistance if they

satisfy one of the two methods set forth in the Tra de Ac t. The first method applies to c ircumstance s where there has been a decr ease in sales or produc tion at the company from which the worke rs wer e sepa rate d. To be e ligible f

or assistance the worke rs must prove that (1 ) a

signif ic ant n umb e r o r p ro po rt ion

of wo rk e rs in s uc h w or

ke rs ’ fi rm , o r a n a pp ro pr iate su

bd ivi sio n o f t

he fi rm , h ave be c ome tot a lly or par tially separ ated, or

are threatened to bec ome totally or partially separ ated; and (2)( A)(i) the sales or production, or both, of suc h firm or subdivision have d e c r e a s e d a b s o l ut e l y; (ii) imports of articles like or direc tly competitive with article s produce d by

such firm or subdivision have inc rea sed; and (iii) the incre ase in imports descr ibed in clause (ii) contributed

importantly

to such worke rs’ sepa

ration or thre at of sepa

ration and to the decline in the sa les or produc tion of such firm or subdivision. I d. The sec ond method applies whe n there has bee n a shift in production. To be e ligible f or assistance under the second me thod the worke rs must prove that (1 ) a

signif ic ant n umb e r o r p ro po rt ion

of wo rk e rs in s uc h w or

ke rs ’ fi rm , o r a n a pp ro pr iate su

bd ivi sio n o f t

he fi rm , h ave be c ome tot a lly or par tially separ ated, or

are threatened to bec ome totally or partially separ ated; and (2)( B) (i) there has bee n a shift in production by such worke rs’ fir

m or su bd ivi sio n to a

fo re ign c ountr

y of art ic le s li ke or

dir e c tly competitive with article s which ar e produc ed by such firm or subdivision; and * * * (ii)(I I I ) there has bee n or is likely to be an incr ease in imports of articles that are like or direc tly

competitive with article s which ar e or w ere produce d by

such firm or subdivision.Court No. 03- 00662 Pag e 17

I d. The wor

kers must satisfy

eac h of the statutory

require ments of the re spective me thod to be elig ible for TAA. For

mer Employees of

Shaw Pipe, Inc. v. U. S. Sec’ y of L abor, 21 CI T 1282, 1285, 988 F. Supp. 588 (1997). One pur pose of the T rade Act is “to provide a dequate proce dures to saf eguard America

n industry and labor ag ainst unfair or

injurious import competiti on, and to assist industries, firm [sic ], w or ke rs , a nd c omm un iti e s to a dju st t o c ha

ng e s in int e rn atio na l tr a de fl ow s. ” 19 U. S.C. § 2 10 2( 4) (2 00 0) ; a c c or d F or tin v. Mars ha ll, 60 8 F .2 d 5 25 , 5 25 (1 st C ir . 1 97 9) . D ue to t he ir
re me dia l natur e , c ourt s li be ra lly c on str ue the TAA p ro vis ion s o f t he Tr a de Ac t to e ff

e c tuate legi sl ati ve i nt ent . P emb ert onv. Mar sh all , 6 39 F.2 d 7 98 , 8 00 (D. C. Ci r. 1 98 1); EDS , 3 50 F. Supp. 2d at 1290; W oodrum v. Donovan, 5 CI T 191, 198, 564 F. Supp. 826 (1983) , aff ’d, 737 F.2d 1575 ( Fe d. Cir. 1984). Howe ver, the re a re limitations to how far a ssistance e x tends. For instance, w orker s who provide se rvice s are not cover ed by the Tra de Ac t. Pemberton, 639 F.2d at 800; see a lso Fortin, 608 F.2d at 528; Nag y v. Donovan, 6 CI T 141, 144, 571 F. Supp. 1261 (1983). To be elig ible for a ssistance, the se parated worke rs must have e ng ag ed in the produc tion of an a rticle. See 19 U.S.C. § 2272(a); Pemberton, 639 F .2d at 800.

II. “Art icle” under the Trade Ac t Th is C ourt

be g ins the su

bs tanti ve ana ly sis of

the iss ue s w iththe fo llo wi nga sp e c ts o f t his
case settled: 1. Pla int if

fs ’ j ob s w e re sh if

te d to a Me rr ill fa c ili ty

in I nd ia . Se c on d Re mand

Re su lts , 70 Fe d. Reg . at 72857. 2. Plaintiffs participated in the pr oduction an ar ticle. Merr ill I I , 387 F. Supp. 2d at 1344.Court No. 03- 00662 Pag e 18

This Court does not apprec iate L abor’ s attempt to rear gue this point in t he third re mand 7 re su lts
. As state d in

the USC I T’ s G a le [Gr ou p] op ini on

[403 F . Su

pp . 2 d 1 29 9], T AAis only available to worker s in a firm eng ag ed in produc tion of an ar ticle. One signific ant fa ctor that distinguishe s a produc tion firm from a se rvice firm is that the fo rm e r o pe rate s c omm e rc ia lly a s a manu fa c tur ingfi rm

and g e ne rate s it s reve nue fr om the sale of the manufa cture d article s; the manufac turer is in the business of makingand sellingan ar ticle. This is in contrast to a ser vice f irm that operates commerc ially

as a se rvice provider a

nd g ener ates its reve nue fr om the provision of servic es. That a n article is created incidental to the pr ovision of the se rv ic e do e s n ot m ake the se rv ic e fi rm a pr od uc tio n f ir m. (Third Remand Re sults 4 (2d Suppl . Admin. R. at 22).) As L abor is we ll-awa

re, this Court is not bound by Gale Group. More over, nothingin the cited portion of Ga le Group–or for that matter

elsewhe re in the opinion–stands for the pr op os iti on

that “ the USC I T e sta

bli sh e d th at w or

ke rs in a se rv ic e fi rm

are no t e lig ibl e to a

pp ly for be nefits under

the Tra de Ac t.” (Third Rema nd Results 3-4 (2d Suppl. Admin. R . at 21-22) (citingGale Group, 403 F . Suppl. 2d at 1303).) In fac t, this C ourt does not take issue w ith the a pp lic a ble po rt ion

of Ga le in whic h th e c ourt

state s “ that f

or TAA e lig ibi lity , Pl a int if

fs ha d to produce an ar

ticle within the meaningof the statute.” Gale Group, 403 F . Suppl. 2d at 1303. This Court settled the issue of firm designation in Merrill I I . “[T] he Tra de Ac t does not limitelig ibilit y

to only those ‘ar ticles’ produc ed by

manufa cturingfac iliti es. Rather , the Tra de Act embr ace s all ‘ar

ticles’ re g ardle ss of the sourc e of pr oduction.” Mer rill I I , 387 F. Supp. 2d at 13 45 (e mph a sis a dd e d) ; se e a lso Murr ay I I , 3 58 F . Su

pp . 2 d at 12 73 n. 8. Th is C ourt sta nd s b y its rulingin Merrill I Iand will not addre ss this i ssue ane w. 3. Commercial value is not relevant f or dete rmining whether

an item is an “a

rticle” for pur poses of the Tr ade A ct. I d. 4. The de signation (i.e., manufa cturing , service , etc.) of the fir m for which Plaintiffs worke d is not relevant to dete rmining whether Plaintiffs participated in the production of a

n article for pur

poses of the Tr ade A ct. I d. at 1345. 7 5. L ands’ End a

nnounced a

policy shift by L abor in that intang ible g oods are now considere d article s “re g ardle ss of their method of tra nsfer .” L ands’ End, 71 F ed. Reg . at 18,357. 6. Pla int if

fs pr od uc e d a n intang ibl e art ic le . ( Th ir d Re mand Re su lts 3 ( 2d

Sup pl. Admin. R. at 21.) Despite L abor’ s relucta

nt acc eptanc e that Plaintiffs wer e eng ag ed in the produc tion an article , the ag ency

continues to deny

Plaintiffs’ reque st for ce rtification for TAA. L abor maintains that Plainti ffs a re ine ligible f

or TAA be cause they

wer e eng ag ed in the produc tion ofCourt No. 03- 00662 Pag e 19

an intang ibl e –r athe r t

ha n ta ng ibl e –a rt ic le . L a bo r’ s d ist inc tio n b e tw e e n ta ng ibl e and

int ang ibl e article s appea

rs nowher e in the Tra de Ac t. Accor dingly , this Court m ust view L abor’ s interpre tation of the Tra de Ac t throug h the Chevron lens. I f congressional intent is clea r, the court a nd the ag ency

“must g ive ef

fec t to the unambiguously expressed intent of Cong ress.” Che vr on , 4 67 U. S. at 84 3. Ho we ve r, if the statut e is s ile nt o r l e ave s a g a p f or the a g e nc y

to f ill , the cour t must determine whethe r the a g ency ’s interpre tation is proper. This Court recognizes that L abor ha s some discretion to def ine “a rticle”–a ter

m left undefine d by

Congr ess–for pur

poses of the Tr ade A ct, but that discretion must be exercise d in a
manner consistent with cong ressional policy underly ing the Trade Act. See Sloan, 436 U.S. at 11 8. Al tho ugh Co ngre ss d id n ot d e fi ne “ art ic le ” in t he c onte xt of

the Tr a de Ac t, n e ith e r d id i t distinguish betwee n “tang ible” and “ intang ible” ar ticles. As re medial leg islation, thi s Court liberally construes the Trade Act, Pember ton, 639 F. 2d at 800, a

nd revie ws L abor’ s construction of the ter m “ar ticle” so that it has the br oadest possible mea ning in or der e ffe ctuate c ong ressional int e nt. The distinction betwee n tang ible and intang ible article s is contrary to the purpose of

the Tr a de Ac t, whic h is to p ro vid e a ssi sta nc e to w or

ke rs wh o a

re dis pla c e d f

ro m th e ir job s d ue to incre ases in “imports of a rticles like or dire ctly

competitive with article s produce d by” the displaced w orker s or due to a shift of production outside the United States. 19 U.S.C. § 2272(a) (empha sis added). L abor’ s distinction between tang ible and intang ible article s is “inconsistent with . . . statutory

mandate [and] . . . frustrate [s] congressional policy underly ing [the] statute.” Sloan, 436 U.S. at 118 (quotation and citation omitted). Thus, this Court finds that L abor’ s distinction between tang ible and intang ible article s is “arbitra ry” and “ manifestly

contra ry to theCourt No. 03- 00662 Pag e 20

statute.” Chevr on, 467 U.S. at 844. Acc ording ly , this Court hol ds that once L abor ha s de te rm ine d th at a ff

e c te d w or ke rs we re e ng a g e d in

the pr od uc tio n o f a

n a rt ic le , b e that art ic le tang ibl e or

int ang ibl e , th os e wo rk e rs have satis fi e d th e “ art ic le ” re qu ir e me nt o f t he Tr a de Ac t.

III. “Lik e” and “Direct ly Com petitive” Ar ticles under the Trade Ac t In both the second a

nd third remand r esults, L abor r easone d that even if Plaintiffs had been e ng ag ed in the produc tion of an ar ticle, they nonetheless would be ineligible f or TAA beca use there are no article s “like or dire ctly competitive” with any

Merr ill-produced a

rticle. Se c on d Re mand

Re su lts , 7 0 F e d. Re g . at 72 ,8 58 ; T hir d Re mand Re su lts 5 ( 2d

Sup pl. Ad

min . R. at 2 3). Th e te rm s “l ik e” and“di rect ly compet it iv e” are n otdefi nedby th e Trad e Act . By regulation, L abor de fines “like a rticles” a s “those which a re substantially

identical in inhere nt or i n tr i n s i c c h ar a c t e r i s t i c s ( i
. e . , m at e r i a l s f r o mw h i c hth e art i c l e s ar e m a d e , a p p e ar an c e , qu a l i ty, te xtur e , e tc .) .” 29 C.F .R. § 9 0. 2 ( 20 05 ). L a bo r’ s r e gulatio ns se pa

ra te ly de fi ne “ dir e c tly competitive” a

rticles, which a

re a rticles that “a lthough not substantially identical in their inher ent
or int ri ns ic c ha ra c te ri sti c s, are su

bs tanti a lly

e qu iva le nt f

or c omm e rc ia l pu

rp os e s ( i.e ., a da

pte d to the same use s and esse ntially intercha ng eable there for) .” I d. (empha sis added). This Court finds L abor’ s interpre tations of “like” a nd “dire ctly

competitive” to be r easona ble construc tions of the Trade Act. See F ormer E mploy ees of Tesco T echs., L L C v. U.S. S ec’ y of L abor, Slip Op. 06- 163, 2006 Ct. I ntl. Trade L EXI S 174, at *13 n.7 (CI T Nov. 9, 2006) ( citing Che vron, 467 U.S. at 843). Althoug h “[a] gre at amount of de fer ence is owed to an a g ency ’s interpre tation of its own regulations,” L ee v. United States, 329 F.3d 817, 822 (F ed. Cir. 2003), this Court’s revie w of L abor’ s actions does not end he re. This Court must nextassess whe ther L abor’ s application ofCourt No. 03- 00662 Pag e 21

In the sec ond rema

nd results, L abor state s that “there are no article s which ar e ‘like’ or 8 ‘d ir e c tly c omp e tit ive ’ t o a

ny sin g le ‘a rt ic le ’ c re ate d b y

Me rr ill be c a

us e e a c h e le c tr on ic fi le is a unique document whic h is crea ted for the sole purpose of satisfying a

specific customer’ s particula r nee d at a pa

rticular point in time.” Second Re mand Results, 70 Fed. Reg . at 72,858 (empha sis added). its own regulations is supported by substantial evidence . 19 U.S.C. § 2395(b). This Court finds that it wa s n ot.

A. Unique Ar

ticles Although L abor ha s established re gulations for re viewing“like” or “dire ctly competitive” article s, the ag ency

appea rs to have a dded a r equire ment not refle cted in the Tr ade A ct or L abor’ s regulations: that the articles in question not be unique. Ac cordingto L abor, “ there are no article s which ar e ‘like’ or ‘dire ctly competitive’ to any

single ‘ar ticle’ c reated by

Merr ill because eac h elec tronic file is a unique document.” ( Third Remand Results 6 (2d Suppl. Admin. R. at 24) (empha sis added).) Howeve r, Cong ress did not provide that TAA bene fits should only be 8 available to worker s eng ag ed in mass-produc tion to the ex clusion of worke rs whose output may require skills, t raining , and expertise nec essar y to produce custom-made a rticles. Te sco Tec hs., 2006 Ct. I ntl. Trade L EXI S 174, at *15. Fur ther, L abor ha s previously cer tified displaced w orker s who produce d unique ar ticles. L ands’ End is a pe rfe ct example of L abor’ s prior treatment worker s who wer e eng ag ed in the production of unique a

rticles. In L ands’ End, the displaced w orker s produce d “dig itiz ed embroider

y desig ns from customer s’ log os.” L ands’ End, 71 F ed. Reg . at 18,357. As in the prese nt case , the desig ns on which the L ands’ End e mploy ees w orked w ere owned by the customers. I d. L ands’ End shifte d the produc tion of the dig itiz ed embr oidery desig ns overse as.Court No. 03- 00662 Pag e 22

After the produc tion shift, the digitized designs we re r eturne d to L ands’ End e lectronic ally . I d. After voluntary

rec onsideration of a

n ear lier neg ative dete rmination of TAA e ligibility , L abor conclude d “that [L ands’ End] produce d an intang ible article (dig itiz ed embr oidery desig ns) that would have be en conside red a n article if embodied in a phy sical medium.” I d. Unlike the prese nt matter, howe ver, the L ands’ End displac ed wor kers we re c ertified a s elig ible for TAA. The L ands’ End log os were owned by the customers; e ach c ustomer’s log o was unique; the L ands’ End w orker s cre ated e lectronic logos to satisfy customer ne ed; the designs were elec tronically

transmitted to L ands’ End f rom abroa d; and L abor de emed the dig itiz ed log os to be intang ible article s. Sim ilarly , Merr ill’s customers provided data from whic h Merr ill employ ees
c re ate d a n e le c tr on ic do c ume nt– an intang ibl e art ic le –th at w a s tr ans mitte d e le c tr on ic a lly to Me rr ill fr om i ts f

a c ili ty a br oa d in or de r t o s atis fy

c us tom e r n e e d. L a

bo r d oe s n ot e xpla in i ts failure to treat Plaintiffs as it did the similarly -situated L ands’ End w orker s. See SKF U SA Inc. v. United States, 263 F.3d 1369, 1382 ( Fe d. Cir. 2001) (ag ency action is arbitra

ry when similar situations treated diff

ere ntly without just ification). In all functional a

nd materia l respec ts the Merrill and L ands’ End e mploy ees ha d the
same re sp on sib ili ty : to c onve rt inf or matio n into a

dig ita l f or mat f or late r u se . It is of

no matte r t o thi s Co ur t, b e c a us e it i s o f n o matte r t o L a bo r u nd e r i ts r e vis e d p oli c y , th at in the c a se of

Me rr ill employ ees the later use may be an e lectronic transmission of an ele ctronic a rticle. L abor’ s policy is clear : “[I ]nt ang ible g oods that would have be en conside red a rticles for the purposes of

the Trade Act if e mbodied in a phy sical medium will now be consider ed to be a rticles re g ardle ss of the their method of tr ansfe r.” L ands’ End, 71 F ed. Reg . at 18,357. Under this poli cy , theCourt No. 03- 00662 Pag e 23

e le c tr on ic fi na

nc ia l do c ume nts Me rr ill pr od uc e s f or its c us tom e rs are to b e tr e ate d a s a rt ic le s, jus t as if they had bee n printed and bound. This Court is “powerless to af firm the administrative a ction” whe re L abor’ s basis for the action is “inade quate or

improper.” SEC v. C hener y Corp., 332 U.S. 194, 196 (1947). L abor does not explain the source of its requireme nt that articles be commodities (not unique) in order to be like or dire ctly

competitive. Given L abor’ s failure to expl ain its rationale f or not following its own regulations in determining that Plainti ffs we re una ble to satisfy

the re quirements of the Trade Act bec ause the article s they produce d wer e unique, this Court holds that L abor’ s deter mination in thi s reg ard is ar bitrary and ca pricious. See B urling ton Truck L ines, Inc. v. United States, 371 U.S. 156, 168 (to be sustained on r eview, “ ag ency must make finding s that support its decision” and “ articulate any rational c onnection betwe en the f acts found a

nd the
c ho ic e ma de ” ); se e a lso Te sc o T e c hs ., 20 06 Ct. Intl . T ra de 17 4, at *1 7 ( L a bo r’ s “ ‘m a sspr od uc tio n’ re qu ir e me nt f

or TA A c e rt if

ic atio n e lig ibi lity” fo un d to be “ no t in a c c or da nc e wi th law and c ontrary

to” congressional intent). Ac cording ly , this Court hol ds that L abor’ s deter mination in the second and third r emand r esults is unsupported by substantial evidence
.

B. “L ike” Ar

ticles Despite ther e beingdistinct definitions for “like” a nd “dire ctly

competitive” in its own regulations, L abor c onflates the te rms in its analy sis of Merrill’s oper ations. See Second Rema nd Results, 70 Fed. Reg . at 72,858 (findingthat there are no like or direc tly competitive ar

ticles beca use the g oods Merrill produc es ar e unique) . I f the ter ms “like” a

nd “dire ctly

competitive”
are no t sy no ny mou s, a s th e ir

re gulator y de fi nit ion s ma

nd ate , th e n th e sin g le fa c tor of un iqu e ne ssCourt No. 03- 00662 Pag e 24

This rule of statutory

construction is not absolute. 9 Most words have dif fer ent shade s of meaning , and conse quently may be variously construed, not only

when they

occur in differ ent statutes, but when use d more than onc e in the same statute . . . . Undoubtedly , there is a natura l presumption that identical wor ds used in differ ent par ts of the same a ct ar e int e nd e d to have the same me anin g . B ut t he pr e sumpt ion

is n ot r ig id a

nd re a dil y yields whene ver the re is such va riation in the conne ction in which the wor ds are used as r easona

bly to warr ant the conc lusion that they wer e employed in diffe rent parts of the act with diffe rent intent. Where the subject-matter to which the wor ds ref er is not the same in the sever al place s where they are used, or the c onditions are differ ent, or the sc ope of the leg islative power e x erc ised in one ca se is broade r than that exercised in a

nother, the me aningwell may vary to meet the purpose s of c ann ot d isq

ua lif y the imp or

te d e le c tr on ic do c ume nts fr om b e ingbo th “ lik e ” and “ dir e c tly competitive.” See Tesco T echs., 2006 Ct. Intl. Trade 174, a t *21. The leg islative history

of the Tr ade A ct spec ifies that “‘ like’ and ‘ direc tly competitive’

. . . a re no t to be re g ard e d a s sy no ny mou s o r e xplanator

y of e a c h o the r, but r athe r t o d ist inguis h be tw e e n ‘ lik e ’ a

rt ic le s and

art ic le s whic h, a lth ou g h n ot ‘ lik e ’, are ne ve rt he le ss ‘ dir e c tly competitive.’” S. Rep. No. 93-1298, at 121-22 ( 1974), re printed in 1974 U.S.C.C.A.N. 7186, 7265. Congr ess adopted this statement in the c ontextof sec tion 201 safeguard inve stigations conducte d by

the International Trade Commi ssion. Nonetheless, this Court finds the direction, within the leg islative history for the sa me leg islation (the Trade Act of 1974) , to be instructive. When a term is used throughout a statute, the c ourt “pre sume[s] that Congr ess intended that the term have the same me aningin eac h of the pe rtinent sections or subsec tions of the statute, and [the c ourt ] pr e sume [s] tha t Co ngre ss i nte nd e d th at [th e a g e nc y ], in de fi nin gthe te rm , w ou ld de fi ne it c on sis te ntl y .” SKF , 2 63 F .3 d at 13 82 ; se e a lso F or me r E mpl oye e s o f E le c . D ata Sy s. Corp. v. U.S. Sec’y

of L abor, 29 CI T __, 408 F. Supp. 2d 1338, 1345 (2005) (“The same ter m cannot ha ve diffe rent mea

nings in re lated statutes.”)
. Thus, L abor must under take a rea soned 9Court No. 03- 00662 Pag e 25

the law, to b e arr ive d at by a c on sid e ratio n o f t

he langua g e in whic h th os e purposes a

re e x presse d, and of the circ umstances unde r which the languag e wa s employ ed. I t is no t un

us ua l f or the same wo rd

to b e us e d w ithdif

fe re nt m e anin g s in the same a ct, and ther e is no rule of statutory construction which pr eclude s the c ourt s f ro m g ivi ngthe wo rd

the me anin gwh ic h th e le g isl atur e int e nd e d it sh ou ld have in e ach instanc e. Atlantic Cleane rs & Dy ers v. United States, 286 U .S. 427, 433 (1932) (interna l citations omi tte d) . In th e pr e se nt m atte r, the pa rt ie s h ave pr e se nte d th is C ourt wi th n o e vid e nc e to s ug g e st that the seve ral uses of

“like” a nd “dire ctly

competitive” in the Tr ade A ct should be g iven dif fe re nt m e anin g s o r t

hat Co ngre ss i nte nd e d th e te rm s to have dif fe re nt m e anin g s whe n u se d in the se ve ra l se c tio ns of

the Tr a de Ac t. N on e the le ss, on re mand , L a

bo r w ill have an o pp or

tun ity to “ atte mpt to p ro vid e a

re a so na ble e xplanatio n f

or a pp lyingdif

fe re nt d e fi nit ion s o f t

he same phrase .” Altx, I nc. v. United States, 25 CI T 1100, 1114 n.29, 167 F. Supp. 2d 1353 (2001)
. analy sis on remand of whether the elec tronic re cords tra nsmitt ed fr om India ar e “like” article s under the Trade Act. See T esco Te chs., 2006 Ct. Intl. Trade 174, a t *22.

C. “Dire ctly

Competiti ve” Articles To the e xclu sio n o f a

ny oth e r f a c tor , L a bo r f oc us e d o n th e un iqu e ne ss o f t he do c ume nts Merr ill produces. As a

result, this Court was not presente d “a me aning ful ana ly sis of [t he
art ic le s’ ] ‘u se s’ and

‘c omm e rc ia l pu

rp os e s’ purs ua

nt t o 2 9 C. F .R. § 9 0. 2, wh ic h in tur n w ou ld demonstrate whether

[t he imported e lectronic documents] constitut e ‘dire ctly competitive’ article s.” Tesc o Tec hs., 2006 Ct. I ntl. Trade 174, at *18. As in the prese nt case , L abor de nied the pla int if

fs ’ a pp lic atio n f

or TAA c e rt if

ic atio n in Te sc o T e c hn olo g ie s b e c a us e the pla int if

fs ’ desig ns for mac hinery

and tooling w ere “unique” and “de veloped to mee t a spec ific customer ’s particula r nee d.” I d. at *12 (quotation and c itation omit ted). In rema nding the case to L abor, the Tesco T echnolog ies court c ommented:Court No. 03- 00662 Pag e 26

L ike wi se , th e re ve nu e g e ne rate d b y Me rr ill fr om t

he pr od uc tio n o f f

ina nc ia l do c ume nts 10 may not be the best sourc e–or e ven a r eleva nt source–of

information for de terminingwhether there are “like” or

“dire ctly competitive” a

rticles. Althoug h L abor c laims that Merrill “does not g ener ate r evenue by

the sale of

the filing s,” (Third Re mand Results 4 (2d Suppl. Admin. R . at I f P la int if fs ’ d e signs we re no t “ lik e or dir e c tly c omp e tit ive ” wi th o the r d e signs , logic dictates that GM would not have attempted to off- shore their production, sin c e e mpl oyingc he a

pe r f or e ign la bo r i ns te a d o f t

he Te sc o e mpl oye e s to c re ate th e d es i gn s wo u l d

n o tyi el d co s ts av i n gs . . . . L i k ew i s e, i f P l ai n t i ff s ’ d es i gn pr od uc tio n w e re immun e to d ir e c t c omp e tit ion a s L a bo r c la ims , o ff

-s ho ri ngc ou ld no t ha ve a ff e c te d Pl a int if

fs ’ j ob s b y

re du c ingde mand

fo r t he ir de signs . I d. at *1 8- 19 . T he same ratio na le is e qu a lly c omp e lli ngin t

his matte r, and

thi s Co ur t a do pts it
e n t i r e l y. Be cause L abor f

ailed to explain why

the elec tronic financ ial documents imported fr om Me rr ill ’s fa c ili ty

in I nd ia are no t “ dir e c tly

c omp e tit ive ” wi th t

ho se Pla int if

fs ’ p ro du c e d, thi s Court holds that L abor’ s determination is not supported by substantial evidence . In rema nding this matter, this Court i nstructs L abor to c onsider that produc tion in I ndia and pr oduction by Plaintiffs need not nec essar ily overla p. See Elec . Data Sy s. Corp., ISoluti ons Ctr., Fairbor n, Ohio, 71 Fe d. Reg . 18,355, 18,356 (De p’t L abor A pr. 11, 2006) ( notice of r evised de termination
on rema nd) (“ [W ]hi le no produc tion of wholly new softwa

re oc curr ed in Mexico during the period unde r investig ation, the Mexican worke rs wer e beingtrained in the pr oduction of new softwar e duringthe re levant per iod and the produc tion of such softwar e now oc curs in Mexico. Thus, a shift of ne w softwar e produc tion to Mex ico was a lso alrea dy underw ay .”). This Court also notes that neither

“inher ent or intrinsic cha rac teristics” nor a daptability for “ the same use s and esse ntially

intercha ng eable ,” 29 C.F.R. § 90.2, indicate that commerc ial value is of a ny importance in determiningwhether article s are “like” or

“dire ctly competitive,” r espec tively , for purp os e s o f t

he tr a de a c t. Se e Me rr ill I I , 3 87 F . Su pp . 2 d at 13 44 . O n r e mand , L a bo r m us t 10Court No. 03- 00662 Pag e 27

22 )) , M e rr ill ’s bu sin e ss a nd Pla int if fs ’ w or k d ur ingthe re le va

nt p e ri od inc lud e d mo re tha

n ju st producingSEC fili ng s. Merrill and Plaintiffs also produc ed other financ ial documents, including prospec tuses and annua l reports, whic h are not filed and, ther efor e, pre sumptively would not g e ne rate fi lin gre ve nu e fo r M e rr ill . ( Se e Con fi de nti a l Su pp l. A dmi n. R. at 10 .) It is re a so na ble to presume that Me rrill did not provide prospec tuses and annua l reports fr ee- of-c harg e. L abor neither e x plains the rele vance of Mer rill’s reve nue strea

m nor the inconsistent information provided by

Merr ill. Although this Court by no means wishes to e ncoura g e L abor’ s focus on reve nue, if the a g ency

persists alongthis vein of inquiry it might be better -ser

ved by inquiring of Merr ill’s controller or c hief fina ncial off icer , rathe r than, re lying upon f inancial infor

mation provided by

the human re source s depar tment. (See Confidential 2d Suppl. Admin. R. at 18.) explain why

“a c ustom-made produc t is not i nterc hang eable with another f or commer cial purposes.” Elec. D ata Sy s., 408 F. Supp. 2d at 1347 (e mphasis added)
.

IV. Similarly-Situated Worker s I t goe s without saying that simi larly -situated cla imants should be treate d simil arly under the law. See , e.g ., SKF, 263 F .3d at 1382 (“ an ag ency action is arbitra

ry when the a g ency

offe rs insufficient re asons for tr eatingsimil ar situations diffe rently” (quotation and citation omitted)). I t is not l ost on this C ourt that L abor c ertified a g roup of wor

kers in substantially

simil ar circ umstances only

last y ear , at roughly

the same time this Court ordere d the third rema nd. L ike Pla int if fs , th e wo rk e rs of

Ca pit a l Cit y Pr e ss, Pub lic atio n Se rv ic e s D ivi sio n, “ c re ate d d oc ume nts elec tronically .” Capital City Press, Inc., Publ’n Servs. Div., B arr e, VT, 71 F ed. Reg . 29,981 (De p’t L abor Ma

y 24, 2006) (notice of re vised deter mination on remand) ( “Capital City ”). Ca pit a l Cit y sh if te d p ro du c tio n to the Phi lip pin e s a nd Ind ia and imp or te d th e pu bli c atio ns in
e le c tr on ic fo rm at. I d. On its ini tia l r e vie w, L a

bo r d e te rm ine d th at th e dis pla c e d Ca pit a l Cit y worke rs did not produce an ar ticle for pur

poses of the Tr ade A ct bec ause of “the e lectronic nature of the publications created by the worke rs.” I d. On voluntary rec onsideration, L abor iter ated theCourt No. 03- 00662 Pag e 28

Specifica lly , L abor state d that 11 the Depa rtment has re vised its policy to acknowle dg e that ther e ar e tang ible and intang ible article s and to clar ify that the produc tion of intang ible article s can be distinguished fr om the provision of servic es. Intang ible g oods that would have been c onsidered a

rticles, for

the purposes of

the Tra de Ac t, if embodied in a phy sical medium are now consider ed to be a rticles re g ardle ss of their method of transfe r. Capital City , 71 Fe d. Reg . at 29,981. policy shift announce d in L ands’ End. L abor the n deter mined that Capital City ’s displace d 11 worke rs “e ng ag ed in ac tivity related to the produc tion of an ar ticle (scie ntific journals and books).” I d. Fur

ther, L abor c oncluded “ that duringthe re levant per iod, a sig nificant portion of worke rs was se parated from [Capital Cit y ], production shifted abroa d, and the subjec t firm incre ased imports of publications following the shift abr oad.” I d. Acc ording ly , L abor c ertified Ca pit a l Cit y ’s wo rk e rs be c a

us e “ a sh if t in pr od uc tio n a br oa d o f p ub lic atio ns lik e or dir e c tly
c omp e tit ive to t

hat pr od uc e d at th e su

bje c t f a c ili tie s f oll ow e d b y

inc re a se d im

po rt s c ontr ibute d to the total or par

tial separa

tion of a sig nificant number or propor tion of worker s at the subject fac iliti es.” I d. at 29,982. L ike Pla int if

fs , th e dis pla c e d Ca

pit a l Cit y e mpl oye e s c re ate d uniq

ue e le c tr on ic documents; the Capital City employ ees’ jobs were reloc ated to a pr oduction fac ility abroa d; and the fo re ig n f

a c ili ty tr ans mitte d th e e le c tr on ic do c ume nts to C a pit a l Cit y e le c tr on ic a lly . In a ll rele vant re spects, the Capital City employ ees’ and Plaintiffs’ situations are identical. Ye t, the Capital City

employ ees w ere cer

tified by L abor a s elig ible for TAA and Plaintiffs we re not. L a bo r h a s f a ile d to e xpla in t

he dis c re pa

nt t re atme nt o f t

he sim ila rl y -s itu ate d w or

ke rs .Court No. 03- 00662 Pag e 29

I t is appare nt to this Court that Plainti ffs have satisfied the elig ibilit y require ments of 12 the Tra de Ac t, 19 U.S.C. § 2272(a)(1) & ( 2)(B ). F irst, Plainti ffs’ jobs we re e liminated. (Admin. R. at 3 ( e le c tr on ic me ssa g e fr om M e rr ill mana g e me nt c on fi rm ingthat “ a numbe r o f p os iti on s in St. P aul and boston/Woburn have be en eliminated” ).) Sec ond, Merr ill shi fted Plaintiffs’ job overse as, spec ifically

to a Merr ill facility

in India. Second Rema

nd Results, 70 Fed. Reg . at 72 ,8 57 . T hir d, the job and pr od uc tio n s hif

t r e su lte d in

an in c re a se in i mpo rt s o f l ike or dir e c tly competitive ar

ticles, in that Merrill’s domestic fa cilities were no longe r per formingthe work that was, duringthe re levant per iod, beingperf ormed ove rsea s. I d. (“f

inancial r eports we re de livered to the United States via ele ctronic tra nsmissi on” fr om India). This Court anticipates that L abor might argue that Capital City is disti nguishable fr om the
case at bar

beca use (1) Capital City

is a production firm, a

nd (2) Capital City ’s publications have
commerc ial value. As this Court held in Merr ill I I , the firm’s de signation as production or service is of no import to determining e ligibility for TAA. Merr ill I I , 387 F. Supp. 2d at 1345. As fo r t he c omm e rc ia l va lue of

Ca pit a l Cit y ’s pu bli c atio ns , th e Court

fi nd s n o me ri t to thi s argument either. The Trade Act does not re quire the a rticles at issue to have commerc ial value. I d. at 1344. On re mand, this Court directs L abor to e x plain its reasoningfor de nying Plaintiffs the TA A c e rt if

ic atio n it g ra nte d to the Ca

pit a l Cit y e mpl oye e s.

V. P laintif

fs S atisfaction of

TAA Cer tification Requ irem ents Even if Plaintiffs have satisfied all of the e ligibility require ments for TAAcer tification under the Trade Act, this Court i s powerle ss to direct L abor to c ertify Plaintiffs at elig ible for 12 TAA. The Trade Act is clea r. This Court may

aff irm L abor’ s determination or it may set aside L abor’ s determination in whole or in part, 19 U.S.C. § 2395(c), but this Court is not authoriz ed to direct L abor to c ertify

Plaintiffs as elig ible for TAA, 28 U.S.C. § 2643(c)( 2) (2000) (“The Court of International Trade may not . . . issue a writ of manda mus in any

civil actionCourt No. 03- 00662 Pag e 30

commence d to reviewany final dete rmination by

the Secr etar

y of L abor unde r sec tion 223 of the Trade Act of 1974 [19 U.S.C. § 2273] ”).

C ONCL US I ON For the re ason stated he rein, this Court remands this matter to the De partment of L abor for f urther pr ocee dings c onsistent with thi s opinion. L abor’ s remand de termination is due no later tha n April 30, 2007. Plaintiffs may file comments conc erningthe re mand re sults no later than May 14, 2007.
/s/ Greg ory W. C arma

n Gre g ory W. C arma

n
Dated: 28 Ma

rch 2007 New Y ork, Ne w YorkERRATUM

For mer Employees of

Merr ill C orporation v. United States, Court No. 03-00662, Slip Op. 07-46, dated Ma rch 28, 2007: Pag e 29, the f

irst sentence in section V should rea d, “. . . this Court is powerless to direc t L abor to c ertify

Plaintiffs as elig ible . . . .” not “at eligible.”
Marc h 29, 2007