02-2338. Spinnaker Coating Maine Incorporated Westbrook, ME; Notice of Negative Determination Regarding Application for Reconsideration

By application dated September 28, 2001, the PACE International Union, Local 1069 requested administrative reconsideration of the Department's negative determination regarding eligibility to apply for Trade Adjustment Assistance (TAA), applicable to workers and former workers of the subject firm. The denial notice was signed on August 23, 2001, and published in the Federal Register on September 11, 2001 (66 FR 47242).

Pursuant to 29 CFR 90.18(c) reconsideration may be granted under the following circumstances:

(1) If it appears on the basis of facts not previously considered that the determination complained of was erroneous;

(2) If it appears that the determination complained of was based on a mistake in the determination of facts not previously considered; or

(3) If in the opinion of the Certifying Officer, a misinterpretation of facts or of the law justified reconsideration of the decision.

The petition for the workers of Spinnaker Coating Maine Co., Westbrook, Maine was denied because the “contributed importantly” group eligibility requirement of section 222(3) of the Trade Act of 1974, as amended, was not met. The “contributed importantly” test is generally demonstrated through a survey of customers of the workers' firm. The survey revealed that none of the respondents increased their purchases of imported pressure sensitive paper (including EDP, thermal transfer, semi gloss etc.), while decreasing their purchases from the subject firm during the relevant period.

The petitioner believes that the Labor Department looked at the wrong product made by Spinnaker Coating Maine Incorporated.

The Department's decision was based on the correct product (pressure sensitive paper). The Department inadvertently referenced the wrong U.S. import category, pressure sensitive labels (HTS-4821902000). The correct product produced at the company plant is classified under the category pressure sensitive papers (HTS-4811210000). The Department uses import statistics as an indicator, but relies primarily on customer surveys to determine if imports “contributed importantly” to the declines in sales and/or production and employment at the subject firm. The Department examined the new data supplied (pressure sensitive paper), but based on other data collected during the initial investigation does not consider the import data as contributing importantly to the workers layoffs, due to the survey responses showing an overwhelming reliance on domestic customer purchases of pressure sensitive papers (including EDP, thermal transfer, semi gloss etc) during the relevant period.

The petitioner also feels that the time period considered in the investigation is not correct.

The Department examined the pertinent time periods of 1999, 2000 and the January through June 2001 over the corresponding 2000 period.

The petitioner further indicates that the Department failed to survey the major customers properly and that a specific customer switched from buying from the subject firm in favor of buying imported thermal transfer pressure sensitive paper (a product similar to what was purchased from the subject firm). That customer stopped buying thermal transfer pressure sensitive paper from the subject firm during February 1999, which is beyond the relevant impact period for this petition and investigation.

The survey, as already indicated, revealed that none of the respondents increased their purchases of imported pressure sensitive papers, (including EDP, thermal transfer, semi gloss etc.) importantly, while decreasing their purchases from the subject firm during the relevant period. The survey further revealed that the overwhelming majority of lost company business was due to customers purchasing products that are like and directly competitive with what the subject plant produced from other domestic sources and only small amounts of imports (and declining) were purchased during the relevant period.

The petitioner further alleges that they feel declining price is a factor in the company sales declines. Price is not a factor that is considered in meeting the “contributed importantly” group eligibility requirement of section 222(3) of the Trade Act of 1974, as amended.

The petitioner also indicates that a foreign producer of products that are like and directly competitive with what the subject firm produces is importing at a lower price and indicates that this is the reason for the plant's problems. Based on the survey results, as already indicated, this is not a major factor contributing to the company's declines in sales, production and employment.

Conclusion

After review of the application and investigative findings, I conclude that there has been no error or misinterpretation of the law or of the facts which would justify reconsideration of the Department of Labor's prior decision. Accordingly, the application is denied.

Signed at Washington, DC, this 26th day of December 2001.

Edward A. Tomchick,

Director, Division of Trade Adjustment Assistance.