Cardinal Glass Industries, Inc. Sextonville, Wisconsin; Notice of Negative Determination Regarding Application for Reconsideration

On January 29, 2004, the Department issued an Affirmative Determination Regarding Application for Reconsideration for the workers and former workers of the subject firm. The notice was published in the Federal Register on February 11, 2004 (69 FR 6693).

The Department initially denied TAA to workers of Cardinal Glass Industries, Inc. because the “contributed importantly” group eligibility requirement of Section 222(3) of the Trade Act of 1974 was not met. The company did not import glass handling equipment in the relevant period nor did it shift production of glass handling equipment to a foreign country. The investigation revealed that the cause of the worker separations was a domestic shift of production.

The company official who filed the reconsideration request alleges that, in order to remain competitive with foreign suppliers of glass, the company was forced to keep the prices of glass at the same level for the last twenty years and that the glass production declines are attributed to foreign competition. The official further states that, the Sextonville facility was not efficient enough in both production speed and quality to meet competitive forces; however it was an integral part in the selling of glass products.

Contact with another company official at the headquarters of Cardinal FG confirmed what had been established in the initial investigation, which was that workers of the subject firm produced glass handling equipment and their separations were predominantly caused by a shift of production from the Sextonville, Wisconsin facility to a newly built domestic site at Spring Green, Wisconsin. The official further stated that production at the new facility will be of an equal or greater value to that produced by the subject firm.

In order to establish import impact, the Department must consider imports that are like or directly competitive with those produced at the subject firm. As the majority of the production of glass handling equipment was used to supply internal demand, and the company reported no imports, there is no evidence of import impact in regard to this product in conjunction with an assessment of eligibility for affected workers at the subject plant.

The petitioner states that the glass handling equipment produced by the subject firm has been displaced as a result of an increase in imports of glass and mentions a new glass plant going into production in Mexico in the next month.

As noted above, the Department considers imports of like or directly competitive products (in this case, glass handling equipment, as the initial investigation established that layoffs are predominantly attributable to the domestic shift of production) when conducting TAA investigations. Thus, although the products produced by the subject firm workers may be indirectly import impacted, the import impact of glass is not relevant to an investigation of eligibility for trade adjustment assistance on behalf of subject firm workers producing glass handling equipment.

The review of the initial investigation revealed that the Department erred in its description of the subject firm's product during the customer survey, thus purchases of glass were surveyed instead of glass handling equipment. Further contact with the company official revealed that major customers of the subject firm are all internal Cardinal Glass Industries, Inc. glass processing plants. It was found that these customers do not import glass handling equipment.

The investigation further revealed that none of the Cardinal Glass Industries, Inc. facilities are under an existing Trade Adjustment Assistance certification.

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.