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Federal Register / Vol. 70, No.

244 / Wednesday, December 21, 2005 / Notices 75837

• Enhance the quality, utility, and 18, 2005 in response to a worker (2) The sales or production, or both, of
clarity of the information to be petition filed by the Texas Work Force such firm or subdivision have decreased
collected; and Commission on behalf of workers at E.I. absolutely, imports of articles like or directly
• Minimize the burden of the DuPont, Victoria, Texas. competitive with articles produced by such
firm or subdivision have increased, and the
collection of information on those who The petitioner has requested that the increase in imports contributed importantly
are to respond, including through the petition be withdrawn. Consequently, to such workers’ separation or threat of
use of appropriate automated, the investigation has been terminated. separation and to the decline in the sales or
electronic, mechanical, or other Signed at Washington, DC this 5th day of production of such firm or subdivision; or
technological collection techniques or December, 2005 (3) There has been a shift in production by
other forms of information technology, Richard Church,
such workers’ firm or subdivision to a foreign
e.g., by permitting electronic submission country of articles like or directly
Certifying Officer, Division of Trade competitive with articles which are produced
of responses. Adjustment Assistance. by such firm or subdivision; and the country
III. Current Action [FR Doc. E5–7608 Filed 12–20–05; 8:45 am] to which the workers’ firm has shifted
The Department is requesting an BILLING CODE 4510–30–P production of the articles is a party to a free
trade agreement with the United States, is a
extension of the currently approved ICR beneficiary country under the Andean Trade
for the Final Rule Relating to Notice of Preference Act, African Growth and
DEPARTMENT OF LABOR
Blackout Periods to Participants and Opportunity Act, or the Caribbean Basin
Beneficiaries. The Department is not Employment and Training Economic Recovery Act or there has been or
proposing or implementing changes to Administration is likely to be an increase in imports of
the regulation or to the existing ICR. A articles that are like or directly competitive
summary of the ICR and the current [TA–W–50,129 and TA–W–50,129A] with articles which are or were produced by
burden estimates follows: such firm or subdivision.
Type of Review: Extension of a IBM Corporation, Global Services 29 U.S.C. Section 222
currently approved collection of Division, Piscataway, NJ; IBM
information. The investigation revealed that the
Corporation, Global Services Division,
Agency: Employee Benefits Security workers were engaged in the analysis
Middletown, NJ; Notice of Negative
Administration, Department of Labor. and maintenance of computer software
Determination on Remand
Title: Final Rule Relating to Blackout and information systems (identifying
Notices to Participants and The United States Court of product requirements, developing
Beneficiaries. International Trade (USCIT) remanded network solutions, and writing
OMB Number: 1210–0122. to the Department of Labor (Labor) for software). The Department determined
Affected Public: Individuals or further investigation Former Employees that the workers did not produce an
households; Business or other for-profit; of IBM Corporation, Global Services article within the meaning of Section
Not-for-profit institutions. Division v. U.S. Secretary of Labor, 222 of the Trade Act. The Department’s
Respondents: 85,150. Court No. 03–00656. The USCIT’s Order determination was issued on March 26,
Frequency of Response: On occasion. was issued on August 1, 2005. 2003. The Notice of determination was
Responses: 11,956,000. A petition for Trade Adjustment published in the Federal Register on
Estimated Total Burden Hours: Assistance (TAA), dated November 13, April 7, 2003 (68 FR 16834).
166,129. 2002, was filed on behalf of workers at By application of April 29, 2003, a
Total Annual Cost (Operating and IBM Corporation, Global Services petitioner requested administrative
Maintenance): $9,351,400. Division, Piscataway and Middletown, reconsideration of the Department’s
Comments submitted in response to New Jersey (the subject firm). The negative determination regarding
this notice will be summarized and/or petitioning workers had been employed eligibility for workers and former
included in the request for OMB by AT&T and had handled the same workers of the subject firm to apply for
approval of the information collection responsibilities for IBM, after being TAA. In the request for reconsideration,
request; they will also become a matter outsourced by AT&T to IBM in 2000. the petitioner alleged that the workers
of public record. In the petition, the workers alleged did produce an article and argued that
Dated: December 14, 2005. that the subject firm was shifting the denial was the result of an overly
Susan G. Lahne, computer software production to narrow and antiquated interpretation of
Canada and importing those products production by the Department.
Senior Pension Law Specialist, Office of
from Canada. Upon institution of the The Department reviewed the
Policy and Research, Employee Benefits
Security Administration. petition on November 19, 2002, the petitioner’s request for reconsideration
Department conducted an investigation and affirmed that the workers did not
[FR Doc. 05–24280 Filed 12–20–05; 8:45 am]
to determine whether the subject produce an article within the meaning
BILLING CODE 4510–29–P
workers were eligible to apply for TAA. of Section 222 of the Trade Act. Prior to
The relevant period for purposes of the making the determination, the
DEPARTMENT OF LABOR investigation was determined to be Department reviewed the legislative
November 2001 through November intent of the TAA program as well as the
Employment and Training 2002. language of the Trade Act. The
Administration For workers of the subject firm to be Department also reviewed the
certified as eligible to apply for TAA, Harmonized Tariff Schedule of the
[TA–W–58,377] United States (HTSUS) and the North
the following criteria must be met:
American Industry Classification
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E.I. Dupont Victoria, TX; Notice of (1) A significant number or proportion of


Termination of Investigation the workers in such workers’ firm, or an
System (NAICS), and sought guidance
appropriate subdivision of the firm, have from the U.S. Customs Service
Pursuant to section 221 of the Trade become totally or partially separated, or are (Customs). On June 26, 2003, the
Act of 1974, as amended, an threatened to become totally or partially Department issued a Notice of Negative
investigation was initiated on November separated; and Determination Regarding Application

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75838 Federal Register / Vol. 70, No. 244 / Wednesday, December 21, 2005 / Notices

for Reconsideration. The Department’s access the software and code regardless by those who needed to view or test.
Notice of determination was published of where they were stored. Corrections CDs were also used in some instances.’’
in the Federal Register on July 15, 2003 were made by ‘‘changing the source SAR 66. The other two Plaintiffs, Mr.
(68 FR 41845). code and compiled software that reside Fusco and Ms. Berger, stated that the
By letter dated September 11, 2003, on the Direct Access Storage Devices.’’ ‘‘software, since it was designed to run
the Plaintiffs requested judicial review SAR 54, 55. ‘‘Back-ups of programs were on mainframe computers, was embodied
by the USCIT, asserting that the workers also kept on tapes and CDs * * * Code on the disk drives’’ in the client’s off-
of the subject firm produced an article was delivered on the shared directories site data center. SAR 17, 52, 54. The
within the meaning of the Trade Act of hard drives, where it could be subject firm, moreover, stated that the
and characterizing the Department’s accessed by those who needed to view software was electronically stored and
basis for denying certification for the or test. CDs were also used in some delivered to the client’s internal servers
subject workers as irrational. instances.’’ SAR 66. and the software is not embodied or
The USCIT’s August 1, 2005 Order Information provided by the subject delivered to AT&T in any kind of
directed the Department to (1) further firm, including the various position physical medium. SAR 20, 71.
investigate the nature of the software descriptions which account for a In order to reconcile the apparent
produced by the Plaintiffs, including significant majority of the displaced conflict, the Department contacted the
whether the software was embodied in workers, confirms that the workers were subject firm for an explanation. SAR 1,
any kind of physical medium, (2) IT Specialists, with various levels of 73. According to the subject firm, source
explain the differences between the expertise, who provided services and code and documentation related to the
activities performed by the Plaintiffs assisted in the construction, development of the software at issue is
and those performed by other implementation, and integration of stored in and shared through an internal
petitioners involved in developing software systems. More senior workers server, and while back-up copies are
software who had received TAA may also have identified new IT saved on CD, the CDs are not shared
benefits in the past, and (3) explain and services opportunities and developed with the client. SAR 73.
support the Department’s position with tools and methods for managing, The subject firm officials also
respect to the characterization of the analyzing, designing and implementing explained that the CDs presented to the
software at issue as an article or a IT solutions. SAR 22–42. client contained only those documents,
service. such as billing invoices and work
Nature of the Software Produced by the schedules, generated for contract
Remand Investigation Findings Plaintiffs administration purposes, along with the
During the remand investigation, the Software consists of source code (text object code the client needed to access
Department obtained additional written by software developers the business documents. In that very
information and clarification, from two commanding the computer to do a narrow regard, there was software sent
subject firm officials, SAR 1, 2–6, 19–42, certain task) and object code (text from the subject firm to the client
48–50, 57–59, 62–67, 70–73, and written in the language of the computer through a physical medium. However,
Plaintiffs, SAR 1, 7–18, 42–47, 51–56, which enables the computer to execute that software was not source code and
60–61, 68–69 and position descriptions the command, hence, also known as the was not related to the software that was
of the petitioning workers. SAR 22–42. execution file). The object code operates produced by the former employees and
The Department also conducted a as a ciphering key because, without the transmitted electronically to the client.
conference call with subject firm proper object code, the source code There was no software reduced to a
officials to clarify a technical matter cannot be executed. In some instances physical medium for the purpose of
regarding the software. SAR 1. Further, where computers cannot interface, an serving the client. SAR 73.
the Department took action to reconcile object code may be required to read or
conflicting information. SAR 73. translate another object code before the Differences Between Activities
In order to determine whether the source code can be executed. Performed by the Plaintiffs and Those
Plaintiffs engaged in activities which The software at issue is client (AT&T) Performed by Software Development
constitute production, the Department legacy (old, pre-existing) mainframe Petitioners Who Received TAA Benefits
requested that the Plaintiffs and the software and midrange software for in the Past
subject firm provide the Department network applications and systems Information provided for the record
with information about the workers’ (software used to run and repair the by the Plaintiffs and the subject firm
functions, and copies of the workers client’s older systems), SAR 1, 20, and substantiated that the workers were IT
position descriptions. SAR 4, 8. was designed to operate on the client’s Specialists performing software design
Information regarding the workers’ mainframe computers. SAR 17, 52, 53, and implementation activities (software
functions was received from all three 55. The software could be accessed architecture, systems engineering,
Plaintiffs. SAR 17, 43, 53. remotely by the workers. SAR 55, 66, design, development, coding, testing,
According to the Plaintiffs, the 73. The source code at issue was not installing and product support). SAR 17,
separated workers were Information provided to the client on a physical 21, 43, 52, 53. The record evidence does
Technology (IT) Specialists, SAR 17, 43, medium. not indicate that the workers were
53, who identified software program The information initially provided engaged in production or the support of
specifications, created source code, regarding whether the software was production of an article at an affiliated
generated unit and string testing, and embodied on a physical medium facility.
ensured that system input and appeared to be inconsistent. According The Department’s practice of
processing were accurate. SAR 17, 18, to a Plaintiff, Mr. Plumeri, ‘‘[t]he code certifying non-production workers who
43, 52, 53. The software and source code was stored on either mainframe, support an affiliated domestic
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were stored in disk drives (also known Windows or Unix based servers. production facility has been consistent.
as a Direct Access Storage Device) at a Backups of programs were also kept on In past cases where petitioners involved
mainframe data center located at the tapes and CDs * * * Code was in developing software were certified as
client’s facility and were ‘‘viewable on delivered on the shared directories of eligible to apply for TAA, the workers
remote terminals.’’ Workers could hard drives, where it could be accessed supported an affiliated domestic

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Federal Register / Vol. 70, No. 244 / Wednesday, December 21, 2005 / Notices 75839

production facility. For example, ‘‘broad enough to prevent every type any expansion of Trade Act’s scope
recently, the Department certified and form of unfair practice.’’ S. Rep. should be the result of legislation.
software writers in Former Workers of 595, 67th Congress, 2d Session, at 3. Further, the Department is obligated to
Ericsson, Inc. v. Elaine Chao, United Therefore, it was foreseeable that the be faithful to the legislative will and is
States Secretary of Labor (Court No. 02– ITC, applying that expanded remedial bound to the language of the statute. See
00809). In Ericsson, the workers wrote authority, would find that it was not Machine Printers and Engravers Ass’n v.
software code which was embodied on limited to acts that occur during the Marshall, 595 F.2d 860, (D.C. Cir. 1979).
a physical medium (CD-Rom). The CD- physical process of importation. For As already noted, while legislation has
Rom was mass-produced at an affiliated, example, the ITC has held that, while been proposed that would expand the
domestic facility and then distributed to the Commission ‘‘accommodates, where scope of the Trade Act to include
customers. The workers of the subject possible, the policies and views of [the service workers such as the plaintiffs, to
firm were certified because they U.S.] Customs [Service] (which ‘‘has date, no such amendment has been
supported an affiliated domestic determined not to regulate electronic adopted.
production facility whose workers transmissions’’),’’ there were The Department’s reliance on the
independently qualified for TAA (mass- circumstances where it was HTSUS to exclude the plaintiffs from
production of the CD-Rom shifted to a ‘‘appropriate to reach such eligibility is appropriate. See Former
qualifying country). importations.’’ In Re Certain Hardware Employees of Murray Engineering v.
The record, as fully developed on Logic Emulation Systems and Chao, 358 F. Supp.2d 1269, 1272 n.7
remand, strongly supports the Components Thereof, USITC Inv. No. (CIT 2005) (‘‘the language of the Act
conclusion that the Plaintiffs did not 337–TA–383, 1998 WL 307240, page 11 clearly indicates that the HTSUS
meet the criteria satisfied in Ericsson (March 1998). governs the definition of articles, as it
and related software cases. Therefore, Trade Act § 222, which controls the repeatedly refers to ‘‘articles’’ as ‘‘items
the Department properly determined present proceeding, has not undergone subject to a duty’’); HTS, General Note
that the plaintiffs were not eligible to any such amendment. Indeed, there 3(I) (exempting ‘‘telecommunications
apply for TAA benefits. have been several recent legislative transmissions’’ from ‘‘goods subject to
efforts (most recently in June 2005) to the provisions of the [HTSUS]’’). For the
Department’s Position With Respect to
amend the Trade Act so that it does Department to abandon the use of the
the Characterization of the Software at
cover service workers as well as HTSUS and abrogate its current practice
Issue as an Article or as a Service
production workers. However, those would be inappropriate unless the
While the Trade Act does not include efforts, to date, have been unsuccessful.
a definition of ‘‘article’’ among the Department had an adequate substitute,
Thus, the Department’s disposition of such as one contained in the Code of
definitions applicable to the TAA the present case is properly controlled
program, the term is integral to making Federal Regulations.
by existing Trade Act § 222, under The Department’s treatment of service
TAA determinations and, as such, the which the Department applies the
Department has given the meaning of (including software) cases and its
HTSUS to require that an ‘‘article’’ be a
‘‘article’’ considerable thought. The requirement that articles be tangible has
tangible object, not by the ITC’s
USCIT has recognized that, as used in been consistent. Service workers may be
application of its broad Trade Act § 337
the Trade Act, the term ‘‘article’’ certified only if they directly support
authority in intellectual property cases.
embraces a tangible commodity. See Throughout the Trade Act, an production of an article. Under the
Nagy v. Donovan, 571 F. Supp 1261, ‘‘article’’ is referenced as something that Department’s methodology, non-
1263 (CIT 1983). This position was can be subject to a duty. production workers may be eligible for
recently supported in Former Telecommunications transmissions TAA certification as ‘‘support service
Employees of Gale Group, Inc. v. U.S. (including electronically transmitted workers’’ if:
Secretary of Labor, Court No. 04–00374, software code) are specifically exempted (1) Their separation was caused
2005 WL 3088605 * 5 (November 18, from duty as they are not goods subject importantly by a reduced demand for their
2005) and Former Employees of Merrill to the provisions of the HTSUS General services from a parent firm, a firm otherwise
Corp. v. U.S. Department of Labor, 389 Note 3(I). Because the software code at related to the subject firm by ownership, or
F. Supp.2d 1326, 1342–1343 (CIT 2005). a firm related by control;
issue is electronically manipulated and
In Gale Group, the USCIT held that delivered to the client only in an (2) The reduction in the demand for their
workers who ‘‘performed electronic electronic form, the Plaintiffs do not services originated at a production facility
indexing services’’ were not eligible for produce an article. See, e.g., Former whose workers independently met the
TAA benefits, because they did not statutory criteria for certification; and
Employees of Dendrite International, 70
(3) The reduction directly related to the
produce an article for the purposes of 19 FR 21247–3 (April 25, 2005). product impacted by imports.
U.S.C. 2272(a)(2)(B). Gale Group * 4.
Further, the USCIT held that the denial Plaintiffs Argue That the Department’s Former Employees of Henderson
of TAA benefits was a reasonable Interpretation of ‘‘article’’ is Overly Sewing Mach. v. United States, 265 F.
interpretation supported by substantial Narrow Supp. 2d 1346, 1359 (CIT 2003) (citing
evidence and in accordance with law, The Department’s interpretation of Former Employees of Chevron Prods.
notwithstanding plaintiffs’ arguments ‘‘article’’ to require a tangible state is Co. v. United States Sec’y of Labor, 245
that other sources of law (i.e., the consistent with Congressional intent F. Supp. 2d 1312, 1328–29 (CIT 2002)
American Job Creation Act of 2004; and supported by legislative history of (citing Bennett v. U.S. Sec’y of Labor, 20
various state tax cases; and the Trade Act. The Trade Act was CIT 788, 792 (1996); Abbott v. Donovan,
determinations by the International designed to counteract the effects of 570 F. Supp. 41, 49 (1983))).
Trade Commission (ITC) under the ITC’s imports upon the manufacturing sector The Court in Henderson Sewing
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Trade Act § 337 authority to protect and other labor-intensive industries. See sustained the Department’s
intellectual property) could support a S. Rep. No. 1298, 93rd Cong. (1974), interpretation of the statute to preclude
ruling in their favor. reprinted in 1974 U.S.C.A.N. 7186. certification of petitioners as support
Trade Act § 337 was amended in Since Congress took explicit legislative service workers in the instance where
1988, for the express purpose making it action to set criteria for TAA eligibility, no production employee independently

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75840 Federal Register / Vol. 70, No. 244 / Wednesday, December 21, 2005 / Notices

qualified for certification. Id. at n.16. the subject facility did not produce an and velvets that were used in the
(citing Abbott, 570 F. Supp. at 49 (citing article or support the production of an production of upholstery fabrics, and a
Woodrum, 564 F. Supp. 826) (‘‘the Court article within the meaning of the Trade loss of business with domestic
must accord substantial deference to the Act and that they are not eligible for manufacturers (whose workers were
interpretation of the statute [19 U.S.C. certification. certified eligible to apply for adjustment
2272(a)] by the agency [Labor] charged As the result of the findings of the assistance) contributed importantly to
with its administration’’); Bennett, 20 investigation on remand, I affirm the the workers separation or threat of
CIT at 792 (stating in pertinent part that original notice of negative separation.
‘‘plaintiff[s] are eligible for certification determination of eligibility to apply for
[as support service workers] when adjustment assistance for workers and In accordance with section 246 the
* * * their separation is caused by a former workers of IBM Corporation, Trade Act of 1974 (26 U.S.C. 2813), as
reduced demand for their services from Global Services Division, Piscataway amended, the Department of Labor
a production department whose workers and Middletown, New Jersey. herein presents the results of its
independently meet the statutory Signed at Washington, DC, this 9th day of investigation regarding certification of
criteria for certification’’ and holding December, 2005. eligibility to apply for alternative trade
that ‘‘Labor permissibly and reasonably Elliott S. Kushner, adjustment assistance (ATAA) for older
interpreted [19 U.S.C. 2272(a)] in Certifying Officer, Division of Trade workers.
formulating the test for certifying Adjustment Assistance. In order for the Department to issue
support service workers’’). [FR Doc. E5–7600 Filed 12–20–05; 8:45 am] a certification of eligibility to apply for
The Department has consistently
determined that workers engaged in the
BILLING CODE 4510–30–P ATAA, the group eligibility
design and development of software requirements of section 246 of the Trade
may be certified if they support an Act must be met. The Department has
DEPARTMENT OF LABOR determined in this case that the
affiliated, domestic firm at which
workers are engaged in producing a Employment and Training requirements of section 246 have been
trade-impacted ‘‘article.’’ See, e.g., Administration met.
Notice of Determinations Regarding A significant number of workers at the
[TA–W–58,043]
Eligibility to Apply for Worker firm are age 50 or over and possess
Adjustment Assistance and NAFTA Intermark Fabric Corp., Plainfield, CT; skills that are not easily transferable.
Transitional Adjustment Assistance in: Notice of Revised Determination on Competitive conditions within the
Ericsson, Inc., Messaging Group, Reconsideration industry are adverse.
Woodbury, N.Y., 68 FR 8619–8621 (TA-
W–50,446) (Feb. 24, 2003); Computer By application of November 29, 2005 Conclusion
Sciences Corporation at Dupont a company official requested
Corporation, 67 FR 10767 (TA–W– administrative reconsideration of the After careful review of the facts
39,535) (March 8, 2002); e-Gain Department’s negative determination obtained in the investigation, I
Communications Corporation, Novato regarding eligibility for workers and determine that workers of Intermark
California, 68 FR 50195 (TA–W–51,001) former workers of the subject firm to Fabric Corp, Plainfield, Connecticut
(Aug. 20, 2003). apply for Trade Adjustment Assistance engaged in production of imitation
Workers in these cases were certified (TAA) and Alternative Trade suede and velvets qualify as adversely
based, in part, upon a finding that the Adjustment Assistance (ATAA). affected secondary workers under
subject facilities produced hardware or The initial investigation resulted in a section 222 of the Trade Act of 1974, as
software embodied in some tangible negative determination signed on amended. In accordance with the
format. Workers in the case at hand, November 2, 2005 was based on the provisions of the Act, I make the
however, do not directly support finding that imports of imitation suede following certification:
certifiable production workers eligible and velvets for upholstery, drapery and
apparel did not contribute importantly All workers of Intermark Fabric Corp,
for TAA benefits, and this distinction
to worker separations at the subject Plainfield, Connecticut, who became totally
explains the different results in cases
plant and no shift of production to a or partially separated from employment on or
involving workers engaged in similar
foreign source occurred. The denial after September 28, 2004, through two years
activity. While the case results may
notice was published in the Federal from the date of this certification, are eligible
differ, based on the particular facts of
to apply for adjustment assistance under
each case, the Department’s application Register on November 23, 2005 (70 FR
section 223 of the Trade Act of 1974, and are
of the statute has been consistent. 70882).
In the request for reconsideration, the eligible to apply for alternative trade
The Department has carefully
petitioner provided additional adjustment assistance under section 246 of
investigated the matter on remand and
the Trade Act of 1974.
has found no basis to support finding information regarding subject firm’s
that workers of IBM Corporation, Global customers and requested to investigate a Signed at Washington, DC, this 8th day of
Services Division, Piscataway and secondary impact on the subject firm as December, 2005.
Middletown, New Jersey are engaged in an upstream supplier in the textile Linda G. Poole,
the production of an article or support industry. A review of the new facts Certifying Officer, Division of Trade
for the production of an article. determined that the workers of the Adjustment Assistance.
Consequently, they are not eligible for subject firm may qualify eligible for [FR Doc. E5–7606 Filed 12–20–05; 8:45 am]
certification. TAA on the basis of a secondary
BILLING CODE 4510–30–P
upstream supplier impact.
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Conclusion Having conducted an investigation of


In the case of IBM Corporation, Global subject firm workers on the basis of
Services Division, Piscataway and secondary impact, it was revealed that
Middletown, New Jersey, it has been Intermark Fabric Corp, Plainfield,
clearly established that the workers of Connecticut supplied imitation suede

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