DEPARTMENT OF LABOR

Employment and Training Administration

TA-W-61,696

MEDTRONIC, INC.
CARDIOVASCULAR DIVISION
SANTA ROSA, CALIFORNIA


Notice of Revised Determination
On Remand

On February 27, 2008, the United States Court of
International Trade (USCIT) granted the Department of Labor’s
motion for voluntary remand for further investigation in Former
Employees of Medtronic, Inc. v. United States, Court No. 07-362.
The worker-filed petition for Trade Adjustment Assistance
(TAA) and Alternative Trade Adjustment Assistance (ATAA), dated
June 14, 2007, alleged that the subject workers produced “medical
stents” and that the subject firm shifted production to a foreign
country. Petitioners did not identify the foreign country to
which production shifted.
On July 19, 2007, the Department of Labor (Department)
issued a negative determination regarding eligibility to apply
for TAA/ATAA for workers and former workers of Medtronic, Inc.,
Cardiovascular Division, Santa Rosa, California (the subject
firm). The initial investigation revealed that the subject
workers produced cardiovascular stents and that, during the
relevant period, the subject firm did not import cardiovascular
stents and did not shift production to a foreign firm. A survey
of the subject firm’s major declining domestic customers was not
conducted because the subject firm sold its stents to an
affiliated, foreign facility. The Department’s Notice of
negative determination was published in the Federal Register on
August 2, 2007 (72 FR 42436).
In the request for reconsideration, dated August 7, 2007,
the petitioning workers alleged that production “was indeed
shifted to a foreign country, Ireland, based on the information
we received from” the subject firm. The Department issued a
Notice of Affirmative Determination Regarding Application for
Reconsideration on August 16, 2007. The Notice was published in
the Federal Register on August 27, 2007 (72 FR 49026).
On September 11, 2007, the Department issued a negative
determination on reconsideration stating that Section (a)(2)(B)
of the Trade Act of 1974, as amended, was not met. The negative
determination was based on the Department’s findings that, while
the subject firm did shift cardiovascular stent production to
Ireland, as alleged, Ireland does not have a free trade agreement
with the United States and is not named as a beneficiary country
under the Andean Trade Preference Act, the African Growth and
Opportunity Act or the Caribbean Basin Economic Recovery Act, and
that, following the shift of production, the subject firm did not
import or plan to import articles like or directly competitive
with those produced at the subject firm. The Department’s Notice
of negative determination on reconsideration was published in the
Federal Register on September 21, 2007 (72 FR 54074).
In their complaint to the USCIT, dated October 3, 2007, the
Plaintiffs made the same allegation they made in the request for
reconsideration – that production shifted to Ireland -- and two
new allegations – that production shifted to Mexico and that the
subject firm shifted production to a foreign country and will
import stents like or directly competitive with those produced at
the subject firm (“Medtronic’s is awaiting FDA approval of their
Drug Eluding Stents (DES) . . . the DES will be made available to
the medical markets in the United States”).
In order to be certified under Section (a)(2)(B) of the
Trade Act of 1974, as amended, the Department must determine that
the following was satisfied:
A. a significant number or proportion of the workers in such
workers' firm, or an appropriate subdivision of the
firm, have become totally or partially separated, or are
threatened to become totally or partially separated; and

B. there has been a shift in production by such workers’ firm
or subdivision to a foreign country of articles like or
directly competitive with articles which are produced by
such firm or subdivision; and

C. One of the following must be satisfied:
1. the country to which the workers’ firm has shifted
production of the articles is a party to a free trade
agreement with the United States; or

2. the country to which the workers’ firm has shifted
production of the articles is a beneficiary country
under the Andean Trade Preference Act, African Growth
and Opportunity Act, or the Caribbean Basin Economic
Recovery Act; or

3. there has been or is likely to be an increase in
imports of articles that are like or directly
competitive with articles which are or were produced
by such firm or subdivision.

During the remand investigation, the Department confirmed
that cardiovascular stent production shifted from the Medtronic
facility in Santa Rosa, California, to Galway, Ireland, and did
not shift to Mexico. Accordingly, the Department determines that
Section (a)(2)(B)(A) and Section (a)(2)(B)(B) have been met, and
that Section (a)(2)(B)(C)(1) and Section (a)(2)(B)(C)(2) have not
been met. Consequently, in order to be certified as eligible to
apply for TAA, the Department must determine that the petitioning
worker group satisfies Section (a)(2)(B)(C)(3).
The Department obtained new information during the remand
investigation that, after the Department issued its negative
determination on reconsideration was issued, the U.S. Food and
Drug Administration (FDA) approved Medtronic’s application for
approval of a drug eluding cardiovascular stent to be used in the
United States.
On February 1, 2008, Medtronic issued a news release stating
that the FDA-approved DES, Endeavor, “provides a consistent and
sustained reduction in the need for repeat procedures compared to
a bare-metal stent” and that “The U.S. market launch of the
Endeavor stent begins immediately.” The news release further
states that, prior to FDA approval of the DES, Medtronic has been
“strengthening our field and manufacturing capabilities in
anticipation of considerable demand for the Endeavor stent in the
United States” and that Medtronic plans to “ship 100,000 units to
U.S. hospitals in the next 30 days to assure full availability of
this next-generation technology.”
During the remand investigation, the Department conducted an
industry research of cardiovascular stents. The Department’s
research revealed that bare-metal stents function similarly to
drug-eluding stents in that both devices are tiny mesh tubes used
to keep open arteries to increase or restore blood flow to the
heart muscle. The two devices differ in that the DES delivers
medication that reduces the probability that blockages will
reform in the artery, while the bare-metal stent is a static,
structural device. Accordingly, the Department determines that
drug eluding cardiovascular stents are like and directly
competitive with bare-metal cardiovascular stents.
As the result of the remand investigation, the Department
determined that there was a shift in production by the subject
firm to a foreign country of articles like or directly
competitive with the cardiovascular stents produced by the
subject firm and that, following the shift of production to a
foreign country, there is an increase in imports (actual or
likely) by Medtronic, Inc. of articles that are like or directly
competitive with the article produced at the subject firm.
In accordance with Section 246 the Trade Act of 1974 (26 USC
2813), as amended, the Department herein presents the results of
its investigation regarding certification of eligibility to apply
for ATAA. The Department has determined in this case that the
group eligibility requirements of Section 246 have been met.
A significant number of workers at the firm are age 50 or
over and possess skills that are not easily transferable.
Competitive conditions within the industry are adverse.
Conclusion
After careful review of the facts generated through the
remand investigation, I determine that there was a total or
partial separation of a significant number or proportion of
workers at the subject firm, and that there was a shift in
production to a foreign country followed by likely increased
imports of articles like or directly competitive with
cardiovascular stents produced at the subject firm.
In accordance with the provisions of the Act, I make the
following certification:
"All workers of Medtronic, Inc., Cardiovascular Division,
Santa Rosa, California, who became totally or partially
separated from employment on or after June 14, 2006, through
two years from the issuance of this revised determination,
are eligible to apply for Trade Adjustment Assistance under
Section 223 of the Trade Act of 1974, and are eligible to
apply for alternative trade adjustment assistance under
Section 246 of the Trade Act of 1974."

Signed at Washington, D.C. this 25th day of March 2008.


/s/ Elliott S. Kushner
_______________________________
ELLIOTT S. KUSHNER
Certifying Officer, Division of
Trade Adjustment Assistance

4510-FN-P


DEPARTMENT OF LABOR

Employment and Training Administration

TA-W-61,696

MEDTRONIC, INC.
CARDIOVASCULAR DIVISION
SANTA ROSA, CALIFORNIA

Negative Determinations Regarding Eligibility
To Apply for Worker Adjustment Assistance
And Alternative Trade Adjustment Assistance

In accordance with Section 223 of the Trade Act of 1974, as
amended (19 USC 2273), the Department of Labor herein presents the
results of an investigation regarding certification of eligibility
to apply for worker adjustment assistance. The group eligibility
requirements for directly-impacted (primary) workers under Section
222(a) the Trade Act of 1974, as amended, can be satisfied in
either of two ways:
I. Section (a)(2)(A) all of the following must be satisfied:
A. a significant number or proportion of the workers in such workers' firm, or an
appropriate subdivision of the firm, have become totally or partially separated, or are
threatened to become totally or partially separated;
B. the Salas or production, or both, of such firm or subdivision have decreased absolutely;
and
C. increased imports of articles like or directly competitive
with articles produced by such firm or subdivision have
contributed importantly to such workers’ separation or
threat of separation and to the decline in Salas or
production of such firm or subdivision; or



II. Section (a)(2)(B) both of the following must be satisfied:

B. a significant number or proportion of the workers in such
workers' firm, or an appropriate subdivision of the firm,
have become totally or partially separated, or are
threatened to become totally or partially separated;
B. there has been a shift in production by such workers’ firm
or subdivision to a foreign country of articles like or
directly competitive with articles which are produced by
such firm or subdivision; and

C. One of the following must be satisfied:
3. the country to which the workers’ firm has shifted
production of the articles is a party to a free trade
agreement with the United States;
4. the country to which the workers’ firm has shifted
production of the articles is a beneficiary country
under the Andean Trade Preference Act, African Growth
and Opportunity Act, or the Caribbean Basin Economic
Recovery Act; or
5. there has been or is likely to be an increase in imports of articles that are like or
directly competitive with articles which are or were produced by such firm or
subdivision.

The investigation was initiated on June 15, 2007, in response
to a petition filed by workers of Medtronic, Inc., Cardiovascular
Division, Santa Rosa, California. Workers at the subject firm
manufacture cardiovascular stents. Workers are not separately
identifiable by product.
The investigation revealed that criteria (a)(2)(A)(I.C) and
(a)(2)(B)(II.B) have not been met.
The subject firm did not import cardiovascular stents in 2005,
2006, or the period of January through May 2007.
Furthermore, the subject firm did not shift the production of
cardiovascular stents to a foreign firm in 2005, 2006, or the
period of January through May 2007.
The investigation revealed that the subject firm sold all
cardiovascular stents to a foreign source. Since the firm sold all
production produced at the Santa Rosa facility to a foreign firm, a
customer survey was not conducted.
A petitioner was contacted regarding the allegations of a
“shift in production” to a foreign country. However, in cross
referencing these allegations with a company official, it was
confirmed that production was not shifted to a foreign source, but
sold to a foreign source.
In addition, in accordance with Section 246 the Trade Act of
1974 (26 USC 2813), as amended, the Department of Labor herein
presents the results of its investigation regarding certification
of eligibility to apply for alternative trade adjustment assistance
(ATAA) for older workers.
In order for the Department to issue a certification of
eligibility to apply for ATAA, the worker group must be certified
eligible to apply for trade adjustment assistance (TAA). Since the
workers are denied eligibility to apply for TAA, the workers cannot
be certified eligible for ATAA.






Conclusion
After careful review of the facts obtained in the
investigation, I determine that all workers of Medtronic, Inc.,
Cardiovascular Division, Santa Rosa, California are denied
eligibility to apply for adjustment assistance under Section 223 of
the Trade Act of 1974, and are also denied eligibility to apply for
alternative trade adjustment assistance under Section 246 of the
Trade Act of 1974.
Signed in Washington, D.C. this 19th day of July 2007


/s/Elliott S. Kushner
______________________________
ELLIOTT S. KUSHNER
Certifying Officer, Division of
Trade Adjustment Assistance









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