Vak-Pak, Inc.

Plain-English summary

Vak-Pak manufactured swimming-pool filtration equipment with eleven employees in Florida. The company denied that its business affected interstate commerce, a prerequisite for coverage under the OSH Act. The Secretary relied on uncertain testimony about possible California chemical suppliers, purchases from 3M, trucks, and other ordinary business activities. The Commission held that the evidence did not establish that Vak-Pak bought out-of-state goods, used goods made out of state, or otherwise affected interstate commerce. It vacated all citations without reaching the underlying exposure and respirator issues. Commissioner Cleary dissented because he considered the supplier testimony and 3M purchases sufficient to establish coverage.

Decision snapshot

• Cited standard(s): 29 U.S.C. § 652(5), 29 C.F.R. § 1910.134(a)(2), 29 C.F.R. § 1910.1000(b)(1), and 29 C.F.R. § 1910.1000(e)
• Outcome: All citations vacated for lack of proof that the employer's business affected interstate commerce.
• Key point: The Secretary must present concrete evidence connecting the employer's activities or purchases to interstate commerce; speculation about suppliers is insufficient.

Full text (OSHRC public release)

Docket No. 79-1569

SECRETARY OF LABOR,

Complainant,

v.

VAK-PAK, INC.,

Respondent.

OSHRC Docket No. 79-1569

DECISION

Before: ROWLAND, Chairman; CLEARY and BUCKLEY, Commissioners.

BY THE COMMISSION:

This case is before the Occupational Safety and Health Review Commission
under 29 U.S.C. � 661(i), section 12(j) of the Occupational Safety and Health Act of
1970, 29 U.S.C. �� 651-678 ("the Act").  The Commission is an
adjudicatory agency, independent of the Department of Labor and the Occupational Safety
and Health Administration.  It was established to resolve disputes arising out of
enforcement actions brought by the Secretary of Labor ("the Secretary") under
the Act and has no regulatory functions.  See section 10(c) of the Act, 29
U.S.C. � 659(c).

The decision of an administrative law judge of the Commission was directed
for review to consider whether the judge erred in concluding that Respondent, Vak-Pak,
Inc. ("Vak-Pak"), was a "business affecting commerce" under section
3(5) of the Act, 29 U.S.C. � 652(5).  For the reasons that follow, we conclude that
the Secretary failed to prove that Vak-Pak was a business affecting commerce and vacate
the citations issued in this case.[[1]]

Vak-Pak manufactures water filtration equipment for swimming pools at its
facility in Jacksonville, Florida.  It has eleven employees.  In its answer to
the Secretary's complaint, Vak-Pak denied that it was a business affecting commerce within
the meaning of the Act.  At the hearing, Vak-Pak's president testified that the
company was not covered by the Act because it did not "deal" in interstate
commerce.

The industrial hygienist ("IH") who conducted the inspection for
the Secretary obtained information with respect to interstate commerce at the opening
conference, which she wrote on an OSHA form.  However, the IH was unable to recall
the information at the hearing, and the form was not introduced into evidence.  When
asked whether she was told by the plant manager that the company ordered some chemicals
that were manufactured in California, the IH answered, "I think there was, yes."

Vak-Pak's president testified about the company's suppliers and its use of
certain materials and equipment.  He stated that the company used methyl ethyl ketone
peroxide, polyester resins, and acetone.  The president also said that Vak-Pak used
stationary and paper clips and that Vak-Pak executives made long distance telephone calls.
 Vak-Pak correctly notes that he did not testify that these calls were out of state.
  In response to questions by the Secretary's attorney, Vak-Pak's president testified
that its supplier, Dynamic Sales, was located in Florida and that he did not know where
that company got its supplies.  He also testified that he was aware of Rolochem
Corporation and that it might be located in California.  No connection between
Rolochem and Dynamic Sales was established on the record, although one may exist.[[2]]
 The president further stated that the filtration equipment manufactured by Vak-Pak
was shipped by trucks owned by Vak-PaK; the manufacturer of the trucks was not mentioned.

In addition, in response to a question unrelated to the commerce clause
issue, concerning monitoring for styrene, Vak-Pak's president stated that he had called
Morris Chemical Company, "the ones that supply me with my chemicals," to obtain
information on styrene vapors.  Morris Chemical, described as reluctant to give this
information, was not identified.  The president went on to say that:  "I
did get enough information to find that 3-M, which we had been buying en masse from has
facilities to test the equipment."

The judge, citing Godwin v. OSHRC , 540 F.2d 1013 (9th Cir. 1976),
concluded that "[t]he types of materials and equipment used by respondent at its
manufacturing facility clearly results in the business affecting commerce within the
meaning of the Act." Vak-Pak argues that the judge's finding was in error, since
there was no proof that it shipped any products out of state, purchased products from
outside Florida, or used products manufactured outside Florida.  The Secretary
contends that the judge's finding on the commerce issue is supported by the evidence.
  The Secretary relies upon Vak-Pak's use of various materials and chemicals in its
operations, its use of trucks to ship its finished product, and testimony by the IH and by
Vak-Pak's president which, in the Secretary's view, establishes that some chemicals used
by Vak-Pak more likely than not were manufactured outside Florida.  The Secretary
also argues that Vak-Pak is "in a class of employers, i.e .,
manufacturers," whose activities affect interstate commerce. Further, the Secretary
requests that the Commission take judicial notice that one of Vak-Pak's suppliers, 3-M, is
engaged in the production and distribution of goods for commerce.

We vacate the citation because the Secretary failed to establish that Vak-Pak
was "engaged in a business affecting commerce . . . . " See 29 U.S.C. �
652(5).[[3]]  To establish that an employer was engaged in a business affecting
interstate commerce, the Secretary must present evidence of activities which either
directly or indirectly have an effect on interstate commerce.  See Austin
Road Co. v. OSHRC , 683 F.2d 905 (5th Cir. 1982)("Austin Road"). 
In this case, the Secretary failed to present such evidence.

The Secretary attempted to demonstrate that Vak-Pak's purchases of certain goods affected
interstate commerce.  At a minimum, therefore, the Secretary must show that the goods
were purchased out of state or manufactured out of state.  See e.g ., Avalotis
Painting Co. , 81 OSAHRC 7/B1, 9 BNA OSHC 1226, 1227, 1981 CCH OSHD � 25,157, p.
31,056 (No. 76-4774, 1981).  Here, however, the Secretary did not establish that
Vak-Pak purchased goods from out of state or that it purchased goods from within the state
that were manufactured outside the state.

We do not find that testimony by the industrial hygienist or Vak-Pak's
president concerning the sources of Vak-Pak's supplies is sufficient to establish an
effect upon interstate commerce.  Although the IH stated that she was told that
Vak-Pak used chemicals manufactured in California, this testimony was qualified by the
words "I think."  The President's testimony indicates that Vak-Pak bought
supplies from a Florida distributor that may in turn have been supplied by Rolochem
Corporation and that Vak-Pak's president "thinks" that Rolochem is located in
California.  This testimony is not definite enough to establish that these purchases
affected interstate commerce.  We note that testimony of this sort is precisely the
type of evidence that the Fifth Circuit found insufficient in Austin Road , supra .
  In that case, testimony by the compliance officer that Austin used "a Bucyrus
Erie hydraulic boom crane which he believed was made in Bucyrus, Michigan" was
held to be inadequate to establish the Secretary's case.  683 F.2d at 907.

We also decline to find an effect upon commerce based upon judicial notice
that one of Vak-Pak's supplier's, "3-M," is Minnesota, Mining &
Manufacturing Company, which is incorporated in Minnesota.  This "fact"
does not satisfy the Secretary's burden.  On this record we do not know what it is
that Vak-Pak purchased from 3-M, where it was purchased or where it was manufactured. The
Secretary has simply not adduced sufficient evidence to determine whether Vak-Pak is
subject to the jurisdiction of the Act. See Austin Road , supra .

While Vak-Pak is a manufacturer of water filtration equipment for swimming pools, there
was no evidence that such business is interstate in nature or affects interstate
commerce.[[4]]  For a specialized industry such as manufacturing water filtration
equipment, we find it inappropriate to take judicial notice of an effect upon interstate
commerce.  See , e.g. , Austin Road , 683 F.2d at 908; Wirtz v.
Miss Hollywood, Inc ., 370 F.2d 326 (5th Cir. 1967)(court did not take judicial notice
of the interstate nature of Miami, Florida clothing business).  We also conclude that
the Commission's decision in Clarence M. Jones , supra (company engaged in
construction is in a class of activity engaged in interstate commerce), should not be
extended to reach operations such as Vak-Pak's. Further, we do not accept the Secretary's
invitation to declare that all employers engaged in manufacturing, regardless of the
nature of the business, affect commerce and hence are covered under the Act, since we have
been presented with no authority which shows that such a conclusion is appropriate.

Accordingly, the citations in this case are vacated.

FOR THE COMMISSION

RAY H. DARLING, JR.

EXECUTIVE SECRETARY

DATED:  JUL 20 1984

CLEARY, Commissioner, dissenting:

I disagree with the majority's finding that the evidence in this case
"does not establish that VAK-PAK purchased goods from out of state or that it
purchased goods from within the state that were manufactured outside the state."
  I therefore disagree with the conclusion that VAK-PAK was not shown to be
"engaged in a business affecting commerce . . . . " 29 U.S.C. � 652(5).
Accordingly, I dissent.

Case law holds that commerce coverage is established if a business purchases
products and supplies that have been manufactured out-of-state.  Avalotis Painting
Co ., 81 OSAHRC 7/B1, 9 BNA OSHC 1226, 1227, 1981 CCH OSHD � 25,157, p. 31,056 (No.
76-4774, 1981).  The record in this case amply demonstrates that VAK-PAK made
purchases of supplies and materials from out-of-state sources.  The industrial
hygienist who conducted the inspection testified that she was told at the pre-hearing
conference by a VAK-PAK representative that the company purchased chemical supplies from a
California-based company named Rolochem. This testimony was directly corroborated by
VAK-PAK's president at the hearing.  The president also stated that VAK-PAK had made
purchases "en masse" from the 3M Company.

The majority, however, disagrees that this evidence establishes that VAK-PAK
uses products that have moved in Interstate commerce.  The majority finds that the
testimony concerning VAK-PAK purchases from Rolochem "is not definite enough . . .
." The majority reasons that this testimony is of the sort found insufficient to
establish commerce coverage in Austin Road Co. v . OSHRC , 638 F.2d 905 (5th
Cir. 1982).  However, that case involved the sufficiency of an administrative law
judge's findings, and not, as here, the sufficiency of the factual record itself.  
The Austin Road court itself recognized this important distinction:  
"[T]he accepted factual findings provide the basis for review:  we need not
glean the evidence, but look only to the administrative findings of fact."   683
F.2d at 90 (footnote omitted).  Because the administrative law judge found that the
compliance officer inspecting Austin Road's job site testified "inconclusively"
about the Bucyrus Erie crane, it is hardly surprising that the Fifth Circuit chose not to
disturb that finding on review.  The majority's reliance on Austin Road is
therefore somewhat misplaced.  In my view the testimony establishes by a
preponderance of the evidence that VAK-PAK purchased chemical supplies from a California
company. The fact that the witnesses used the terms "I think" or "I
believe" does not sufficiently weaken their testimony.  It remains that two
witnesses corroborated the fact that one of VAK-PAK's suppliers is based in
California.  Such evidence establishes commerce coverage under the Act.  See
Avalotis Painting , supra .

I would also take official notice that the 3M Company, one of VAK-PAK's
suppliers, is engaged in interstate commerce.  It is no answer to say, as the
majority does, that "[w]e do not know what it is that VAK-PAK purchased from 3M,
where it was purchased or where it was manufactured."  The question is whether
it is subject to reasonable dispute that VAK-PAK's president was referring to the
Minnesota Mining & Manufacturing Company.  See Fed.R.Evid. 201(b).  
In my view it is not, and I note in this regard that the Supreme Court itself has recently
seen fit to refer to this corporation solely as "the 3M Company."  See
United States v. Knotts , 103 S.Ct. 1081, 1083 (1983).  I also note that the
Ninth Circuit has taken judicial notice of the fact that Weyerhauser and Sears Roebuck are
engaged in the production and distribution of goods for commerce, based on testimony that
a company used materials and tools manufactured by Weyerhauser and Craftsman (Sears
Roebuck).  Usery v. Franklin R. Lacy , 628 F.2d 1226, 1229 n.3 (9th Cir.
1980).  Accordingly, I would take official notice that the 3M Company is engaged in
the production and distribution of goods for commerce and is a supplier of VAK-PAK. 
On this basis, I also find that VAK-PAK's activities affected interstate commerce.

The Administrative Law Judge decision in this matter is unavailable in this
format.  To obtain a copy of this document, please request one from our Public
Information Office by e-mail ( [email protected]
) telephone (202-606-5398), fax (202-606-5050), or TTY (202-606-5386).

FOOTNOTES:

[[1]] This case was also directed for review to consider whether alleged
violations of 29 C.F.R. �� 1910.1000(b)(1), 1910.1000(e) and 1910.134(a)(2) should be
vacated on the ground that the Secretary's sample analyses were erroneously admitted into
evidence and accorded probative weight.  Because vacate the citations on the commerce
issue, we do not reach the issue regarding the admissibility and sufficiency of the
evidence.

[[2]] Vak-Pak's president's testimony on this point is ambiguous, at best:

Q.  They [Rolochem] are not located anywhere in Florida, are they?

A.  Yes, sir.

Q.  They have a supplier in Florida, is that what it is?

A.  The people we buy that from is Dynamic Sales in Orlando, Florida.

Q.  But, they have to get it from the folks in Anaheim, is it, or

is it Santa Ana?

A.  I don't know where they get it from.

[[3]] Congress declared as its purpose and policy in passing the Act that the
Secretary of Labor be authorized "to set mandatory occupational safety and health
standards applicable to businesses affecting interstate commerce . . . . 29 U.S.C.
� 651(b)(3) (emphasis added).  See also 29 U.S.C. � 652(5) (Congress
defined "employer" as a "person engaged in a business affecting
commerce").  Congress intended, therefore, to have the Act cover only those
businesses which affect interstate commerce, not all businesses that have employees who
may be subject to injury.

[[4]] This case is different from Godwin v. OSHRC , supra , the
case relied upon by the judge.  In that case there was evidence that the cited
activity, the clearing of land for the purpose of growing grapes, was an integral part of
the interstate business of wine manufacturing.  There was no similar evidence
produced in this case.