Dealers and Repair Shops

The interconnected economy and the broken leg

This industry sells what other plants build, titles what other offices register, finances what other lenders approve, and serves customers whom other orders confined. An order on any of those is an order limiting commerce, travel or group meetings, and an operation of this industry delayed, interrupted or terminated because of it is suspended due to it. The orders of 2020 and the first half of 2021 compelled this industry to dismantle its operation; the orders' own reopening steps show that the restoration ran into and through the third quarter of 2021; and the clause's grammar, Tri-State's definition and the Notice's own words make the continuing suspension a suspension "during the calendar quarter."

The mechanisms

Six mechanisms carried orders addressed to others into this industry's operation. Supply chain and borders: Michigan's, Pennsylvania's, Ontario's and Mexico's plant closures, the land-border notifications, the entry proclamations, the Title 42 order and the rail and port orders closed or conditioned the supply of every vehicle and part the industry sells, in the circumstances that the semiconductor orders of Asia, recorded as facts, created.²⁰² Workforce, schools and child care: the school closures of the spring of 2020, the Families First leave mandate through December 31, 2020, the State paid-leave statutes and the quarantine and isolation orders removed the industry's technicians and salespeople from its premises by law.²⁰³ Travel, tourism and gatherings: the traveler quarantines of Hawaii, New York and Chicago, the gathering limits of every State and the venue closures cancelled the auto, boat and RV shows and confined the tourist, rental and fleet customers of the resort and border markets.²⁰⁴ Courts and public offices: the motor-vehicle agencies, clerks, recorders and courts converted or closed the venues in which every sale is completed and every title dispute, replevin and repossession is heard.²⁰⁵ Transit: the CDC conveyance order, the TSA directives and the transit agencies' rules conditioned every commute from February 1, 2021.²⁰⁶ Health care as counterparty: the OSHA Healthcare ETS and the health-care-worker vaccination orders of California, New York, New Jersey, Los Angeles County, Philadelphia and Denver from June, July and August 2021 conditioned the hospitals, clinics and ambulance services whose fleets the industry sells and services.²⁰⁷

Counterparty orders as orders

The statute's object is "commerce, travel, or group meetings," not the employer's premises. The Notice's Q&A-12 applies the clause exactly so, making an employer eligible "because its operations have been suspended due to the governmental order that suspended operations of its supplier," and its own example is "Employer A," which "operates an auto parts manufacturing business" and whose supplier "is required to fully suspend its operations due to a governmental order"; the United States told the Ninth Circuit that "a business may be suspended 'due to' a government order addressing a third party."²⁰⁸ The supplier of a dealership is the assembly plant that Michigan closed by order; the supplier of its parts counter is the distribution center and the port; the supplier of its title work is the Secretary of State whose branches Michigan closed the same day; the supplier of its finance desk is the notary whose in-person act every State suspended. Each was closed or conditioned by order, and the operations that depended on it were suspended in part because of the order in the only sense the statute uses. The Treasury and Customs and Border Protection said as much of this industry's importers in April 2020, conditioning duty deferral on operations "fully or partially suspended ... due to orders from a competent governmental authority limiting commerce, travel, or group meetings," which is the Suspension Clause's vocabulary applied by the Executive Branch to the same period.²⁰⁹

The textual point

The clause reads "is fully or partially suspended during the calendar quarter due to orders." The phrase "during the calendar quarter" modifies "suspended"; it asks whether the suspension existed at any time in the quarter, not whether an order was issued in or addressed to the quarter. Congress did not write "orders in effect during the calendar quarter."²¹⁰ Tri-State holds that a suspension includes a "delay" and that causation is but-for.²¹¹ The Notice recognizes both propositions: Q&A-22 makes an employer whose suspension ends in the middle of a quarter eligible for the whole quarter, and Q&A-16 treats the time an employer needs to move between modes of operation as part of the suspension where the delay exceeds two weeks.²¹² A showroom ordered closed on March 19, 2020, permitted to sell online on April 20, to admit customers by appointment on May 8, and to operate under mitigation orders until May 31, 2021 was delayed by those orders on every day between, and the delay did not end on the day the last order expired.

The restoration arithmetic for this industry

What the orders compelled this industry to dismantle is recorded in the orders themselves. Showrooms: Pennsylvania closed the showroom March 19, 2020 (Ex. PA-004), permitted online sales April 20 (Ex. PA-053), appointments in yellow-phase counties May 8 (Ex. PA-010), green-phase operation May 29 (Ex. PA-011), targeted mitigation from July 16 (Ex. PA-016), remote operation "[u]nless impossible" from November 27 (Ex. PA-022), limited-time mitigation December 12 to January 4 (Ex. PA-028), the telework mandate to April 4, 2021 (Ex. PA-033) and the mitigation order to May 31, 2021; Michigan closed the showroom to in-person traffic March 24, 2020 (Ex. MI-011; Ex. MI-017), admitted customers by appointment May 26 (Ex. MI-030), generally June 1 (Ex. MI-031), bound every workplace to safeguards from May 18 (Ex. MI-027), to MIOSHA's rules from October 14, 2020 (Ex. MI-054) and to the Department of Health and Human Services' orders until June 22, 2021 (Ex. MI-076); Kentucky closed the showroom March 23, 2020 (Ex. KY-008), reopened dealerships on May 11, 2020 under the Healthy at Work requirements (Ex. KY-017) and, from June 11, 2020, under Version 2.0 of the Requirements for Vehicle and Boat Dealerships, which provided that "In no case should a showroom exceed 25% of its designated maximum occupancy" and required unaccompanied test drives and curbside delivery (Ex. SEC-08-010), until Executive Order 2021-386 rescinded the regime on June 11, 2021 (Ex. KY-049 ¶ 1), twelve months under the cap and thirteen under the regime, beside the general Healthy at Work capacity steps of 50 percent from December 14, 2020 (Ex. KY-033) and 60 percent from April 19, 2021 (Ex. KY-018); Nevada closed the showroom from 11:59 p.m. March 20, 2020 (Ex. NV-004; Ex. NV-064), admitted customers at fifty percent of fire-code capacity from May 9 (Ex. NV-016), cut to twenty-five percent from November 24 (Ex. NV-030), ended distancing April 30 and capacity June 1, 2021 (Ex. NV-038; Ex. NV-074) and placed every showroom in Clark and Washoe Counties under universal indoor face coverings, an occupational-health and airborne-transmission control enforced by Nevada OSHA, from July 30, 2021 (Ex. NV-041); New York confined sales to remote transactions from March 22 and April 17, 2020 (Ex. NY-002; Ex. NY-092), reopened by region from May 29 and in New York City from June 22 (Ex. NY-117), held the cluster zones and caps to May 19, 2021 (Ex. NY-008; Ex. NY-054) and the orders to June 25 (Ex. NY-049); Colorado ordered residents home and closed non-essential in-person retail from 6:00 a.m. March 26, 2020 (Ex. CO-012; Ex. CO-013), confined dealers from April 2 to "automobile online sales with no touch delivery service" (Ex. CO-016), permitted curbside April 27 and fifty percent May 1 (Ex. CO-020), moved to Level Red November 20 (Ex. CO-037) and lifted its caps April 16, 2021 (Ex. CO-051); Los Angeles County closed sales March 21, 2020 (Ex. MET-LA-003; revised Apr. 10, Ex. MET-LA-004), reopened under the State's Stage 2 from May 8 (Ex. CA-015), cut "Automobile Dealerships, Auto Repair" to twenty percent December 30 (Ex. MET-LA-012), listed "automobile dealerships" at fifty percent March 15, 2021 (Ex. MET-LA-071) and placed every showroom under universal indoor face coverings, an exposure-control requirement on every indoor public setting, again July 17, 2021 (Ex. MET-LA-018); Honolulu closed sales March 25, 2020 (Ex. HI-004), permitted online sales April 3 (Ex. MET-HNL-006), appointments April 30 (Ex. MET-HNL-009), tiers from September 24 (Ex. MET-HNL-021) and Exhibit B's conditions on September 22, 2021 (Ex. MET-HNL-038).²¹³ Title offices: the Illinois Secretary of State closed for eleven weeks from March 17, 2020 and for seven more from November 17 (Ex. IL-055; Ex. IL-056; Ex. IL-058); the New Jersey Commission for sixteen weeks (Ex. NJ-107; Ex. AGY-ST-DMV-SOS-RECORDERS-027); California's 169 offices for eleven weeks (Ex. AGY-ST-DMV-SOS-RECORDERS-018; Ex. AGY-ST-DMV-SOS-RECORDERS-015); the District's Department by appointment for thirteen months to July 19-20, 2021 (Ex. DC-082); Texas suspended the requirements themselves for thirteen months to April 14, 2021 (Ex. TX-069); every title those closures deferred was completed later, in the appointment slots the reopening orders allotted.²¹⁴ Inventory: the plants closed by Michigan's order from March 24 to May 11, 2020 (Ex. MI-011; Ex. MI-026), by Pennsylvania's from March 19 (Ex. PA-004) and by Mexico's from March 30 through May 30, 2020 (Ex. FOR-007; Ex. FOR-008) built nothing for seven to nine weeks; the reopening orders fixed the conditions of the restart; the semiconductor plants of Asia closed and reopened under their governments' orders through 2021 (Ex. FOR-035; Ex. FOR-036); the President ordered the shortage reviewed on February 24, 2021 (Ex. SEC-08-021), the Commerce Department put it in the Federal Register on March 15 and September 24, 2021 (Ex. ECO-A-073; Ex. SEC-08-020), and the Federal Reserve wrote on July 9, 2021 that "Companies laid off workers, idled plants, and canceled orders for materials ... by late 2020, factories in some industries were scrambling to find the workers, parts, and materials," and on September 8, 2021 that "Dealers perceive no end in sight" and that new cars "are largely already spoken for" (Ex. LAW-221; Ex. SEC-08-022).²¹⁵ Employment: the industry employed 2,049,200 in February 2020, 1,667,600 in April 2020 and 1,969,200 in September 2021, eighty thousand fewer than before the orders after eighteen months (Ex. SEC-08-034).²¹⁶ An employer whose operation was ordered suspended through June 30 was not walking normally on July 1, and the orders' own step dates fix the arithmetic.

What was still in force when the general restrictions ended

When the last capacity orders lifted between June 15 and July 1, 2021, the following remained in force and are relied on as the orders they are: the federal workplace and contractor orders; the CDC conveyance order and TSA directives; the entry proclamations, land-border notifications, Title 42 order and inbound-testing order; the rail and port orders; Hawaii's and Honolulu's proclamations and emergency orders; the Cal/OSHA, Virginia, Oregon and Washington workplace standards and, from August 5 and September 6, 2021, the New York exposure prevention plans and their activation; the emergency declarations of thirty-five States on July 2 and twenty-five on September 21, 2021; the exposure-control (universal indoor face-covering), quarantine and vaccination orders of ten States and a dozen metros from July 17, 2021 onward; the motor-vehicle, notarial and court instruments of the States; and the school face-covering orders of the autumn, airborne-transmission controls on the workforce's children's schools.²¹⁷ The third-quarter inventory states them with dates. The semiconductor interruption the Commerce Department put in the Federal Register on September 24, 2021 and the Federal Reserve recorded on July 14 and September 8, 2021 is the circumstance in which those orders operated; the plant, border, port and rail orders among them are the orders that reached the inventory. They are not the residue of a suspension; they are orders limiting commerce, travel and group meetings in force during the calendar quarter.