219 F.3d 1348 (Fed. Cir. 2000), 99-1379, Nippon Steel Corp. v United States

Docket Nº:99-1379, -1386
Citation:219 F.3d 1348
Party Name:NIPPON STEEL CORPORATION, NKK CORPORATION, KAWASAKI STEEL CORPORATION and SUMITOMO METAL INDUSTRIES, LTD., Plaintiffs-Appellees, v. UNITED STATES, and USS-POSCO INDUSTRIES, Defendants-Appellants
Case Date:July 26, 2000
Court:United States Courts of Appeals, Court of Appeals for the Federal Circuit
 
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Page 1348

219 F.3d 1348 (Fed. Cir. 2000)

NIPPON STEEL CORPORATION, NKK CORPORATION, KAWASAKI STEEL CORPORATION and SUMITOMO METAL INDUSTRIES, LTD., Plaintiffs-Appellees,

v.

UNITED STATES, and USS-POSCO INDUSTRIES, Defendants-Appellants

99-1379, -1386

United States Court of Appeals, Federal Circuit

July 26, 2000

Appealed from: United States Court of International Trade Judge Delissa A. Ridgway

Page 1349

Theodore B. Olson, Gibson, Dunn & Crutcher, LLP, of Washington, DC, argued for plaintiffs-appellees. With him on the brief were Daniel J. Plaine, Douglas R. Cox,Miguel A. Estrada, John H. Sturc, and Lisa A. Murray. Of counsel on the brief wereMatthew J. Clark, Howrey & Simon, of Washington, DC; Daniel L. Porter; and James P. Durling, Willkie, Farr & Gallagher, of Washington, DC; and Leonard M. Shambon, Wilmer, Cutler & Pickering, of Washington, DC.

Roger M. Golden, Fenwick & West, LLP, of Washington, DC, argued for defendant-appellant USS-POSCO Industries. With him on the brief were Phyllis E. Andes, and Patrick C. O'Brien.

Velta A. Melnbrencis, Assistant Director, Commercial Litigation Branch, Civil Division, Department of Justice, of Washington, DC, argued for defendant-appellant United States. On the brief were David W. Ogden, Acting Assistant Attorney General;David M. Cohen, Director; and Katherine A. Barski, Attorney. Of counsel on the brief were Stephen J. Powell, Chief Counsel; Elizabeth C. Seastrum, Senior Counsel;Thomas H. Fine, Senior Attorney; and Melanie A. Frank, Attorney, Office of the Chief Counsel for Import Administration, U.S. Department of Commerce, of Washington, DC.

Before LOURIE, Circuit Judge, FRIEDMAN, Senior Circuit Judge, and LINN, Circuit Judge.

FRIEDMAN, Senior Circuit Judge.

This government appeal challenges a preliminary injunction of the Court of International Trade prohibiting the Department of Commerce from continuing its administrative proceeding under 19 U.S.C. § 1677j(c) and 19 C.F.R. § 351.225(i) (1998) to determine whether certain imported steel had been "altered in form . . . in minor respects" and therefore still was covered by an antidumping duty order, even though the altered products were not within the literal scope of the order. The Court of International Trade held that the altered products were "expressly and unambiguously" excluded from that order, and that Commerce's inquiry to determine whether the order covers the products "is ultra vires." We hold that Commerce's inquiry was permissible, and therefore reverse the preliminary injunction and remand to the Court of International Trade with instructions to dismiss the complaint.

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I

A. In response to a petition filed by American steel companies seeking antidumping duties on carbon steel products from Japan and after an investigation, Commerce found that such steel products from Japan were being "dumped" in the United States, i.e., sold at less than fair value. See 58 Fed. Reg. 37154 (1993).

Commerce subsequently issued an order imposing antidumping duties. Antidumping Duty Orders: Certain Corrosion-Resistant Carbon Steel Flat Products From Japan, 58 Fed. Reg. 44163 (1993) ("antidumping duty order"). It described various products the order covered, and excluded other "flat rolled steel products" and products of specified dimensions. See id.

Although the antidumping duty order did not define "carbon steel," that term was defined in the petition that led to the investigation, the questionnaires Commerce sent to Japanese steel producers and Commerce's preliminary and final investigation results. The parties agree that that is the proper definition, and we have no reason to disagree.

Those documents adopted the definition of "carbon steel" in the Harmonized Tariff Schedule of the United States ("HTSUS"). The petition, for example, states:

The term "carbon steel" as used in this Petition, is equivalent to the HTS term "non-alloy" steel, which is defined as other than:

1) "stainless steel" . . . ; or

2) "other alloy steel": steel other than stainless and containing by weight one or more of the following elements in the following proportions:

This is followed by a list of specified percentages by weight of fifteen listed elements and one general category covering "other elements." In other words, steel that contains more than the stated percentage of any one of the listed elements is "other alloy steel," and therefore not "carbon steel."

One of the fifteen elements thus listed, which is the only one involved in this case, was 0.0008 percent or more of boron.

B. Approximately five years after the antidumping duty order was issued, an American steel company filed with Commerce a petition to initiate an inquiry "to determine whether imports of boron-added Japanese hot-dipped and electrolytic corrosion-resistant steel sheet, falling within the physical dimensions outlined in the scope of the order, are circumventing the antidumping duty order on corrosion-resistant carbon steel sheet from Japan." The petition stated: "Japanese exporters have been circumventing the order by exporting hot-dipped and electrolytically zinc coated sheet by adding small amounts of boron - [stated percentages exceeding 0.0008] by weight based on laboratory tests of two samples." It further stated that the "cost of adding small amounts of boron is infinitesimal, and the resulting product with boron is virtually identical to the original product without boron," and that "consumers . . . do not rely on or benefit from the presence of boron and thus do not expect, seek, or desire its presence." The petition also stated that the appellees Nippon Steel Company and three other Japanese companies (collectively Nippon Steel) either have produced and exported the challenged imports or were capable of doing so.

In response to the petition, Commerce initiated "an anticircumvention inquiry to determine whether imports of boron-added hot-dipped and electrolytic corrosion-resistant carbon steel sheet, falling within the physical dimensions outlined in the scope of the order, are circumventing the antidumping duty order on corrosion-resistant carbon steel flat products from Japan." 63 Fed. Reg. 58364 (1998). The notice initiating the inquiry described the appellees as "interested parties," who have "submitted comments." See id. at 58366.

Nippon Steel then filed the present case in the Court of International Trade to

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enjoin Commerce from conducting the anticircumvention inquiry. It sought a temporary restraining order (which the court issued), and preliminary and permanent injunctions. After a hearing, the court entered a preliminary injunction.

In its findings and conclusions, the court first held that it had jurisdiction under 28 U.S.C. § 1581(i), which gives that court jurisdiction where "meaningful relief would not be available were one to await the conclusion of administrative proceedings." Nippon Steel Corp. v. United States, No 98-10-03102, slip op. at 5 (Ct. Int'l Trade Mar. 9, 1999). The court then applied the traditional four-part test governing preliminary injunctions, and concluded: 1) that Nippon demonstrated "a high likelihood of success on the merits" because the products in question were "expressly and unambiguously" excluded from the duty order; 2) that Nippon will suffer irreparable harm if "forced to defend themselves in an ultra vires administrative proceeding" which was "initiated without legal authority"; 3) that the balance of hardships favored granting the preliminary injunction because Commerce would "suffer no harm if an administrative proceeding initiated without authority of law is enjoined"; and 4) that "the public interest [would be] served by enjoining an administrative proceeding initiated without authority of law." Id., slip op. at 5-7.

II

The Court of International Trade ruled that it "has jurisdiction over Plaintiffs' request for a preliminary injunction pursuant to 28 U.S.C. § 1581(i)." Id. at 5. Section 1581(i) is a catch-all jurisdictional provision which authorizes the court to "conduct review under the general authority of the Administrative Procedure Act, 5 U.S.C. §§ 701-706, but only when review would never be available under one of the other subsections of 28 U.S.C. § 1581, or when the remedy afforded by the other subsections would be 'manifestly inadequate.'" Shakeproof Indus. Prods. Div. of Ill. Tool Works Inc. v. United States, 104 F.3d 1309, 1312 (Fed. Cir. 1997).

The court quoted the following statement from Hylsa, S.A. v. United States, 960 F.Supp. 320, 324 (Ct. Int'l Trade 1997), aff'd, No. 97-1270, 1998 U.S. App. LEXIS 1896 (Fed. Cir. Feb. 12, 1998): "28 U.S.C. § 1581(i) is a Congressional fail-safe device. If the circumstances of a case are sufficiently unusual so that one may presume that Congress could not have provided for such a case under the general language of 19 U.S.C. § 1516a, and meaningful relief would not be available were one to await the conclusion of administrative proceedings, 28 U.S.C. § 1581(i) is available to afford a means of vindication of statutory rights." Id. It then stated: "Here Plaintiffs would have no opportunity for meaningful relief under 28 U.S.C. § 1581(a)-(h). It would be impossible to remedy Plaintiffs' losses after the anticircumvention proceeding was completed. An ex post facto decision by this Court declaring the administrative proceeding ultra vires would be a pyrrhic victory for Plaintiffs." Id. at 5-6.

The parties debate whether the Court of International Trade had jurisdiction over this case under 28 U.S.C. § 1581(i). The government contends (1) that Commerce properly initiated its minor alterations inquiry, (2) that Nippon Steel may review Commerce's final order in that inquiry pursuant to 28 U.S.C. § 1581(c), and (3) that that remedy would be fully adequate. Nippon Steel responds that Commerce exceeded its authority in initiating the inquiry and that judicial review after...

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