FMC Corp. v. U.S., 92-1366

• Decision Date: 19 August 1993
• Docket Number: No. 92-1366,92-1366
• Citation: 3 F.3d 424
• Parties: FMC CORPORATION and Monsanto Company, Plaintiffs-Appellants, v. The UNITED STATES, Defendant-Appellee, and Rotem Fertilizers Ltd., Defendant-Appellee.
• Court: U.S. Court of Appeals — Federal Circuit

Page 424

3 F.3d 424

15 ITRD 1601

FMC CORPORATION and Monsanto Company, Plaintiffs-Appellants, v. The UNITED STATES, Defendant-Appellee, and Rotem Fertilizers Ltd., Defendant-Appellee.

No. 92-1366.

United States Court of Appeals, Federal Circuit.

Aug. 19, 1993.

Joseph H. Price, Gibson, Dunn & Crutcher, Washington, DC, argued for plaintiffs-appellants.

Jeffrey M. Telep, Atty., Commercial Litigation Branch, Dept. of Justice, of Washington, DC, argued for defendant-appellee, The U.S. With him on the brief were Stuart M. Gerson, Asst. Atty. Gen. and David M. Cohen, Director. Of Counsel were Velta A. Melnbrencis, Stephen J. Powell and Berniece A. Browne. Also on the brief was Jeffrey B. Denning, Attorney-Advisor, Office of Chief Counsel for Import Admin., U.S. Dept. of Commerce, of counsel. Dennis James, Jr., Whitman & Ransom, of Washington, DC, argued for defendant-appellee, Rotem Fertilizers Ltd.

Before RICH, Circuit Judge, COWEN, Senior Circuit Judge, and MAYER, Circuit Judge.

RICH, Circuit Judge.

FMC Corporation and Monsanto Company (collectively FMC), domestic producers of industrial phosphoric acid (IPA), appeal the May 15, 1992 final determination of the United States Court of International Trade (CIT), refusing to preliminarily enjoin the liquidation of IPA entries exported from Israel by Rotem Fertilizers Ltd. and its predecessor corporation, Negev Phosphate, Ltd. (Negev). 792 F.Supp. 1285. For the reasons set forth below, we affirm.

I. BACKGROUND

In 1987, the International Trade Administration of the United States Department of Commerce (Commerce) issued an antidumping duty order and a countervailing duty order directed against IPA exported from Israel. ¹ The orders declared all unliquidated entries or warehouse withdrawals of IPA liable for possible assessment of antidumping and countervailing duties. Subsequently, Commerce conducted three administrative reviews of the antidumping duty order pursuant to Section 751 of the Tariff Act of 1930, 19 U.S.C. Sec. 1675 (1988). ² These reviews covered two manufacturers/exporters, Negev and Haifa Chemicals. Although Commerce found dumping margins for Haifa Chemicals in each of the three administrative reviews, it determined that the dumping margin for Negev was zero. FMC submitted no challenge to the results of the first two reviews. ³ FMC did, however, challenge the results with respect to Negev in the third administrative review. ⁴

The third administrative review of the antidumping order was initiated on September 24, 1990, covering Negev's IPA exports during the period August 1, 1989, through July 31, 1990 (1989-90 review period). As part of this review, Commerce served Negev with an antidumping questionnaire addressing the 1989-90 exports. Negev's completed questionnaire response was received on March 28, 1991 and a copy was sent to FMC.

On April 29, 1991, FMC requested that Commerce conduct a cost of production (COP) investigation, i.e., an investigation to determine whether Negev's home market IPA sales in Israel were made at prices below the cost of producing its IPA, pursuant to 19 U.S.C. Sec. 1677b(b). In support of its request, FMC submitted a consultant's report prepared by an outside expert, containing a worldwide study of the IPA industry. The consultant's report was based on data gathered before or during 1986 and included estimates of Negev's cost of producing IPA. FMC argued that the consultant's COP estimates, when compared to Negev's questionnaire response, demonstrated that Negev was selling IPA at a price below Negev's COP. Commerce rejected FMC's request for a COP investigation, finding that there was no reasonable basis to believe Negev was making home market sales at prices below the COP. FMC subsequently requested that Commerce reconsider conducting a COP investigation and grant FMC an opportunity to supplement the record with additional information to support its argument. Commerce denied both requests.

On December 27, 1991, Commerce issued the preliminary results of the third administrative review, determining that the dumping margin for Negev was zero. ⁵ Commerce also disclosed its intention to revoke the antidumping duty order with respect to Negev if, in the final determination, Negev's dumping margin remained at zero for the third consecutive year and Negev agreed to an immediate suspension of liquidation of its future entries and a reinstatement of the antidumping duty order if Negev resumed less-than-fair value sales of IPA. See 19 C.F.R. 353.25 (1992).

On January 27, 1992, FMC renewed its request for a COP investigation of Negev's IPA home market sales. FMC included additional evidence in the form of Negev's 1990 financial statement which showed that Negev had operated at a loss during that year. FMC argued that the financial statement, together with the consultant's 1986 report, provided a reasonable basis for Commerce to conduct a COP investigation. This request was effectively rejected by Commerce's issuance of the final results of the third administrative review. In its final determination, Commerce concluded that Negev had made no sales at less-than-fair value during the 1989-90 review period and assessed a zero percent margin. Accordingly, in light of Commerce's finding that Negev was not dumping for three consecutive years, the antidumping duty order was revoked against Negev. The order, however, remained in effect against Haifa Chemical.

On April 29, 1992, FMC filed suit in the CIT challenging the administrative review determination and requesting the CIT to issue an order compelling Commerce to conduct a COP investigation of Negev. In addition, FMC moved for a preliminary injunction to prevent Commerce from instructing Customs to liquidate entries of IPA exported from Israel by Negev, pending the CIT's decision on the merits. The CIT denied FMC's motion because FMC failed to establish that it would be irreparably harmed absent the issuance of a preliminary injunction and because FMC did not show a likelihood of success in proving the merits of its case. FMC appealed here. ⁶ The appeal was opposed by the U.S. Government and Rotem Fertilizers, Ltd. (collectively "the government").

II. ISSUE

The issue before us is whether the CIT abused its discretion when it denied FMC's preliminary injunction motion.

III. DISCUSSION

To obtain the extraordinary relief of an injunction prior to trial, the movant carries the burden to establish a right thereto in light of the following factors: 1) that the movant is likely to succeed on the merits at trial; 2) that it will suffer irreparable harm if preliminary relief is not granted; 3) that the balance of the hardships tips in the movant's favor; and 4) that a preliminary injunction will not be contrary to the public interest. New England Braiding Co. Inc. v. A.W. Chesterton Co., 970 F.2d 878, 882, 23 USPQ2d 1622, 1625 (Fed.Cir.1992); Chrysler Motors Corp. v. Auto Body Panels of Ohio, Inc., 908 F.2d 951, 952, 15 USPQ2d 1469, 1470 (Fed.Cir.1990); Zenith Radio Corp. v. United States, 710 F.2d 806, 809 (Fed.Cir.1983). No one factor, taken individually, is necessarily dispositive. If a preliminary injunction is granted by the trial court, the weakness of the showing regarding one factor may be overborne by the strength of the others. If the injunction is denied, the absence of an adequate showing with regard to any one factor may be sufficient, given the weight or lack of it assigned the other factors, to justify the denial. Chrysler Motors, 908 F.2d at 952, 15 USPQ2d at 1470. As a basic proposition, the matter lies largely within the sound discretion of the CIT. Id.; Asociacion Colombiana de Exportadores de Flores v. United States, 916 F.2d 1571, 1578 (Fed.Cir.1990).

Once a request for a preliminary injunction is denied, the movant faces a heavy burden of showing that the trial court abused its discretion, committed an error of law, or seriously misjudged the evidence. The trial court's discretion is not absolute, however, and must be measured against the standards governing the issuance of injunctions. Black & Decker, Inc. v. Hoover Service Center, 886 F.2d 1285, 1290, 12 USPQ2d 1250, 1254 (Fed.Cir.1989), (citing Smith Int'l, Inc. v. Hughes Tool Co., 718 F.2d 1573, 1579, 219 USPQ 686, 690-91 (Fed.Cir.), cert. denied, 464 U.S. 996, 104 S.Ct. 493, 78 L.Ed.2d 687 (1983)).

In this case, the CIT held that FMC failed to establish that it would be irreparably harmed absent the grant of a preliminary injunction or that it was likely to succeed in proving the merits of its case. Although we find that the CIT's finding on irreparable harm is clearly erroneous, we nonetheless find that the CIT did not abuse its discretion in making the ultimate determination that a preliminary injunction is not warranted. Absent a showing that a movant is likely to succeed on the merits, we question whether the movant can ever be entitled to a preliminary injunction unless some extraordinary injury or strong public interest is also shown. Here, it would not be an abuse of the CIT's discretion to base its holding on FMC's failure to establish a likelihood of success on the merits and FMC's failure to establish that the magnitude of its injury is sufficient to tip the balance of equity in its favor in view of its failure to prove a likelihood of success on the merits.

A. Likelihood of Success

In the course of denying FMC's motion for a preliminary injunction, the CIT held that FMC failed to establish that it was likely to succeed in proving the merits of its case. We find no legal error, misjudgment of the evidence, or abuse of discretion in the CIT's finding.

FMC's CIT complaint contains three counts: first, that Commerce used an incorrect standard to conclude that it was not obligated to conduct a COP investigation; second, that the administrative record contained substantial evidence to support a finding that there are reasonable grounds to believe or suspect that Negev had made sales below its...