Siderca, S.A.I.C. v. U.S., SLIP OP. 05-64.

• Citation: 374 F.Supp.2d 1285
• Decision Date: 09 June 2005
• Docket Number: Court No. 01-00603.,SLIP OP. 05-64.
• Parties: SIDERCA, S.A.I.C., Plaintiff, v. UNITED STATES, Defendant, and United States Steel Corp., Defendant-Intervenor.
• Court: U.S. Court of International Trade

374 F.Supp.2d 1285

SIDERCA, S.A.I.C., Plaintiff, v. UNITED STATES, Defendant, and United States Steel Corp., Defendant-Intervenor.

SLIP OP. 05-64.

Court No. 01-00603.

United States Court of International Trade.

June 9, 2005.

White & Case, LLP, Washington, DC (David P. Houlihan, Gregory J. Spak, Richard J. Burke, Lyle B. Vander Schaaf, Joanna M. Ritcey-Donohue) for Plaintiff.

James M. Lyons, Acting General Counsel, Peter L. Sultan, Attorney Advisor, United States International Trade Commission, Washington, DC, for Defendant.

Skadden, Arps, Slate, Meagher & Flom LLP, Washington, DC, (Robert E. Lighthizer, John J. Mangan, James C. Hecht, Stephen P. Vaughn) for Defendant-Intervenor.

OPINION

POGUE, Judge.

Plaintiff, Siderca S.A.I.C. ("Siderca"), challenges the remand determination of Defendant, the U.S. International Trade Commission ("the ITC"), in the sunset review of antidumping orders on certain standard, line, and pressure pipe ("SLP") from Argentina, Brazil, Germany, and Italy. Plaintiff alleges that aspects of the ITC's determination are unsupported by law or substantial record evidence.

BACKGROUND

In August of 1995, pursuant to the ITC's finding that U.S. producers of SLP were being materially injured by competition from dumped imports, the United States Department of Commerce imposed antidumping orders on SLP from Argentina, Brazil, Germany, and Italy. See Certain Small Diameter Seamless Carbon and Alloy Steel Standard, Line and Pressure Pipe from Argentina, 60 Fed.Reg. 39,708 (Dep't Commerce Aug. 3, 1995) (notice of antidumping duty order), Certain Small Diameter Seamless Carbon and Alloy Steel Standard, Line and Pressure Pipe from Brazil, 60 Fed.Reg. 39,707 (Dep't Commerce Aug 3, 1995) (notice of antidumping duty order and amended final determination), Certain Small Diameter Seamless Carbon and Alloy Steel Standard, Line and Pressure Pipe from Germany, 60 Fed.Reg. 39,704 (Dep't Commerce Aug. 3, 1995) (notice of antidumping duty order and amended final determination), Certain Small Diameter Seamless Carbon and Alloy Steel Standard, Line and Pressure Pipe from Italy, 60 Fed.Reg. 39,705 (Dep't Commerce Aug. 3, 1995) (notice of antidumping duty order). Five years later, pursuant to 19 U.S.C. § 1675(c) (2000), the ITC instituted a sunset review to determine whether revocation of the antidumping orders would likely lead to the recurrence of material injury to U.S. SLP producers within a reasonably foreseeable period of time. See 19 U.S.C. § 1675a(a)(1);¹ Seamless Pipe from Argentina, Brazil, Germany, and Italy, 65 Fed.Reg. 41,090 (ITC July 3, 2000) (institution of five-year reviews concerning the countervailing duty and antidumping duty orders on seamless pipe from Argentina, Brazil, Germany, and Italy). The ITC cumulated the volume and effect of imported SLP from three of the four reviewed countries; having so done, the ITC found that these cumulated imports would likely cause recurrence of material injury to U.S. SLP producers within a reasonably foreseeable time. See Certain Seamless Carbon and Alloy Steel Standard, Line, and Pressure Pipe from Argentina, Brazil, Germany and Italy, Investigations Nos. 701-TA-362 and 731-TA-707-710 (Review) (July 2001), CR List 2, Doc. 78 at 30 ("Commission's Views").

Plaintiff, an Argentine producer of SLP, challenged these determinations before the Court. The Court upheld the ITC's cumulation determination, but remanded its finding that revocation of the order would likely cause recurrence of material injury within a reasonably foreseeable time.² Specifically, the Court remanded the determination so that the agency could (1) explain how it understood and applied the statutory term "likely" in making its determination, (2) address whether certain aspects of its "likely volume" determination were in accordance with law and supported by substantial evidence, (3) address whether certain aspects of its "likely price effects" determination were supported by substantial evidence, (4) address record evidence suggesting that the domestic industry might not be vulnerable to injury upon revocation of the antidumping order on subject producers' SLP. On remand, the ITC again found likely the recurrence of material injury to the domestic industry in the event of revocation of the antidumping order. Plaintiff now challenges that remand determination.

STANDARD OF REVIEW

The Court reviews the ITC's determinations in sunset reviews to ascertain whether they are "unsupported by substantial evidence on the record, or otherwise not in accordance with law." 19 U.S.C. § 1516a(b)(1)(B)(i); see also 19 U.S.C. § 1516a(a)(2)(B)(iii).

DISCUSSION

Plaintiff challenges the ITC's determinations on all four issues upon which the Court predicated its remand order. The Court will address the issues in turn.

1. The "Likely" Standard.

In its earlier opinion, the Court found that the ITC's determination did not indicate fidelity to the plain meaning of the statutory term "likely." That term is the fulcrum upon which most of the determinations that the agency is required to make in a sunset review turn. For example, the ITC must determine whether material injury is "likely" to continue or recur. See 19 U.S.C. § 1675a(a)(1).

Various opinions of the Court have held that the term "likely" should be interpreted to mean "probable," or, to put it another way, "more likely than not." See, e.g., A.G. der Dillinger Huttenwerke v. United States, 193 F.Supp.2d 1339, n. 14, 26 CIT 1091, 1101 n. 14 (2002) (explaining that in a countervailing duty sunset review, to satisfy a "likely" standard, a thing must be shown to be "probable," or "more likely than not"); Usinor Industeel, S.A. v. United States, 26 CIT 367, 474-75, 215 F.Supp.2d 1356 (2002) ("Usinor I"), Usinor Industeel, S.A. v. United States, 26 CIT 1402, 1403-04, 2003 WL 22080731 (2002), affirmed after remand at 112 Fed.Appx. 59 (Fed.Cir.2004) (rejecting argument that "likely" means something between "possible" and "probable"). In light of previous cases dealing with contemporaneous reviews finding that the ITC may have employed the wrong standard, contemporaneous statements by the ITC arguing for or advancing a "possible," rather than a "probable" standard, and the lack of discussion of the issue in the determination itself, the Court directed the agency on remand to indicate what standard it had actually used, and if the standard used was incorrect, to revisit its determinations accordingly.

In its remand determination, the ITC states "[i]n our original views in these reviews we applied a `likely' standard that is consistent with how the Court has defined that term in [its opinion remanding the original views] as well as in prior opinions addressing this issue." Views of the Commission on Remand, CR List 2, Doc. No. 147R at 5 ("Remand Determ."). The Court will accept this statement as an assertion that the evidence amassed and cited by the agency is such as to meet or surpass the burden under the "probable" standard. Therefore, at this juncture, the only way in which the agency's statement can be measured is by the sum of record evidence that the agency provides as the rationale for its determinations here.

2. The likely volume analysis.

In evaluating whether material injury is likely to recur, the ITC is statutorily required to evaluate three factors and to determine whether they support a finding that revocation would lead to material injury in a "reasonably foreseeable" period of time. See 19 U.S.C. § 1675a(a)(1). The first factor concerns the likely volume of subject imports in the event of revocation. This factor itself has four non-exclusive sub-factors: (1) any likely increase in the production capacity or existing unused production capacity in the exporting country; (2) existing inventories of the subject merchandise; or likely increases in inventories; (3) the existence of barriers to the importation of such merchandise into countries other than the United States; and (4) the potential for product-shifting if production facilities in the foreign country, which can be used to produce the subject merchandise, are currently being used to produce other products. See 19 U.S.C. § 1675a(a)(2). In its pre-remand determination, the ITC appears to have considered two additional subfactors, for a total of six subfactors: (5) the extent to which the exporting countries' SLP production was export-driven; and (6) the international business affiliations of the manufacturers in the exporting countries. See Commission's Views, CR List 2, Doc. No. 78 at 25-27. In its prior opinion, the Court found that the ITC's evidence on the six subfactors was "minimal at best," but particularly remanded the ITC's evaluation of the product-shifting subfactor and the international business affiliation subfactor, finding that the ITC appeared to rely heavily on both, that the ITC's product-shifting analysis was not in accordance with law, and that its reliance on business affiliations was unsupported by substantial evidence. Siderca, S.A.I.C., 28 CIT at ___, 350 F.Supp.2d at 1238. The Court will address the ITC's remand discussion of the two subfactors in turn.

i. Product-shifting.

The product-shifting subfactor directs the ITC to consider the potential for product-shifting "if production facilities in the foreign country, which can be used to produce the subject merchandise, are currently being used to produce other products." 19 U.S.C. § 1675a(a)(2)(D). In its pre-remand determination, the ITC found that the potential for product-shifting was such as to support a determination that the likely volume would be so great as to cause recurrence of material injury. The ITC rested this finding on the fact that subject producers reported that product-shifting was physically possible; i.e., it was possible to adjust machines being used to produce other products so as to produce SLP. See Commission's Views, CR List 2, Doc. No. 78 at 24. The Court found, however, that such...