British Steel Corp. v. United States

• Decision Date: 06 August 1984
• Docket Number: Court No. 83-7-01040.
• Citation: 593 F. Supp. 405,8 CIT 86
• Parties: BRITISH STEEL CORPORATION and British Steel Corporation, Inc., Plaintiffs, v. UNITED STATES of America, United States International Trade Commission, Defendants, Allegheny Ludlum Steel Corporation; Armco Inc.; Carpenter Technology Corporation; Crucible Materials Group, Colt Industries, Inc.; Eastern Stainless Steel Company; Guterl Special Steel Corporation; Jessop Steel Company; Jones and Laughlin Steel Incorporated; Republic Steel Corporation; Universal-Cyclops Specialty Steel Division, Cyclops Corporation; Washington Steel Corporation; and the United Steelworkers of America, AFL/CIO-CLC, Defendants-Intervenors.
• Court: U.S. Court of International Trade

593 F. Supp. 405

8 CIT 86

BRITISH STEEL CORPORATION and British Steel Corporation, Inc., Plaintiffs, v. UNITED STATES of America, United States International Trade Commission, Defendants, Allegheny Ludlum Steel Corporation; Armco Inc.; Carpenter Technology Corporation; Crucible Materials Group, Colt Industries, Inc.; Eastern Stainless Steel Company; Guterl Special Steel Corporation; Jessop Steel Company; Jones and Laughlin Steel Incorporated; Republic Steel Corporation; Universal-Cyclops Specialty Steel Division, Cyclops Corporation; Washington Steel Corporation; and the United Steelworkers of America, AFL/CIO-CLC, Defendants-Intervenors.

Court No. 83-7-01040.

United States Court of International Trade.

August 6, 1984.

Steptoe & Johnson Chartered, Washington, D.C. (Michael Sandler and Alice L. Mattice, Washington, D.C., of counsel), for plaintiffs.

Michael H. Stein, Gen. Counsel, United States Intern. Trade Com'n, Michael P. Mabile, Asst. Gen. Counsel and Catherine R. Field, Washington, D.C., for federal defendants.

Collier, Shannon, Rill & Scott, Washington, D.C. (David A. Hartquist and Paul C. Rosenthal, Washington, D.C., of counsel) for defendants-intervenors.

Review of International Trade Commission's Affirmative Determination of Material Injury on Agency Record Pursuant to Rule 56.1—Stainless Steel Plate from the United Kingdom

NEWMAN, Senior Judge.

Introduction

Plaintiffs, British Steel Corporation and British Steel Corporation, Inc. (collectively referred to as plaintiffs or British Steel), seek review upon the agency record pursuant to Rule 56.1 of the final determination by the United States International Trade Commission (Commission) that "an industry in the United States is materially injured by reason of imports of stainless steel plate from the United Kingdom (investigation No. 701-TA-196 (Final)) which have been found by the Department of Commerce to be subsidized by that Government". USITC Pub. 1391 (June 1983) at 1; 48 Fed.Reg. 27454 (June 15, 1983). Plaintiffs challenge the Commission's determination as unsupported by substantial evidence and otherwise not in accordance with law. The Commission and defendants-intervenors (domestic producers of stainless steel plate) seek affirmance of the final injury determination.

For the reasons that follow, the Court concludes there is substantial evidence in the administrative record supporting the Commission's affirmative injury determination and such determination is in accordance with law. Therefore, the determination is affirmed.

Background

Investigation No. 701-TA-196 (Final) was instituted by the Commission effective February 10, 1983 following a preliminary determination by the International Trade Administration of the United States Department of Commerce (Commerce) that imports of stainless steel plate from the United Kingdom were being subsidized by the government of that country. 48 Fed. Reg. 19048 (1982).¹ On May 4, 1983 the Commission held a hearing concerning its investigation of stainless steel plate from the United Kingdom and three other investigations involving stainless steel sheet and strip from the Federal Republic of Germany, France and the United Kingdom.² On June 9, 1983 the Commission issued its affirmative final injury determination in its investigation of stainless steel plate from the United Kingdom and transmitted its report to Commerce. See USITC Pub. 1391 (June 1983). In due course, plaintiffs commenced the present action on July 22, 1983.

In USITC Pub. 1391 at 3, the Commission noted that it had focused its analysis on the causal connection between the condition of the domestic industry and the subject imports "because material injury to the domestic industries is clearly present". See also id. at 6. As stated in the Commission's report, "all of the important economic indicators show the significantly weakened conditions of these industries domestic producers of stainless steel sheet and strip and stainless steel plate". Id. at 6. The Commission's analysis of the relevant economic indicators was based upon industry data for 1979 through the first quarter of 1983; and the Commission found that 1979 was the last year "in which the domestic industry exhibited a robust economic performance". Id. at 6-7.

Specifically and respecting the plate industry during the period investigated, the Commission cited the substantial declines in production, capacity utilization, shipments, employment, hours worked, wages paid to production and related workers, and financial experience as evidenced by the severe declines in net sales and operating profits resulting in the industry experiencing an operating loss in 1982. In sum, the Commission found that the domestic stainless steel plate industry was "clearly experiencing material injury". Id. at 8.

Focusing upon the role of the subject imports "in creating the situation faced by U.S. producers" (Id. at 9), the Commission found that there is a sufficient causal nexus between the imports and the difficulties experienced by the domestic industry. In reaching its conclusion regarding causation, the Commission expressly considered, among other factors: the volume of imports, underselling by imports, lost sales and price depression.

Opinion

I. Scope and standard of review

At the outset, it is helpful to briefly review the scope and standard of review applicable to the Commission's injury determinations.

Under the statute, a final affirmative injury determination by the Commission must be sustained unless it is "unsupported by substantial evidence on the record, or is otherwise not in accordance with law." 19 U.S.C. § 1516a(b)(1)(B) (1982). Rhone Poulenc, S.A., and Rhone Poulenc, Inc. v. United States, 8 C.I.T. ___, 592 F.Supp. 1318 (July 19, 1984) and cases cited; American Spring Wire Corporation v. United States, 8 C.I.T. ___, 590 F.Supp. 1273 (July 11, 1984). See also Armstrong Bros. Tool Co. v. United States, 84 Cust.Ct. 16, C.D. 4838, 483 F.Supp. 312 (1980), aff'd, 67 CCPA 94, C.A.D. 1252, 626 F.2d 168 (1980). Moreover, "the court may not substitute its judgment for that of the agency when the choice is `between two fairly conflicting views, even though the court would justifiably have made a different choice had the matter been before it de novo * * *'." American Spring Wire Corporation, supra, quoting Universal Camera Corp. v. NLRB, 340 U.S. 474, 477, 71 S.Ct. 456, 459, 95 L.Ed. 456 (1951). This teaching of the Supreme Court is applicable to a review of the Commission's injury determination. See American Spring Wire Corporation, supra; Sprague Electric Co. v. United States, 2 Ct. Int'l Trade 302, 310-11, 529 F.Supp. 676, 682-83 (1981). Accord, Pasco Terminals, Inc. v. United States, 68 CCPA 8, C.A.D. 1256, 634 F.2d 610 (1980).

II. Material injury

The following observations in American Spring Wire Corporation, 8 C.I.T. at ___, 590 F.Supp. 1273, concerning "material injury" are also pertinent to the present review:

In its final antidumping and countervailing duty investigations, the ITC is required to determine whether:

(A) an industry in the United States —

(i) is materially injured, or

(ii) is threatened with material injury, or

(B) the establishment of an industry in the United States is materially retarded, by reason of imports of the merchandise with respect to which the administering authority ITA has made an affirmative determination....

19 U.S.C. §§ 1671d(b)(1) and 1673d(b)(1) (1982). Footnote omitted The Commission must make an affirmative finding only when it finds both (1) present material injury (or threat to or retardation of the establishment of an industry) and (2) that the material injury is "by reason of" the subject imports. Relief may not be granted when the domestic industry is suffering material injury but not by reason of unfairly traded imports. Nor may relief be granted when there is no material injury, regardless of the presence of dumped or subsidized imports of the product under investigation. In the latter circumstance, the presence of dumped or subsidized imports is irrelevant, because only one of the two necessary criteria has been met, and any analysis of causation of injury would thus be superfluous.

"Material injury" has been defined by Congress as "harm which is not inconsequential, immaterial, or unimportant." 19 U.S.C. § 1677(7)(A) (1982). Congress has directed the ITC to consider "all relevant economic factors which have a bearing on the state of the industry," id. § 1677(7)(C)(iii) * * *. Emphasis in original.

And as recently observed in Rhone Puolenc, 8 C.I.T. at ___, 592 F.Supp. 1318:

In contrast to the dearth of guidelines for the determination of threat of injury, the statute contains detailed specifications for the determination of material injury. In general, "`material injury' means harm which is non-inconsequential, immaterial, or unimportant." 19 U.S.C. § 1677(7)(A) (1982); 19 C.F.R. § 207.27 (1983). In making an injury determination, the Commission is required to consider, among other factors, the following:

(i) the volume of imports of the merchandise which is the subject of the investigation;

(ii) the effect of imports of that merchandise on prices in the United States for like products, and

(iii) the impact of imports of such merchandise on domestic producers of like products.

19 U.S.C. § 1677(7)(B)(i)-(iii) (1982); see 19 C.F.R. § 207.26(a)(1)-(3) (1983).

III. Issues presented

Plaintiffs maintain that the Commission's determination in this case is unsupported by substantial evidence and otherwise is not in accordance with law in that:

(1) the Commission erred by finding that the import volumes of stainless steel plate from the United Kingdom had increased during the period investigated and in disregarding plaintiffs' data showing that the subject imports were declining during the most recent twelve month period covered by the investigation;

(2) the Commission erred by finding that the subject imports were...