Lone Star Steel Co. v. United States, Court No. 85-06-00790.

• Decision Date: 28 November 1986
• Docket Number: Court No. 85-06-00790.
• Citation: 10 CIT 731,650 F. Supp. 183
• Parties: LONE STAR STEEL COMPANY and CF & I Steel Corporation, Plaintiffs, v. The UNITED STATES, Defendant, Dalmine Siderca, S.A.I.C., Defendant-Intervenor.
• Court: U.S. Court of International Trade

650 F. Supp. 183

10 CIT 731

LONE STAR STEEL COMPANY and CF & I Steel Corporation, Plaintiffs, v. The UNITED STATES, Defendant Dalmine Siderca, S.A.I.C., Defendant-Intervenor.

Court No. 85-06-00790.

United States Court of International Trade.

November 28, 1986.

Akin, Gump, Strauss, Hauer & Feld (Richard R. Rivers, Warren E. Connelly, Valerie A. Slater and William J. Long), Washington, D.C., for plaintiffs.

Lyn M. Schlitt, General Counsel, Michael P. Mabile, Asst. Gen. Counsel, and E. Clark Lutz, U.S. Intern. Trade Com'n, Washington, D.C., for defendant.

Mudge, Rose, Guthrie, Alexander & Ferdon (David P. Houlihan and Jeffrey S. Neeley), Washington, D.C., for defendant-intervenor.

OPINION

RESTANI, Judge:

Plaintiffs challenge a final negative International Trade Commission ("ITC") determination.¹ ITC found that the injury suffered by the domestic oil country tubular goods ("OCTG") industry was not by reason of imports of OCTG from Argentina. Plaintiffs make two basic arguments: (1) ITC improperly failed to consider data regarding increased shipments of Argentine imports, lost sales and revenue and (2) ITC improperly failed to cumulate data on volume and effects of Argentine and Spanish OCTG imports.

Facts

Plaintiffs filed administrative petitions on June 13, 1984, stating that OCTG from Argentina, Brazil, Mexico, Spain and Korea were being sold at less than fair value ("LTFV") and were causing or threatening material injury to the U.S. OCTG industry. See 19 U.S.C. § 1673 (1982). OCTG refers to several products, including oil well tubing, casing and drill pipe. Eventually affirmative final determinations under the antidumping laws were made with regard to Spanish OCTG. Final determinations were delayed in regard to the other countries concerned, except Argentina. Although LTFV margins on Argentine imports were found to be 61.7 percent, no antidumping duties were imposed because of the negative ITC injury determination under discussion here. Duties are required to be deposited upon entry of the same merchandise pursuant to separate proceedings under the countervailing duty laws, where no injury requirement was applicable and subsidies were found to exist.

The record shows that channels of distribution and principal markets were the same for OCTG imports from Spain and Argentina. The record also shows that one type of OCTG was sold by importers of Argentine OCTG, but not importers of Spanish OCTG. Specifications of Spanish and Argentine OCTG differed.

Average margins of underselling were similar as between the imports of the two countries, but the trend of underselling with regard to the Argentine products was downward. Levels of underselling with regard to the Spanish product were increasing in 1984. ITC was able to obtain information on six possible instances of lost sales or revenue attributable to the price of Argentine imports. No other reason for lost sales surfaced. An additional sale was lost, according to the buyer, because the domestic supplier would only sell to the small distributor at end user, rather than distributor, prices. Approximately 500 tons of OCTG were involved in ITC's lost sales data. The demonstrated revenue lost in instances where Argentine imports competed, but the sale of the domestic product was made, was very small.

Volume of Spanish imports reflected a deep 1983 decline and a large 1984 surge.² Argentine imports volume was steady.³ Shipments in the U.S. market, although lower than import volume, increased for both Spanish and Argentine imports from 1982-1984. Year end inventories as a percentage of U.S. shipments of the relevant imports decreased for both, but the percentages were consistently higher for Spanish imports.

Domestic OCTG consumption, production, shipments and capacity utilization statistics exhibited one pattern — low 1982 performance, less than half of that performance in 1983 and 1984 performance closer to 1982 levels. Employment and sales statistics dipped even lower in 1983 than did the statistics for the previous four factors, and 1984 figures do not approach 1982 levels. Operating losses appear in 1983 and continue in 1984.⁴ Based on such facts ITC found that the domestic industry was experiencing material injury. It concluded, however, that Argentine OCTG did not contribute to such injury.

Reliance on Limited Criteria

ITC states that it based its negative injury determination with regard to Argentine OCTG on the following. Argentine OCTG import volume was low and stable, and the market share remained small. Levels of underselling decreased and year-end inventories of Argentine OCTG declined from 1982 to 1984.

These fact are accurate. Plaintiffs' objection is that other facts should have been considered and that those facts can only lead to the opposite conclusion. First, plaintiffs allege ITC did not consider shipments in the U.S. market. ITC obviously did so as demonstrated by the citation to inventories as a percentage of U.S. market shipments and by ITC's analysis of consumption. Plaintiffs also state that the decline in inventories reflects the release of a large quantity of stock so that shipments of Argentine imports in the U.S. market increased in comparison to U.S. shipments, giving Argentine imports a greater market share. This fact is evident from the record. ITC considered this increase, but noted that it was at a low level and was of a temporary nature.

The record reflects that because of anticipated demands in 1981, OCTG distributors increased their inventories. Demand did not materialize and inventories grew until demand rose in 1983. Shipments of Argentine imports did increase greatly in 1983, while new imports decreased, but the rate of increase dropped dramatically in 1984, as did the level of inventories. As shares of consumption, Argentine imports were almost equal in 1982 and 1984. The 1983 bulge is consistent with the unexpected lack of demand and a subsequent release of stored inventory. Plaintiffs attribute the 1984 return to 1982 levels as a reaction to unfair trade cases, for which the plaintiffs argue ITC must adjust. ITC's historical explanation is equally plausible. In this context, standing alone, the single factor of the increase in shipments does not mandate an affirmative finding.

Second, plaintiffs claim that underselling, even though it was decreasing, and the evidence of lost sales and revenue, demonstrate injury. Anecdotal evidence of lost sales and revenue rarely adds distinct information to a record of this type but rather confirms what is already substantially demonstrated by the presence of fairly fungible products from both Argentina and the United States in...