CEMEX, SA v. US

• Decision Date: 07 April 1992
• Docket Number: Court No. 90-10-00509.
• Citation: 790 F. Supp. 290
• Parties: CEMEX, S.A., Plaintiff, and Apasco, S.A. de C.V., Plaintiff-Intervenor, v. UNITED STATES of America and United States International Trade Commission, Defendants, and The Ad Hoc Committee of AZ-NM-TX-FL Producers of Gray Portland Cement, Defendant-Intervenor.
• Court: U.S. Court of International Trade

790 F. Supp. 290

CEMEX, S.A., Plaintiff and Apasco, S.A. de C.V., Plaintiff-Intervenor, v. UNITED STATES of America and United States International Trade Commission, Defendants and The Ad Hoc Committee of AZ-NM-TX-FL Producers of Gray Portland Cement, Defendant-Intervenor.

Court No. 90-10-00509.

United States Court of International Trade.

April 7, 1992.

Skadden, Arps, Slate, Meagher & Flom, Thomas R. Graham, John J. Mangan, John J. Burke, Albert J. Boro, Jr., Erik O. Autor, Catherine Kane Ronis, Roger B. Banks, Washington, D.C., for plaintiff.

O'Connor & Hannan, Joseph H. Blatchford, Guy C. Smith, Washington, D.C., for plaintiff-intervenor.

Lyn M. Schlitt, Gen. Counsel, U.S. Intern. Trade Com'n, James A. Toupin, Asst. Gen. Counsel, Judith M. Czako, Washington, D.C., for defendant.

Kilpatrick & Cody, Joseph W. Dorn, Martin M. McNerney, Michael P. Mabile, Atlanta, Ga., for defendant-intervenor.

RESTANI, Judge.

In Gray Portland Cement and Cement Clinker From Mexico, 55 Fed.Reg. 35,371 (ITC 1990), the United States International Trade Commission ("ITC") determined that a regional domestic industry in the United States was materially injured by reason of cement imports from Mexico. CEMEX, S.A., a Mexican producer of cement, appeals from the determination, and now moves for judgment on the agency record. ITC's determination is affirmed.

I. BACKGROUND

The Ad Hoc Committee of AZ-NM-TX-FL Producers of Gray Portland Cement ("Ad Hoc Committee") represents certain cement producers with production facilities in Arizona, New Mexico, Texas and Florida. On September 26, 1989, Ad Hoc Committee filed a petition with ITC and the Department of Commerce ("Commerce"), alleging injury to a United States industry by reason of less than fair value ("LTFV") imports of gray Portland cement and cement clinker from Mexico. ITC and Commerce issued affirmative preliminary determinations. See Gray Portland Cement and Cement Clinker From Mexico, USITC Pub. 2235, Inv. No. 731-TA-451 (Nov.1989); Gray Portland Cement and Clinker From Mexico, 55 Fed.Reg. 13,817 (Dep't Comm.1990).

ITC reached a final determination on August 13, 1990, and issued an opinion on August 23, 1990. Gray Portland Cement and Cement Clinker From Mexico, USITC Pub. 2305, Inv. No. 731-TA-451 (Aug.1990) ("Final Det."). It determined that a United States industry, composed of producers of gray portland cement and cement clinker in the southern-tier states, was materially injured by reason of LTFV imports of cement and cement clinker from Mexico.

Prior to the final determination, a committee of cement producers in Southern California had filed a petition with ITC and Commerce alleging material injury due to LTFV cement imports from Japan. By the time of the final determination in this case, ITC had made a preliminary affirmative determination in the Japanese case, (Gray Portland Cement and Cement Clinker From Japan, USITC Pub. 2297, Inv. No. 731-TA-461 (July 1990) ("Japan Cement")), but Commerce had not issued its preliminary or final determinations regarding LTFV sales.

II. ITC DETERMINATION

Three Commissioners participated in ITC's final determination. Commissioner Rohr made a negative determination, which is not at issue. Acting Chairman Brunsdale and Commissioner Lodwick made affirmative determinations, and each issued an opinion. Both opinions are challenged here.

Acting Chairman Brunsdale first determined that cement and cement clinker comprise a single like product. She then found that a regional industry analysis was appropriate, and that the regional industry consisted of producers in the southern-tier states of California, Texas, Arizona, New Mexico, Alabama, Louisiana, Mississippi and Florida. She determined that cumulation was mandatory, and cumulatively assessed the volume and price effects of Mexican and Japanese imports into the region: her consideration of Japanese imports was based on the allegations in the Japanese case, as recalculated by Commerce. She then considered whether there was material injury to the domestic industry based on the statutory factors. She found that the financial performance of the southern-tier producers had deteriorated during the period of investigation, and applied an elasticities analysis to determine the volume, price and overall effect of the dumped imports on the domestic industry. She concluded that the domestic industry was materially injured by reason of LTFV imports from Mexico. Finally, she found that the statutory requirements for injury in a regional investigation had been met, and that all producers were injured because they were not insulated from the general effect of the injurious imports.

Commissioner Lodwick's determination was based on a slightly different analysis. He concurred with Acting Chairman Brunsdale's findings about like product, regional industry, and cumulation. He then found deterioration in the financial performance of the domestic industry, and considered whether there was material injury by reason of LTFV imports. He found evidence of a significant volume of imports, under-selling, depression of domestic prices, and an adverse impact on the domestic injury. Based on all these factors, he found material injury by reason of LTFV imports from Mexico. Finally, he concluded that the statutory criteria for injury in a regional investigation had been met because the effect of the imports was felt throughout the region, and there was no evidence to indicate that individual producers were not injured.

III. STANDARD OF REVIEW

ITC's determination shall be upheld unless it is "unsupported by substantial evidence on the record, or otherwise not in accordance with law." 19 U.S.C. § 1516a(b)(1)(B) (1988).

IV. DISCUSSION

A. Regional Industry Analysis

CEMEX challenges ITC's regional industry analysis on two grounds: misinterpretation of the "all or almost all" standard; and failure to employ a disaggregate analysis, or an aggregate approach with a safeguard to ensure an accurate finding is made.

1. "All, or Almost All" Standard

ITC's task is to determine whether an industry in the United States is materially injured, or threatened with material injury by reason of imports or sales at LTFV. See 19 U.S.C. § 1673d(b)(1) (1988). An industry consists of "domestic producers as a whole of a like product, or those producers whose collective output of the like product constitutes a major proportion of the total domestic production of that product." 19 U.S.C. § 1677(4)(A) (1988) (emphasis added). Under certain circumstances set forth in the statute, ITC may divide the United States into two or more regional markets, and treat producers in each market as a separate industry. 19 U.S.C. § 1677(4)(C) (1988). In such cases, material injury to an industry may be found "if the producers of all, or almost all, of the production" within the regional market suffer material injury due to the dumped imports. Id. (emphasis added) ("regional injury provision").¹

Here, ITC found that the region consisted of producers in the southern-tier states; it then found material injury to producers of "all or almost all" of the cement production in the region. Final Det., at 51, 66. CEMEX argues, however, that the decision is flawed because the "all or almost all" language requires a finding of material injury to eighty or eighty-five percent of production, and no such finding was made in this case. CEMEX bases its argument on case law and ITC practice under a parallel statutory provision. This authority is not persuasive.

CEMEX cites the Atlantic Sugar cases.² In Atlantic Sugar, Ltd. v. United States, 2 CIT 295 (1981) (Atlantic Sugar III), the court considered the "all or almost all" provision. It found that "all or almost all" constitutes more than a "major proportion" of production, which is the standard required in a nationwide determination (see id. at 301), and in dicta noted that seventy-six percent of production might not constitute "all or almost all" of the production.³ Id. at 301-302. In finding the issue of injury to a producer of one-quarter of the production determinative in the context of the disaggregate analysis at issue in Atlantic Sugar V, the Federal Circuit seems to accept that, at least for purposes of disaggregate analysis, seventy-five percent of production is not "all or almost all." Atlantic Sugar, 744 F.2d 1556, 1562-63 (Fed.Cir.1984). Whatever remains of the teaching in Atlantic Sugar III, that opinion certainly does not stand for the proposition that an eighty percent threshold is required in every case. Moreover, the appellate decision does not provide guidance on the appropriate measure if an aggregate analysis is used.

CEMEX notes that in addition to the regional injury provision, the "all or almost all" language is found in a second place in 19 U.S.C. § 1677(4)(C). See supra, n. 1. This second provision states that ITC may adopt a regional industry approach if producers within the region sell "all or almost all" of their production in that region ("regional market provision"). CEMEX argues that ITC interprets the regional market provision to require at least an eighty percent threshold, and that this interpretation is relevant in the first context.

It is true, as CEMEX claims, that the court may apply parallel constructions when a phrase appears more than once in the same provision of a statute. See United States v. Nunez, 573 F.2d 769, 771 (2d Cir.), cert. denied, 436 U.S. 930, 98 S.Ct. 2828, 56 L.Ed.2d 774 (1978). Where, however, the contexts and purposes of the provisions differ, parallel constructions are inappropriate. See, e.g., Laffey v. Northwest Airlines, Inc., 567 F.2d 429, 461-62 n. 230 (D.C.Cir.1976), cert. denied, 434 U.S. 1086, 98 S.Ct. 1281, 55 L.Ed.2d 792 (1978). It is not the case, as CEMEX claims, that ITC has established a fixed eighty percent threshold in the regional market context. See Operators for Jalousie and Awning Windows From El Salvador, USITC Pub....