Mitsubishi Materials Corp. v. US

• Decision Date: 29 February 1996
• Docket Number: Slip. Op. 96-44. Court No. 91-06-00426.
• Citation: 918 F. Supp. 422
• Parties: MITSUBISHI MATERIALS CORP., Nihon Cement Co., Ltd., Osaka Cement Co., Ltd., and Onoda Cement Co., Ltd., Plaintiffs, v. The UNITED STATES, and U.S. International Trade Commission, Defendants, and The Ad Hoc Committee of Southern California Producers of Gray Portland Cement, Defendant-Intervenor.
• Court: U.S. Court of International Trade

918 F. Supp. 422

MITSUBISHI MATERIALS CORP., Nihon Cement Co., Ltd., Osaka Cement Co., Ltd., and Onoda Cement Co., Ltd., Plaintiffs, v. The UNITED STATES, and U.S. International Trade Commission, Defendants, and The Ad Hoc Committee of Southern California Producers of Gray Portland Cement, Defendant-Intervenor.

Slip. Op. 96-44. Court No. 91-06-00426.

United States Court of International Trade.

February 29, 1996.

Graham & James, Yoshihiro Saito, Washington, DC, for plaintiffs Mitsubishi Materials Corp., Nihon Cement Co., Ltd., and Osaka Cement Co., Ltd.

Akin, Gump, Strauss, Hauer & Feld, L.L.P., Patrick F.J. Macrory, Spencer S. Griffith, Washington, DC, for plaintiff Onoda Cement Co., Ltd.

Lyn M. Schlitt, General Counsel; James A. Toupin, Assistant General Counsel, United States International Trade Commission, Washington, DC, Judith M. Czako, for defendant.

Kilpatrick & Cody, Joseph W. Dorn, Michael P. Mabile, Washington, DC, for defendant-intervenor.

OPINION

GOLDBERG, Judge:

Plaintiffs, Mitsubishi Materials Corp., Nihon Cement Co., Ltd., Osaka Cement Co., Ltd., and Onoda Cement Co., Ltd. commenced this action under section 516A of the Tariff Act of 1930, challenging the final affirmative threat of injury finding and the final affirmative injury determination made by the U.S. International Trade Commission ("Commission") in Grey Portland Cement and Cement Clinker from Japan, USITC Pub. No. 2376, Inv. No. 731-TA-461 (Final) (Apr. 1991) ("Original Determination"). By order dated April 27, 1993, the Court remanded this action with instructions that the Commission reevaluate its material injury determination in accordance with the Court's opinion. Mitsubishi Materials Corp. v. United States, 17 CIT 301, 820 F.Supp. 608 (1993) ("Mitsubishi Materials I").

The Commission issued its remand determination in June 1993. Grey Portland Cement and Cement Clinker from Japan, USITC Pub. No. 2657, Inv. No. 731-TA-461 (Views on Remand) (June 1993) ("Remand Results"). Three new commissioners had been appointed to the Commission who participated in the remand. On remand, two of the new commissioners, Commissioners Watson and Nuzum, found threat of material injury; Commissioner Newquist affirmed his original finding of material injury; and newly appointed Commissioner Crawford found no material injury and no threat of injury.

In the Commission's Original Determination, Commissioner Brunsdale found no injury and no threat of injury. Her findings were not challenged by any party. Commissioner Rohr found threat of material injury. Since Commissioner Rohr's finding of threat of material injury has already been affirmed by the Court, Mitsubishi Materials I, 17 CIT at 320-23, 820 F.Supp. at 625-27, a three commissioner majority now has determined that a threat of material injury exists.¹

This opinion addresses plaintiffs' objections to Commissioners Watson and Nuzum's threat of injury determination. As the Court affirms their joint determination, the Court does not need to address plaintiffs' challenges to Commissioner Newquist's remand determination. The Court exercises its jurisdiction pursuant to 28 U.S.C. § 1581(c) (1988) and affirms the Commission's finding of threat of material injury.

DISCUSSION

The underlying facts of this action are detailed in the Court's original opinion. Mitsubishi Materials I, 17 CIT at 301-03, 820 F.Supp. at 611-13.

Three commissioners have now made an affirmative determination of threat of material injury. The Court affirmed Commissioner Rohr's finding of threat of injury in its original opinion. Mitsubishi Materials I, 17 CIT at 320-23, 820 F.Supp. at 625-27. Commissioners Watson and Nuzum have adopted the same position as Commissioner Rohr on remand.

When the commissioners are evenly divided as to whether a determination should be affirmative or negative, the Commission is deemed to have made an affirmative determination. 19 U.S.C. § 1677(11) (1988). In the present case, the Commission has made an affirmative determination of threat of material injury, and because its determination is supported by substantial evidence on the record in accordance with 19 U.S.C. § 1516a(b)(1)(B) (1988), plaintiffs' various challenges pertaining to the Commission's findings of material injury are rendered moot and need not be addressed. Plaintiffs' objections to Commissioners Watson and Nuzum's findings of threat of material injury are discussed below.

A. Standard of Review

A Commission determination in an antidumping investigation shall be upheld unless the Court determines that 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). Commission determinations are presumed to be correct, and the burden is on the party challenging the Commission's determination to demonstrate otherwise. 28 U.S.C. § 2639(a)(1) (1988).

The Supreme Court has defined substantial evidence as "more than a mere scintilla. It means such relevant evidence as a reasonable mind might accept as adequate to support a conclusion." Consolidated Edison Co. v. NLRB, 305 U.S. 197, 229, 59 S.Ct. 206, 216-17, 83 L.Ed. 126 (1938) (citations omitted). The possibility of drawing two inconsistent conclusions from the evidence does not prevent an administrative agency's finding from being supported by substantial evidence. Consolo v. Federal Maritime Commission, 383 U.S. 607, 620, 86 S.Ct. 1018, 1026-27, 16 L.Ed.2d 131 (1966) (citations omitted).

B. Plaintiffs' Objections

1. Remand Instructions

Plaintiffs argue that Commissioners Watson and Nuzum violated the Court's remand instructions in Mitsubishi Materials I both by failing to evaluate costs when assessing price trends, and by failing to consider plant-specific data. Addressing these objections together, the Court finds that the remand instructions to which plaintiffs refer govern only the Commission's material injury determination. These Commissioners were not members of the Commission at the time of the original determination, and properly reviewed the case on remand de novo. Trent Tube Div., Crucible Materials Corp. v. Avesta Sandvik Tube AB, ___ Fed.Cir. (T) ___, 975 F.2d 807, 811, 815 (1992). They made a threat of injury determination, and therefore, the remand instructions which pertained only to the Commission's material injury finding do not apply to their determination. Commissioners Watson and Nuzum therefore have not violated the Court's remand instructions. The Court will review their findings on their own merit, without regard to the Court's remand instructions.

2. Causation

Plaintiffs object that the findings of Commissioners Watson and Nuzum that lower prices resulted from dumped Japanese cement are not supported by substantial evidence. Plaintiffs argue that the lower prices in the Southern California cement market were caused by domestic producers passing on their reduced costs. Plaintiffs object that the Commissioners do not provide evidence that disproves their theory of causation.

Plaintiffs invite the Court to substitute its own expertise for the Commission's in evaluating the various theories of causation. Specifically, plaintiffs argue that their theory is more consistent with increases in demand during part of the study period, and that acceptance of the Commissioners' theory assumes that domestic producers agreed not to pass on reductions in cost to consumers. The Court declines to substitute its own expertise for that of the Commission in evaluating causation. Instead, the Court takes its guidance from the standard of review governing this case. Under the substantial evidence standard, the reviewing court may not "even as to matters not requiring expertise ... displace the agency's choice between two fairly conflicting views, even though the court would justifiably have made a different choice had the matter been before it de novo." Universal Camera Corp. v. NLRB, 340 U.S. 474, 488, 71 S.Ct. 456, 464-65, 95 L.Ed. 456 (1951).

Congress directed the Commission not to weigh causes of price suppression and depression in antidumping cases, but instead to affirmatively find injury, or threat of injury, where it determines that dumped imports minimally contribute to industry conditions. British Steel Corp. v. United States, 8 CIT 86, 96, 593 F.Supp. 405, 413 (1984); see also H.R.Rep. No. 317, 96th Cong., 1st Sess. 47 (1979). Under this standard, if the Commission can demonstrate that dumped imports have contributed to lower domestic prices, then the Commission can properly find a threat of material injury, regardless of the contribution lower costs may have made to lower domestic prices.

Commissioners Watson and Nuzum found that domestic producers had an incentive to reduce prices because imports from abroad were entering the market at reduced prices. Remand Results at 12-13. The Court holds that this finding is supported by substantial evidence: Japanese imports were being sold at lower prices, domestic market share was threatened, and domestic producers therefore had an incentive to lower domestic prices in order to maintain capacity utilization and profits. Id.

Because the Commissioners have supported their finding of causation with substantial evidence by showing how dumped imports caused or contributed to price suppression and depression in the Southern California cement market, this Court affirms their finding of causation.

3. Loss of Market Share

Plaintiffs also argue that Commissioners Watson and Nuzum's finding that loss of market share contributed to local producers' vulnerability is unsupported by substantial evidence. Plaintiffs contend that because domestic producers operated at or near full capacity during the early part of the investigation, they were not harmed. Therefore, in plaintiffs' opinion, the loss of market share could not have rendered domestic producers vulnerable. The Court does not find this argument persuasive.

The Commissioners interpreted the same...