963 F.Supp. 1220 (CIT. 1997), 94-08-00467, Dastech Intern., Inc. v. United States Intern. Trade Com'n

Docket Nº:Court No. 94-08-00467S.
Citation:963 F.Supp. 1220
Party Name:DASTECH INTERNATIONAL, Inc.; ICC Industries, Inc.; Sinochem (USA), Inc.; Guangdong Chemicals Import & Export Corp.; Sinochem Jiangsu Import & Export Corp.; Sinochem International Chemicals Co., LTD. Tianjin Chemicals Import & Export Corp. Plaintiffs, v. UNITED STATES INTERNATIONAL TRADE COMMISSION, Defendant, and Union Camp Corp., Defendant-Interve
Case Date:May 01, 1997
Court:Court of International Trade

Page 1220

963 F.Supp. 1220 (CIT. 1997)

DASTECH INTERNATIONAL, Inc.; ICC Industries, Inc.; Sinochem (USA), Inc.; Guangdong Chemicals Import & Export Corp.; Sinochem Jiangsu Import & Export Corp.; Sinochem International Chemicals Co., LTD. Tianjin Chemicals Import & Export Corp. Plaintiffs,



Union Camp Corp., Defendant-Intervenor.

Slip Op. 97-52.

Court No. 94-08-00467S.

United States Court of International Trade.

May 1, 1997

Page 1221

Williams, Mullen, Christian & Dobbins, P.C., William E. Perry, Washington, DC, for Plaintiffs.

Lyn M. Schlitt, General Counsel, James A. Toupin, Deputy General Counsel, Andrea C. Casson, Office of the General Counsel, United States International Trade Commission, Washington, DC, for Defendant.

Fenwick & West, Roger M. Golden, Phyllis E. Andes, Washington, DC, for Defendant-Intervenor.



In this case, the court is called on to decide the particularity with which the International Trade Commission ("ITC") must explain its affirmative finding of a threat of injury to a domestic industry in an antidumping investigation. This matter is before the

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court on a motion for judgment upon an agency record, pursuant to USCIT Rule 56.2, brought by Dastech International, Inc., and other Chinese exporters and United States importers of sebacic acid (collectively, "Dastech"). Dastech challenges the finding of a threat of injury to a domestic industry made by the ITC in Sebacic Acid From the People's Republic of China, Inv. No. 731-TA-653 (Final), USITC Pub. No. 2793 (1994) (the "Determination"), contending that the determination should be remanded primarily because the ITC majority failed to consider certain facts in the record. The court disagrees for the following reasons, and dismisses the action.


On July 19, 1993, Union Camp Corporation ("Union Camp") filed a petition with the Department of Commerce ("Commerce") and the ITC alleging that sebacic acid from the People's Republic of China ("PRC") was being dumped in the United States, injuring the American sebacic acid manufacturing industry. Commerce made a final determination that sebacic acid indeed was being sold in the United States at less that fair market value on May 31, 1994. Sebacic Acid From the People's Republic of China, 59 Fed.Reg. 28,053.

On July 5, 1994, the ITC promulgated its final injury determination, finding a threat of material injury to the American industry, based on a 3-2 vote 1, but no present material injury. Determination at pp. I-3, I-Il. Commerce published an antidumping duty order on July 14, 1994. Antidumping Duty Order: Sebacic Acid From the People's Republic of China, 59 Fed.Reg. 35,909.

This action was severed from consolidated actions brought by Dastech and Union Camp which challenged Commerce's determination in the sebacic acid investigation as well as the ITC's determination. The two actions were heard seriatim by the court. Its opinion in the Commerce-related action appears at USCIT Slip Op. No. 96-123 (Aug. 5, 1996); this is its opinion in the ITC-related action. 2


The court's inquiry is circumscribed by the deference that it must accord the ITC's determination. Congress has directed the CIT to review ITC determinations of a threat of material injury 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) (1988); Suramerica de Aleaciones Laminadas, CA. v. United States, 44 F.3d 978, 982 (Fed.Cir.1994). Substantial evidence on the record means "such relevant evidence as a reasonable mind might accept as adequate to support a conclusion." Pierce v. Underwood, 487 U.S. 552, 565, 108 S.Ct. 2541, 2550, 101 L.Ed.2d 490 (1988) (citation omitted). Moreover, "the possibility of drawing two inconsistent conclusions from the evidence does not prevent an administrative agency's finding from being supported by substantial evidence." E.g., Granges Metallverken AB v. United States, 13 CIT 471, 475, 716 F.Supp. 17, 21 (1989) (citations omitted).

Affirming a particular conclusion "is not necessarily inconsistent with a holding that the opposite conclusion was also supported by substantial evidence and otherwise in accord with law." Trent Tube Div. v. Avesta Sandvik Tube AB, 975 F.2d 807, 814 (Fed.Cir.1992). Consistent with this standard, the court may not reweigh the evidence, or substitute its judgment for that of the ITC. Granges Metallverken, 13 CIT at 474, 716 F.Supp. at 22. The court does not act on whether it believes the Commission's determination to be correct, but rather whether the determination is unfounded or legally defective.

Despite the deference that this court must give the ITC's determination the

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court's review is neither passive nor powerless:

A court does not depart from its proper function when it undertakes a study of the record, hopefully perceptive, even as to the evidence on technical and specialized matters, for this enables the court to penetrate to the underlying decisions of the agency, to satisfy itself that the agency has exercised a reasoned discretion, with reasons that do not deviate from or ignore the ascertainable legislative intent. "The deference owed to an expert tribunal cannot be allowed to slip into a judicial inertia." Volkswagenwerk Aktiengesellschaft v. FMC, 390 U.S. 261, 272, 88 S.Ct. 929, 935-36, 19 L.Ed.2d 1090 (1968).

Greater Boston Television Corp. v. FCC, 444 F.2d 841, 850 (D.C.Cir.1970), cert. denied, 403 U.S. 923, 91 S.Ct. 2233, 29 L.Ed.2d 701 (1971).


Plaintiff contends that the ITC failed to consider certain evidence in the record, and that this failure renders the Commission's decision unsupported by substantial evidence in the record and contrary to law. The ITC and Union Camp respond that Dastech offers no cognizable proof that the ITC failed to consider all the evidence in the record, and that Dastech in truth is asking the court to reweigh the evidence, which is, of course, impermissible.


It is useful to begin with the statute that governs the ITC's actions. The ITC's determination of threat of injury is governed by 19 U.S.C. § 1677(7)(F) (1988), which sets forth the economic factors that the Commission must consider in investigating such a threat. The statute states:

In determining whether an industry in the United States is threatened with material injury by reason of imports (or sales for importation) of the merchandise, the Commission shall consider, among other relevant factors--

(I) if a subsidy is involved, such information as may be presented to it by the administering authority as to the nature of the subsidy (particularly as to whether the subsidy is an export subsidy inconsistent with the Agreement),

(II) any increase in production capacity or existing unused capacity in the exporting country likely to result in a significant increase in imports of the merchandise to the United States,

(III) any rapid increase in United States market penetration and the likelihood that the penetration will increase to an injurious level,

(IV) the probability that imports of the merchandise will enter the United States at prices that will have a depressing or suppressing effect on domestic prices of the merchandise,

(V) any substantial increase in inventories of the merchandise in the United States,

(VI) the presence of underutilized capacity for producing the merchandise in the exporting country,

(VII) any other demonstrable adverse trends that indicate the probability that the importation (or sale for importation) of the merchandise (whether or not it is actually being imported at the time) will be the cause of actual injury,

(VIII) the potential for product-shifting if the production facilities owned or controlled by the foreign manufacturers, which can be used to produce products subject to investigation(s) under section 1671 or 1673 of this title or to final orders under section 1671e or 1673e of this title, are also used to produce the merchandise under investigation,

(IX) in any investigation under this subtitle which involves imports of both raw agricultural product ... and any product processed from such raw agricultural product, the likelihood that there will be increased imports, by reason of product shifting, if there is an affirmative determination by the Commission under section 1671d(b)(1) or 1673d(b)(1) of this title with respect to either the raw agricultural product or the processed agricultural product (but not both)

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(X) the actual and potential negative effects on the existing development and production efforts of the domestic industry, including efforts to develop a derivative or more advanced version of the like product.

19 U.S.C. § 1677(7)(F)(i) (1988).

Of the foregoing factors, numbers I, VIII and IX are not applicable here because (I) there is no subsidy at issue, (VIII) sebacic acid production facilities are so highly specialized that there is no possibility of product shifting, and (IX) there are no agricultural products, raw or processed, at issue here. Determination, fn 77 at p. I-11-12.

It is also important to note that the list of factors is not exhaustive. The statute calls on the ITC to consider the enunciated criteria "among other relevant economic factors", 19 U.S.C. 1677(7)(F)(i) (1988), thus requiring the ITC to look beyond the specified economic factors to "any other factors that tend 'to make the existence of a [threat of material injury] more probable or less probable than it would be without the [factors].' " Suramerica, 44 F.3d at 983, quoting Fed.R.Evid. 401 (defining relevance). In Suramerica, the Federal Circuit found mandatory ITC consideration of all relevant economic factors in a threat determination, unlike a...

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