Elkem Metals Co. v. U.S.

• Decision Date: 23 March 1999
• Docket Number: Court No. 98-03-00475.,Slip op. 99-26.
• Citation: 44 F.Supp.2d 288
• Parties: ELKEM METALS COMPANY, Plaintiff, v. UNITED STATES of America, Defendant.
• Court: U.S. Court of International Trade

44 F.Supp.2d 288

ELKEM METALS COMPANY, Plaintiff, v. UNITED STATES of America, Defendant.

Slip op. 99-26.

Court No. 98-03-00475.

United States Court of International Trade.

March 23, 1999.

Baker and Botts, L.L.P (William D. Kramer, Kirk K. Van Tine, Clifford E. Stevens, Jr., Wendy L. Cox, Jacqueline H. Fine) for Elkem Metals Company, plaintiff.

David W. Ogden, Acting Assistant Attorney General, David M. Cohen, Director, Commercial Litigation Branch, Civil Division, United States Department of Justice (Lucius B. Lau), Mark A. Barnett, Office of Chief Counsel for Import Administration, United States Department of Commerce, of counsel, for defendant.

MEMORANDUM OPINION AND ORDER

BARZILAY, District Judge.

Defendant, the United States, moves to dismiss Plaintiff's, Elkem Metals Company ("Elkem"), motion for judgment upon the agency record challenging the Department of Commerce's ("Commerce") continuation of a suspension agreement with the government of Ukraine, Antidumping: Silicomanganese from Ukraine; Suspension of Investigation, 59 Fed.Reg. 60,951 (Nov. 29, 1994). Defendant asserts that this Court does not possess subject matter jurisdiction. For the reasons that follow, this Court grants Defendant's motion to dismiss and denies Elkem's motion for judgment upon the agency record.

BACKGROUND

Plaintiff Elkem is a domestic producer of silicomanganese. On November 12, 1993, Elkem filed a petition with Commerce pursuant to 19 U.S.C. § 1673a. Pl.'s Mot. J. Agency R. at 1; Def.'s Mot, Dismiss at 1-2. Elkem alleged that imports of silicomanganese from Ukraine were being sold at less than fair value and that these imports were materially injuring, or threatening material injury, to a United States industry. Id. In response, on December 2, 1993, Commerce initiated an antidumping investigation on silicomanganese from Ukraine. Initiation of Antidumping Duty Investigations: Silicomanganese From Brazil, the People's Republic of China, Ukraine and Venezuela, 58 Fed. Reg. 64,553 (Dec. 8, 1993).

On June 17, 1994, Commerce published a preliminary determination which stated that imports of silicomanganese from Ukraine were being sold in the United States at less than fair value and assigned a dumping margin of 163 percent. Notice of Preliminary Determination of Sales at Less Than Fair Value and Postponement of Final Determination: Silicomanganese from Ukraine, 59 Fed.Reg. 31,201 (June 17, 1994), as amended by Correction of Ministerial Errors in Preliminary Antidumping Duty Determination: Silicomanganese from Ukraine, 59 Fed.Reg. 37,969 (July 26, 1994).

Commerce then entered into a Suspension Agreement ("Agreement") with Ukraine pursuant to 19 U.S.C. § 1673c(l), which permits such agreements with non-market economy countries as an alternative to the immediate issuance of an antidumping duty order. In this Agreement, the Government of Ukraine agreed to limit its exports of silicomanganese to the United States and ensure that those exports within the agreed quantitative limits were sold at or above a prescribed reference price. Antidumping: Silicomanganese from Ukraine; Suspension of Investigation, 59 Fed.Reg. 60,951 (Nov. 29, 1994).

On November 1, 1994, pursuant to 19 U.S.C. § 1673c(g), Elkem and Ukraine filed requests for continuation of the antidumping investigation. Pl.'s Mot. J. Agency R. at 2; Def.'s Mot. Dismiss at 2. On December 6, 1994, Commerce published its final determination, finding that imports of silicomanganese from Ukraine were being sold in the United States at less than fair value and assigning an antidumping margin of 163 percent. Notice of Final Determination of Sales at Less Than Fair Value: Silicomanganese From Ukraine, 59 Fed.Reg. 62,711 (Dec. 6, 1994).

On December 21, 1994, the United States International Trade Commission published its final affirmative injury determination. Silicomanganese From Brazil, the People's Republic of China, Ukraine, and Venezuela, 59 Fed.Reg. 65,788 (Dec. 21, 1994). No antidumping duty order was issued due to the continued existence of the Agreement and pursuant to 19 U.S.C. § 1673c(f)(3)(B). Def.'s Mot. Dismiss at 3.

In November of 1995, 1996, and 1997, Commerce published its "Notice of Opportunity to Request Administrative Review of Antidumping or Countervailing Duty Order, Finding, or Suspended Investigation" in which it gave interested parties an opportunity to request an administrative review of the Agreement. Antidumping or Countervailing Duty Order, Finding, or Suspended Investigation; Opportunity to Request Administrative Review, 60 Fed.Reg. 55,540 (Nov. 1, 1995); 61 Fed. Reg. 56,663 (Nov. 4, 1996); 62 Fed.Reg. 60,219 (Nov. 7, 1997). No requests for review were made at any time by any party.

Elkem filed this action on March 4, 1998, invoking this Court's jurisdiction under 28 U.S.C. § 1581(i). Subsequently, on June 4, 1998, Commerce began a formal anticircumvention review pursuant to the terms of the Agreement. Pl.'s Opp. Def.'s Mot. Dismiss at 11-12. Commerce stated that the "review will be conducted to determine whether the commitments made under the reporting and anticircumvention provisions have been met." Id. at 12 (quoting Memorandum of Consultations Regarding Administration of the Silicomanganese Suspension Agreement, dated May 28, 1998). In addition, on November 12, 1998, Commerce published the fourth "Notice of Opportunity to Request Administrative Review of Antidumping or Countervailing Duty Order, Finding, or Suspended Investigation." Antidumping or Countervailing Duty Order, Finding, or Suspended Investigation; Opportunity to Request Administrative Review, 63 Fed.Reg. 63,287 (Nov. 12, 1998). As a result, Elkem requested an administrative review pursuant to 19 U.S.C. § 1675. Prior to this request, neither Elkem nor any other interested party had requested an administrative review or a changed circumstances review pursuant to 19 U.S.C. § 1675.

ARGUMENTS

This action comes before the Court on Elkem's motion for judgment upon the agency record, pursuant to USCIT R. 56.1, and on Defendant's motion to dismiss, pursuant to USCIT R. 12(b)(1).

A. Plaintiff's Argument

Elkem argues that Commerce is compelled to cancel the Agreement and issue an antidumping duty order because Commerce has evidence that Ukraine has violated the Agreement. Pl.'s Mot. J. Agency R. at 6. Elkem asserts that Ukraine has violated the Agreement because the Ukrainian government failed to establish measures to ensure restriction of direct and indirect exports. Id. at 6-13. In addition, Elkem also asserts that as a result of Ukraine's violations, Commerce cannot effectively and adequately monitor compliance with the Agreement and cannot prevent the suppression or undercutting of price levels of domestic products. Id. at 14-15.

Elkem states that the Court has jurisdiction under subsection 1581(i) because the case is not reviewable under any other subsection of the statute. Pl.'s Opp. Def.'s Mot. Dismiss at 17. Elkem argues that no exhaustion of administrative remedies is required by the statute; furthermore, judicially mandated exhaustion is discretionary under 28 U.S.C. § 2637(d). Id. at 20. Elkem also argues that exhaustion would serve no purpose because there is nothing to be gained from permitting the compilation of a record or from agency expertise. Id. at 20-22. Elkem states that it has complained to Commerce many times, but to no avail. Id. at 25. An administrative review would not redress Elkem's injury because such a review would cover only a specific time period and would not reach violations that occurred outside that time. Id. at 26-27. Moreover, Elkem asserts, the reviews would take years and, since Commerce has been unwilling to consider Elkem's claims, as shown by their inaction for the past three years, Elkem could be put out of business. Id. at 28.

Elkem posits that Commerce is required by 19 U.S.C. § 1673c(i) to cancel a suspension agreement if the agreement has been violated. Pl.'s Mot. J. Agency R. at 22. Elkem asserts that since the statute states that "if the administering authority determines that an agreement ... is being, or has been, violated, or no longer meets the requirements of [subsection 1673c(b) or (c)], it shall ... issue an antidumping duty order," 19 U.S.C. § 1673c(i)(1)(C), then the use of the word shall is directive and offers Commerce no discretion whether to terminate the Agreement. Id. at 23. Elkem also suggests that legislative history supports the notion that Congress intended suspension provisions to be used rarely and only if compliance could be carefully monitored. Id. at 24.

Elkem furthers its argument by proffering Commerce's regulations under 19 C.F.R. § 351.209. Id. at 27. That regulation provides that if there is a finding of violation, which Elkem asserts in this case, then there must be immediate action. Id. at 27-28. Elkem further asserts that Commerce has no discretion to offer an opportunity to cure to the party in violation. Id. at 27.

Elkem argues that it has petitioned Commerce for two and a half years to take action, and that such a delay by Commerce is unreasonable. Pl.'s Opp. Mot. Dismiss at 25. Elkem also asserts that Commerce never advised it that Elkem was pursuing the wrong course by informally contacting Commerce instead of requesting an administrative or changed circumstances review. Id. In its motion for judgment upon the agency record, Elkem requests that the Court compel Commerce to: 1) cancel the Agreement using immediate determination procedure; 2) suspend liquidation 3) issue an antidumping duty order; and 4) issue instructions to Customs for cash deposits.

B. Defendant's Argument

Commerce opposes Elkem's motion for judgment upon the agency record and argues that it has not acted in an arbitrary or capricious manner. Def.'s Opp. Mot. J. Agency R. at 21. Defendant has moved to dismiss arguing that this Court does not possess subject matter jurisdiction. Def.'s Mot. Dismiss at 6. Moreover, Commerce...