Imbert Imports, Inc. v. United States

• Decision Date: 10 September 1971
• Docket Number: A.R.D. 294,Reap. No. R63/5025 and 13 others.
• Citation: 331 F. Supp. 1400
• Parties: IMBERT IMPORTS, INC., et al., Appellants, v. The UNITED STATES, Appellee.
• Court: U.S. Court of Customs and Patent Appeals (CCPA)

331 F. Supp. 1400

IMBERT IMPORTS, INC., et al., Appellants, v. The UNITED STATES, Appellee.

A.R.D. 294; Reap. No. R63/5025 and 13 others.

United States Customs Court, Second Division, Appellate Term.

September 10, 1971.

COPYRIGHT MATERIAL OMITTED

Barnes, Richardson & Colburn, New York City (Norman C. Schwartz, David O. Elliott, New York City of counsel), for appellants.

L. Patrick Gray, III, Asst. Atty. Gen. (Glenn E. Harris, trial atty.), for appellee.

Before LANDIS, MALETZ and NEWMAN, Judges.

NEWMAN, Judge:

Plaintiffs below have filed this application for review seeking reversal of the decision and judgment of Watson, J. in Imbert Imports, Inc., et al. v. United States, 65 Cust.Ct. 697, 314 F.Supp. 784, R.D. 11718 (1970), wherein the trial judge upheld dumping duty appraisements on fourteen entries of portland gray cement¹ exported by Fabrica Dominicana de Cemento C, por A. in the Dominican Republic during the period between October 25, 1962 and March 25, 1963, and entered at the port of San Juan, Puerto Rico. We affirm.

STATUTES INVOLVED

Section 201(a) of the Antidumping Act of 1921, as amended (19 U.S.C. § 160(a)).

Sec. 201. (a) Whenever the Secretary of the Treasury (hereinafter called the "Secretary") determines that a class or kind of foreign merchandise is being, or is likely to be, sold in the United States or elsewhere at less than its fair value, he shall so advise the United States Tariff Commission, and the said Commission shall determine within three months thereafter whether an industry in the United States is being or is likely to be injured, or is prevented from being established, by reason of the importation of such merchandise into the United States. The said Commission, after such investigation as it deems necessary, shall notify the Secretary of its determination, and, if that determination is in the affirmative, the Secretary shall make public a notice (hereinafter in this Act called a "finding") of his determination and the determination of the said Commission. * * *

Section 201(c) of the Antidumping Act of 1921, as amended (19 U.S.C. § 160 (c)).

(c) The Secretary, upon determining whether foreign merchandise is being, or is likely to be, sold in the United States at less than its fair value, and the United States Tariff Commission, upon making its determination under subsection (a) of this section, shall each publish such determination in the Federal Register, with a statement of the reasons therefor, whether such determination is in the affirmative or in the negative.

The "record" is entirely documentary and consists of certified copies of papers filed with the United States Tariff Commission during its investigation, and the Commission's "Determination of Likelihood of Injury" (TC Publication 87, April 19, 1963).

The "official record" before the Commission discloses that:

On January 21, 1963, the Commission was advised by the Acting Assistant Secretary of the Treasury that portland cement, other than white, nonstaining portland cement, from the Dominican Republic was being or was likely to be sold in the United States at less than fair value within the meaning of the Antidumping Act of 1921, as amended.²

On January 25, 1963 the Commission issued a notice that it had instituted an investigation pursuant to section 201(a) of the Antidumping Act "to determine whether an industry in the United States is being or is likely to be injured, or is prevented from being established, by reason of the importation of such merchandise into the United States". Such notice was published in the Federal Register. 28 F.R. 882.

On April 19, 1963, the Commission issued a determination (Chairman Dorfman dissenting) "that an industry in the United States is likely to be injured by reason of the importation of portland cement, other than white, nonstaining portland cement, from the Dominican Republic, sold at less than fair value within the meaning of the Antidumping Act, 1921, as amended".³ As required by section 201(c) of the Antidumping Act of 1921 (19 U.S.C. § 160(c)), the majority and minority determinations of the Commission were followed by a statement of reasons therefor. T.C. Publication 87, supra; 28 F.R. 4047.

The views stated by the majority of the Commission are quoted in extenso, and provide a helpful factual background:

The imports of portland cement from the Dominican Republic sold at less than fair value were entered largely at the port of New York. The imports entered at that port were marketed almost exclusively in the metropolitan area of New York City. For purposes of this determination this area constitutes a "competitive market area." The domestic plants that have historically supplied portland cement in this competitive area and in recent years have sold substantial quantities of cement there are considered to constitute "an industry" for the purposes of the Antidumping Act.

* * * * * *

The Dominican producer has the capacity to sell considerably increased quantities of portland cement in the United States and has sufficient motivation to do so. In recent years the Dominican market has provided an outlet sufficient to take only about half of the potential production of that country's cement plant. Even with substantial exports, it has generally operated with considerable excess capacity. Through a form of price discrimination sic—i. e., through sales at prices below those charged in the home market—but at prices sufficiently high to cover out-of-pocket costs and to make a positive contribution to net return, the Dominican producer can achieve more complete utilization of plant capacity and a lowering of average unit costs. His inducement to attain a level of output approaching full capacity therefore is strong. Consequently, the very substantial market in the New York metropolitan area constitutes a continuing and attractive lure for the Dominican management seeking to expand production and reduce costs. Indeed, the instant case represents the second occasion in which the Treasury Department has advised the Commission that portland cement from the Dominican Republic was being sold in the United States at less than fair value.

Somewhat comparable circumstances cause the domestic producers of cement which customarily supply the New York metropolitan market to be vulnerable to competition from imports sold in the United States at less than fair value. In recent years producers supplying this market have generally operated at about 70 percent of capacity. Not only do sales of imported cement at less than fair value tend to repress prices in that marketing area but it is also difficult for domestic producers to compete therewith inasmuch as the price is based not on lower costs but on discrimination. Domestic manufacturers, moreover, are precluded from making as complete use of their productive facilities as they would be able to do in the absence of such competition. The injury that is likely to be sustained thereby would be reflected in continuing market instability and higher production costs. Because of both legal and economic restraints, however, domestic producers would be unable to increase volume by resort to the same kind of price discrimination.

Little has occurred in recent months to alter the situation that has twice given rise to sales in the United States of Dominican portland cement at less than fair value. The capacity and incentive for making such shipments remain. Domestic producers will be no less vulnerable in the future than they have been to date. In the opinion of the Commission, therefore, the portland cement industry serving the New York metropolitan market is likely to be injured by reason of importation of such cement sold in the United States at less than fair value.

Appellants' sole claim is that the Tariff Commission's "injury determination"⁴ is invalid. Such claim is advanced on the theory that in the absence of a valid injury determination by the Commission, there can be no valid dumping duty appraisement. Cf. United States v. Central Vermont Railway Co., 17 CCPA 166, T.D. 43474 (1929); United States v. Tower & Sons, 14 Ct.Cust.App. 421, T.D. 42058 (1927).

In support of their claim, appellants contend:

(1) The Tariff Commission violated its statutory authority in basing its injury determination in part on the mere presence of sales at less than fair value.

(2) The Tariff Commission functioned as an agency within the meaning of Administrative Procedure Act and its injury determination should be set aside as arbitrary.

(3) The Tariff Commission's determination, insofar as it encompasses Puerto Rican imports, constitutes excessive remedial action.

We shall consider appellants' contentions in the above order.

(1) Appellants' argument is, in essence, that the Commission substantially equated injury with sales at less than fair value; and consequently, the Commission's action is ultra vires or in excess of its delegated authority.⁵ We cannot agree.

The Act requires that the Commission shall determine "whether an industry in the United States is being or is likely to be injured * * * by reason of the importation of dumped merchandise". Emphasis added. Thus, the statute in effect mandates the Commission to focus upon dumped imports as a cause of injury or likelihood of injury to domestic industry. Consequently, we fail to understand appellants' position that the Commission exceeded its delegated authority by considering the factor of dumped imports. Especially in the present case, where the Commission was faced with recurring or renewed dumping of portland cement by the exporter, clearly the Commission would have failed in its statutory duty had it ignored that factor in determining whether a domestic industry was injured or was likely to be injured "by reason of" such dumping. Hence, while the presence of dumping may not be regarded by the Commission as ipso facto injurious to a domestic industry,⁶ such dumping nevertheless must be...