Kenda Rubber Indus. Co., Ltd. v. United States

• Decision Date: 24 February 1986
• Docket Number: Court No. 84-7-00949.
• Citation: 10 CIT 120,630 F. Supp. 354
• Parties: KENDA RUBBER INDUSTRIAL CO., LTD., et al., Plaintiffs, v. UNITED STATES, Defendant.
• Court: U.S. Court of International Trade

630 F. Supp. 354

10 CIT 120

KENDA RUBBER INDUSTRIAL CO., LTD., et al., Plaintiffs, v. UNITED STATES, Defendant.

Court No. 84-7-00949.

United States Court of International Trade.

February 24, 1986.

Myron Solter for plaintiffs.

Lyn M. Schlitt, Gen. Counsel, Michael P. Mabile, Asst. Gen. Counsel, and Brenda A. Jacobs, U.S. International Trade Com'n, for defendant.

CARMAN, Judge:

Before the Court is plaintiffs' motion for judgment upon the agency record, pursuant to Rule 56.1, in this antidumping investigation. Defendant United States opposes the motion. Plaintiffs ask for a review of the International Trade Commission's (Commission) determination in Bicycle Tires and Tubes from Taiwan, U.S.I.T.C. Public. 1532, Investigation No. 731-TA-166 (Final) (May 1984), that imports of bicycle tires and tubes from Taiwan are materially injuring industries in the United States.

Plaintiffs challenge the Commission's determination on basically two grounds. First, plaintiffs contend that the Commission improperly found injury to the separate tire and tube industries on the basis of aggregated data. Second, plaintiffs claim that a majority of Commission members based their determination on a period six to nine years before the date of the determination, and that the use of such a period contravenes the language of the relevant statute. Use of the earlier period, plaintiffs claim, made it impossible to determine whether the dumping caused the injury, and a determination based on that period, when applied to present entries, operates as an unlawful penalty. For the reasons given below, the Court sustains the Commission's determination.

Background

Before outlining the facts of this case, it may be useful to examine the procedures followed in an antidumping investigation, since much of the controversy in this case arises from a disjointed procedure that resulted from a court remand. To initiate an antidumping investigation, an interested party files a petition with the administering authority, the United States Department of Commerce (Commerce)¹ and simultaneously with the Commission, alleging the sale of imports at less than fair value (LTFV). 19 U.S.C. § 1673a(b) (1982). Within 20 days Commerce determines whether to initiate an investigation and informs the Commission of its determination. If Commerce decides to initiate an investigation, the Commission makes a preliminary determination of whether there is a reasonable indication that the alleged LTFV sales are injuring or threatening to injure a domestic industry. 19 U.S.C. § 1673b(a). If the Commission's determination is affirmative, Commerce conducts an investigation and arrives at a preliminary determination of whether there have been LTFV sales. 19 U.S.C. § 1673b(b). Commerce then performs a complete investigation and arrives at a final determination. 19 U.S.C. § 1673d(a). Finally, if Commerce's final determination is affirmative, the Commission performs its complete investigation and makes its final determination of whether the LTFV sales materially injure or threaten to injure a domestic industry. Id. at § 1673d(b). The statutory scheme involves a series of interlocking steps by the agencies, the next step of each dependent upon the prior step of the other. The statute clearly contemplates that each step will follow close upon the other, mandating a period of days for the completion of each step. From filing of the petition to the Commission's final injury determination should take 230 days, if verification is waived (see 19 U.S.C. § 1673b(b)(2) ), to at most 420 days in an extraordinarily complicated case (see 19 U.S.C. § 1673b(c)).

In this case the administering authority at the time, the United States Department of Treasury (Treasury), made a negative final determination as to LTFV sales, which the petitioner appealed. Upon remand the new administering authority, Commerce, made an affirmative final determination, and the Commission then made an affirmative injury determination, several years after Treasury's initial investigation. It is the Commission's determination that plaintiffs now challenge. A more detailed history of the case follows.

In January 1978 Carlisle Tire & Rubber Co. filed a petition with Treasury alleging LTFV sales of bicycle tires and tubes from Taiwan. In December 1978 Treasury made a negative final determination of LTFV sales² and Carlisle appealed to this court's predecessor, the United States Customs Court. In May 1982 the court remanded that case, Court No. 79-3-00513, instructing that a different methodology be used to calculate dumping margins.

While that case was under advisement, Carlisle filed a new petition again alleging LTFV sales of bicycle tires and tubes from Taiwan. The Commission conducted a preliminary investigation and determined that there was a reasonable indication that the alleged dumping was injuring a domestic industry. U.S.I.T.C. Public. 1258, Investigation No. 731-TA-94 (Preliminary) (June 1982). In May 1983, however, Commerce made a final negative determination regarding LTFV sales occurring between December 1, 1981 and May 31, 1982. Carlisle's appeal of that determination to this court was designated Court No. 83-5-00773.

In October 1983 Commerce issued its redetermination in the remanded 1978 investigation, finding LTFV sales, and referred the case to the Commission for an injury determination. See 49 Fed.Reg. 2492 (1984). At this juncture Carlisle settled its appeal of the 1982 determination, on the basis of Commerce's affirmative redetermination in the 1978 case, and the court issued an order dismissing the appeal.

In January 1984 the Commission began its final injury determination in the 1978 case. The Commission sent a questionnaire to Carlisle³ and to importers and purchasers of imported bicycle tires and tubes, seeking data for the period 1981-1983. During the investigation the Commission also determined that it had in its files data on the domestic industry and imports dating from 1973. The data had been collected in a 1978 investigation under section 201 of the Trade Act of 1974, preliminary antidumping and countervailing duty investigations in 1982, and a 1983 review investigation under section 104 of the Trade Agreements Act of 1979. The Commission determined that the data from these investigations were calculated on the same basis as the data in the ongoing investigation. It therefore incorporated some of the tables and the staff reports from the prior investigations into the record in the ongoing investigation.

Controversy arose during the investigation as to which time period the Commission should examine to determine injury— the period of the initial investigation, around 1978, or the "present" period, 1981-1983. Carlisle argued that the earlier period was appropriate, while the Taiwanese respondents argued for the present period. The Commissioners did not reach a unanimous decision on which time period to use, though whichever period each used, all of them found that the domestic industry was injured by LTFV sales of imports. Commissioners Stern, Haggart, and Rohr based their decision on the period 1975-1978, U.S. I.T.C. Public. 1532, at 3 n. 1, although Commissioner Haggart also noted that she had considered the 1981-1983 data and reached the same conclusion. Id. Then-Chairman Eckes and Commissioner Lodwick based their injury determination on the period 1975-1983. In January 1984 plaintiffs appealed the Commission's affirmative injury determination. That appeal is now before the Court.

Opinion

Plaintiffs raise a number of challenges to the Commission's determination, all of which fall into basically two categories. First, plaintiffs claim that the Commission improperly found injury to the separate tire and tube industries on the basis of aggregated data. Second, they claim that the determination was based upon data from the period 1975-1978 and that the use of this earlier time period was improper. Plaintiffs claim that in committing these two errors the Commission acted ultra vires and its determination is therefore void. An agency action is ultra vires when the agency has acted beyond the scope of its defined authority. In this case, the Commission conducted an investigation and issued a determination within the confines of its statutorily granted authority. Plaintiffs present no evidence that the Commission exceeded that authority. The Court's review of agency determinations in such a case is governed by 19 U.S.C. § 1516a(b)(1)(B) (1982). Thus, under that statute, the issues in this case are whether the Commission's determination is "unsupported by substantial evidence on the record, or otherwise not in accordance with law" (1) because the agency based its determination of injury to the separate tire and tube industries on data that was not segregated for 1975-1978 as to the profits for each industry, and (2) because the agency based its determination on an improper time period.

A. Separate Injury Based on Aggregated Profits Data

The Commission found that the bicycle tire and bicycle tube industries were separate industries, and that each was separately injured by reason of LTFV imports. U.S.I T.C. Public. 1532, at 8, 15. To reach this determination, the Commission relied on data in its files compiled in part from previous investigations. Id. at 6. For the period 1979-1983 the Commission had before it segregated data regarding all relevant aspects of the domestic industries, including profits data. For the period 1975-1978 the Commission had segregated data on all relevant aspects of the domestic industries except profits. Nothing in the record of the investigation indicates that the Commission made any attempt to obtain segregated profits data for 1975-1978.

Under the appropriate standard of review, the first question the Court must address is whether the Commission acted in accordance with law when it failed to request segregated profits data from Carlisle for the period 1975...