Motion Systems Corp. v. Bush, Slip Op. 04-58.

• Decision Date: 03 June 2004
• Docket Number: Court No. 03-00146.,Slip Op. 04-58.
• Citation: 342 F.Supp.2d 1247
• Parties: MOTION SYSTEMS CORPORATION, Plaintiff, v. George W. BUSH, President of the United States, and Robert B. Zoellick, United States Trade Representative, Defendants, and CCL Industrial Motor Ltd., Defendant-Intervenor.
• Court: U.S. Court of International Trade

342 F.Supp.2d 1247

MOTION SYSTEMS CORPORATION, Plaintiff, v. George W. BUSH, President of the United States, and Robert B. Zoellick, United States Trade Representative, Defendants, and CCL Industrial Motor Ltd., Defendant-Intervenor.

Slip Op. 04-58.

Court No. 03-00146.

United States Court of International Trade.

June 3, 2004.

COPYRIGHT MATERIAL OMITTED

Fitch, King & Caffentzis (Richard Carville King, James Caffentzis) for plaintiff.

Peter D. Keisler, Assistant Attorney General, David M. Cohen, Director, Jeanne E. Davidson, Deputy Director, Steven C. Tosini, Trial Attorney, Commercial Litigation Branch, Civil Division, United States Department of Justice; David L. Weller, Assistant General Counsel, Office of the United States Trade Representative, for defendants, of counsel.

Kaye Scholer LLP (Michael P. House and Margaret S. Rudin) for defendant-intervenor.

OPINION

STANCEU, Judge.

[Summary judgment granted for defendants]

Plaintiff Motion Systems Corporation challenges a decision by the President of the United States to deny import relief to the U.S. industry manufacturing "pedestal actuators," which are components of electrically-powered vehicles used by persons whose mobility is impaired. Plaintiff's principal argument is that the President exceeded his statutory authority in declining to impose import quotas on pedestal actuators from the People's Republic of China ("China") following a recommendation by the United States International Trade Commission that import quotas are needed to remedy "market disruption" adversely affecting the U.S. pedestal actuator industry. Plaintiff contends in particular that the President acted contrary to the relevant statute in denying relief without quantifying the adverse impact of providing relief and demonstrating that this adverse impact was "clearly greater" than the benefits that such relief would provide to the domestic industry.

Motion Systems has named as defendants the President and the United States Trade Representative, who issued a recommendation to the President addressing the issue of import relief after publishing a notice soliciting comment and conducting a public hearing. In addition to its primary argument, plaintiff raises objections to the U.S. Trade Representative's conduct of the public hearing, to the President's considering certain political factors that Motion Systems considers improper, and to the apparent denial of Motion Systems' request to the U.S. Trade Representative that the President reconsider the final decision.

This matter is before the court on two motions by defendants. Defendants moved to dismiss for lack of subject matter jurisdiction pursuant to USCIT Rule 12(b)(1) and, previous to that motion, sought dismissal of this action through judgment upon an agency record pursuant to USCIT Rule 56.1.

This court concludes that it has subject matter jurisdiction of this case under 28 U.S.C. § 1581(i). This court further concludes that the President's decision declining to impose restraints on imports of pedestal actuators must be upheld because it is within the authority delegated to the President by the relevant statute. The court finds no basis to conclude that the presidential decision misconstrued statutory provisions or must be overturned for noncompliance with procedural requirements. Additionally, the court finds no basis to order a reopening of proceedings for reconsideration of the final presidential decision. Accordingly, for the reasons discussed below, defendants are entitled to judgment as a matter of law.

I. BACKGROUND

The pedestal actuators imported from China, and the pedestal actuators manufactured in the United States by Motion Systems Corporation, are motor-driven mechanical devices chiefly used as components in mobility scooters and electric wheelchairs. As typically installed in a mobility scooter or electric wheelchair, a pedestal actuator converts rotary motion, created by the electric motor, to the linear motion required to raise and lower the seat.

Motion Systems Corporation sought import relief through the administrative proceedings summarized below. Electric Mobility Corporation, a manufacturer of mobility scooters and purchaser of Chinese-origin pedestal actuators, opposed the imposition of import relief in those administrative proceedings, as did defendant-intervenor CCL Industrial Motor Ltd., a Chinese manufacturer of pedestal actuators.

A. Procedures Leading to the President's Decision to Deny Relief

Motion Systems, on August 19, 2002, petitioned the U.S. International Trade Commission (the "USITC") for relief from imports of pedestal actuators from China, under procedures established by section 421 of the Trade Act of 1974, as amended (19 U.S.C. § 2451) ("Section 421"). Section 421, added to the Trade Act of 1974 by the U.S.-China Relations Act of 2000, establishes procedures under which the President, following an affirmative "market disruption" determination by the USITC, is empowered to proclaim "increased duties or other import restrictions" on a product of China that "is being imported into the United States in such increased quantities or under such conditions as to cause or threaten to cause market disruption to the domestic producers of a like or directly competitive product." 19 U.S.C. § 2451(a). "Market disruption" is found to exist "whenever imports of an article like or directly competitive with an article produced by a domestic industry are increasing rapidly, either absolutely or relatively, so as to be a significant cause of material injury, or threat of material injury, to the domestic industry." 19 U.S.C. § 2451(c).

The Section 421 procedures involve separate determinations by the USITC and potentially by the President, who is to make the actual decision whether or not to grant import relief after receiving a recommendation of the U.S. Trade Representative. To initiate the process, a domestic producer may petition the USITC to investigate whether a product of China is being imported into the United States in such increased quantities or under such conditions as to cause or threaten to cause market disruption to domestic producers of like or directly competitive products. 19 U.S.C. § 2451(b).

The statute directs the USITC, upon making an affirmative determination of market disruption, to propose actions in the form of increased duties or other import restrictions necessary to prevent or remedy the market disruption. 19 U.S.C. § 2451(f). The statute further directs the U.S. Trade Representative, after receiving the report of the USITC, to publish in the Federal Register notice of any import relief measure the U.S. Trade Representative proposes to be taken and to invite public comment, with the opportunity to request a public hearing on the appropriateness of the proposed measure. 19 U.S.C. § 2451(h)(1). Further, the statute authorizes the U.S. Trade Representative to enter into agreements with the People's Republic of China under which China would take action to prevent or remedy market disruption and provides that the Trade Representative "should seek to conclude such agreements" within a 60-day period commencing five days after receiving an affirmative determination of the USITC. 19 U.S.C. § 2451(j)(1).

Section 421 vests in the President the discretion whether to provide import relief. Within 15 days of receiving the Trade Representative's final recommendation, the President is directed to provide import relief for the domestic industry "unless the President determines that provision of such relief is not in the national economic interest of the United States" or, in extraordinary cases, that it would cause serious harm to the national security. 19 U.S.C. § 2451(k)(1). The import relief may take the form of increased duties or other import restrictions and is to remain in effect "for such period as the President considers necessary to prevent or remedy the market disruption." 19 U.S.C. § 2451(a).

The President's discretion to deny import relief following an affirmative USITC finding of market disruption is subject to specific limitations. The statute provides that "[t]he President may determine ... that providing import relief is not in the national economic interest of the United States only if the President finds that the taking of such action would have an adverse impact on the United States economy clearly greater than the benefits of such action." 19 U.S.C. § 2451(k)(2).

In the proceedings leading up to this litigation, the USITC issued its report on the petition of Motion Systems on November 7, 2002, following the submission of briefs and a public hearing. See Pedestal Actuators from China: Investigation No. TA-421-1, USITC Pub. 3557. The USITC concluded in its report that pedestal actuators from China are being imported in such increased quantities or under such conditions as to cause market disruption to the domestic producers of like or directly competitive products. The USITC proposed, as a remedy to the market disruption it had found to exist, a three-year period of quantitative restrictions on Chinese pedestal actuator imports, to consist of 5,626 units in the first year, 6,470 units in the second year, and 7,440 units in the third year.¹ See International Trade Commission: Pedestal Actuators, 67 Fed. Reg. 69,557, 69,558 (Nov. 18, 2002).

After seeking, unsuccessfully, an agreement with the People's Republic of China to prevent or remedy market disruption from pedestal actuator imports, and after inviting written comments² and conducting a public hearing, the U.S. Trade Representative submitted its recommendation to the President on January 2, 2003.³ On January 17, 2003, the President issued a determination not to impose restrictive measures on imports of pedestal actuators from China.

B. The President's Decision to Deny Relief to the Domestic Pedestal Actuator Industry

The President's decision was released in the form of a Federal Register notice setting ...