PPG Industries, Inc. v. US, Court No. 89-12-00678.

• Decision Date: 17 January 1990
• Docket Number: Court No. 89-12-00678.
• Citation: 729 F. Supp. 859,14 CIT 18
• Parties: PPG INDUSTRIES, INC., Plaintiff, v. UNITED STATES, Defendant, Vitro Flex, S.A. and Cristales Inastillables de Mexico, S.A., Defendants-Intervenors.
• Court: U.S. Court of International Trade

729 F. Supp. 859

14 CIT 18

PPG INDUSTRIES, INC., Plaintiff, v. UNITED STATES, Defendant, Vitro Flex, S.A. and Cristales Inastillables de Mexico, S.A., Defendants-Intervenors.

Court No. 89-12-00678.

United States Court of International Trade.

January 17, 1990.

Stewart and Stewart, Terence P. Stewart and David Scott Nance, Washington, D.C., for plaintiff.

Stuart M. Gerson, Asst. Atty. Gen., David M. Cohen, Director, Commercial Litigation Branch, Civ. Div., U.S. Dept. of Justice, Washington, D.C. and Velta A. Melnbrencis, New York City, for defendant.

Brownstein, Zeidman and Schomer, Irwin P. Altschuler, David R. Amerine, Claudia G. Pasche, Washington, D.C., and Jeff P. Manciagli, Brooklyn, N.Y., for defendants-intervenors.

MEMORANDUM OPINION

CARMAN, Judge:

This Court issued an order on January 5, 1990, granting plaintiff's application for a preliminary injunction. Pursuant to Rule 52(a) of this Court, this opinion sets forth the findings of fact and conclusions of law underlying the issuance of that order.

Plaintiff commenced this action by filing a summons and complaint concurrently with an application for a temporary restraining order and preliminary injunction. Plaintiff contests certain aspects of the final determination of the International Trade Administration (ITA) in its administrative review of the countervailing duty order covering fabricated automotive glass from Mexico for the calendar year 1986.¹

On December 26, 1989, with the consent of all parties, Senior Judge Bernard Newman sitting in Motion Part, granted plaintiff's request for a temporary restraining order and scheduled a hearing on the merits of the imposition of a preliminary injunction. The temporary restraining order enjoined the defendant from making or permitting the liquidation of any unliquidated entries of fabricated automotive glass, including tempered and laminated automotive glass, produced by the Mexican manufacturers and exporters, Cristales Inastillables de Mexico, S.A., and Vitro Flex, S.A., which were entered or withdrawn from warehouse on or after January 1, 1986 and exported on or before December 31, 1986.

At the hearing, the Court granted the application by the Mexican manufacturers to intervene as of right. Defendant-intervenors opposed plaintiff's motion for a preliminary injunction in part. The defendant United States consented to the issuance of a preliminary injunction. After hearing the arguments of the parties, the Court issued an order enjoining the defendant from liquidating any and all entries covered by the temporary restraining order.

BACKGROUND

On December 19, 1989 the ITA published its final determination concerning its administrative review of the countervailing duty order covering fabricated automotive glass from Mexico for the calendar year 1986. Fabricated Automotive Glass From Mexico; Final Results of Countervailing Duty Administrative Review, 54 Fed.Reg. 51,908 (Dec. 19, 1989). The determination noted the ITA had found the total grant or bounty for the period January 1, 1986 through December 31, 1986 to be zero. The ITA instructed the Customs Service to liquidate all outstanding entries of the merchandise exported during the 1986 calendar year without regard to countervailing duties and directed that no countervailing duty deposits be collected henceforth.

At the administrative hearing before the ITA, defendant-intervenors argued that as a result of Mexico's accession to the General Agreement on Tariffs and Trade (GATT), effective on August 24, 1986, countervailing duties could not be assessed on merchandise subsequent to that date, without an injury determination pursuant to section 303(a)(2) of the Tariff Act of 1930. 19 U.S.C. § 1303(a)(2) (1988). Plaintiff argued that the ITA had neither the obligation nor the authority to revoke the countervailing duty order for the period after August 24, 1986 (the "post-GATT" period).

In its determination the ITA stated:

The merchandise covered by this review is afforded duty-free status under the Generalized System of Preferences. Section 303(a)(2) prohibits the imposition of countervailing duties on duty-free products absent an affirmative injury determination when the United States has an "international obligation" to provide such a test. Mexico's accession to the GATT imposes such an international obligation on the United States with respect to duty-free merchandise entered into the United States after the date of Mexico's accession.

54 Fed.Reg. at 51,912. Nevertheless, the ITA declined to address the issue of whether Mexico's accession to the GATT required revocation of the countervailing duty order as to merchandise entered subsequent to that date. The ITA reasoned as follows:

Assessment of duties is not an issue at this time because the total bounty or grant for the period January 1, 1986 through December 31, 1986, is zero. Moreover, we are currently pursuing means by which an injury determination could be made concerning imports of Mexican automotive glass entered on or after August 24, 1986, the date of Mexico's accession to the GATT.

Id.

Thereafter, plaintiff commenced this action to contest certain of the ITA's findings that resulted in its determination of a zero bounty or grant for entries covered in the administrative review. In opposing plaintiff's motion for the preliminary injunction, defendant-intervenors object only to the issuance of a preliminary injunction for the liquidation of merchandise entered after Mexico's accession to the GATT, i.e., during the period from August 25, 1986 through December 31, 1986. At oral argument defendant-intervenors consented to the granting of a preliminary injunction covering the period from January 1, 1986 through August 24, 1986.

DISCUSSION

A preliminary injunction is an extraordinary remedy that must be granted sparingly. Zenith Radio Corp. v. United States, 1 Fed.Cir. (T) 74, 77, 710 F.2d 806, 809 (1983). It should be granted only upon a clear showing that the movant is entitled to the relief requested. American Air Parcel Forwarding Co., Ltd. v. United States, 1 CIT 293, 298, 515 F.Supp. 47, 52 (1981).

When considering an application for a preliminary injunction, it is well settled that the movant must establish four factors: (1) a threat of immediate and irreparable injury; (2) the likelihood of success on the merits; (3) that the public interest would be better served by the relief requested; and (4) that the balance of hardship on all the parties favors the movant. Matsushita Elec. Indus. Co. v. United States, 5 Fed.Cir. (T) 116, 120, 823 F.2d 505, 509 (1987); Zenith Radio Corp., 1 Fed.Cir. (T) at 76, 710 F.2d at 809; S.J. Stile Assocs. Ltd. v. Snyder, 68 CCPA 27, 30, C.A.D. 1261, 646 F.2d 522, 525 (1981); Timken Co. v. United States, 6 CIT 76, 78, 569 F.Supp. 65, 68 (1983).

In analyzing these criteria, the Court applies a "balance of hardship," or sliding scale approach. See National Customs Brokers and Forwarders Assn. of America v. United States, 13 CIT ___, Slip Op. 89-140 at 13, 723 F.Supp. 1511, 1516 (1989) (citing Zenith Radio Corp., 1 Fed. Cir. (T) at 81, 710 F.2d at 812 (Nies, J. concurring)); Algoma Steel Corp., Ltd. v. United States, 12 CIT ___, 696 F.Supp. 656, 658 n. 2 (1988); The Timken Co. v. United States, 11 CIT 504, 506-07, 666 F.Supp. 1558, 1559-60 (1987); American Air Parcel, 1 CIT at 299-300, 515 F.Supp. at 53.

Plaintiff will clearly suffer immediate and irreparable injury if the injunction were not to issue. Liquidation of the entries in question would irrevocably deprive plaintiff of its statutory right to judicial review of the ITA's administrative review of the 1986 calendar year. Liquidation of entries subject to an administrative review, prior to judicial review in this Court of the merits of the ITA's determination in the administrative review, constitutes irreparable injury, since liquidation of the entries would render judicial review a meaningless exercise. See Zenith Radio Corp., 1 Fed. Cir. (T) at 77-78, 710 F.2d at 810; Timken Co., 6 CIT at 79-80, 569 F.Supp. at 69. As the Court noted in Zenith, once liquidation occurs, a subsequent decision by the trial court on the merits of the challenge to the administrative review "can have no effect" on the duties assessed on entries during the review period. Zenith Radio Corp., 1 Fed.Cir. (T) at 78, 710 F.2d at 810. Should a decision on the merits alter the duty rate in this case, this Court would be powerless to grant the only effective remedy sought by the plaintiff: assessment of correct countervailing duties on the entries covered by the administrative review for 1986. See id.

This conclusion is not altered by defendant-intervenors' argument that plaintiff cannot possibly show irreparable harm concerning the post-GATT entries. Defendant-intervenors base this argument on the proposition that "any change in the duty rate which may result from the instant litigation would not ... apply to the post-GATT accession entries" since, if the ITA were to find that a bounty or grant had indeed been conferred in this case, it would be required to revoke the countervailing duty order due to the absence of an injury determination. Defendant-Intervenors' Memorandum at 19-20.

However, plaintiff argues, it is entirely possible that there will be an injury determination conducted in this case. The ITA stated in its determination that it is "currently pursuing means by which an injury determination could be made concerning imports...