SCM Corp. v. United States, Court No. 77-4-00553.

• Decision Date: 15 July 1982
• Docket Number: Court No. 77-4-00553.
• Citation: 4 CIT 7,544 F. Supp. 194
• Parties: SCM CORPORATION, Plaintiff, v. The UNITED STATES, Defendant; Brother International Corporation, Party-in-Interest.
• Court: U.S. Court of International Trade

544 F. Supp. 194

4 CIT 7

SCM CORPORATION, Plaintiff, v. The UNITED STATES, Defendant Brother International Corporation, Party-in-Interest.

Court No. 77-4-00553.

United States Court of International Trade.

July 15, 1982.

Frederick L. Ikenson, Washington, D. C., for plaintiff.

J. Paul McGrath, Asst. Atty. Gen., Washington, D. C. (David M. Cohen, Director, Commercial Litigation Branch, and Sheila N. Ziff, New York City), for defendant.

Tanaka Walders & Ritger, Washington, D. C. (H. William Tanaka and Wesley K. Caine, Washington, D. C., of counsel), for party-in-interest.

MEMORANDUM AND ORDER ON CROSS-MOTIONS FOR SUMMARY JUDGMENT

NEWMAN, Judge:

I.

BACKGROUND

This action, brought under 19 U.S.C. § 1516(c) (1976) by SCM Corporation (SCM), a domestic portable typewriter manufacturer, is again before the Court following my remand to, and the responsive Statement of Reasons by, the United States International Trade Commission ("Commission") in Portable Electric Typewriters From Japan, U.S.I.T.C. Public 732, Investigation No. AA1921-145 (40 FR 27079 (1975)). Plaintiff has contested the Commission's negative determination of injury made on June 19, 1975 under the Antidumping Act of 1921, as amended (19 U.S.C. § 160 et seq.)¹, and now before the Court is the Commission's new Statement of Reasons dated September 23, 1981. The history of this protracted case is summarized in my prior decision of July 1, 1981 remanding the action to the Commission,² and that background will be reiterated here only to the extent necessary for discussion of the remaining issues raised by the parties.

Briefly, my order of July 1, 1981 stayed the proceedings and specified that the Commission: (a) supply this Court with a more specific and explicit Statement of Reasons in compliance with the prior remand order entered by Chief Judge Re on March 7, 1980³ (with which order the Commission had not complied); (b) reconsider and advise this Court whether there was price suppression; and (c) make and report a specific finding of fact as to whether there were lost sales as a consequence of market penetration by the Japanese less than fair value (LTFV) imports.

On October 1, 1981 defendant filed with the Court the "Statement of the U. S. International Trade Commission in Compliance with Remand Order", dated September 23, 1981. This statement was approved and signed by all of the members of the Commission. In its statement of September 23, 1981 the Commission explained: (1) why it concluded that the facilities of SCM for producing manual typewriters could not be considered as a separate industry for purposes of the injury investigation; (2) why it would not predicate an affirmative determination of injury on significant market penetration standing alone; (3) why it could not find price suppression; and (4) why the record fails to support a finding of significant lost sales by reason of the LTFV imports.

In short, on remand the Commission has reexamined the record before it and provided this Court with a new Statement of Reasons. The central issue is whether the Commission's negative injury determination is correct in light of the reasons advanced in its initial and new Statement of Reasons and the record before the Commission. Presently before the Court are plaintiff's renewed motion for summary judgment and the renewed cross-motions for summary judgment by defendant and the party-in-interest. For the reasons expressed herein, plaintiff's renewed motion is denied, and the renewed cross-motions by defendant and the party-in-interest are granted. Accordingly, the Commission's negative injury determination is affirmed.

II.

OPINION

A. Commission's Compliance With Remand Order

Initially, plaintiff contends that the Commission's statement of September 23, 1981 fails to comply with either the "letter or the spirit" of the second remand order (dated July 1, 1981), and that the Commission's statement is logically and factually unsupportable. Specifically, plaintiff argues that the Commission's new statement constitutes merely "post hoc rationalizations" of the Commission's initial determination, and manifests an "institutional commitment" to defend the original determination rather than a genuine reconsideration of the issues. These contentions must be rejected.

The remand orders required more specific and explicit explanations for certain conclusions reached by the Commission in its original Statement of Reasons. In their new statement, the Commissioners advised that they had "carefully reviewed the administrative record" when they acted in compliance with the remand order; and plainly, the Commission's response manifests an objective and good faith effort to merely articulate the reasoning behind the conclusions previously reached by the Commission and questioned by the Court. Except to the extent that my remand order required the Commission to make additional findings of fact, the Commission was required to do nothing more than elaborate on certain conclusions previously reached in its original Statement of Reasons. Clearly, the Commission's new statement did not recast any of the reasons articulated in its original statement, and the orders of remand did not oblige the Commission to arrive at a different substantive result. Cf. Sprague Electric Company v. United States (Capar Components Corp., Party-in-Interest), 84 Cust.Ct. 243, C.R.D. 80-3, 488 F.Supp. 910 (1980), in which the action was remanded to the Commission expressly for reconsideration and a new determination by the Commissioners serving at that time. See also the remand to the Secretary of Labor for administrative reconsideration in R. E. Abbott et al. v. United States Secretary of Labor, 2 CIT ___, Slip Op. 82-12 (February 11, 1982).

In sum, plaintiff's contentions that the Commission has failed to comply with the Court's remand orders and that the Commission's new statement comprises post hoc rationalizations are without merit. However, the question remains whether, in light of the Commission's original Statement of Reasons and its new findings of fact and clarifications, the negative injury determination should be sustained.

It is now settled law that the sole standard of review of factual determinations of injury or likelihood of injury in antidumping cases is whether the Commission's determination is supported by substantial evidence. Armstrong Bros. Tool Co., et al. v. United States, 67 CCPA 94, C.A.D. 1252, 626 F.2d 168 (1980). Moreover, in reviewing an injury determination under the Antidumping Act, the Court may not weigh the evidence concerning specific factual findings, nor may the Court substitute its judgment for that of the Commission. Sprague Electric Company v. United States (Capar Components Corp., Party-in-Interest), 1 CIT ___, Slip Op. 81-120, 529 F.Supp. 676 (1981), and cases cited.

B.

Scope of the Affected Domestic "Industry"

We turn to the issue of industry scope. The Commission's statement on remand aptly points out that in any determination of injury under the Antidumping Act a necessary first step is to define the scope of the domestic industry against which the impact of LTFV imports is to be measured. In its original Statement of Reasons, the Commission majority stated in pertinent part:

In this case the imported articles found to be sold at LTFV by the Treasury and the imported articles covered by the Commission's notice of investigation are portable electric typewriters. However, with regard to what is the industry most likely to be affected by the subject imported articles, we have considered whether that industry is, in the alternative, the facilities devoted to the production of all portable typewriters (both electric and manual) or the facilities devoted to the production of only portable electric typewriters. In either instance the industry is the U. S. facilities of SCM Corporation, the sole U. S. producer of portable electric and portable manual typewriters.

Plaintiff argued in support of its original motion for summary judgment that the Commission erred as a matter of law when it failed to consider a third alternative industry — the domestic production facilities for portable manual typewriters. The Court's remand orders required the Commission to supply a more specific and explicit Statement of Reasons for its conclusion relating to the scope of the affected domestic industry.

In the new statement on remand, the Commission submitted its reasons for the original approach taken to the question of industry scope. To summarize, the Commission explained:

1. That portable electric typewriters, as distinct from portable manual typewriters, were the subject of the less-than-fair-value determination;

2. That "the domestic industry producing articles of a like class or kind portable electric typewriters competes most directly with and is most likely to be affected by LTFV imports"; SCM is the sole U. S. producer of portable electric typewriters, and therefore, "the core consideration * * * is the effect of the imports on SCM's facilities devoted to the production of portable electric typewriters";

3. That SCM also manufactures portable manual typewriters, and the record indicates that LTFV imports of low-end portable electric typewriters may compete with manual portables produced by SCM and may affect their sales. Consequently, it was appropriate for the Commission to alternatively consider SCM's entire facilities for the production of portable typewriters, both manual and electric, in assessing injury;

4. That the information of record indicates SCM enjoyed a "dominant position in the U. S. market for portable typewriters", and SCM's production facilities were of such a nature that SCM could change the mix of its products (i.e., the mix of portable electrics and portable manuals) in response to changing market trends and consumer preferences; and

5. That while "the inter-relationship of facilities devoted to the production of both kinds

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