Silver Reed America, Inc. v. United States

• Citation: 590 F. Supp. 1254
• Decision Date: 21 June 1984
• Docket Number: Court No. 80-6-00934.
• Parties: SILVER REED AMERICA, INC. and Silver Seiko, Ltd., Plaintiffs, v. UNITED STATES, Defendant, and Smith-Corona Group, Consumer Products Division, SCM Corporation, Intervenor.
• Court: U.S. Court of International Trade

590 F. Supp. 1254

SILVER REED AMERICA, INC. and Silver Seiko, Ltd., Plaintiffs, v. UNITED STATES, Defendant, and Smith-Corona Group, Consumer Products Division, SCM Corporation, Intervenor.

Court No. 80-6-00934.

United States Court of International Trade.

June 21, 1984.

Wald, Harkrader & Ross, Washington, D.C. (Christopher Dunn, William J. Clinton and William E. Shimer, Washington, D.C., of counsel), for plaintiffs.

Richard K. Willard, Acting Asst. Atty. Gen., David M. Cohen, Director, Commercial Litigation Branch, Washington, D.C., Velta A. Melnbrencis, New York City, and Francis J. Sailer, Washington, D.C., for defendant.

Stewart & Stewart, Washington, D.C. (Eugene L. Stewart and Terence P. Stewart, Special Counsel, Washington, D.C.), Edwin Silverstone, New York City, and Robert E. Walton, King of Prussia, Pa., for intervenor.

NEWMAN, Senior Judge:

Introduction

This case raises the novel and significant question of whether, following a decision in plaintiffs' favor on the merits in an antidumping case, stay of remand, and pending an interlocutory appeal filed by intervenor, plaintiffs' motion to enjoin liquidation of entries covered by a prior Court decision is barred by the doctrine of res judicata or collateral estoppel.

Plaintiffs, Silver Seiko, Ltd., a Japanese manufacturer and exporter of portable electric typewriters ("PETs"), and Silver Reed America, Inc., its wholly-owned importer (hereinafter "Silver" when used collectively), seek to enjoin liquidation of all entries of their PETs otherwise than in accordance with the final decision in Silver Reed America, Inc. v. United States, 7 CIT ___, 581 F.Supp. 1290 (1984), appeal pending, CAFC Misc. Docket No. 29. In the present case, Silver contested the Commerce Department's Affirmative Determination of Sales at Less Than Fair Value ("LTFV") concerning Silver's PETs; and in remanding the action to Commerce, this Court held that the exporter's sales price ("ESP") offset "cap" in 19 CFR § 353.15(c) challenged by Silver is invalid. Defendant, United States, opposes Silver's application respecting the entries covered by the Commerce Department's Early Determination of Antidumping Duties ("early determination entries") under section 736(c) of the Tariff Act of 1930, as amended, 19 U.S.C. § 1673e(c).¹

In Brother Indus., Ltd. v. United States, 3 CIT 125, 126, 540 F.Supp. 1341 (1982), aff'd sub. nom. Smith Corona Group v. United States, 713 F.2d 1568 (Fed.Cir. 1983), cert. denied, ___ U.S. ___, 104 S.Ct. 1274, 79 L.Ed.2d 679 (1984) ("Brother"), the ESP offset adjustment under 19 CFR § 353.15(c) itself was challenged by SCM Corporation ("SCM"), but the Commerce Department's Early Determination under section 736(c) was upheld by this Court. Silver intervened in the Brother action in support of the ESP offset adjustment and Early Determination. The Government contends that respecting the early determination entries, Brother has res judicata or collateral estoppel effect on Silver's application to enjoin liquidation.

Intervenor, SCM, does not oppose Silver's motion, yet nevertheless argues that Silver has not established irreparable injury.

Background

Silver commenced this action on June 6, 1980 under section 516A(a)(2) of the Tariff Act of 1930, as amended, 19 U.S.C. § 1516a(a)(2), to contest the Final Affirmative Determination of Sales at LTFV (45 Fed.Reg. 18416, March 21, 1980) and Antidumping Duty Order (45 Fed.Reg. 30618, May 9, 1980) of the United States Department of Commerce, International Trade Administration ("ITA"). Silver challenged ITA's LTFV determination primarily on the ground that the ESP offset cap in 19 CFR § 353.15(c) was invalid, and therefore, in comparing foreign market value with the exporter's sales price, ITA erred in limiting the deduction of home market selling expenses in Japan to the amount of the selling expenses incurred in the United States market.

On August 29, 1980, almost three months after Silver commenced the instant suit, SCM filed an action challenging ITA's Early Determination under section 736(c) contending that the ESP offset itself was invalid, and as a result ITA erred in deducting any home market selling expenses from the foreign market value.² Silver intervened in the Brother action supporting ITA's ESP offset adjustment and Early Determination, but expressing dissatisfaction with the offset cap in 19 CFR § 353.15(c). On April 30, 1982 this Court sustained ITA's Early Determination (Brother, supra) and upheld the ESP offset adjustment. That decision dissolved a preliminary injunction granted SCM on December 30, 1980, which had suspended liquidation of the early determination entries. However, by order dated June 28, 1982, SCM's motion for restoration of the injunction during pendency of its appeal was granted. See 3 CIT 242 (1982). On August 9, 1983 the Court of Appeals for the Federal Circuit affirmed this Court's decision of April 30, 1982 in Brother (3 CIT 125, 540 F.Supp. 1341). Smith Corona Group v. United States, 713 F.2d 1568 (Fed.Cir.1983), cert. denied ___ U.S. ___, 104 S.Ct. 1274, 79 L.Ed.2d 679 (1984). Subsequently, in an opinion and order issued on February 1, 1984, this Court sustained Silver's challenge in its own action to the March 21, 1980 LTFV Determination holding invalid the ESP offset cap in 19 CFR 353.15(c), and remanded to ITA for redetermination of the offset adjustment in accordance with the Court's decision.³Silver Reed America, Inc. v. United States, supra. By order of March 9, 1984 this Court granted defendant's motion for a stay of the remand order of February 1, 1984 (7 CIT ___, 581 F.Supp. 1290); and granted on March 16, 1984 SCM's motion for certification of the question of the validity of the ESP offset cap for an immediate appeal. Thereafter, on April 5, 1984, the Court of Appeals granted SCM permission to file an immediate appeal; and on April 17, 1984, an appeal was filed by SCM (CAFC Misc. Docket No. 29), which is now pending.

Following its successful litigation on the merits in the instant case, the stay of the remand, and pending SCM's interlocutory appeal, Silver now seeks to enjoin liquidation of all its entries covered by the May 9, 1980 Antidumping Duty Order from January 4, 1980, the date liquidation was first suspended, to the date notice of this Court's final judgment is published or until final disposition of this case on appeal. Specifically, the unliquidated entries for which Silver seeks injunctive relief fall into the following categories:

1. entries from January 4, 1980 to May 7, 1980, the subject of ITA's Early Determination and the Brother case;

2. entries from April 1, 1980 to March 31, 1981, covered by ITA's final results of its first administrative review pursuant to section 751(a) of the Tariff Act of 1930, as amended, 19 U.S.C. § 1675(a). 48 Fed.Reg. 4076, September 9, 1983;⁴

3. entries from April 1, 1981 to March 31, 1982, covered by ITA's second section 751(a) review, which has not yet been completed;

4. entries from April 1, 1982 to the date when a notice of the final Court decision in this case is published in the Federal Register.

Silver has not previously sought to enjoin liquidation of any entries of its PETs.⁵

Res Judicata and Collateral Estoppel

Defendant does not oppose plaintiffs' application for an injunction except as to the early determination entries, viz., those between January 4, 1980 and May 7, 1980. As mentioned supra, defendant contends that the judgment in Brother has res judicata or collateral estoppel effect on plaintiffs' present application respecting the early determination entries, and hence plaintiffs are barred from relitigating the amount of antidumping duties to be assessed upon the early determination entries. Before addressing defendant's contention, this Court notes the authoritative teaching of the Supreme Court in Parklane Hosiery Co. v. Shore, 439 U.S. 322, 326, n. 5, 99 S.Ct. 645, 649, n. 5, 58 L.Ed.2d 552 (1978) with respect to the doctrines of res judicata and collateral estoppel:

Under the doctrine of res judicata, a judgment on the merits in a prior suit bars a second suit involving the same parties or their privies based on the same cause of action. Under the doctrine of collateral estoppel, on the other hand, the second action is on a different cause of action and the judgment in the prior suit precludes relitigation of issues actually litigated and necessary to the outcome of the first action.

Continuing, the Supreme Court observed (id.):

Collateral estoppel, like the related doctrine of res judicata, has the dual purpose of protecting litigants from the burden of relitigating an identical issue with the same party or his privy and of promoting judicial economy by preventing needless litigation.

See also: Lawlor v. Nat'l Screen Svc., 349 U.S. 322, 326-27, 75 S.Ct. 865, 867-68, 99 L.Ed. 1122 (1954); Partman Corp. v. Paramount Corp., 347 U.S. 89, 74 S.Ct. 414, 98 L.Ed. 532 (1954).

Fundamentally, of course, the doctrine of res judicata "applies to repetitious suits involving the same cause of action." Comm'r v. Sunnen, 333 U.S. 591, 597, 68 S.Ct. 715, 719, 92 L.Ed. 898 (1947). Significantly, however, Silver's cause of action in the present case is not the same as that upon which SCM sued in Brother. In its own action (the instant case) Silver challenged the LTFV determination of March 21, 1980 and the application by ITA of the ESP offset cap in determining foreign market value. In Brother, SCM challenged the ESP offset itself and other adjustments applied by ITA in determining foreign market value in arriving at the Early Determination of April 30, 1982. Silver intervened in Brother for the limited purpose of supporting the ESP offset and certain other adjustments to foreign market value in the Early Determination. The legal issue in Silver's own case — the validity of the ESP offset cap — was explicitly not before the Court in Brother. 3 CIT 143 n. 15, 540 F.Supp. 1341.

Moreover, in the Bro...