Sprague Elec. Co. v. United States

• Decision Date: 28 December 1981
• Docket Number: Court No. 77-9-03056.
• Citation: 2 CIT 302,529 F. Supp. 676
• Parties: SPRAGUE ELECTRIC COMPANY, Plaintiff, v. UNITED STATES (Capar Components Corp., Party-In-Interest), Defendant.
• Court: U.S. Court of International Trade

529 F. Supp. 676

2 CIT 302

SPRAGUE ELECTRIC COMPANY, Plaintiff, v. UNITED STATES (Capar Components Corp., Party-In-Interest), Defendant.

Court No. 77-9-03056.

United States Court of International Trade.

December 28, 1981.

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

J. Paul McGrath, Asst. Atty. Gen., Washington, D. C., David M. Cohen, Director, Commercial Litigation Branch, Joseph I. Liebman, Atty. in Charge, Field Office for Customs Litigation, and Sidney N. Weiss, Trial Atty., New York City, for defendant.

Memorandum and Order on Plaintiff's Motion for Summary Judgment and Defendant's Cross-Motion for Summary Judgment

NEWMAN, Judge:

INTRODUCTION

The within action is again before this Court following my remand to, and reconsideration by, the United States International Trade Commission ("Commission") of its negative injury determination under the Antidumping Act of 1921, as amended (19 U.S.C. §§ 160, et seq. (1970)) ("Antidumping Act") in Investigation No. AA1921-159 (41 FR 47604 (1976)). That investigation involved tantalum electrolytic fixed capacitors imported from Japan. See 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, modified on rehearing, 84 Cust.Ct. 260, C.R.D. 80-6 (1980).

Pending for decision are plaintiff's motion for summary judgment and defendant's cross-motion for summary judgment. For the reasons indicated, plaintiff's motion is denied, and defendant's cross-motion is granted.

BACKGROUND

Plaintiff is a domestic manufacturer of tantalum electrolytic fixed capacitors. On September 24, 1975 plaintiff, through counsel, submitted a complaint to the Commissioner of Customs alleging that tantalum electrolytic fixed capacitors from Japan were being sold at less than fair value ("LTFV") within the meaning of the Antidumping Act. Following an investigation, the Department of the Treasury determined on July 27, 1976 that tantalum electrolytic fixed capacitors (other than those produced and sold by Matsushita Electric Industrial Company, Ltd. ("Matsushita") from Japan were being or likely to be sold at LTFV within the meaning of the Antidumping Act (41 FR 31240 (1976)).

Thereafter, the Commission conducted an investigation to determine whether a domestic industry was being or was likely to be injured or was prevented from being established by reason of the importation of tantalum electrolytic fixed capacitors from Japan at LTFV. On October 22, 1976 a six-member Commission by a vote of 5 to 1 reached a negative determination, viz., the Commission majority determined that an industry in the United States was not being or likely to be injured or prevented from being established by reason of the LTFV imports (41 FR 47604 (1976)) (hereinafter "Tantalum I").

On September 14, 1977 plaintiff commenced this action challenging the Commission's negative injury determination, alleging inter alia that the Commission relied upon false import statistics which underrepresented the true magnitude of LTFV imports.¹

On August 22, 1978 the Commission published notice of the erroneous import statistics and invited the public to comment upon "whether the Commission's reliance on erroneous official statistics justifies further Commission action with respect to its determination in investigation No. AA1921-159" (43 FR 37233 (1978)).

On February 9, 1979 the Commission announced that no further action would be taken relative to its negative determination (44 FR 8359 (1979)).

On May 15, 1979 plaintiff filed its motion for summary judgment and shortly thereafter, defendant filed its cross-motion for summary judgment. These motions culminated in an order of the Court, entered on March 27, 1980, which provides:

1. Plaintiff's motion and defendant's cross-motion for summary judgment are denied at this time;

2. Proceedings in the instant case shall be stayed pending a reconsideration by the Commission of its original determination in Investigation No. AA1921-159 and the taking of a new vote on the question of whether, in light of the correct import statistics for tantalum electrolytic fixed capacitors from Japan, sales of such merchandise at LTFV were injuring or were likely to injure an industry in the United States within the meaning of the Antidumping Act of 1921, as amended; and the Commission may conduct any further proceedings which it deems appropriate, but consistent with this order;

3. The Commission shall, through counsel for defendant, submit to the Court within 90 days from the date of entry of this order its new determination, whether affirmative or negative, together with a complete statement of findings and conclusions, and the reasons or bases therefor, on all material issues of fact or law presented, including the materiality of the corrected import statistics on the Commission's new determination. 84 Cust.Ct. at 254-55, 488 F.Supp. 910.

Subsequently, on April 25, 1980 plaintiff filed a motion for rehearing, and in a decision dated May 23, 1980 (C.R.D. 80-6) this Court ordered, so far as pertinent:

1. That plaintiff's motion for rehearing be granted to the extent that the Commission is directed to consider in its deliberations on remand the effect of Nippon Electric Company's plans to increase productive capacity for, and exportation to the United States, of epoxy dipped tantalum electrolytic fixed capacitors.

After receipt of the Court's order, as modified, the Commission published an invitation for comments "on the question of whether the Commission's earlier determination in investigation No. AA1921-159, Tantalum Electrolytic Fixed Capacitors From Japan, should change by virtue of considering `epoxy dipped' tantalum electrolytic fixed capacitors exported to the United States by Nippon Electric Company to be within the class or kind of merchandise found by the Department of the Treasury to have been sold or likely to be sold at less than fair value" (45 FR 41249-50 (1980)).

On August 6, 1980 a five-member Commission determined, two Commissioners dissenting, "that as of October 22, 1976, the date of the Commission's earlier determination regarding tantalum electrolytic fixed capacitors from Japan, an industry in the United States was not being and was not likely to be injured, and was not prevented from being established, by reason of the importation of tantalum electrolytic fixed capacitors from Japan sold, or likely to be sold, at less than fair value within the meaning of the Antidumping Act, 1921, as amended." (45 FR 58729 (1980)) (hereinafter "Tantalum II").

In their joint statement of views, Chairman Alberger, Vice Chairman Calhoun, and Commissioner Stern, none of whom was a Commissioner when the first determination was rendered, offered this explanation:

In arriving at its determination in this matter, the Commission has given due consideration to written submissions received from interested persons, information obtained during the course of investigation No. AA1921-159, and the corrected official import statistics for tantalum electrolytic fixed capacitors from Japan for the period Janury 1975 through June 1976 as reported by the Bureau of Census. With the exception of the corrected import statistics, the Commission has not considered any information obtained subsequent to the date of the earlier determination.

* * * * * *

In accordance with the instructions of the United States Customs Court since November 1, 1980, the United States Court of International Trade we have reviewed the confidential staff report of September 1976 and the statement of reasons in the Commission's report on Tantalum Electrolytic Fixed Capacitors, USITC Publication 789, October 1976, as revised to reflect corrected import statistics. In our deliberations we have considered all imports of tantalum electrolytic fixed capacitors from Japan less those from Matsushita Electrical Industrial Co., Ltd., as sales at less than fair value (LTFV) for the purpose of addressing present and future injury.

We are persuaded that any injury suffered by the U.S. industry as of October 22, 1976, was not caused or likely to be caused by LTFV imports of tantalum electrolytic fixed capacitors (tantalum capacitors), but rather by the recessionary forces at work in the electronics industry. Taking into account the corrected import statistics, as well as the modification of the content of LTFV sales, we believe that the penetration of the U.S. market and the underselling of U.S. producers were not of sufficient magnitude to warrant a determination of injury by reason of LTFV sales.

The successor Commissioners proceeded to state that the evidence bearing on the existence of present injury indicated that although LTFV imports increased in the first six months of 1976 after having declined in 1975, other indices showed "a concurrent improvement in the health of the U.S. industry." They then noted that with respect to the first six months of 1976 these other indices showed that (a) domestic consumption of tantalum capacitors had increased, (b) capacity utilization rates were growing in the domestic industry, and (c) the domestic producers accounting for the "bulk" of United States production were experiencing increasing profits and high ratios of net operating profits to net sales. The new Commissioners further found that (a) increases in shipments of domestically produced tantalum capacitors exceeded the market gains achieved by LTFV imports throughout 1974-76; (b) "only the major supplier of LTFV capacitors consistently undersold domestic producers;" and (c) the frequency of actual sales of imports at LTFV was too low to cause the loss of sales to domestic producers. Additionally, in their findings of fact, the new Commissioners observed that "although LTFV imports from Japan increased as a share of the U.S. market for tantalum capacitors throughout the period of investigation, at no time did the share of total U.S. consumption held by LTFV...