Sichuan Changhong Elec. Co., Ltd. v. United States

Slip Op. 06-168

UNITED STATES COURT OF INTERNATIONAL TRADE

______________________________
:
SICHUAN CHANGHONG ELECTRIC :
CO., LTD., :
:
Plaintiff, :
:
and : Before: Richard K. Eaton, Judge
:
APEX DIGITAL, INC. and : Court No. 04-00266
TCL CORP., :
: Public Version
Pl.-Ints., :
:
v. :
:
UNITED STATES, :
:
Defendant, :
:
and :
:
FIVE RIVERS ELECTRONICS :
INNOVATION, LLC, INDUSTRIAL :
DIVISION OF THE COMMUNICATION :
WORKERS OF AMERICA (IUE-CWA) :
and INTERNATIONAL BROTHERHOOD :
OF ELECTRICAL WORKERS, :
:
Deft.-Ints. :
______________________________:

OPINION AND ORDER

[United States International Trade Commission’s Final
Determination remanded.]

Dated: November 15, 2006

Wiley, Rein & Fielding, LLP (Charles Owen Verrill, Jr. and
Timothy C. Brightbill), for plaintiff.
Court No. 04-00266 Page 2

McDermott, Will & Emery, LLC (Raymond Paul Paretzky), for
plaintiff-intervenor TCL Corp.

O’Melveny & Myers, LLP (Veronique Lanthier), for plaintiff-
intervenor Apex Digital, Inc.

James M. Lyons, General Counsel, United States International
Trade Commission; Robin L. Turner, Acting Assistant General
Counsel, United States International Trade Commission (Marc A.
Bernstein), for defendant.

Kelley Drye Collier Shannon, PLLC (Mary Tuck Staley), for
defendant-intervenors.

Eaton, Judge: Before the court is plaintiff Sichuan

Changhong Electric Co., Ltd.’s (“Changhong” or “plaintiff”)

motion for judgment upon the agency record pursuant to USCIT Rule

56.2. By its motion, Changhong contests the final affirmative

material injury determination of the United States International

Trade Commission (the “Commission” or “ITC”) in the antidumping

duty investigation concerning certain color television receivers

(“CTVs”) from the People’s Republic of China (“PRC”).1 See

Certain Color Television Receivers From China, USITC Pub. 3695,

Inv. No. 731-TA-1034 (Final) (May 2004), List 2, Doc. 426 (“Final

Determination”); Certain Color Television Receivers From China,

69 Fed. Reg. 31,405 (ITC June 3, 2004). The court has

1
As a manufacturer and exporter of CTVs subject to the ITC’s
final determination, Changhong is an “interested party” within
the meaning of 19 U.S.C. § 1677(9)(A) (2000) and is thus entitled
to challenge the determination.
Court No. 04-00266 Page 3

jurisdiction pursuant to 28 U.S.C. § 1581(c) (2000) and 19 U.S.C.

§ 1516a(a)(2)(B)(i) (2000). For the reasons that follow, the

court remands the Final Determination.

BACKGROUND

On May 2, 2003, the International Brotherhood of Electrical

Workers, the Industrial Division of the Communication Workers of

America (IUE-CWA) and Five Rivers Electronics Innovation, LLC

filed an antidumping duty petition alleging that the United

States CTV industry was being materially injured and was

threatened with further material injury by reason of less than

fair value (“LTFV”) imports of CTVs from the PRC and Malaysia.2

List 1, Doc. 1. Based on the information contained in the

petition, the Commission instituted an antidumping duty

investigation. Certain Color Television Receivers From China and

Malaysia, 68 Fed. Reg. 25,627 (ITC May 13, 2003). A conference

2
The United States Department of Commerce’s (“Commerce”)
investigation was initiated for both Malaysia and the PRC.
Certain Color Television Receivers From Malaysia and the PRC, 68
Fed. Reg. 32,013 (ITA May 29, 2003). As a result of the
investigation, Commerce determined that imports from Malaysia
were not sold at LTFV. Certain Color Television Receivers From
Malaysia, 69 Fed. Reg. 20,592 (ITA Apr. 16, 2004). The
Commission terminated its investigation with respect to CTVs from
Malaysia, effective April 16, 2004. Certain Color Television
Receivers From Malaysia, 69 Fed. Reg. 22,093 (ITC Apr. 23, 2004).
As such, imports from Malaysia are not the subject of this
litigation.
Court No. 04-00266 Page 4

in connection with the investigation was held on May 23, 2003,

and all persons requesting the opportunity were permitted to

appear. Certain Color Television Receivers From China and

Malaysia, 68 Fed. Reg. 38,089 (ITC June 26, 2003) (prelim.).

Interested parties filed briefs on May 29, 2003. See, e.g., List

2, Docs. 42-46. On the basis of the record developed in the

investigation, the ITC preliminarily determined that there was a

“reasonable indication that an industry in the United States

[was] materially injured by reason of imports” of the subject

merchandise. 68 Fed. Reg. at 38,089.

Following its preliminary determination, the ITC published a

schedule for the final phase of its investigation. Certain Color

Television Receivers From China and Malaysia, 69 Fed. Reg. 3601

(ITC Jan. 26, 2004) (“Scheduling Notice”). Issued on January 20,

2004, the Scheduling Notice established a timetable for the

remainder of the ITC’s investigation: (1) “The prehearing staff

report . . . will be placed in the nonpublic record on April 1,

2004”; (2) “The Commission will hold a hearing . . . on April 15,

2004 . . . . Requests to appear . . . should be filed . . . on

or before April 7, 2004”; (3) “Each party who is an interested

party shall submit a prehearing brief to the Commission . . . .

[T]he deadline for filing is April 8, 2004”; (4) “The deadline

for filing posthearing briefs is April 22, 2004”; (5) “On
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May 7, 2004, the Commission will make available to parties all

information on which they have not had an opportunity to

comment”; (6) “Parties may submit final comments on this

information on or before May 11, 2004, but such final comments

must not contain new factual information and must otherwise

comply with section 207.30 of the Commission’s rules.” Id. at

3601-02.

The Commission conducted its investigation according to the

Scheduling Notice. Interested parties submitted questionnaire

responses and pre-hearing briefs in March and April 2004. On

April 15, 2004, the ITC held a day-long hearing where several

parties presented testimony. The arguments made at the hearing

prompted a reevaluation of the record information documenting the

domestic industry’s financial performance. This reevaluation led

the Commission to conclude that it lacked the most recent

financial data relating to the domestic industry. On April 21,

2004, Commission staff sent e-mail messages to domestic producers

of CTVs whose fiscal years ended on March 31, 2003, asking for

updated financial data for calendar year 2003. List 2, Docs.

308, 309, 313, 314. On April 29 and May 4, 2004, the domestic

producers furnished the ITC with the requested information

(“updated financial information”). In the aggregate, the
Court No. 04-00266 Page 6

domestic producers’ submissions averaged under ten pages in

length. List 2, Docs. 324, 325, 326, 336.

On May 6, 2004, the Commission placed on the record a

memorandum, which contained a one-page digest of the updated

financial information provided by the domestic CTV producers.

List 2, Doc. 398. In accordance with the dates in the Scheduling

Notice, the updated financial data was released to the parties,

including Changhong, on May 7, 2004. Changhong and the other

Chinese respondents filed their final comments on the updated

financial information on May 11, 2004. List 2, Doc. 407.

Pursuant to Commission regulations, the parties’ final comments

were not to exceed fifteen pages. 19 C.F.R. § 207.30(b) (2004).

Changhong submitted ten pages of comments, of which one and one-

quarter pages discussed the updated financial information. List

2, Doc. 407 at 6-7. On May 27, 2004, on the basis of the record

developed in the investigation, the ITC determined that “an

industry in the United States is materially injured by reason of

imports of certain color television receivers from China that are

sold in the United States at less than fair value . . . .” Final

Determination at 3.
Court No. 04-00266 Page 7

STANDARD OF REVIEW

When reviewing a final determination in an antidumping or

countervailing duty investigation, “[t]he court shall hold

unlawful any determination, finding, or conclusion found . . . to

be unsupported by substantial evidence on the record, or

otherwise not in accordance with law . . . .” 19 U.S.C.

§ 1516a(b)(1)(B)(i). “Substantial evidence is such relevant

evidence as a reasonable mind might accept as adequate to support

a conclusion.” Huaiyin Foreign Trade Corp. (30) v. United

States, 322 F.3d 1369, 1374 (Fed. Cir. 2003) (quoting Consol.

Edison Co. v. NLRB, 305 U.S. 197, 229 (1938)). “Substantial

evidence is more than a mere scintilla.” Consol. Edison, 305

U.S. at 229. The existence of substantial evidence is determined

“by considering the record as a whole, including evidence that

supports as well as evidence that ‘fairly detracts from the

substantiality of the evidence.’” Huaiyin, 322 F.3d at 1374

(quoting Atl. Sugar, Ltd. v. United States, 744 F.2d 1556, 1562

(Fed. Cir. 1984)).

DISCUSSION

A. Changhong’s Due Process Claim

Changhong argues that the ITC deprived it of a right to

“participate meaningfully” in the ITC’s investigation. Pl.’s
Court No. 04-00266 Page 8

Conf. Revised Br. Supp. Mot. J. Agency R. (“Pl.’s Supp. Br.”) at

4. Changhong styles this claim as a due process violation, but

it does not challenge the constitutionality of either the

antidumping statute or the Commission’s regulations, nor does it

contend the ITC failed to comply with its regulations. Pl.’s

Revised Conf. Reply Br. (“Pl.’s Reply”) at 4 (“Changhong has

never claimed that the ITC did not comply with its

regulations.”).

In its opening brief, Changhong claims that “[b]ecause [it]

was given only four days to review and comment on [the updated

financial] information, it had no real opportunity to analyze the

information, conduct further research, and develop and submit its

own information and arguments in response.” Pl.’s Supp. Br. at

10 (emphasis omitted). In its reply brief, however, Changhong

seems to retreat from this position and argues instead that the

“issue is not whether [it] should have been accorded more time to

comment on the information, but whether its inability to submit

new factual information prejudiced its ability to make meaningful

comments.” Pl.’s Reply at 5-6. Changhong asserts that the

updated financial information was important to the ITC’s finding

that the profitability of the domestic industry decreased between

2001 and 2003, and that it was prejudiced by not having the

opportunity to submit new factual information of its own to show
Court No. 04-00266 Page 9

that “declining production and profitability in the domestic

industry was a consequence of [a] shift to non-subject countries

. . . .” Pl.’s Supp. Br. at 14. Changhong thus seeks a remand

to the Commission with instructions to permit the parties to

“submit new factual information” on the domestic industry’s

financial condition in 2003 and the first quarter of 2004. Pl.’s

Reply at 9. The court shall address both of Changhong’s

arguments.

It is well established that “[t]he fundamental requisite of

due process of law is the opportunity to be heard.” Grannis v.

Ordean, 234 U.S. 385, 394 (1914) (citations omitted). In order

to succeed in its due process claim, then, Changhong must show

that its opportunity to be heard was unreasonably curtailed. See

Borden, Inc. v. United States, 23 CIT 372, 375 n.3 (1999), rev’d

on other grounds, 7 Fed. Appx. 938 (Fed. Cir. 2001).

Here, the primary basis for Changhong’s due process claim is

that it was denied a meaningful opportunity to participate in the

administrative proceeding by having only four days to review and

comment on the updated financial information and by not being

permitted to submit new factual information. Pl.’s Supp. Br. at

10. This Court has stated that, at a minimum, the ITC must

adhere “to the procedures which Congress has set out in the

statutes and [the ITC] has implemented in regulations.” PPG
Court No. 04-00266 Page 10

Indus., Inc. v. United States, 13 CIT 183, 190, 708 F. Supp.

1327, 1332 (1989), aff’d, 978 F.2d 1232 (Fed. Cir. 1992).3

The statutory and regulatory provisions relevant to

Changhong’s claim are set forth in 19 U.S.C. § 1677m(g) and 19

C.F.R. § 207.30. Subsection 1677m(g) of the antidumping statute,

entitled “Public comment on information,” provides:

Information that is submitted on a timely
basis to the administering authority or the
Commission during the course of a proceeding
under this subtitle shall be subject to
comment by other parties to the proceeding
within such reasonable time as the
administering authority or the Commission
shall provide. The administering authority
and the Commission, before making a final
determination under section 1671d, 1673d,
1675, or 1675b of this title shall cease
collecting information and shall provide the
parties with a final opportunity to comment
on the information obtained by the
administering authority or the Commission (as
the case may be) upon which the parties have
not previously had an opportunity to comment.
Comments containing new factual information
shall be disregarded.

3
Changhong relies heavily on the PPG Industries case, where
the court remanded the matter to Commerce to reopen and
supplement the record with a document Commerce stated it had
relied upon in making its determination, but which the parties
had neither seen nor commented upon prior to the litigation
before this Court. Pl.’s Supp. Br. at 10-11. On remand, the
parties were permitted to review and comment on the omitted
document. Here, it is undisputed that the updated financial
information relied upon by the ITC was placed on the record and
was the subject of comment by the parties. Thus, PPG Industries
is of no benefit to Changhong.
Court No. 04-00266 Page 11

19 U.S.C. § 1677m(g). The regulation that implements this

provision expands upon § 1677m(g)’s instruction to afford the

parties advance notice of the time within which to comment upon

information submitted to, or collected by, the ITC. Section

207.30 provides that “the Commission shall specify a date on

which it will disclose to all parties . . . all information it

has obtained on which the parties have not previously had an

opportunity to comment.” 19 C.F.R. § 207.30(a). Subsection (b)

of the regulation provides:

The parties shall have an opportunity to file
comments on any information disclosed to them
after they have filed their posthearing brief
. . . . Comments shall only concern such
information, and shall not exceed 15 pages of
textual material . . . . A comment may
address the accuracy, reliability, or
probative value of such information by
reference to information elsewhere in the
record . . . . Comments containing new
factual information shall be disregarded.

19 C.F.R. § 207.30(b). Like the statute it implements, § 207.30

provides that parties will have an opportunity to comment on

previously undisclosed information following the filing of their

post-hearing briefs. The statute’s requirement that the

Commission disregard new factual information is reiterated in the

regulation by its statement that the comments themselves may only

address the “accuracy, reliability, or probative value” of
Court No. 04-00266 Page 12

information on the record by reference to information already

present elsewhere in the record.

There is no dispute that the ITC complied with the relevant

statute and regulations. Indeed, as noted above, Changhong

concedes as much. Pl.’s Reply at 4. The ITC provided the

parties, including Changhong, an opportunity to comment on the

updated financial information as provided in the Scheduling

Notice. Scheduling Notice, 69 Fed. Reg. at 3602 (“On May 7,

2004, the Commission will make available to parties all

information on which they have not had an opportunity to comment.

Parties may submit final comments on this information on or

before May 11, 2004 . . . .”). Changhong did, in fact, avail

itself of the opportunity and submitted comments on May 11, 2004.

In its initial papers, Changhong expends considerable

argument on the amount of time afforded it to comment on the

updated financial information. Pl.’s Supp. Br. at 5, 6-12

(“Changhong was given access to this information only four days

before the Commission closed the record . . . depriving Changhong

of any meaningful opportunity to analyze or rebut this

information . . . .”). Changhong essentially argues that had it

had more time to prepare comments on the updated financial

information, it potentially could have found holes in the data

and rebutted the usefulness of the information more successfully.
Court No. 04-00266 Page 13

Rather than point to the specific information with which it would

have found fault, however, plaintiff merely asserts that “[w]ith

a reasonable amount of time, Changhong could have at least

attempted to develop information addressing” the factual issues

allegedly raised by the updated financial information. Id. at

16.

This argument, of course, could be made in nearly any

investigation. With more time most parties could improve the

quality of their comments. Nonetheless, the Commission complied

with the statute and its regulations, which provide for an

opportunity to comment while bringing an investigation to an

orderly end. In addition, the ITC maintained the schedule it had

established from the first, and Changhong did, in fact, submit

comments on the new data. Finally, there is no evidence that

given more time Changhong would have, in fact, provided more

meaningful comments.

Nor can Changhong make a claim of prejudice based on its

alleged “inability to submit new factual information . . . .”

Pl.’s Reply at 5. When an investigation is coming to a close,

the antidumping statute specifically directs the Commission to

disregard new factual information. 19 U.S.C. § 1677m(g). The

implementing regulation echoes this restriction and further

directs that the final comments themselves may not reference new
Court No. 04-00266 Page 14

factual information, but only that information already in the

record. 19 C.F.R. § 207.30(b). This Court has found that

limiting the submission and consideration of new factual

information is reasonable because an agency “clearly cannot

complete its work unless it is able at some point to ‘freeze’ the

record and make calculations and findings based on that fixed and

certain body of information.” Böwe-Passat v. United States, 17

CIT 335, 339 (1993) (not published in the Federal Supplement).

For the foregoing reasons, the court finds that the four-day

period in which Changhong could submit final comments conformed

to its long-established schedule and provided an adequate period

for the submission of comments, which Changhong took advantage

of. In addition, the statutory and regulatory provisions set

forth in 19 U.S.C. § 1677m(g) and 19 C.F.R. § 207.30 are a

reasonable means to bring an administrative procedure to closure.

B. Changhong’s Causation Claim

Next, Changhong challenges the ITC’s finding that subject

imports caused material injury to the domestic industry.4

Changhong contends that “[t]he Commission failed to consider

4
Changhong does not contest the ITC’s volume, price effects
and impact determinations, made pursuant to 19 U.S.C.
§ 1677(7)(C)(i)-(iii), which form the basis of the ITC’s
materiality finding.
Court No. 04-00266 Page 15

other factors that affected the performance of the U.S. industry,

especially the impact of non-subject imports, and so failed in

its duty to ensure that injury from other factors was not

attributed to the subject imports.” Pl.’s Supp. Br. at 16-17.

In particular, it asserts that the ITC failed to “assess . . .

sufficiently . . . whether [non-subject imports from

Thailand] . . . severed the causal connection between the subject

imports and injury.” Pl.’s Reply at 12-13.

To make an affirmative material injury determination, the

ITC must find both “(1) present material injury and (2) a finding

that the material injury is ‘by reason of’ the subject imports.”

Gerald Metals, Inc. v. United States, 132 F.3d 716, 719 (Fed.

Cir. 1997) (citation omitted). With respect to the latter

finding, the United States Court of Appeals for the Federal

Circuit has held that “[a]s long as its effects are not merely

incidental, tangential or trivial, the foreign product sold at

less than fair value meets the causation requirement.” Nippon

Steel Corp. v. United States Int’l Trade Comm’n, 345 F.3d 1379,

1381 (Fed. Cir. 2003) (citation omitted). In determining

causation, “the Commission must analyze ‘contradictory evidence

or evidence from which conflicting inferences could be

drawn’ . . . to ensure that the subject imports are causing the

injury, not simply contributing to the injury in a tangential or
Court No. 04-00266 Page 16

minimal way.” Taiwan Semiconductor Indus. Ass’n v. United

States, 266 F.3d 1339, 1344 (Fed. Cir. 2001) (quoting Suramerica

de Aleaciones Laminadas, C.A. v. United States, 44 F.3d 978, 985

(Fed. Cir. 1994); citing Gerald Metals, 132 F.3d at 722). In

other words, the ITC “must distinguish between harm that is

caused by imports and harm that is caused by other factors; in

determining injury, it cannot attribute to imports the impact of

other factors.” Altx, Inc. v. United States, 370 F.3d 1108, 1120

(Fed. Cir. 2004) (citation omitted).

In keeping with these injunctions, cases have expanded on

the necessary inquiry the ITC must conduct by holding that, under

certain circumstances, the ITC must consider the effects of non-

subject imports. See Bratsk Aluminium Smelter v. United States,

444 F.3d 1369, 1373 (Fed. Cir. 2006) (“Where commodity products

are at issue and fairly traded, price competitive, non-subject

imports are in the market, the Commission must explain why the

elimination of subject imports would benefit the domestic

industry instead of resulting in the non-subject imports’

replacement of the subject imports’ market share without any

beneficial impact on domestic producers.”); Caribbean Ispat, Ltd.

v. United States, 450 F.3d 1336, 1341 (Fed. Cir. 2006) (remanding

to ITC for further consideration where ITC had found “high level

of fungibility” between subject and non-subject imports but had
Court No. 04-00266 Page 17

not addressed whether non-subject imports would replace subject

imports without any beneficial effect on the domestic industry);

Gerald Metals, 132 F.3d at 720 (remanding where subject and non-

subject Russian imports of pure magnesium were “perfect

substitutes”). Thus, to sustain a finding of material injury,

the court must (1) be able to discern how the Commission ensured

that it did not attribute the injury from other sources to the

subject imports; and as shall be seen, (2) under certain

circumstances, be able to determine that, following issuance of

an antidumping order, the injury would not continue by reason of

non-subject imports. Taiwan Semiconductor Indus. Ass’n v. United

States, 23 CIT 410, 416, 59 F. Supp. 2d 1324, 1330-31 (1999),

aff’d, 266 F.3d 1339 (Fed. Cir. 2001); Statement of

Administrative Action Accompanying the Uruguay Round Agreements

Act, H.R. Doc. No. 103-826(I), at 851-52 (1994), reprinted in

1994 U.S.C.C.A.N. 4040, 4184-85; Bratsk, 444 F.3d at 1373.

Here, the ITC did take into account non-subject imports in

making its volume, price effects and impact determinations under

19 U.S.C. § 1677(7)(B). See, e.g., Conf. Staff Report at E-6-7 &

Tbls. E-12, II-3, II-4, IV-2, IV-4, IV-5, V-2, V-4, V-5 & V-6.

Nonetheless, as discussed infra in section B(4), the court finds

remand appropriate, in light of the Federal Circuit’s holdings in

Bratsk and Caribbean Ispat, which were issued after the Final
Court No. 04-00266 Page 18

Determination was made. A brief description of the findings made

by the Commission will illustrate why this remand is appropriate.

(1) Volume

The ITC concluded that under 19 U.S.C. § 1677(7)(C)(i), “the

volume and increase in volume of subject imports, both in

absolute terms and relative to consumption in the United States,

[were] significant.” Final Determination at 22; 19 U.S.C.

§ 1677(7)(C)(i). In its volume analysis, the ITC found that

between 2001 and 2003 the record evidence showed increases in the

total quantity of subject imports,5 U.S. shipments of subject

imports6 and the share of apparent U.S. consumption represented

by U.S. shipments of subject imports.7 Final Determination at

19-20.

5
“[T]he quantity of subject imports increased from 56,000
units in 2001 to 1.3 million units in 2002 and then to 1.8
million units in 2003.” Final Determination at 19 (citing Conf.
Staff Report, Tbl. IV-2).
6
United States shipments of subject imports increased from [[
]] units in 2001 to [[ ]] in 2002 and then to [[
]] in 2003. Final Determination at 19 (citing Conf.
Staff Report, Tbl. IV-3).
7
The share of apparent U.S. consumption represented by
subject imports increased from [[ ]] percent in 2001 to [[
]] percent in 2002 and then to [[ ]] percent in 2003.
Final Determination at 19-20 (citing Conf. Staff Report, Tbl. IV-
5).
Court No. 04-00266 Page 19

The ITC also considered non-subject imports. This

consideration is evident in its findings with respect to market

share. The ITC found that the “subject imports gained market

share at the expense of both the domestic industry and nonsubject

imports . . . in some of the most significant CTV size ranges.”

Final Determination at 20. For example, the ITC examined analog

direct-view CTVs with a 4 x 3 aspect ratio in size ranges: 27 to

30 inches; 24 to 25 inches; and the combined category of 24 to 30

inches. Id. at 20-22. In these size ranges, the quantity of

shipments of subject imports and the share of total U.S.

shipments represented by the subject imports increased. Non-

subject import measures, however, decreased. Specifically, non-

subject imports from Mexico decreased in absolute terms, and the

share of total shipments represented by non-subject imports and

the domestically produced product declined as well. Id. at 20-22

(citing Conf. Staff Report at E-6-7 & Tbl. E-12). After

considering the record evidence regarding subject and non-subject

imports, the Commission concluded that the increase in subject

import volume, in absolute terms and relative to apparent

consumption, was significant.
Court No. 04-00266 Page 20

(2) Price Effects

Next, with respect to price effects, the ITC concluded that

“there has been significant price underselling by the subject

imports and that the effect of such imports has been to depress

prices for the domestic like product to a significant degree.”

Final Determination at 27; 19 U.S.C. § 1677(7)(C)(ii)(I)-(II).

In its price effects analysis, the ITC considered underselling

and price depression, as required by § 1677(7)(C)(ii)(I)-(II).

It found that the subject imports undersold the domestic like

product in 26 out of 28 comparisons. Final Determination at 23

(citing Conf. Staff Report, Tbls. V-2, V-4, V-5 & V-6).

In determining the significance of the observed underselling

by subject imports, the ITC considered data showing that non-

subject imports from Mexico also frequently undersold the

domestic like product. The ITC further noted that “subject

imports from China also undersold imports from Mexico in 16 of 23

quarterly comparisons.” Id. The non-subject data collected

permitted a comparison of quarterly prices of imports from Mexico

and Malaysia, which indicated “[p]rices for subject imports were

lower than prices for nonsubject imports from any source in 14 of

28 quarterly observations. Thus, the pricing data . . . show

that subject imports were frequently the lowest-priced products
Court No. 04-00266 Page 21

in the market.” Id. (citing Conf. Staff Report, Tbls. V-2, V-4,

V-5 & V-6).

The ITC found that U.S. CTV prices declined during the

period of investigation and that “the subject imports, frequently

the lowest-priced product in the market, were a significant cause

of price declines.” Final Determination at 25. Questionnaire

responses submitted by CTV purchasers indicated that price was a

“very important” factor in their purchasing decisions. Id. at 16

(noting 26 of 30 purchasers indicated price as “very important”

factor; citing Conf. Staff Report, Tbl. II-15). In light of the

price competition found to exist among CTVs, the ITC sent

questionnaires to domestic producers, importers and purchasers,

asking them to attribute the cause of U.S. CTV price declines to

imports from specific countries. Conf. Staff Report, Tbls. II-3

& II-4. “On average, producers attributed 73 percent of this

cause of price decline to subject imports, importers 50 percent,

and purchasers 56 percent.” Final Determination at 25 (citing

Conf. Staff Report, Tbl. II-4). The ITC found that “the subject

imports have had significant price-depressing effects on prices

for the domestic like product.” Id. at 26.
Court No. 04-00266 Page 22

(3) Impact

Finally, with respect to impact, the ITC “conclud[ed] that

the subject imports have had a significant adverse impact on the

domestic CTV industry.” Final Determination at 33; 19 U.S.C.

§ 1677(7)(C)(iii). The ITC considered the factors enumerated in

the statute.8 The ITC found the record evidence showed declines

in output related indicators. For example, production, capacity

8
Subsection 1677(7)(C)(iii) lists the following economic
factors, which the ITC must consider in the context of the
business cycle and conditions of competition of the affected
industry:

(I) actual and potential decline in output,
sales, market share, profits, productivity,
return on investments, and utilization of
capacity,

(II) factors affecting domestic prices,

(III) actual and potential negative effects
on cash flow, inventories, employment, wages,
growth, ability to raise capital, and
investment,

(IV) actual and potential negative effects on
the existing development and production
efforts of the domestic industry, including
efforts to develop a derivative or more
advanced version of the domestic like
product, and

(V) in a proceeding under part II of this
subtitle, the magnitude of the margin of
dumping.

19 U.S.C. § 1677(7)(C)(iii).
Court No. 04-00266 Page 23

utilization and the domestic industry’s share of U.S. apparent

consumption declined in the face of overall increases in capacity

and apparent U.S. consumption. Final Determination at 28 (citing

Conf. Staff Report, Tbl. III-6).9

The ITC’s findings with respect to the volume and market

penetration of the subject imports, adverse price effects of the

subject imports and “the causal linkage between the subject

imports and the domestic industry’s declines in output, market

share, employment, and operating performance” led to the ITC’s

conclusion that the “subject imports have had a significant

adverse impact on the domestic CTV industry.” Id. at 33.

(4) Consideration of Non-Subject Imports

The court finds Changhong’s argument that the ITC did not

consider record evidence pertaining to non-subject imports from

Thailand, to be without merit. While the Final Determination

specifically discussed non-subject imports from Mexico, the staff

9
In addition, the ITC expressly addressed the respondents’
argument that “declines in the domestic industry’s domestic
shipments of CTVs were . . . offset by increases in the domestic
producer’s shipments of non-[cathode ray tube] televisions,”
finding that the decline in the domestic industry’s CTV shipments
was many times greater than the increase in domestic producers’
U.S. shipments of non-cathode ray tube televisions during the
period of investigation. Final Determination at 30 (citing Conf.
Staff Report, Tbl. E-13).
Court No. 04-00266 Page 24

report contains information about Thai, Korean, Malaysian and

other non-subject imports.10 See, e.g., Conf. Staff Report, Tbl.

IV-2. It is presumed that the ITC considered all of the evidence

placed before it, and here, the ITC clearly considered non-

subject imports from a number of countries in reaching its

causation determination. Nat’l Ass’n of Mirror Mfrs. v. United

States, 12 CIT 771, 779, 696 F. Supp. 642, 648 (1988) (“[A]bsent

some showing to the contrary, the Commission is presumed to have

considered all of the evidence in the record.”) (citations

omitted). “This is especially true where the facts allegedly

ignored were presented to the Commission at an open hearing,” as

facts pertaining to Thailand were here. Id.; see, e.g., Tr.

Public Hearing at 169, 178, 206, 221; Pl.’s Supp. Br. at 24 (“In

this case, Changhong and the other Chinese producers presented

detailed arguments regarding the impact of non-subject imports on

the domestic industry.” (citations to record omitted)).

10
The ITC specifically discussed non-subject imports from
Mexico in the Final Determination. It is undisputed that Mexico
was the largest source of non-subject imports during the period
of investigation. Pl.’s Supp. Br. at 20 & Tbl. 1 at 17; Def.’s
Opp’n Mem. at 22. The ITC explained that subject imports were
priced lower than not only the domestic like product but also
non-subject imports. Final Determination at 23 (“[S]ubject
imports from China also undersold imports from Mexico in 16 of 23
quarterly comparisons.”).
Court No. 04-00266 Page 25

It is apparent that the ITC took the necessary steps to

ensure that it did not attribute injury caused by non-subject

imports to the subject imports. To the extent Federal Circuit

precedent requires the ITC to make “a specific causation

determination and in that connection to directly address whether

non-subject imports would have replaced the subject imports

without any beneficial effect on domestic producers,” however,

the court finds remand appropriate. Bratsk, 444 F.3d at 1375;

Caribbean Ispat, 450 F.3d at 1341. In doing so the court

recognizes that in Bratsk and Caribbean Ispat, the subject

imports were found to be highly fungible, price-sensitive

commodities that could be replaced by non-subject imports without

benefit to the domestic industry. Here, there has been no

showing that CTVs are “commodity products,” nor has the ITC made

a finding of “high fungibility” among subject and non-subject

imports. Thus, it may be that the analysis the court required in

those cases does not apply here. Nonetheless, because the Final

Determination was issued before the Federal Circuit’s decisions

in Bratsk and Caribbean Ispat, the court remands this matter to

the ITC to explain (1) whether the “specific causation

determination” required in those cases applies here; and (2)

whether the Final Determination otherwise complies with the

Federal Circuit’s requirements in making its causation
Court No. 04-00266 Page 26

determination. If the ITC finds its causation analysis deficient

in any respect in light of Bratsk and other Federal Circuit case

law, it must adjust its analysis accordingly.

CONCLUSION

For the foregoing reasons, the court remands the matter to

the ITC. Remand results are due on February 7, 2007, comments

are due on March 9, 2007, and replies to such comments are due on

March 20, 2007.

/s/ Richard K. Eaton
Richard K. Eaton, Judge

Dated: November 15, 2006
New York, New York