Neenah Foundry Co. v. United States

Slip Op. 01 - 77

UNITED STATES COURT OF INTERNATIONAL TRADE

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NEENAH FOUNDRY CO. et al., :

Plaintiffs, :

v. :

UNITED STATES OF AMERICA and THE UNITED : Court No. 99-11-00716
STATES INTERNATIONAL TRADE COMMISSION,
:
Defendants,

-and- :

BENGAL EXPORT CORPORATION et al., :

Intervenor-Defendants. :

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Opinion & Order

[Plaintiffs' motion for judgment on the
agency record denied; action dismissed.]

Decided: June 25, 2001

Collier Shannon Scott, PLLC (Paul C. Rosenthal, Robin H.
Gilbert, Kathleen W. Cannon and Lynn Duffy Maloney) for the
plaintiffs.

Lyn M. Schlitt, General Counsel, James A. Toupin, Deputy
General Counsel, and Charles A. St. Charles, Attorney-Advisor,
for the defendant United States International Trade Commission.

Cameron & Hornbostel LLP (Dennis James, Jr.) for the inter-
venor-defendants.

AQUILINO, Judge: This action contests the "sunset-

review" determination of the International Trade Commission ("ITC")

pursuant to 19 U.S.C. §1675(c)(1) (1995) that

revocation of the countervailing duty order on iron metal
castings from India would not be likely to lead to con-
tinuation or recurrence of material injury to an industry
in the United States within a reasonably foreseeable
time.
Court No. 99-11-00716 Page 2

Iron Metal Castings From India; Heavy Iron Construction Castings

From Brazil; and Iron Construction Castings From Brazil, Canada,

and China, 64 Fed.Reg. 58,442 (Oct. 29, 1999). This decision

caused the International Trade Administration, U.S. Department of

Commerce ("ITA") to publish its notice of Revocation of Counter-

vailing Duty Order: Iron Metal Castings From India, 64 Fed.Reg.

61,602 (Nov. 12, 1999), prior to which the same plaintiffs as

appear herein had commenced a separate action for judicial review

of the final results of the ITA's sunset review. See generally

Neenah Foundry Co. v. United States, 25 CIT , F.Supp.2d

(April 2, 2001).

I

The ITC rendered the foregoing determination qua India

over the dissents of two of its six voting members. Those

comprising the majority refused to cumulate the imports from that

land with the merchandise from Brazil, Canada and China, notwith-

standing contrary Commission resolution of the reviews of all the

other duty orders covering castings from those three nations. See

64 Fed.Reg. at 58,442. Chairman Bragg and Commissioners Crawford

and Askey concluded that

revocation of the order with respect to heavy construc-
tion castings from India would have no discernible
adverse impact on the U.S. industry and, therefore, do
not cumulate subject heavy construction castings from
India with the subject heavy iron construction castings
from Canada, Brazil or China.

Iron Metal Castings From India; Heavy Iron Construction Castings

From Brazil; and Iron Construction Castings From Brazil, Canada,
Court No. 99-11-00716 Page 3

and China, USITC Pub. 3247, pp. 12-13 (Oct. 1999). The fourth com-

missioner, Stephen Koplan, did not join in this finding of "no

discernible adverse impact on the U.S. industry" but did decline to

cumulate the imports based on his analysis of relevant conditions

of competition.

The plaintiffs now argue in their motion for judgment

upon the agency record filed pursuant to CIT Rule 56.2 that this

action "raises several important issues of first impression

concerning certain commissioners' interpretations of the cumulation

provision applicable in 'sunset' revocation proceedings", to wit:

. . . In exercising his discretion . . . under the guise
of considering "conditions of competition," Commissioner
Koplan conducted an unlawful circular analysis of the
effects of the imports on an individual-country basis in
a manner that mooted the principle of cumulation. . . .

* * *

Likewise, Commissioner Askey analyzed cumulation in
a manner contrary to the statute. Although the statute
precludes the Commission from cumulating when it finds
that imports are likely to have "no" discernible adverse
impact, Commissioner Askey has wrongly interpreted this
provision to mean that she may cumulate only when the
record shows that imports will have "a" discernible
adverse impact. As a result, Commissioner Askey has at
once raised the burden for cumulating, altered the
statutory standard, and created a pre-condition for
cumulation that Congress did not intend. . . .

Commissioner Crawford, too, has erred in her
decision not to cumulate. In particular, [she] violated
basic tenets of administrative law by failing to ade-
quately explain her reasons not to cumulate, stating in
one instance simply that she "declined to exercise her
discretion to cumulate" imports from Brazil and China
with the remaining imports and providing no further
explanation. . . .

Plaintiffs' Rule 56.2 Brief, pp. 9-11.
Court No. 99-11-00716 Page 4

A

The court's jurisdiction to decide this action is

pursuant to 19 U.S.C. §1516a(a)(2)(B)(iii) and 28 U.S.C. §§

1581(c), 2631(c). And, whatever the issues raised herein, the

ITC's determination must be affirmed unless it is "unsupported by

substantial evidence on the record, or otherwise not in accordance

with law". 19 U.S.C. §1516a(b)(1)(B)(i). Moreover, the rule has

been that, in

reviewing an agency's construction of a statute that it
administers, this court addresses two questions outlined
by the Supreme Court in Chevron U.S.A., Inc. v. Natural
Resources Defense Council, Inc., 467 U.S. 837, 842-43
. . . (1984). The first question is "whether Congress
has directly spoken to the precise question at issue."
Id. at 842 . . .. If so, this court and the agency "must
give effect to the unambiguously expressed intent of
Congress." Id. at 843 . . .. If, however, Congress has
not spoken directly on the issue, this court addresses
the second question of whether the agency's interpreta-
tion "is based on a permissible construction of the
statute." Id.

"To survive judicial scrutiny, an agency's construc-
tion need not be the only reasonable interpretation or
even the most reasonable interpretation." Koyo Seiko
[Co. v. United States], 36 F.3d [1565,] 1570 [Fed.Cir.
1994]. Thus, when faced with more than one reasonable
statutory interpretation, "a court must defer to an
agency's reasonable interpretation . . . even if the
court might have preferred another." NSK Ltd. v. United
States, 115 F.3d 965, 973 (Fed.Cir. 1997)(citations
omitted).

U.S. Steel Group v. United States, 225 F.3d 1284, 1285-86 (Fed.Cir.

2000). Compare United States v. Mead Corp., 533 U.S. ,

S.Ct. (June 18, 2001).

(1)

The statute underlying this action is the Uruguay Round

Agreements Act ("URAA"), Pub. L. No. 103-465, 108 Stat. 4809 (Dec.
Court No. 99-11-00716 Page 5

8, 1994), section 220 of which established five-year or "sunset"

reviews of outstanding antidumping- and countervailing-duty orders

to be conducted pursuant to:

Special rules for section 1675(b) and 1675(c) reviews

(a) Determination of likelihood of continuation or
recurrence of material injury

(1) In general

In a review conducted under section
1675(b) or (c) of this title, the Commission
shall determine whether revocation of an order
. . . would be likely to lead to continuation
or recurrence of material injury within a
reasonably foreseeable time. The Commission
shall consider the likely volume, price ef-
fect, and impact of imports of the subject
merchandise on the industry if the order is
revoked or the suspended investigation is
terminated. . . .

19 U.S.C. §1675a(a). In addition to explaining in further detail

the factors the ITC is to consider in evaluating the likely volume

of imports and their price effect and impact on a domestic

industry, the statute provides for cumulation in sunset reviews as

follows:

For purposes of this subsection, the Commission may
cumulatively assess the volume and effect of imports of
the subject merchandise from all countries with respect
to which reviews under section 1675(b) or (c) of this
title were initiated on the same day, if such imports
would be likely to compete with each other and with
domestic like products in the United States market. The
Commission shall not cumulatively assess the volume and
effects of imports of the subject merchandise in a case
in which it determines that such imports are likely to
have no discernible adverse impact on the domestic
industry.

19 U.S.C. §1675a(a)(7).
Court No. 99-11-00716 Page 6

B

In this matter, the ITC found that the prerequisites of

initiation of reviews on the same day and competition in the U.S.

market were met, and those findings are not at issue before the

court. As for the other express limitation on Commission discre-

tion to cumulate, namely, whenever subject "imports are likely to

have no discernible adverse impact on the domestic industry",

Commissioner Koplan was of the view that

current volumes of subject imports from India, even with
the countervailing duty order in place, exceed levels
that would satisfy the "no discernible adverse impact"
provision. There is no evidence in the record indicating
that subject imports from India are likely to decline
significantly upon revocation . . .. [W]ith at least a 17
percent share of the market, I cannot conclude that the
subject imports from India are likely to have . . . no
discernible adverse impact on the domestic industry if
the . . . duty order is revoked.

USITC Pub. 3247, p. 28. Nonetheless, the commissioner declined to

comulate, explaining that

the conditions of competition would be significantly
different for subject imports from India as opposed to
those for subject imports from China, Brazil and Canada
if the respective orders were revoked. Consequently, I
find that it is not appropriate to assess cumulatively
the likely volume and price effects of subject imports
from India with those . . . from China, Brazil, and
Canada.

Id. at 31. His discussion of such conditions of competition

includes a comparative analysis of current and likely margins,

volume, and price effects:

. . . [T]he magnitude of the antidumping duty margins,
and likely margins of dumping, for imports from China,
Brazil, and, to a lesser extent Canada, are all signifi-
cantly higher than the current and likely countervailing
duty rate on subject imports from India. These are
Court No. 99-11-00716 Page 7

significant differences in the conditions of competition
for subject imports from India as opposed to subject
imports from China, Brazil, and Canada.

Given this central condition of competition, I join
the Commission’s conclusion that neither the volume nor
the price of subject imports of heavy metal castings from
India are likely to significantly change if the counter-
vailing duty order is revoked. Unlike the other subject
countries, the current countervailing duty order has not
had a material effect on the volume or price of subject
imports from India. The Commerce Department, in its
review of that order, found that the likely prevailing
countervailable subsidy rate would be unchanged from the
current rate. Viewed in this light, the capacity and
capacity utilization figures for the Indian producers are
not probative of the likely volume of subject imports if
the order is revoked. The levels and ratios of their
home market shipments and U.S. and third country exports
have been largely unaffected by the existing countervail-
ing duty order. Thus, unlike the other subject imports
which are being restrained by the respective orders,
current capacity and capacity utilization rates for
producers in India are not indicative of whether exports
to the United States likely would increase significantly
if the order were revoked. In other words, since the
subject Indian imports are not being restrained by the
order, the current level of capacity utilization at the
Indian foundries does not bear on the likely volume of
shipments to the U.S. if the order is revoked.

The record does not show that prices of subject
imports from India had a significant effect on domestic
prices during the period examined. In this regard, . . .
the Indian government Export Promotion Council maintains
a price floor for exports to ensure fair market prices
(and the antidumping duty order for India was revoked).
More important, perhaps reflecting these price floors,
our pricing data show that while subject Indian import
prices generally were stable throughout the period
examined, domestic prices fluctuated significantly. These
data suggest that domestic prices were not adversely
affected by the relative levels of subject Indian import
prices. To some extent, the underselling by subject
Indian producers can be explained by the fact that the
quality of much of that product is perceived to be
inferior to the domestic product. Indeed, if the
products were generally comparable, one would expect that
widespread underselling would result in increased import
volume and market penetration, not the declining volume
and share experienced by subject imports from India at
Court No. 99-11-00716 Page 8

the end of the period examined. In sum, I find that
subject Indian import volume and prices have been largely
unaffected by the existing order and are likely to
continue to be stable if the order is revoked.

In light of the fact that the Commission received no
responses from respondent interested parties regarding
the reviews on heavy metal castings from China, Brazil,
and Canada, the analysis of the conditions of competition
concerning those subject imports must, of necessity, be
based principally on the best information available in
the record. The record evidence leads me to conclude
that the conditions of competition among those subject
countries would be quite similar, and distinct from those
relating to subject imports from India. Those three
subject countries are all restrained to a significant
degree by the respective antidumping duty orders and the
Commerce Department has determined that all are likely to
have significant dumping margins in the event of revoca-
tion. Thus, in stark contrast to the subject imports
from India, the existing orders have effectively elimi-
nated or, in the case of Canada, severely curtailed
subject imports from those countries. For this reason,
as discussed in the Commission’s opinion in which I join,
the enormous capacity and substantial excess capacity in
those three countries leads me to conclude that subject
imports from those countries are all likely to face the
same conditions of competition upon revocation of the
respective orders. As a result, unlike subject imports
from India, I find that removal of the existing orders
covering subject merchandise from China, Brazil, and
Canada would result in substantial changes in the volume
of subject imports from those countries.

In addition, unlike subject imports from India,
subject imports from China, Brazil, and Canada are not
covered by stable minimum price floors. Accordingly, the
record indicates that prices for subject imports from
those three countries are likely to fluctuate to a
significant degree if the respective orders are revoked.
Finally, unlike subject imports from India, the record
does not contain any indication that the quality of heavy
metal castings produced in China, Brazil, or Canada
differs significantly from that produced by the domestic
industry.1
(1)

1
USITC Pub. 3247, pp. 29-31 (footnotes omitted). Imports
from China, Brazil and Canada were covered by antidumping-duty
orders, ergo the commissioner's references thereto.
Court No. 99-11-00716 Page 9

Whether such analysis in the context of cumulation was an

abuse of discretion is the primary issue now before the court. To

begin with, while URAA added sunset reviews to the Trade Agreements

Act in 1994, cumulation predates that moment. In fact, before any

statutory provision, the ITC had discretion in determining whether

to cumulate data on volume and effects of subject imports from

different countries. See, e.g., Lone Star Steel Co. v. United

States, 10 CIT 731, 734, 650 F.Supp. 183, 186 (1986). Its approach

was simply to cumulate "where the conditions of trade so

warrant[ed]". USX Corp. v. United States, 11 CIT 82, 87, 655

F.Supp. 487, 491 (1987). Hence, where one nation’s exports

developed trends in the U.S. market that were distinct from the

market patterns of other countries’ competing exports, a decision

not to cumulate was justified. See, e.g., id. But caselaw also

established that the ITC could not engage in "a process of circular

reasoning that renders cumulation a vestigial part of the causation

analysis." Id., 11 CIT at 88, 655 F.Supp. at 493. In other words,

it was an abuse of discretion to rely on coincident reasoning in

declining to cumulate while reaching a negative material-injury

determination because cumulation is based on the proposition that

unfair imports from one country, while not necessarily an independ-

ent cause of material injury, can contribute to such injury when

viewed in combination with subject imports from other countries.

The Trade and Tariff Act of 1984, Pub. L. No. 98-573,
Court No. 99-11-00716 Page 10

§612(a)(2), 98 Stat. 2948, 3033 (Oct. 30, 1984), established a

guideline for ITC cumulation in material-injury investigations, to

wit, when subject imports compete with each other and with like

products of the domestic industry in the U.S. market. This

criterion was added in committee, replacing a requirement in the

original bill that the imports have a contributing effect in

causing, or threatening to cause, material injury. See H.R. Rep.

No. 98-725, p. 37 (1984):

. . . [C]umulation is based on the sound principle of
preventing material injury which comes about by virtue of
several simultaneous unfair acts or practices. The
Committee amended the criteria to permit cumulation of
imports from various countries that each account individ-
ually for a very small percentage of total market
penetration, but when combined may cause material injury.
The requirement in the bill as introduced that imports
from each country have a "contributing effect" in causing
material injury would have precluded cumulation in cases
where the impact of imports from each source treated
individually is minimal but the combined impact is
injurious.

Although Congress continued to refine the standards for cumulation,

the intent of the various provisions remained the same, namely, to

address the fact that

competition from unfairly traded imports from several
countries simultaneously often has a hammering effect on
the domestic industry. This hammering effect may not be
adequately addressed if the impact of the imports are
[sic] analyzed separately on the basis of their country
of origin. The cumulation requirement is thus an effort
to make the application of the injury analysis more
realistic in terms of recognizing the actual effects of
unfair import competition.
Court No. 99-11-00716 Page 11

H.R. Rep. No. 100-40, part 1, at 130 (1987). Similarly, URAA

recognized cumulation as "a critical component of U.S. antidumping

and countervailing duty law", reiterating that "a domestic industry

can be injured by a particular volume of imports and their effects

regardless of whether those imports come from one source or many

sources." H.R. Doc. No. 103-316, vol. I, at 847 (1994).

Although a sunset review may be a "brand new animal"2,as
the intervenor-defendants postulate, the statute and its legisla-

tive history nowhere suggest that the underlying purpose of

cumulation has changed. That is, while

the sunset inquiry is different from a present injury
inquiry -- asking whether injury is likely to continue or
recur if an order is revoked rather than asking whether
imports cause present injury or the threat thereof -- the
"hammering effect" or likely hammering effect of imports,
whether from one source or many sources, is still the
same. In an original investigation, the Commission
cumulates imports to ensure that it addresses injury
caused collectively by multiple import sources, even if
those sources on an individual basis are not causing
injury. In a sunset review, the Commission cumulates
imports to ensure that it prevents the likely continua-
tion or recurrence of injury caused by the revocation of
orders against multiple import sources, even if revoca-
tion of an order against a single import source would not
be likely to cause injury.

Plaintiffs’ Reply Brief, p. 14 (emphasis in original).

Neither URAA nor its legislative history offers guidance

as to the factors the ITC is to consider in exercising discretion

to cumulate in sunset reviews. Since the underlying purpose of

cumulation has not changed, however, caselaw covering discretionary

2
Defendants-Intervenors' Memorandum in Opposition, pp. 7, 8,
13, 23.
Court No. 99-11-00716 Page 12

cumulation is of moment. Most notably, the courts have considered

it an abuse of discretion to engage in circular analysis, relying

on the same factors for refusal to cumulate as for an ultimate

negative injury determination. Such an approach thwarted congres-

sional intent in that it demanded demonstrated, independent

causation of material injury before any consideration of cumula-

tion. In USX Corp. v. United States, supra, for example, it was

not the reliance on volume and price trends per se in considering

cumulation that required remand, rather the problem was that the

ITC had not sufficiently analyzed whether those differing trends

reflected actual differences in the way that the imports affected

the domestic market. There was at least a possibility that the

differing trends therein had been caused by the initiation of the

administrative proceedings themselves and ITA subsequent orders to

suspend liquidation. However, as the court confirmed after remand,

differing trends which reflect actual differences in the way

imports from various countries affect the domestic market "alone

may justify a decision not to cumulate". USX Corp. v. United

States, 12 CIT at 205, 220-21, 682 F.Supp. 60, 74 (1988).

While the court did also find the ITC's initial analysis

circular in part in USX Corp., the finding was based on the

agency’s reference to lack of confirmed lost sales and revenue in

the U.S. market as the basis for both declining to cumulate subject

imports from Argentina and finding no material injury, not because

of the comparison of volume and market-share trends. That is not
Court No. 99-11-00716 Page 13

to say that circularity can never be a problem where differences in

volume, price and market share are at issue. The distinction is a

narrow but important one, hinging on trends as opposed to abso-

lutes. In one case upholding the ITC's refusal to cumulate based

on differing volume and market-share trends, the court explained

that, if the Commission

majority had listed small volume or market share as its
reason for not cumulating, the validity of the legal
basis on which it rests its decision would be debatable.
Here, however, rather than just absolute levels, numerous
trends . . . reveal significant differences in the
effects of Argentine and Spanish imports. . . . In this
case, cumulation of data would obscure significant
differences in trends. Prior to the effective date of
the 1984 statutory amendment, ITC could consider this
type of data in making its discretionary determination on
cumulation.

Lone Star Steel Co. v. United States, 10 CIT at 735, 650 F.Supp. at

187 (emphasis added). Thus, while comparing trends inherently

involves consideration of the underlying elements, that considera-

tion itself does not make the analysis circular.

Similar reasoning has been followed with regard to

discretionary cumulation in threat-of-material-injury cases:

The court views cumulative analysis for threat
purposes as feasible in certain circumstances. For
example, if imports are increasing at similar rates in
the same markets and have relatively similar margins of
underselling, it is likely that cumulation could be
undertaken. This does not mean that each country’s
imports need threaten injury by themselves. Separately,
none of them might threaten injury. Whether cumulative
analysis is actually feasible in various circumstances is
left to the ITC to decide in other cases. Here, ITC
found great disparity in the patterns of volume increases
and decreases among imports from the various countries.
The court does not read ITC’s references to Colombian
market share versus that of other countries as indicating
Court No. 99-11-00716 Page 14

application of an improper contributing effects test.
Colombian exports were simply on a totally different
plane from those of other countries in terms of market
share, volume trends and otherwise. Finally, ITC notes
that patterns of underselling, or lack thereof, varied
greatly from one country to the next. Thus, price
effects analysis on a cumulative basis would be diffi-
cult. . . .

Asociacion Colombiana de Exportadores de Flores v. United States,

12 CIT 1174, 1178, 704 F.Supp. 1068, 1072 (1988).

Under 19 U.S.C. §1675a, supra, the ITC is both given

discretion to cumulate and required to consider whether material

injury is likely to continue or recur in the event of revocation.

In the likelihood determination, the agency must consider "the

likely volume, price effect, and impact of the imports of the

subject merchandise on the industry if the order is revoked",

taking into account, among other things, its prior injury determi-

nation(s). Thus, by definition, the causation inquiry in sunset

reviews will involve recalling the past in attempting to predict

future trends.

While import trends will therefore play a role in both

causation and cumulation analyses in sunset reviews, such trends

are considered for different purposes, and, despite plaintiffs’

arguments to the contrary, the problem of circularity is avoided.

For example, in a discretionary cumulation inquiry, the ITC

examines differences in current or likely volume or market-share

trends between exporting countries, which would justify a decision

not to exercise such discretion according to the aforementioned
Court No. 99-11-00716 Page 15

caselaw. However, in the likelihood determination, the ITC must

then use trends to consider

whether the likely volume of imports of the subject
merchandise would be significant if the order is revoked
or the suspended investigation is terminated, either in
absolute terms or relative to production or consumption
in the United States.

19 U.S.C. §1675a(a)(2).

The consideration of trends in re cumulation is not the

equivalent of an injury analysis thereof. For example, in a case

where exports from only one country are likely to exhibit increased

volume and price effects in the event of revocation, but trends for

imports from each of the other countries under an ITA order are

likely to be negligible, the ITC would be justified in deciding not

to cumulate imports from the first country with those from the

others. However, cumulation of imports from the countries with

relatively-small likely volume and price impact would not only be

appropriate, a refusal to do so without some additional justifica-

tion could constitute an abuse of discretion. Thus, a comparison

of trends does not, as the plaintiffs assert, ask the ultimate,

individual-country causation question as a predicate to cumulation

"in a way that precludes consideration of this question on a

cumulative basis".

(2)

In Commissioner Koplan's analysis, supra, there was

likewise no preclusion of cumulation; there were simply no other
Court No. 99-11-00716 Page 16

countries from which subject imports had had, or were likely to

have, volume and price trends similar to those of imports from

India. In other words, Indian imports were on a different plane

from those of the other countries in terms of likely trends in

market share, volume, and price effects. See, e.g., USITC Pub.

3247, Table I-7 and Fig. E-1. Thus, the court cannot and does not

conclude that Commissioner Koplan's foregoing analysis amounted to

an abuse of discretion or otherwise was not in accordance with law.

C

As recited above, 19 U.S.C §1675a(a)(7) precludes

cumulation of the volume and effects of imports of the subject

merchandise when the ITC determines that such imports are likely to

have "no discernible adverse impact" on the domestic industry.

Commissioner Askey concluded, as one of the ITC majority in this

matter, that revocation of the order with respect to India would

have no discernible adverse impact upon the U.S. industry. USITC

Pub. 3247, p. 14. She appended a footnote expressing her individ-

ual views regarding the proper analysis of this issue:

. . . [T]he language of section 752(a)(7) . . . clearly
states that the [ITC] has the discretion to cumulate
subject imports for purposes of its sunset analysis, as
long as the statutory requirement of competition between
the subject countries and the domestic like product is
satisfied. Section 752(a)(7) also clearly states,
however, that the [ITC] is precluded from exercising this
discretion if the imports from a country subject to
review are likely to have "no discernible adverse impact
on the domestic industry" upon revocation of the order.
. . . Thus, under this provision, the [ITC] must find
that the subject imports from a country will have a
"discernible adverse impact on the domestic industry"
Court No. 99-11-00716 Page 17

after revocation of the order before cumulating those
imports with other subject imports. Accordingly, the
[ITC]’s task under this provision is a straightforward
one. To determine whether the Commission is precluded
from cumulating subject imports from a particular
country, the [ITC] must focus on how significantly the
imports will impact the condition of the industry as a
result of revocation, and not simply on whether there
will be a small volume of imports after revocation, i.e.,
by assessing their negligibility after revocation of the
order. If the impact of the imports is not discernible,
then the [ITC] is precluded from cumulating those imports
with other subject imports. . . .

Id. at 10-11, n. 52 (emphasis in original, citation omitted). The

plaintiffs object to this stated approach. First, they contend

that the statute does not require imports to have a discernible

adverse impact in order to cumulate and that requiring such a

showing is materially different than requiring a showing of no

discernible adverse impact in order not to cumulate. The court

cannot, and therefore does not, concur.

When the ITC considers whether subject imports are likely

to have no discernible adverse impact, the result of the inquiry

will be either negative or affirmative. Logic and grammar indicate

that a negative finding is that such imports will have a discern-

ible adverse impact. Commissioner Askey’s footnote merely breaks

down the language of the requisite analysis into simple steps.

Hence, an affirmative finding of discernible impact is only part of

the answer to the question of whether cumulation is precluded. In

other words, the first question is whether the imports are likely

to have any such impact. If not, the ITC is precluded from cumu-
Court No. 99-11-00716 Page 18

lating. If yes, then the question remains whether that impact is

also adverse. If affirmative, the agency is permitted to cumulate;

if negative, cumulation is not permissible since any impact is not

both discernible and adverse. In short, the court concludes that

Commissioner Askey reasonably restated the standard for analysis,

rather than changed it or "entirely dismantled the statute as

written by Congress". Plaintiffs' Rule 56.2 Brief, p. 36.

Plaintiffs' second objection to the commissioner's

analysis is that she

considered as part of her cumulation analysis the
critical question of whether revocation would have a
discernible adverse impact on the U.S. industry . . .
rather than whether the imports under review would have
no discernible adverse impact.

Id. at 38 (emphasis in original). The court finds that that

analysis, on its face, refutes such a claim. Most notably,

Commissioner Askey joined the majority in stating that the no-

discernible-adverse-impact analysis "is focused on subject imports

and the likely impact of those imports on the domestic industry

within a reasonably foreseeable time if the order is revoked."

USITC Pub. 3247, p. 10 (footnotes omitted). Moreover, her footnote

52, quoted above, does have references to the impact of "the

imports" in the event of revocation. While Commissioner Askey has

indeed considered such impact "upon" or "in the event of" revoca-

tion, this is clearly the proper context of the inquiry. As the

defendant explains in its papers,
Court No. 99-11-00716 Page 19

the statute's reference to whether the imports "are like-
ly" to have no discernible adverse impact on the domestic
industry is clearly parallel to the ultimate question
"whether revocation of the countervailing or antidumping
duty order . . . would be likely to lead to continuation
or recurrence of . . . material injury." Both, then,
express the Congressional intent that the Commission is
to focus on changes, if any, that likely will occur if
revocation were to take place . . ..

Defendant International Trade Commission's Opposition, pp. 31-32

(emphasis in original). Accord Defendants-Intervenors' Memorandum

in Opposition, p. 35. On its face, Commissioner Askey's analysis

demonstrates that she was not analyzing the impact of revocation in

general but of "the subject imports from a country . . . after

revocation of the order before cumulating those imports with other

subject imports." USITC Pub. 3247, p. 10, n. 52.

Finally, the plaintiffs assert that the commissioner's

interpretation contradicts Congress's intent that the "no discern-

ible adverse impact" provision be limited to an analysis of import

volume. Plaintiffs' Rule 56.2 Brief, p. 38. As the language of

the statute and its legislative history show, that was not the

intent of Congress. Presumably, if it had intended that the ITC

consider only import volume in deciding whether cumulation was

precluded, it would have so restricted its enactment. It did not.

Congress chose "no discernible adverse impact", and impact in the

context of U.S. unfair trade law, by any definition, encompasses

more than volume of imports. The reason for this choice was

reported as follows:
Court No. 99-11-00716 Page 20

. . . The Committee believes that it is appropriate to
preclude cumulation where imports are likely to be
negligible. However, the Committee does not believe that
it is appropriate to adopt a strict numerical test for
determining negligibility because of the extraordinary
difficulty in projecting import volumes into the future
with precision. Accordingly, the Committee believes that
the "no discernible adverse impact" standard is appropri-
ate in sunset reviews.

S. Rep. No. 103-412, p. 51 (1994).

The plaintiffs interpret this language to mean that no

discernible adverse impact "is equivalent to negligibility, which,

in turn, equates to import volumes." Plaintiffs' Rule 56.2 Brief,

p. 39. The concept of negligibility arises from a previous

statutory provision, 19 U.S.C. §1677(7)(C)(v), which was in effect

prior to enactment of URAA. At that time, cumulation was mandatory

in present-material-injury determinations for subject imports in

competition with each other and with the domestic like product.

Section 1677(7)(C)(v) granted the ITC discretion not to cumulate

imports that it found to be "negligible" and having "no discernible

adverse impact". Thus, the concept was originally applied as an

exception to mandatory cumulation -- a grant of discretion not to

cumulate -- whereas in sunset reviews the same principle now

operates to preclude cumulation which would otherwise be discre-

tionary.

The above-quoted URAA legislative history does analogize

the no-discernible-adverse-impact standard to negligibility.
Court No. 99-11-00716 Page 21

However, in discussing this change in the law, the plaintiffs seem

to overlook the fact that the 1994 Senate report distinguishes

negligibility from import volumes in the context of sunset

cumulation, rather than equating the two. It rejects "a strict

numerical test" in order to avoid "the extraordinary difficulty in

projecting import volumes into the future with precision". Again,

even under the former statute, negligibility encompassed more than

just import volumes. The ITC was required to evaluate "all

relevant economic factors regarding the imports", including volume

and market share, whether sales transactions involving the imports

are isolated and sporadic, and price sensitivity of the domestic

market. 19 U.S.C. §1677(7)(C)(v)(I)-(III) (1994). Thus, the court

cannot concur in plaintiffs’ assertion that negligibility equates

only to import volume in this context. In the light of the sunset

cumulation provision and its relevant legislative history, the

court cannot hold that Commissioner Askey's interpretation was not

in accordance with law.

D

The plaintiffs complain that Commissioner Crawford’s

analysis of cumulation lacked adequate explanation and was thus

contrary to law.3 Although her overall approach to cumulation may

3
This claim was initially made in reference to the
commissioner’s analysis of India, China and Brazil. See
Plaintiffs’ Rule 56.2 Brief, p. 40. The court addresses the
argument only as it relates to Indian subject imports, as the ITC's
determinations regarding China and Brazil are not at issue in this

(footnote continued)
Court No. 99-11-00716 Page 22

be unique4, the commissioner recognizes that the "statute clearly
prohibits cumulation where the subject imports are likely to have

no discernible adverse impact on the domestic industry." USITC

Pub. 3247, p. 42. As evidenced by a notation to the majority Views

and her individual views, Commissioner Crawford stood with the

majority in determining that revocation of the existing counter-

vailing-duty order covering subject imports of heavy castings from

India likely would have no discernible adverse impact on the

domestic industry. See id. at 3, n. 2 and at 42-43. Consequently,

she concluded that the statute precluded cumulation of the subject

imports from India with those from the other countries. See id. at

43. Given that the commissioner clearly joined in section III.C.1.

of the majority Views regarding no-discernible-adverse impact, the

court does not consider the remainder of her individual analysis to

be actionable, as the plaintiffs pray.

matter. The other countries were purportedly included "to
illustrate the totality of the shortcomings" in Commissioner
Crawford’s written explanation regarding cumulation, "not as an
independent claim for relief." Plaintiffs' Reply Brief, p. 28.
4
Commissioner Crawford describes her approach as a "se-
quential, four-step analytical process that addresses eligibility
for cumulation, statutory prohibition, Commission discretion, and
competition." USITC Pub. 3247, p. 41. The court notes a
discrepancy in the cited result of her "eligibility" inquiry in
this matter. Compare id. at 42 with id. at 13, n. 63. However,
the court considers it to be harmless because the commissioner's
steps are sequential, and the next one found that cumulation was
precluded with regard to India. This conclusion mooted any issue
raised by the discrepancy as to which countries' imports, if any,
might have been cumulated with subject imports from India.
Court No. 99-11-00716 Page 23

II

The plaintiffs take the position that, if the companion

appeal from the ITA’s sunset determination were to result in

affirmative judicial relief, the court should remand this action to

the ITC for consideration of the other agency's amended results.

Initially, the court agrees that there can be interrela-

tion between the subsidy rates and the ITC’s determination.

Indeed, the statute provides that, in

making a determination under section 1675(b) or (c) of
this title, the Commission may consider the magnitude of
the margin of dumping or the magnitude of the net
countervailable subsidy.

19 U.S.C. §1675a(a)(6). And the commissioners, including those

writing in dissent, exercised this discretion, noting that the ITA

found that the likely countervailable subsidy upon revocation would

range from 0.84 percent to 1.82 percent for imports from India.

See USITC Pub. 3247, pp. 13, 29 and 38, n. 26.

Notwithstanding the relationship between the determina-

tions of Commerce and the Commission, counsel for the latter

assert that

remand would not be appropriate even if the margins were
to change as a result of the separate court action. The
statute and Statement of Administrative Action . . .
accompanying the URAA make clear that, even in the
context of the Commission’s mandatory consideration of
margins in the antidumping context . . ., the Commission
is not to reconsider its determination if Commerce
changes margins upon which the Commission has relied:
Court No. 99-11-00716 Page 24

For other investigations for which
cumulation is appropriate, the Commission is
to use the most recent dumping margin issued
by Commerce at the time the Commission closes
the record. This precludes challenges to a
Commission determination on the basis that
Commerce later modifies the original dumping
margin.

Changes in the original margin could
occur due to further proceedings in staggered
investigations, corrections of ministerial
errors, reconsideration of a determination, or
judicial remand. Absent this provision,
Commission determinations could be subject to
repeated requests for reconsideration or
judicial remands. The finality of injury
determinations would be seriously compromised
if the Commission were required to amend or
revisit its determination each time the admin-
istering authority revised its dumping margin.

H.Doc. No. 103-316 at 851 (1994) (emphasis added). . . .
Although this SAA discussion relates only to cases in
which the Commission has considered antidumping duty
margins, there is every reason to view it as equally
applicable when the margins relied on are countervailing
duty margins. Whereas the Antidumping Agreement that
resulted from the Uruguay Round of trade negotiations,
and thus U.S. implementing law (19 U.S.C. §1677(35))
require consideration of the magnitude of dumping
margins, the Subsidy Agreement from the Round, and thus
U.S. implementing law, do not require the Commission to
consider the rate of subsidization. . . . The discussion
in the SAA therefore relates specifically only to dumping
margins. . . . [T]here would be no rational basis to
require a remand to the Commission when countervailing
duty margins change by court remand, when such change in
the very margins the Commission is required to consider,
dumping margins, is not to be followed by a remand to the
Commission.

Defendant International Trade Commission's Opposition, pp. 42-43

(citation omitted).
Court No. 99-11-00716 Page 25

Be this reasoning as it may, the court is not at liberty

to excuse automatically ITC reconsideration of subsidy rates

developed during countervailing-duty sunset reviews pursuant to 19

U.S.C. §1675a5. That only Congress can do. In any event, the

results of this court's remand of related case No. 99-07-00441 to

the ITA do not entail different rates, and they have now been

affirmed by the court. See Neenah Foundry Co. v. United States, 25

CIT , F.Supp.2d , Slip Op. 01-74 (June 20, 2001). Thus,

plaintiffs' contingent claim for relief herein is now moot.

5
Cf. 28 U.S.C. §2643(c)(1). In fact, while not in the
context of a sunset review, the Court of International Trade and
the Court of Appeals for the Federal Circuit have addressed the
question of a remand to the ITC when dumping margins calculated by
the ITA change. In Borlem S.A.BEpreedimentos Industriais v. United
States, 13 CIT 535, 718 F.Supp. 41 (1989), aff’d, 913 F.2d 933
(Fed.Cir. 1990), for example, a recalculation of the dumping from
the two respondent countries resulted in one margin's changing from
approximately 20 percent to de minimis and thereby being excluded
from the order after the ITC had issued an affirmative injury
determination. The CIT directed the Commission on remand to
reconsider its determination in light of that change, and the
Federal Circuit affirmed the agency's authority to do so.

Subsequent cases have pointed out that the remand in Borlem
was based on the fact that the change was "of such substantial
significance that the ITC might well have changed its
determination". Nippon Steel Corp. v. United States, 19 CIT 450,
467 (1995). They have sought to make clear that Borlem "does not
stand for the broad proposition that ITC must reconsider a final
determination based upon affirmative [dumping] margins that later
change." Id. That is, the Commission need not reconsider its
determination where it does not "appear the ITC made its finding of
injury based upon material and significant inaccurate facts."
Saarstahl AG v. United States, 18 CIT 595, 597, 858 F.Supp. 196,
198 (1994)(quoting Borlem, 13 CIT at 541, 718 F.Supp. at 46), rev'd
on other grounds, 78 F.3d 1539 (Fed.Cir. 1996).
 III

In view of the foregoing, plaintiffs' motion for judgment

upon the agency record must be denied6 and this action dismissed.
Judgment will enter accordingly.

So ordered.

Decided: New York, New York
June 25, 2001

___________________________
Judge

6
Plaintiffs' Consent Motion for Oral Argument also can be
denied, given the quality of their written submissions, as well as
of the papers filed in opposition.