Altx, Inc. v. United States ( 2002 )

Slip Op. 02-66
UNITED STATES COURT OF INTERNATIONAL TRADE
____________________________________
:
ALTX, INC., AMERICAN EXTRUDED :
PRODUCTS, CORP., DMV STAINLESS :
USA, INC., SALEM TUBE, INC., :
SANDVIK STEEL CO., PENNSYLVANIA :
EXTRUDED TUBE COMPANY, and :
UNITED STEEL WORKERS OF :
AMERICA, AFL-CIO/CLC, :
:
Plaintiffs, :
:
v. :
:
THE UNITED STATES, and THE :
UNITED STATES INTERNATIONAL :
TRADE COMMISSION, :
: Court No. 00-09-00477
Defendants, :
:
and :
:
SUMITOMO METAL INDUSTRIES, :
NIPPON STEEL CORPORATION, :
KAWASAKI STEEL CORPORATION, :
NKK CORPORATION, KOBE STEEL :
LTD., and SANYO SPECIAL STEEL :
COMPANY, :
:
:
Defendant-Intervenors. :
____________________________________:
[Motion for preliminary injunction denied.]
Dated: July 12, 2002
Collier Shannon Scott, PLLC (David A. Hartquist, Jeffrey S. Beckington, and R. Alan
Luberda) for plaintiffs.
Lyn M. Schlitt, General Counsel, Marc A. Bernstein, Assistant General Counsel, United
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States International Trade Commission (Rhonda M. Hughes), for defendants.
Wilmer, Cutler & Pickering (John D. Greenwald, Robert C. Cassidy, Jr., Leonard
Shambon, Jason Kearns and Lynn M. Fischer) for defendant-intervenors.
OPINION
RESTANI, Judge:
Plaintiffs Altx, Inc., American Extruded Products Corp., DMV Stainless USA, Inc.,
Salem Tube, Inc., Sandvik Steel Co., Pennsylvania Extruded Tube Company, and United
Steelworkers of America, AFL-CIO/CLC (collectively, “Altx”) move this court for the entry of a
preliminary injunction that: (1) enjoins the U.S. Customs Service (“Customs”) from liquidating
entries of circular seamless stainless steel hollow products (“CSSSHP”) from Japan which have
been entered or withdrawn from warehouse on or after May 1, 2000 – the date of the preliminary
determination of sales at less than fair value, see Circular Seamless Stainless Steel Hollow
Products from Japan, 65 Fed. Reg. 25,305 (May 1, 2000) – and that remain unliquidated as of the
date of the court’s issuance of the requested injunction; and (2) orders the Department of
Commerce (“Commerce” or “the Department”) to issue instructions to Customs suspending
liquidation on all such entries or withdrawals from warehouse, pending the final resolution of
this action and any appeals thereto. See CIT Rule 65.
Background
On August 30, 2000, the United States International Trade Commission (“ITC” or “the
Commission”) published its final determination by a 4-2 vote that the domestic CSSSHP industry
was neither materially injured nor threatened with material injury by reason of dumped imports
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of CSSSHP from Japan. See Circular Seamless Stainless Steel Hollow Products from Japan, 65
Fed. Reg. 52,784 (Aug 30, 2000). Accordingly, Customs ceased collecting duty deposits on
entries of CSSSHP from Japan and refunded all deposits that had been collected between the date
of publication of Commerce’s preliminary determination (i.e., May 1, 2000) and the publication
of the Commission’s final determination.
On September 19, 2001, the court remanded the determination to the Commission to
reconsider its findings with respect to the volume of imports, the effect of subject imports on
domestic prices, and impact of imports on the domestic industry, and to reevaluate its
determinations regarding present material injury and threat of material injury. See Altx, Inc. v.
United States, 167 F. Supp. 2d 1353 (Ct. Int’l Trade 2001). On December 3, 2001, the
Commission returned a remand determination reflecting a 3-3 affirmative determination based on
the original minority opinion.
Discussion
Pursuant to 19 U.S.C. § 1516a(c)(2), the court has the authority to render preliminary
injunctive relief “upon a request by an interested party for such relief and a proper showing that
the requested relief should be granted under the circumstances.” A preliminary injunction,
however, is an extraordinary remedy which may issue only upon a clear showing by the moving
party that they are entitled to such relief. See Trent Tube Div., Crucible Materials Corp. v.
United States, 744 F. Supp. 1177 (1990). “Only a viable threat of serious harm which cannot be
undone authorizes exercise of a court's equitable power to enjoin before the merits are fully
determined. A preliminary injunction will not issue simply to prevent a mere possibility of
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injury, even where prospective injury is great.” S. J. Stile Assocs. v. Snyder, 646 F.2d 522, 525
(1981) (citation omitted). Plaintiffs must establish the following four factors in order to obtain a
preliminary injunction: (1) the threat of immediate irreparable harm; (2) the likelihood of success
on the merits; (3) the public interest would be better served by the requested relief; and (4) the
balance of hardship on all the parties favors plaintiffs. See Zenith Radio Corp. v. United States,
710 F.2d 806, 809 (Fed. Cir. 1983).
A. The ITC’s Affirmative Decision does not Establish Irreparable Harm
Altx relies on Zenith for the proposition that because, following initial remand, the
Commission has rendered an affirmative determination of injury under the antidumping laws, the
court must find irreparable harm to the domestic industry. Altx’s reliance on Zenith is
misplaced. The Federal Circuit in Zenith held that during an appeal of an administrative review
of an antidumping order, liquidation of entries constituted irreparable harm. The Federal Circuit
reasoned that liquidation of entries was of particular concern in the case of an administrative
review because liquidation under such circumstances “would eliminate the only remedy available
to [the petitioner] for an incorrect review determination.” Zenith, 710 F.2d at 810. Clearly,
Zenith does not apply here because the instant case involves an appeal of injury determination in
an investigation, rather than an administrative review. See also Sandoz Chemicals Corp. v.
United States, 17 CIT 1061, 1063 (1993) (“Unlike an annual review, a negative injury
determination affects liquidation of all future entries, not just those made within a specific time
period. In such a situation, liquidation does not substantially curtail available judicial
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remedies.”).
Altx attempts to distinguish the holding in Standoz on the ground that it involved an
appeal from a negative injury determination pursuant an investigation. In Trent Tube, however,
the court extended the Sandoz holding to an investigation where, as here, the Commission had
made an initial negative injury determination, and subsequently made an affirmative injury
determination on remand. The court denied the motion for a preliminary injunction, reasoning
that liquidation of entries is not per se irreparable harm in the context of determinations in
investigations. Trent Tube, 744 F. Supp. at 1177 (“Plaintiffs must show additional evidence to
prevail on the motion for preliminary injunction.”). The court ultimately found that liquidated
entries, supplemented by speculative evidence of harm, was insufficient to establish that denial of
an injunction would cause irreparable harm. Trent Tube, 744 F. Supp. at 1179. Thus, to support
a finding of irreparable harm, Altx must present additional evidence establishing irreparable
injury.
B. Evidence of Lost CDO Revenue does not Establish Irreparable Harm
Altx argues that the loss of duty revenue under the Continued Dumping and Subsidy
Offset Act (“CDO”) constitutes irreparable harm. See 19 U.S.C. 1675c (2001); 19 C.F.R. §
159.61. Under the CDO, assessed duties received by Customs during the fiscal year will be
disbursed to affected domestic producers that have incurred qualifying expenditures subsequent
to the issuance of an antidumping or countervailing duty order. See 19 C.F.R.§ 159.61(a).
Under the CDO, all duties collected by Customs are placed in a Special Account to be distributed
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to “affected producers” with “qualifying expenditures.” Id. at § 159.64(b). If the Special
Account figure is larger than the qualifying expenditures, the domestic producers will be paid for
their full claim of qualified expenditures. Id. at § 159.61(c). If the Special Accout is less than
the qualified expenditures, however, the domestic industries will be paid on a pro rata basis. Id.
Thus, in order to establish irreparable injury, Altx has the burden of showing that the
affected producers’ qualified expenditures will be greater than the amount that will be distributed
from the Special Account. Altx has not met this burden. First, Exhibit 1 (“Continued Dumping
and Subsidy Offset”) indicates that Sandvik Steel incurred qualifying expenditures of
$14,790,198 in calendar year 2001 against which domestic industry might claim disbursement
under the CDO. Qualifying expenditures, however, “must be incurred after the issuance, and
prior to the termination, of the antidumping duty order . . . .” 19 C.F.R. 159.61(c). Altx fails to
show that evidence of qualifying expenditures for the year 2001 will correspond to qualifying
expenditures following the antidumping order. Furthermore, in Attachment 8 (“U.S. Imports of
Circular Seamless Stainless Steel Hollow Products from Japan”), Altx provides evidence of
volume and value of imports for the period from August 2001 to February 2002. This serves
merely as an indicator of revenues that Customs could collect for the Special Account if there
was a suspension of liquidated entries. This does not indicate the portion of that revenue the
affected producers would receive. At a minimum, Altx must produce affidavits or other evidence
showing, with more specificity, expected lost antidumping duties on liquidated entries, the
amount of antidumping duties to be raised in the event of the issuance of an antidumping duty
order, and the amount of qualified expenditures to be expected following an order. Further,
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because the effects of any order will continue in the future, Altx must establish that there is a
likelihood that it will suffer economically because of the liquidation of particular entries.
Without such specific showings, it is left to speculation whether liquidating entries will have any
impact on the domestic industry.
Although the court has not sustained the remand affirmative injury finding, but has again
remanded the case, because Altx failed to meet the burden of proving irreparable harm, the court
need not reach its arguments with respect to the other three factors assessed in determining
whether to grant an preliminary injunction. See Trent Tube, 744 F. Supp. 1177 (“If any one of
the requisite factors has not been established by plaintiffs, the motion for a preliminary injunction
must be denied.”). The court notes, however, that it cannot predict at this time whether the final
remand injury determination will be affirmative or negative. Thus, further attempts to show
irreparable harm are unlikely to satisfy Altx’s overall burden under the four-part test.
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Accordingly, Altx’s motion for a preliminary injunction is DENIED.
____________________________
Judge of the United States
Court of International Trade
Dated: New York, New York
This ___ day of July, 2002.
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