Diamond Sawblades Manufacturers Coalition v. United States

Slip Op 09 - 128
UNITED STATES COURT OF INTERNATIONAL TRADE
:
DIAMOND SAWBLADES :
MANUFACTURERS COALITION, :
:
Plaintiff, :
:
v. : Before: MUSGRAVE, Senior Judge
: Court No. 09-00110
UNITED STATES, :
:
Defendant, :
:
and :
:
SAINT-GOBAIN ABRASIVES, INC., :
HEBEI JIKAI INDUSTRIAL GROUP :
CO., LTD., HUSQVARNA :
CONSTRUCTION PRODUCTS NORTH :
AMERICA, INC., EHWA DIAMOND :
INDUSTRIAL CO., LTD., and BOSUN :
TOOLS GROUP CO., LTD., :
:
Defendant-Intervenors. :
:
OPINION AND ORDER
[Motion to stay denied.]
Dated: November 4, 2009
Wiley, Rein & Fielding LLP (Daniel B. Pickard), for the plaintiff.
Tony West, Assistant Attorney General; Jeanne E. Davidson, Director, Franklin E.
White, Jr., Assistant Director, Commercial Litigation Branch, Civil Division, U.S. Department of
Justice; (Delisa M. Sanchez), Office of the Chief Counsel for Import Administration, U.S.
Department of Commerce; (Christine Sohar Henter), Of Counsel, for the defendant U.S. Department
of Commerce.
Court No. 09-00110 Page 2
Akin Gump Strauss Hauer & Feld LLP (J. David Park), counsel for the defendant-
intervenor Ehwa Diamond Industrial Co., Ltd.
Fischer Fox Global PLLC (Lynn M. Fischer Fox) for the defendant-intervenor Saint-
GobainAbrasives, Inc.
Alston & Bird, LLP, (Kenneth G. Weigel) for the defendant-intervenors Hebei Jikai
Industrial Group Co., Ltd., and Husqvarna Construction Products North America, Inc.
DeKeiffer & Horgan (Gregory S. Menegaz), for the defendant-intervenor Bosun Tools
Group Co., Ltd.
Musgrave, Senior Judge: Before the court, Defendant-Intervenors Saint-Gobain
Abrasives, Inc., Hebei Jikai Industrial Group Co., Ltd., Husqvarna Construction Products North
America, Inc., Ehwa Diamond Industrial Co., Ltd., and Bosun Tools Group Co., Ltd., (“Intervenors”)
move for a stay of enforcement of the writ of mandamus issued by the court in Diamond Sawblades
Mfrs.’ Coalition v. United States, 33 CIT __, Slip Op. 09-107 (Sept. 30, 2009) (“Slip Op. 09-107”)
pending the appeal of that case before the United States Court of Appeals for the Federal Circuit
(“Federal Circuit”). Defendant International Trade Administration, United States Department of
Commerce (“Commerce” or the “Department”) does not oppose the motion for a stay. Def. Resp.
at 2. For the reasons set forth below, the motion will be denied.
Background
The history of this matter will be summarized here only briefly; familiarity with the
previous cases is presumed. In June 2006 the Department issued a final determination that diamond
sawblades imported from the Peoples Republic of China and the Republic of Korea were being
dumped on the U.S. market. However, when the United States International Trade Commission
(“ITC” or the “Commission”) completed its final investigation, it determined that the domestic
Court No. 09-00110 Page 3
industry was neither materially injured nor threatened with material injury by reason of the subject
imports. As a result, no antidumping duty orders were issued and previously collected cash deposits
were returned. See 19 U.S.C. § 1673d(c)(2).
DSMC challenged the ITC’s negative determination in this court. Upon review, the
court remanded the matter to the ITC for further consideration of certain issues. On remand, the ITC
reversed its position and entered an affirmative determination on the question of threat-of-material-
injury. The remand determination was subsequently reviewed by the court and sustained in its
entirety, and the court issued final judgment. Diamond Sawblades Mfrs.’ Coalition v. United States,
Slip Op. 09-5, 2009 WL 289606 (CIT January 13, 2009) (“Slip Op. 09-5”). However, other than
suspending liquidation, neither the ITC nor Commerce gave effect to the court’s decision; both
agencies asserted that they had no further duty to effectuate the court’s decision because Intervenors
had filed an appeal.
DSMC asserted to the ITC and Commerce that each agency had the obligation to
effectuate the court’s decision in spite of the pending appeal. When they declined, DSMC sought
relief in this court by filing mandamus actions against both agencies. In one action (Court No. 06-
00247), DSMC sought to compel the ITC to publish a Federal Register notice of the affirmative
remand determination. Commerce was not named as a party in that matter, so DSMC filed this
Court No. 09-00110 to compel Commerce to issue the appropriate antidumping duty orders and to
order the collection of cash deposits.
Two of the Intervenors in this case (Court No. 09-00110) also intervened in the
proceedings that involved the Commission (Court No. 06-00247). In both cases, the central question
Court No. 09-00110 Page 4
before the court was whether, or to what extent, the government agencies involved had a duty to
effectuate a final decision of the Court of International Trade if an appeal had been filed. In both
cases, Defendants and Intervenors asserted that, except for suspension of liquidation, decisions of
this Court were to be given no effect unless and until the Federal Circuit issued a final and
conclusive decision on the matter.
The court addressed both mandamus actions in a combined opinion issued on
September 30, 2009, which is the subject of the current motion to stay. See Slip Op. 09-107.
Pursuant to that opinion, the court granted the writ of mandamus as to Commerce (Court No. 09-
00110) and ordered Commerce “forthwith” to issue and publish antidumping duty orders and to
order the collection of cash deposits. Judgment, Slip Op. 09-107. The court denied as moot the
mandamus application as to the ITC, finding that publication was unnecessary because de facto
notice-publication of the ITC’s decision had already occurred. Id. On October 7, 2009, Intervenors
filed an appeal as to Slip Op. 09-107, and now move to stay the effects of the writ of mandamus
pending that appeal.
Discussion
In determining whether a stay should be granted, the court considers the same four
factors traditionally considered in deciding whether to grant a preliminary injunction: A movant must
demonstrate that (1) without a stay, it will suffer immediate irreparable harm, (2) there is a likelihood
of success on appeal, (3) the public interest would be better served by the requested relief, and (4)
the balance of hardships on all the parties favors them. Zenith Radio Corp. v. United States, 710
F.2d 806, 809 (Fed. Cir.1983).
Court No. 09-00110 Page 5
In weighing these factors, the court employs a “sliding scale,” meaning that no single
factor is dispositive, and that “the weakness of the showing regarding one factor may be overborne
by the strength of the others.” FMC Corp. v. United States, 3 F.3d 424, 427 (Fed. Cir. 1993). See
also Michigan Coalition v. Griepentrog, 945 F.2d 150 (6th Cir. 1991) (holding that “the probability
of success that must be demonstrated is inversely proportional to the amount of irreparable injury
[movants] will suffer absent a stay”). But see Nat’l Hand Tool Corp. v. United States, 14 CIT 61,
65 (1990) (noting that “[t]he critical question . . . is whether denial of the requested relief will
expose the applicant to irreparable harm.”).
I. Irreparable Harm
The parties seeking the stay bear the burden of producing “probative evidence” to
demonstrate a threat of immediate, irreparable harm. Nat’l Hand Tool, 14 CIT at 66. To establish
irreparable harm, the movant must prove that, absent a stay, “some harm will result to [them] that
cannot be reasonably redressed in a court of law.” Am. Customs Brokers Co. v. U.S. Customs
Service, 10 CIT 385, 386, 637 F.Supp. 218, 220 (CIT 1986). Here, Intervenors set forth several
allegations as to how that they will suffer “immediate and irreparable” harm if the mandamus order
is not stayed. Mot at 7. As discussed below, the court finds these allegations to be without merit.
Intervernors first contend that they will suffer immediate and irreparable harm
because Commerce’s publication of antidumping duty orders would “trigger[] the deadline[]” for
the annual administrative reviews. As a result, one year hence they will be forced to “incur
significant financial and administrative costs” by participating in the administrative review,
regardless of whether the appeal of Slip Op. 09-5 has been conclusively resolved. Id. These
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allegations fail as a matter of law. It has been firmly established that the cost incurred from
participating in administrative review is not irreparable harm. Matsushita Elec. Indus. Co. v. United
States, 823 F.2d 505, 509 (Fed. Cir. 1987) (holding that “‘the ordinary consequences of antidumping
duty procedures do not constitute irreparable harm.’”) (quoting Toshiba Corp. v. United States, 657
F.Supp. 534, 535 (1987). Moreover, the alleged harm, which is based upon a hypothetical worst-
case scenario that might occur one year from now, is by its very nature speculative and lacking in
immediacy. S.J. Stile Assocs. Ltd. v. Snyder, 646 F.2d 522, 525 (C.C.P.A. 1981) (finding that “ a
mere possibility of injury” is not irreparable harm).
Intervenors contend next that the publication of an antidumping duty order “serve[s]
as immediate public notice that certain exporters are guilty of injurious dumping,” which would
“have a devastating effect on the foreign exporters’ business, reputation, and credibility.” Mot. at
8. These allegations are speculative and unsubstantiated. Intervenors offer no evidence whatsoever
to support these allegations or logical explanation as to how the publication of an antidumping duty
order would be an independent cause of reputational damage given that Commerce has already
published a final determination that Intervernors were, in fact, dumping. See Matsushita, supra.Intervernors allege further that they will suffer irreparable harm in the absence of a
stay because this court violated their due process rights. They contend that “their procedural due
process rights were strongly prejudiced” by Slip Op. 09-107 because that determination
relied heavily on the arguments set forth in the brief filed in a separate appeal (Court
No. 06-[00]247), which was not before the Court in the above-captioned appeal . . ..
Thus, Defendant-Intervenors and Commerce (through its attorneys at the U.S.
Department of Justice) did not have an opportunity to comment on the Commission’s
arguments since these arguments were not on the record of this action. Moreover,
this Court did not permit parties to this action to present oral arguments and, thus,
Court No. 09-00110 Page 7
this mandamus order . . . was issued without giving Defendant-Intervenors and the
Government a full opportunity to comment and address this Court’s concerns based
on arguments raised by another party in a separate appeal.
Mot. at 9-10 (citations omitted). These contentions are unpersuasive for several reasons1. In
considering procedural due process, “the court must first determine whether a protected property or
liberty interest exists, then determine what procedures are necessary to protect that interest.”
Techsnabexport, Ltd. v. United States, 795 F. Supp. 428, 435 (1992). “‘The essential elements of
“due process of law” are notice and opportunity to be heard and to defend in [an] orderly proceeding
adapted to [the] nature of [the] case, and . . . require[] that every [litigant] have [the] protection of
[a] day in court and [the] benefit of general law.’” Barnhart v. U.S. Treasury Dept. 7 CIT 295, 303,
588 F. Supp. 1432, 1438 (1984) (quoting Blacks Law Dictionary 449 (5th ed. 1979)). The test is one
of fundamental fairness in light of the total circumstances. Id. (referencing Buttny v. Smiley, 281 F.
Supp. 280 (1968)). It is highly unlikely that Intervenors’ asserted “entitlement to the benefit of the
fair administration of the antidumping duty laws” (as they interpret them) constitutes a valid property
interest. Yet, even assuming a statutory right to a “fair and honest process,” see NEC Corp. v.
United States, 151 F.3d 1361 (Fed. Cir. 1998), the described allegations do not constitute a
deprivation of procedural due process.
1
Although the violation of constitutional rights is widely recognized as irreparable harm,
“cases so holding, however, are almost entirely restricted to cases involving alleged infringements
of free speech, association, privacy[,] or other rights as to which temporary deprivation is viewed
of such qualitative importance as to be irremediable by any subsequent relief.” Pub. Service Co. of
N.H. v. Town of West Newbury, 835 F.2d 380, 382 (1st Cir. 1987). The court has reservations as to
whether a violation of procedural due process, alleged to have occurred in the lower court
proceeding, would constitute future irreparable harm, or, for that matter, whether such an allegation
is more appropriately the subject for appeal as a part of the process that is due.
Court No. 09-00110 Page 8
First, Intervenors fail to explain how their alleged inability to comment upon any of
the Commission’s Court No. 06-00247arguments affected the fundamental fairness of the
proceedings. Even where the litigants are parties to the same action the Court’s Rules do not,
without leave of the Court, afford Defendants and Defendant-Intervernors an opportunity to
comment on each others’ arguments. Furthermore, because the court rejected the Commission’s
arguments as meritless, it is difficult to imagine how the court could be seen as “relying” upon those
arguments, or how Intervenors were prejudiced by not having “an opportunity” to comment on those
arguments.
Second, even if the court had “relied heavily” on arguments or legal theories “not on
the record” of Court No. 09-00110, Intervenors offer no support for their assertion that doing so
would have been a violation of due process, or even that it would have been improper. When a
particular issue “is properly before the court, the court is not limited to the particular legal theories
advanced by the parties, but rather retains the independent power to identify and apply the proper
construction of governing law.” Kamen v. Kemper Financial Services, Inc., 500 U.S. 90, 99 (1991).
See also Forshey v. Principi, 284 F.3d 1335, 1357 (Fed. Cir. 2002) (en banc), superseded by statute
on other grounds, as recognized in Morgan v. Principi, 327 F.3d 1357 (Fed. Cir. 2003).
Finally, the court observes that two of the five intervenors here also intervened in
Court No. 06-00247, and were represented by the same counsel in both cases; that the joint brief
submitted by Intevenors in Court No. 09-00110 did, in fact, discuss arguments presented by the
Commission in Court No. 06-00247, and included as an attachment a preliminary Commission brief;
and that Intervenors discussed arguments that they planned to advance in the 06-00247 case. As to
Court No. 09-00110 Page 9
the intervenors’ contention that the court “did not permit parties to this action to present oral
arguments,” the court will only comment that, if Intervenors had wished to present oral arguments
on the matter, they should have filed a motion so requesting. They did not.
Additionally, the intervenors appear to argue that proof of irreparable harm should
not be required in this case. This argument is based upon a ruling from the Tenth Circuit Court of
Appeals holding that “a party seeking injunctive relief need not prove any irreparable harm if the
party to be enjoined will engage in conduct prohibited by a statute that affords injunctive relief to
prevent such conduct.” Mot. at 10 (citing Atchison, Topeka & Santa Fe Ry. Co. v. Lennen, 640 F.2d
255 (10th Cir. 1981). Intervenors attempt to explain the relevance of Lennen to this matter by
asserting that because “this [c]ourt’s mandamus order would require Commerce to take actions that
are inconsistent with the law” (as they interpret it), Lennen requires the court to afford less weight
to the irreparable harm factor, and more weight to other factors, such as, presumably, likelihood of
success on the merits.
This argument is meritless. Lennen has no bearing on this matter. The rule set forth
in Lennen is only applicable to injunctive relief specifically provided by statute. Lennen, 640 F.2d
at 259 (holding that because “‘Congress has expressly authorized federal courts to grant injunctive
relief in furtherance of the express purposes of Section 306, it is not required that irreparable harm
or inadequacy of legal remedies first be shown . . . .”’) (quoting State of Tenn. v. Louisville & N. R.
Co., 478 F. Supp. 199, 210 (D.C. Tenn. 1979)). Because the current matter is unrelated to
statutorily-based injunctive relief, the rule set forth in Lennen and related cases is irrelevant.
Court No. 09-00110 Page 10
II. Likelihood of Success on the Merits
Assessing the “likelihood of success” factor presents a difficult question when applied
to a stay because it calls upon the court to determine the likelihood of reversal by the appellate court.
Indeed, if the court thought that the Intervenors were likely to succeed on the merits, it would not
have ruled against them. As Judge Watson observed, “it is hard to imagine a judge ever answering
that question in the affirmative unless he had a cynical view of his opinion or the wisdom of the
appellate court.” American Grape Growers Alliance for Fair Trade v. United States, 9 CIT 505, (CIT
1985) 1985 WL 25781 at *2. However, it is also a given that “[w]henever decisions of one court
are reviewed by another, a percentage of them are reversed.” Brown v. Allen, 344 U.S. 443, 540, 73
(1953) (Jackson, J., concurring) (maintaining that “[w]e are not final because we are infallible, but
we are infallible only because we are final”). Accordingly, objective criteria offered for assessing
the likelihood of reversal include whether the issues presented are “novel or close” or whether the
movant has raised “substantial, difficult and doubtful” questions on the merits. Standard Havens
Products, Inc. v. Gencor Industries, Inc., 897 F.2d 511 (Fed. Cir. 1990); Alaska Cent. Express, Inc.
v. United States, 51 Fed.Cl. 227 (2001).
The court finds that Intervenors have little chance of success on appeal. Although
the novelty of the questions addressed in Slip Op. 09-107 may, theoretically, increase the likelihood
of reversal on appeal, that novelty is not viewed in isolation. Slip Op. 09-107 did indeed address
issues never squarely addressed by the Federal Circuit; however, the position advocated by the
intervenors — that, notwithstanding liquidation suspension, this Court’s decisions are to be given
no effect while the decision is on appeal— constitutes such a radical departure from fundamental
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legal principles governing the judicial process that it is difficult to envision an appellate court that
would agree with such a result.
III. Balance of Hardships
In addressing this factor, Intervenors essentially attempt to re-argue questions already
decided in the mandamus action. However, the Intervenors present no reason and no new
information that would compel the court to find that the balance of hardships runs in their favor, and
as discussed supra, they have provided no evidence of irreparable harm. Furthermore, as noted in
Slip Op. 09-107, the Commission determined that DSMC was imminently threatened with material
injury by reason of the dumped imports, a condition that antidumping duties is intended to remedy.
Accordingly, the court cannot conclude that the balance of hardships favors Intervenors.
IV. Public Interest
Intervenors arguments in this regard may be boiled down to a contention that the
public interest is best served by a stay because Slip Op. 09-107 is, in their mind, incorrect.
Intervenors contentions in this regard were discussed at length in Slip Op. 09-107 and the court will
not revisit these issues here.
Court No. 09-00110 Page 12
Conclusion
In applying the standards outlined above to the facts of this case, the court must
conclude that Intervenors have failed to demonstrate the need for a stay. Accordingly, the motion
is denied.
SO ORDERED.
/s/ R. Kenton Musgrave
R. KENTON MUSGRAVE, Senior Judge
Dated: November 4, 2009
New York, New York