Kerr-McGee Chemical Corp. v. United States

15 Ct. Int'l Trade 261, 765 F. Supp. 1576, 15 C.I.T. 261, 13 I.T.R.D. (BNA) 1513, 1991 Ct. Intl. Trade LEXIS 172
CourtUnited States Court of International Trade
DecidedJune 5, 1991
DocketCourt No. 89-03-00152; Court No. 89-03-00170
StatusPublished

This text of 15 Ct. Int'l Trade 261 (Kerr-McGee Chemical Corp. v. United States) is published on Counsel Stack Legal Research, covering United States Court of International Trade primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Kerr-McGee Chemical Corp. v. United States, 15 Ct. Int'l Trade 261, 765 F. Supp. 1576, 15 C.I.T. 261, 13 I.T.R.D. (BNA) 1513, 1991 Ct. Intl. Trade LEXIS 172 (cit 1991).

Opinion

Memorandum and Order

Restani, Judge:

Plaintiffs move for judgment on the administrative record of the Final Determination on Remand of the International Trade Administration (“ITA” or “Commerce”) and ask the court to determine that sales of Electrolytic Manganese Dioxide (“EMD”) from Ireland were likely during the Period of Investigation (“POI”), December 1, 1987, to May 31, 1988, and to remand to ITA to determine the dumping margin. For the reasons stated below, the court denies plaintiffs’ request and affirms ITA’s determination.

Procedural History

The factual and procedural background of this case is set forth in the court’s previous opinion, Kerr-McGee Chemical Corp. v. United States, 14 CIT 344, 739 F. Supp. 613 (1990), with which the court presumes the reader to be familiar.

The court’s major findings in that opinion were as follows. The court held that ITA had conducted an adequate investigation and had not abused its discretion in refusing to extend the POI backwards, but the court found that ITA was required to reconsider its determination that sales were not likely during the POI. Id. at 622 and 628. The court explained that ITA’s key reasons for not finding likely sales were “all based on erroneous or unexplained standards.” Id. at 622.

The court noted that the determination of no likely sales depended, under ITA’s reasoning, on the lack of an irrevocable offer of sale during [262]*262the POI. Id. at 623. Although ITA claimed to use a different definition of an irrevocable offer than that which practitioners and courts generally employ, the court found ITA’s explanation insufficient, and that at the very least such a standard would be misleading. Moreover, the court noted that ITA defined “irrevocable” as “imminent, ” 1 but that ITA had not explained why an irrevocable offer was more susceptible of imminent acceptance than a revocable offer. Id. at 624. The court also held that ITA’s finding of no likely sales was not supported by the fact of incomplete qualification (for continuing use in the purchaser’s battery production) of Mitsui Denman Ireland’s (“MDI”) EMD in this case, as sales for qualification were nonetheless sales. Finally, the court held that ITA did not properly analyze whether actual sales occurred a few days after the POI. Under the facts of record, such sales would indicate likely sales during the POI.

Accordingly, the court instructed ITA to “define a standard for determining whether sales are likely which considers industry practice and which will capture imminent sales.” Because the purchase orders, which appeared to evidence actual sales, were canceled, the court also directed ITA to “explain its policy on canceled sales in terms of the governing statute and this case. ”2 Id. at 628.

The court’s general instruction to ITA was to

determine whether U.S. sales existed or were likely. In doing so it shall consider the relationship, if any, between the primary purchaser’s orders and the preexisting Agreement, and it shall consider the activities discussed here of the primary purchaser, the potential purchaser and MDI.3

Id.

On July 11, 1990, plaintiff Kerr-McGee requested that ITA re-open the record on remand to take evidence on (i) industry practice as to the use (or non-use) of irrevocable offers, (ii) whether MDI and the primary purchaser reached a well defined agreement during the POI, and (iii) MDI’s motivation in requesting the primary purchaser to cancel its June 9, 1988 orders.

On August 17, 1990, ITA sent a letter to counsel enclosing its draft remand determination stating that its request to reopen the record was denied. ITA did state, however, that it would accept factual information [263]*263regarding the 1988 Agreement “that was accessible and in existence between the date verification was completed (December 16,1988) and the signing of the Department’s final determination (February 22,1989).” Letter from Roland MacDonald, Director of Antidumping Compliance, to W. N. Harrell Smith IV of Drinker Biddle & Reath (Aug. 17, 1990); Appendix 2 to Memorandum in Support of Plaintiffs’ Motion for Judgment upon the Agency Record After Remand (“P. Brief’) (emphasis in original).

In its remand determination of October 12, 1990, Commerce stated:

In determining whether the merchandise subject to investigation is likely to be sold in the United States at less than fair value, the Department requires evidence of an irrevocable offer to sell the subject merchandise. [Citation omitted]. The Department defines an irrevocable offer as an offer on the part of the seller binding it to sell the subject merchandise at a specific price for a specified period of time.

Remand Determination at 4.

Commerce noted that while other types of offers may indicate that a sale is likely to occur,

more than a speculative potential of future sales is necessary to satisfy the likelihood of sales criteria of the Act. Certain Carbon Steel Products from Czechoslovakia, 50 Fed. Reg. 1912 (1985). In the absence of actual sales, the Department must have evidence that establishes, with a sufficient degree of definiteness, that a sale is imminent at a price sufficiently reliable to form the sole basis of a dumping determination.

Remand Determination at 3. Commerce proceeded to explain that

irrevocable offers serve as a better benchmark of pricing practices than revocable offers, because if a seller’s offer is revocable, it has the option of withdrawing or modifying the offer at any point in time * * * With irrevocable offers, the seller is bound to sell at a specific price; it does not have the option of withdrawing or modifying the terms of the offer * * *

In discussing the two purchase orders from the primary purchaser, ITA stated that:

[o]ur examination of the record reveals that the two purchase orders essentially represent bids by a U.S. buyer to purchase the subject merchandise at a price and quantity specified by the buyer. In this industry, unless the purchase orders are tied to a larger agreement binding the seller to supply the merchandise at the price specified, the seller is not bound by the terms of the purchase order; a valid contract is not formed. See C.R. Doc. 2 at 142A; C.R. Doc. 24 at 329A; P.R. Doc. 81 at 875. If the two purchase orders are tied to a comprehensive agreement to sell the subject merchandise to the U.S. purchaser, a valid contract would be formed upon issuance of the purchase orders.
[264]*264In this case, a purchasing agreement existed between MDI and the U.S. purchaser who issued the aforementioned purchase orders. However, this agreement only covered two grades of EMD produced by MDI. These grades were destined for sales to a third country and not to the United States. Since the agreement does not cover the EMD specified in the purchase orders, MDI was never bound to sell EMD to the United States at the stated price.
Although the agreement provides for inclusion of other grades of EMD upon mutual written agreement, verification of customer files at MDI and Mitsui New York demonstrate that the agreement was not modified to include the subject merchandise. C.R.

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Related

Kerr-McGee Chemical Corp. v. United States
739 F. Supp. 613 (Court of International Trade, 1990)

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15 Ct. Int'l Trade 261, 765 F. Supp. 1576, 15 C.I.T. 261, 13 I.T.R.D. (BNA) 1513, 1991 Ct. Intl. Trade LEXIS 172, Counsel Stack Legal Research, https://law.counselstack.com/opinion/kerr-mcgee-chemical-corp-v-united-states-cit-1991.