CHEFLINE CORPORATION, ET AL.,

Plaintiffs,

v.

UNITED STATES,

Defendant,

and

THE STAINLESS STEEL COOKWARE COMMITTEE,

Defendant-Intervenor.

Slip Op. 01-118

United States Court of International Trade

Before: Pogue, Judge

Court No. 00-05-00212

Public Version

[Plaintiff’s motion for judgment on the agency record affirmed-inpart and denied-in-part. Agency determination remanded for action

consistent with this opinion.]

Decided: September 26, 2001

Hogan & Hartson LLP (Lynn G. Kamarck, Craig A. Lewis), for

Plaintiffs.

Lyn M. Schlitt, General Counsel; Marc A. Bernstein, Acting

Assistant General Counsel; Laurent M. de Winter, Attorney, Office

of General Counsel, U.S. International Trade Commission, for

Defendant.

King & Spalding (Joseph W. Dorn, Stephen A. Jones, Christine E.

Savage), for Defendant-Intervenor.

OPINION

Pogue, Judge: Plaintiffs Chefline Corporation, Inc., Daelim

Trading Co., Ltd., Dong Won Metal Co., Ltd., Hai Dong Stainless

Steel Co., Ltd., Kyung Dong Industrial Do., Ltd., Namyang

Kitchenflower Co., Ltd., O’bok Stainless Steel Co., Ltd., and Sam
Court No. 00-05-00212 Page 2

1The purpose of a sunset review is to determine whether

revocation of an antidumping or countervailing duty order would,

within a reasonably foreseeable time, likely lead to continuation

or recurrence of material injury. See 19 U.S.C. § 1675(c)

(1994). A finding that material injury would likely continue or

recur constitutes an “affirmative determination.”

Yeung Industrial Co., Ltd. (collectively, “Plaintiffs” or

“Chefline”), move for judgment upon the agency record pursuant to

USCIT Rule 56.2, challenging the U.S. International Trade

Commission’s (“Commission” or “ITC”) final affirmative

determination in the five-year administrative review (“sunset

review”) of antidumping and countervailing duty orders on top-ofthe-stove stainless steel cookware from Korea and Taiwan.1 See

Porcelain-on-Steel Cooking Ware from China, Mexico, and Taiwan, and

Top-of-the-Stove Stainless Steel Cooking Ware from Korea and

Taiwan, USITC Pub. 3286, Inv. Nos. 701-TA-267 & 268 (Review) and

731-TA-297-299, 304 & 305 (Review) (March 2000) (“Review

Determination”). Defendant United States and Defendant-Intervenor

The Stainless Steel Cookware Committee (“Committee”), an

association of domestic producers of top-of-the-stove stainless

steel cooking ware, oppose Plaintiffs’ motion.

Plaintiffs challenge several aspects of the Review

Determination, including, (1) the Commission’s “domestic like

product” determination, (2) the Commission’s decision to cumulate

subject imports from Korea and Taiwan, and (3) the Commission’s

determinations related to its finding of a likelihood of
Court No. 00-05-00212 Page 3

continuation or recurrence of material injury, namely, that, upon

revocation of the orders, subject imports would likely increase to

significant volume levels, would lead to significant underselling,

price depression, and price suppression, and would have a

significant adverse impact on the domestic industry. See Pl.’s Br.

Supp. Mot. J. Agency R. (“Pl.’s Br.”) at 1-4.

For the reasons discussed below, we affirm the Commission’s

“domestic like product” determination, and remand the Commission’s

decision to cumulate. The Commission’s material injury

determination will be reviewed after the remand results on the

issue of cumulation are received.

Background

In January 1987, the Commission determined that an industry in

the United States was materially injured by reason of less than

fair value (“LTFV”) and subsidized imports of stainless steel

cookware from Korea and Taiwan. See Top-of-the-Stove Stainless

Steel Cooking Ware from Korea and Taiwan, USITC Pub. 1936, Inv.

Nos. 701-TA-267-268 and 731-TA-304-305 (Final), (Jan. 1987)

(“Original Determination”). The Department of Commerce

(“Commerce”) subsequently published antidumping and countervailing

duty orders covering the subject merchandise. See Certain

Stainless Steel Cooking Ware from the Republic of Taiwan, 52 Fed.

Reg. 2,138 (Dep’t Commerce Jan. 20, 1987) (antidumping duty order);
Court No. 00-05-00212 Page 4

2A full review includes a public hearing, the issuance of

questionnaires, and other procedures. Expedited reviews do not

include such procedures. See 19 U.S.C. § 1675(c)(3); 19 C.F.R.

§§ 207.62-207.68 (1999).

Certain Stainless Steel Cooking Ware from the Republic of Korea, 52

Fed. Reg. 2,139 (Dep’t Commerce Jan. 20, 1987) (antidumping duty

order); Certain Stainless Steel Cooking Ware from the Republic of

Korea, 52 Fed. Reg. 2,140 (Dep’t Commerce Jan. 20, 1987)

(countervailing duty order); Certain Stainless Steel Cooking Ware

from the Republic of Taiwan, 52 Fed. Reg. 2,141 (Dep’t Commerce

Jan. 20, 1987) (countervailing duty order).

On February 1, 1999, the Commission instituted sunset reviews

with respect to the orders covering the subject merchandise. See

Porcelain-on-Steel Cooking Ware from China and Taiwan, 64 Fed. Reg.

4,896 (Int’l Trade Comm’n Feb. 1, 1999) (instituting five-year

reviews). On May 7, 1999, the Commission decided to conduct full

reviews with respect to all of the stainless steel cookware

orders.2 On March 17, 2000, the Commission determined that

revocation of the countervailing and antidumping duty orders

covering top-of-the-stove stainless steel cookware from Korea and

Taiwan would likely lead to continuation or recurrence of material

injury in the United States within a reasonably foreseeable time.

See Review Determ. at 1. Therefore, the antidumping and

countervailing duty orders remain in place. See 19 U.S.C. §

1675(d)(2).
Court No. 00-05-00212 Page 5

Standard of Review

The court will uphold a determination by the Commission unless

it is unsupported by substantial evidence in the administrative

record or is otherwise not in accordance with the law. See section

516a(b)(1)(B)(i) of the Tariff Act of 1930, as amended, 19 U.S.C.

§ 1516a(b)(1)(B)(i) (1994).

Substantial evidence is “something less than the weight of the

evidence.” Consolo v. Federal Mar. Comm’n, 383 U.S. 607, 620

(1966). Nonetheless, the Commission must present “such relevant

evidence as a reasonable mind might accept as adequate to support

a conclusion.” Gold Star Co. v. United States, 12 CIT 707, 709,

692 F. Supp. 1382, 1383-84 (1988) (internal quotation omitted),

aff’d sub nom. Samsung Elec. Co. v. United States, 873 F.2d 1427

(Fed. Cir. 1989). The possibility of drawing two inconsistent

conclusions from the same evidence does not mean that the agency’s

finding is unsupported by substantial evidence. See Consolo, 383

U.S. at 620. In other words, the ITC’s determination will not be

overturned merely because the plaintiff “is able to produce

evidence . . . in support of its own contentions and in opposition

to the evidence supporting the agency’s determination.” Torrington

Co. v. United States, 14 CIT 507, 514, 745 F. Supp. 718, 723 (1990)

(internal quotation omitted), aff’d, 938 F.2d 1276 (Fed. Cir.

1991).
Court No. 00-05-00212 Page 6

Discussion

I. The Commission’s “Like Product” Determination

To determine whether an industry in the United States is

materially injured or threatened with material injury by reason of

imports of the subject merchandise, the ITC must first define the

“domestic like product” and the “industry” producing the product.

See 19 U.S.C. §§ 1673(2), 1677(4), 1677(10) (1994).

Section 1677 defines “domestic like product” as “a product

which is like, or in the absence of like, most similar in

characteristics and uses with the article subject to an

investigation.” 19 U.S.C. § 1677(10). In turn, the relevant

“industry” is defined as the “producers as a whole of a domestic

like product, or those producers whose collective output of a

domestic like product constitutes a major proportion of the total

domestic production of the product.” 19 U.S.C. § 1677(4)(A).

In its final five-year review determinations, Commerce defined

the subject merchandise as:

top-of-the-stove stainless steel cookware from Korea and

Taiwan. The subject merchandise is all non-electric

cooking ware of stainless steel which may have one or

more layers of aluminum, copper or carbon steel for more

even heat distribution. The subject merchandise includes

skillets, frying pans, omelette pans, saucepans, double

boilers, stock pots, dutch ovens, casseroles, steamers,

and other stainless steel vessels, all for cooking on

stove top burners, except tea kettles and fish poachers.

Top-of-the-Stove Stainless Steel Cookware From South Korea, 64 Fed.

Reg. 48,374, 48,375 (Dep’t Commerce Sept. 3, 1999) (final results
Court No. 00-05-00212 Page 7

CVD sunset review); Top-of-the-Stove Stainless Steel Cookware From

Taiwan, 64 Fed. Reg. 48,372 (Dep’t Commerce Sept. 3, 1999) (final

results CVD sunset review); Top-of-the-Stove Stainless Steel

Cookware From the Republic of Korea and Taiwan, 64 Fed. Reg. 40,570

(Dep’t Commerce July 27, 1999) (final results AD sunset reviews).

In its Review Determination, the Commission found that the

appropriate like product corresponding to the subject imports of

top-of-the-stove stainless steel cookware is domestic top-of-thestove stainless steel cookware. See Review Determ. at 9. The

Commission used the same like product definition that the

Commission had adopted in the Original Determination. See Original

Determ. at 4.

Chefline opposes the Commission’s determination as too narrow,

and claims that “the domestic like product includes competing

categories of stove top cookware produced from all metals,

including aluminum.” See Pl.’s Br. at 20. Chefline challenges the

Commission’s determination in two ways. First, Chefline argues

that the Commission acted contrary to law insofar as it “applied a

rebuttable presumption that the domestic like product determination

made in the original investigation should continue to apply.”

Pl.’s Br. at 1. Second, according to Chefline, the Commission’s

determination that there is a “clear dividing line” between

stainless steel cookware and all other metallic cookware is not

supported by substantial evidence, or otherwise not in accordance
Court No. 00-05-00212 Page 8

with law. See id. at 1-2.

A. The Commission’s Interpretation of the Role of the

Original Determination is in Accordance with Law

19 U.S.C. § 1675a(a)(1)(A) directs the Commission to “take

into account its prior injury determinations . . . .” There is,

however, no presumption that the former determination is

controlling. See Asociacion Colombiana de Exportadores de Flores

v. United States, 12 CIT 634, 638 n.5, 693 F. Supp. 1165, 1169 n.5

(1988)(“[E]ach finding as to like product must be based on the

particular record at issue including the arguments raised by the

parties.”). The Commission has interpreted § 1675a(a)(1)(A) to

include its prior like product determinations. See Review Determ.

at 7; see also, e.g., Stainless Steel Plate from Sweden, USITC Pub.

3204, Inv. No. AA-1921-114 (Review) at 8 (July 1999). The

Commission “may revisit its like product determination when there

have been significant changes in the products at issue since the

original investigation . . . .” Rules of Practice and Procedure,

63 Fed. Reg. 30,599, 30,602 (Int’l Trade Comm’n June 5, 1998).

Here, the Commission did revisit its original like product

determination, and concluded that “[t]he record . . . does not

provide any reason to depart from the finding in the original

investigation that domestically produced top-of-the-stove stainless

steel cookware is the like product for the subject merchandise.”
Court No. 00-05-00212 Page 9

Review Determ. at 9.

Chefline does not challenge the Commission’s interpretation of

the statute to include a prior like product determination, but

asserts that the Commission acted contrary to law because, rather

than “revisiting” the like product issue, it “improperly presumed

the continued applicability of its original like product

determination . . . .” Pl.’s Br. at 24. It is well established

that, “because of the factual nature of such investigations, a

domestic like product finding in one investigation is not

dispositive of another like product investigation.” Acciai

Speciali Terni S.p.A. v. United States, 24 CIT __, __, 118 F. Supp.

2d 1298, 1304 (2000) (citing Nippon Steel Corp. v. United States,

19 CIT 450, 454-55 (1995)) (“AST”).

It is apparent from the Review Determination, however, that

the Commission did not consider the like product finding of the

Original Determination to be either “dispositive” or to create a

“rebuttable presumption” for purposes of the sunset review; rather,

it regarded it as its “starting point.” Review Determ. at 7. This

interpretation is entirely consistent with the statute’s directive

to take prior findings “into account,” and Chefline itself agrees

that the prior like product finding is “relevant” to the like

product finding in the sunset review. Pl.’s Br. at 24; see also

AST, 24 CIT at __, 118 F. Supp. 2d at 1304-05 (“Where, as here, the

ITC has addressed similar or identical facts, no statute or case
Court No. 00-05-00212 Page 10

authority prohibits it from drawing upon its previous work in

addressing the issue at hand . . . . In fact, to find otherwise

would require the ITC to ignore its institutional experience and

make each like product determination in a vacuum -- an impractical

conclusion which cannot be reasonably endorsed.”).

Moreover, it is clear that the Commission in fact considered

changes in the product or industry, and thus “revisited” the like

product issue in some meaningful way. The Commission noted

Chefline’s disagreement with maintaining the original like product

determination, see Review Determ. at 7, and emphasized that it had

“considered the similarities between top-of-the-stove stainless

steel and aluminum cookware.” Id. at 10; see also Porcelain-onSteel Cooking Ware from China, Mexico, and Taiwan, and Top-of-theStove Stainless Steel Cooking Ware from Korea and Taiwan, USITC

Pub. INV-X-046, Inv. Nos. 701-TA-267 & 268 (Review) and 731-TA-297-

299, 304 & 305 (Review) at I-18 - I-30 (March 2000) (“Confidential

Report”). Indeed, the Commission stated that it considered the

changes in the product and industry “to be most pronounced in the

comparison of top-of-the-stove stainless steel cookware with

aluminum cookware.” Review Determ. at 9 n.47. The Commission also

made clear that it based its like product determination on the

“relevant factors in this review,” id. at 10 (emphasis added), thus

indicating that it had not simply adopted the like product finding

of the Original Determination, or presumed it to continue to apply.
Court No. 00-05-00212 Page 11

Chefline further claims that, as a result of the Commission’s

presumption that the original like product determination continued

to apply, it “failed to give sufficient consideration to

intervening changes in the product and industry.” Pl.’s Br. at 24.

Because this is a claim that the Commission did not offer

substantial evidence to support its conclusion that these changes

did not affect the original like product determination, it is

addressed below.

B. The Commission’s Like Product Determination is Supported

by Substantial Evidence and Otherwise in Accordance with

Law

The Commission’s decision regarding the appropriate domestic

like product is a factual determination, in which the Commission

applies the statutory standard on a case-by-case basis. See, e.g.,

Torrington Co. v. United States, 14 CIT 648, 652 n.3, 747 F. Supp.

744, 749 n.3 (1990), aff’d, 938 F.2d 1278 (Fed. Cir. 1991);

Asociacion Colombiana, 12 CIT at 638 n.5, 693 F. Supp. at 1169 n.5.

We review the Commission’s determination for substantial evidence,

bearing in mind that “it is not the province of the courts to

change the priority of the relevant like product factors or to

reweigh or judge the credibility of conflicting evidence.” Chung

Ling Co. Ltd. v. United States, 16 CIT 636, 648, 805 F. Supp. 45,

55 (1992); see also NEC Corp. v. United States, 22 CIT 1108, 1111,
Court No. 00-05-00212 Page 12

36 F. Supp. 2d 380, 384 (1998) (holding that whether the

differences between products are minor or significant is a factual

determination within the discretion of the Commission).

Furthermore, “[t]he finding of some similarities among the products

delineated by the Commission is not sufficient to overturn the

determination[] when there is otherwise substantial evidence to

support its findings.” Torrington, 14 CIT at 656, 747 F. Supp. at

753.

The ITC has generally sought “clear dividing lines” between

domestic product groups, disregarding minor variations. See, e.g.,

Aramide Maatschappij V.O.F. v. United States, 19 CIT 884, 885

(1995); Nippon Steel Corp. v. United States, 19 CIT 450, 455

(1995). Factors that the ITC typically considers in defining “like

product” include: (1) physical appearance, (2) interchangeability,

(3) channels of distribution, (4) customer perceptions, (5) common

manufacturing facilities and production employees, and, where

appropriate, (6) price. See Torrington Co., 14 CIT at 652, 747 F.

Supp. at 749. In this case, the Commission found “significant

differences” between domestic top-of-the-stove stainless steel and

aluminum cookware, citing in particular different physical

characteristics and end uses, limited interchangeability, different

channels of distribution, and the lack of common manufacturing

facilities, equipment and workers. See Review Determ. at 9-10,
Court No. 00-05-00212 Page 13

3Cites to the administrative record specify whether

reference is made to a public document (“P.R.”) or to a

confidential document (“C.R.”).

citing The Cook’s Wares, Consumer Reports, P.R. Doc. No. 201,3 Nov.

1998, at 40, 43 (indicating greater heat conductivity of aluminum

cookware); Hearing Tr., P.R. Doc. No. 180 at 21, 24, 74 (March 3,

2000) (indicating that aluminum offers even heat distribution, may

be treated with nonstick coatings, and is superior to stainless

steel for frying, while stainless steel is dishwasher safe and is

superior in durability and non-reactivity with food); Cookware

Manufacturers’ Association, CMA Guide to Cookware and Bakeware,

P.R. Doc. No. 134 at Ex. 4 (discussing the use, care, and

characteristics (including heat conductivity, use of nonstick

coatings, and durability) of cookware made of different materials);

Confidential Report at I-21 - I-22 (stating that “equipment and

workers used in the production of top-of-the-stove stainless steel

cookware could not be used to produce other types of cookware”);

Public Staff Report, Porcelain-on-Steel Cooking Ware from China,

Mexico, and Taiwan, and Top-of-the-Stove Stainless Steel Cooking

Ware from Korea and Taiwan, USITC Pub. No. 3286, Inv. Nos. 701-TA267 & 268 (Review) and 731-TA-297-299, 304 & 305 (Review) at I-16

(March 2000) (“Public Report”) (noting same); Confidential Report

at I-24, Public Report at I-18 (noting that distribution of

stainless steel top-of-the-stove cookware is concentrated in direct

sales, while distribution of aluminum cookware is concentrated in
Court No. 00-05-00212 Page 14

retail sales).

The Commission noted some “similarities” between the two

products, such as purchaser responses indicating that all

categories of cookware are essentially substitutable, and product

information suggesting that the prices charged for stainless steel

and aluminum cookware overlap to a large extent. See Review

Determ. at 10. Nonetheless, the Commission concluded that a “clear

dividing line” exists between domestic stainless steel cookware and

domestic aluminum cookware. Id.

Chefline argues that the Commission’s conclusion was “based on

trivial or meaningless distinctions between the products and...

ignored the overwhelming evidence of a nearly complete overlap

between the product categories with regard to each of the

Commission’s traditional six like product factors.” Pl.’s Br. at

24. In a like manner, Chefline claims that the Commission “failed

to give sufficient consideration to intervening changes in the

product and industry.” Id.

Despite Chefline’s assurances to the contrary, see Pl.’s Reply

Br. at 25-27, it is difficult to understand how asking the Court to

decide that distinctions the Commission regarded as “significant”

are, in fact, “trivial or meaningless,” or to decide that the

Commission “failed to give sufficient consideration” to certain

evidence, is not asking the court to reweigh that evidence, “and

generally substitute the court’s judgment on factual matters
Court No. 00-05-00212 Page 15

committed to the Commission’s expertise and role as the finder of

fact.” Chung Ling, 16 CIT at 649, 805 F. Supp. at 55-56.

Chefline’s claimed evidence of some “overlap” between domestic

products similarly fails to invalidate the Commission’s findings,

if those findings are otherwise supported by substantial evidence.

See Torrington, 14 CIT at 656, 747 F. Supp. at 753. As to

Chefline’s assertion that the Commission “ignored” the evidence of

overlap, it is well established that, “absent a showing to the

contrary, the agency is presumed to have considered all of the

evidence in the record.” USEC, Inc. v. United States, slip op. 01-

58, at 7 (CIT May 17, 2001) (citing Nat’l Ass’n of Mirror Mfrs. v.

United States, 12 CIT 771, 779, 696 F. Supp. 642, 648 (1988)). The

evidence in the record reflects sufficient differences in

characteristics, end uses, and production and distribution

processes to support the Commission’s determination that there

exists a “clear dividing line” between domestic stainless steel

cookware and domestic aluminum cookware.

Chefline also asserts that the ITC, in making its like product

determination, departed from its prior practice “by arbitrarily

dividing a single continuum of products.” Pl.’s Reply Br. at 2.

According to the “continuum principle”:

[M]inor physical differences in a product should not be

permitted to obscure competitive realities. Accordingly,

if there is a “continuum” of products slightly

distinguishable from each other, among which no clear

dividing lines can be drawn based on characteristics and
Court No. 00-05-00212 Page 16

4To the extent that Chefline is asserting that the

Commission departed from a prior practice of defining “like

product” more broadly than it did here in similar cases, this

court recently held that there is no support in the legislative

history or case law for the view “that the Commission should seek

to define the ‘domestic like product’ broadly. Rather, this

authority simply cautions that the ITC should not define the

domestic industry too narrowly, since to do [so] might deny

relief to an industry adversely affected by unfairly-traded

imports.” AST, 24 CIT at __, 118 F. Supp. 2d at 1303. Chefline

points in vain to cases that resulted in like product

determinations that it perceives to be “broader” in a way

favorable to its cause. See Pl.’s Reply Br. at 6-12. “These

dissimilar results demonstrate that every like product

determination must be based on the particular record at issue and

the unique facts of each case.” NEC, 22 CIT at 1111, 36 F. Supp.

2d at 384.

uses, the Commission will treat the merchandise as a

single like product. . . . The focus of the “like

product” analysis therefore should be on competition in

the marketplace and whether the domestic article competes

with, and is in a position to be injured by, the imported

article.

Pl.’s Reply Br. at 4-5 (quoting Legal Issues in Certain color

Television Receivers from the Republic of Korea and Taiwan, USITC

Pub. GC-G155, Inv. Nos. 731-TA-134 & 135 (Mem. from Gen. Counsel)

at 10-11 (June 1983)). Chefline maintains that, if the Commission

had followed its previous practice, it would have included domestic

aluminum cookware in the “domestic like product.”4 Id. at 11.

Chefline’s claim of departure from prior practice would

perhaps have merit if it were the case that the Commission found a

“continuum” of domestic products, then “artificially divided” it by

ignoring “minor differences” or “competitive realities.” Here,

however, the Commission concluded that the differences between
Court No. 00-05-00212 Page 17

domestic aluminum and stainless steel cookware are significant, and

that therefore there is not a “continuum” of products, but rather

a “clear dividing line” between them. Chefline’s simple

disagreement with the Commission’s conclusion is not a reason to

disturb the Commission’s holding, for “[i]t is within the

Commission’s discretion to make reasonable interpretations of the

evidence and to determine the overall significance of any

particular factor or piece of evidence.” Maine Potato Council v.

United States, 9 CIT 293, 300, 613 F. Supp. 1237, 1244 (1985).

Having carefully reviewed the Review Determination and the

underlying record, this Court concludes that the Commission’s

determination that domestic stainless steel cookware is the

domestic like product is supported by substantial evidence.

Chefline has presented no argument that demonstrates that the

Commission drew an invalid conclusion from the evidence on the

record; Chefline succeeds only in showing that a different

conclusion could have been drawn from this evidence.

II. The Commission’s “Cumulation” Determination

The statute provides that:

The Commission may cumulatively assess the volume and

effect of imports of the subject merchandise from all

countries with respect to which the 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
Court No. 00-05-00212 Page 18

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). In the Review Determination, as it had in

the Original Determination, the Commission decided to cumulate

imports of the subject merchandise from Korea with those from

Taiwan. See Review Determ. at 23-26.

Chefline objects to the Commission’s cumulation decision on

two grounds: first, that the Commission failed to provide

substantial evidence in support of its conclusion that there is a

reasonable overlap of competition between imports from Korea and

imports from Taiwan, see Pl.’s Br. at 39-42; and second, that the

Commission acted contrary to law in failing to explain its

conclusion that “the Prevailing Commissioners did not find that the

subject imports [from either of the subject countries] are likely

to have no discernible adverse impact on the domestic industry if

the orders are revoked.” See id. at 43-44; Review Determ. at 24.

Defendant responds first to the latter charge, asserting that

it based its conclusion of “discernible adverse impact” on

“findings [that] appear throughout the Commission’s discussion of

cumulation.” Def.’s Mem. Opp. Pl.’s Mot. J. Agency R. (“Def.’s

Mem.”) at 38. Defendant is apparently referring to a section

called “Other Considerations,” see Review Determ. at 25-26, that

lists the findings Defendant avers support the Commission’s
Court No. 00-05-00212 Page 19

conclusion. See Def.’s Mem. at 38-40. While these “other

considerations” may be legitimately viewed as addressed to the “no

discernible adverse impact” provision, see Review Determ. at 25

n.166 (comparing the majority’s analysis in the section to that of

Chairman Bragg’s dissenting views on “no discernible adverse

impact”), the Commission’s findings do not provide substantial

evidence in support of its conclusion that the subject imports from

each country are likely to have a discernible adverse impact on the

domestic industry if the orders are revoked.

The Commission made three findings in support of its

conclusion. First, that Korean and Taiwanese manufacturers had

demonstrated an ability to increase their exports to the United

States market when conditions warrant, see Review Determ. at 25-26;

second, that the cookware industries in Korea and Taiwan are export

oriented, see id. at 26; and third, that both Korean and Taiwanese

cookware is present in the direct sales channel of distribution and

those producers have the incentive to increase sales into that

channel in competition with the bulk of domestic products. See id.

This court has explained that, pursuant to 19 U.S.C. §

1675a(a)(7):

[A]n 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 cumulating. If yes,

then the question remains whether that impact is also

adverse.
Court No. 00-05-00212 Page 20

5 Nowhere in its determination is there any indication that

the Commission relied on competition between low-end and high-end

products. Rather, the Commission determined that “[t]he most

notable change since the original determination is that the

remaining domestic producers make only high-end top-of-the-stove

stainless steel cookware.” Review Determ. at 24. Moreover, the

Commission noted that “nonsubject imports, which were primarily

low-end and mid-range products from China, India, Indonesia, and

Thailand, accounted for a large and growing share of the U.S.

market, in terms of both volume and value. We find that this

low-end and mid-range merchandise competes with the domestic like

product to a lesser degree.” Review Determ. at 28.

Neenah Foundry Co. v United States, slip op. 01-77, at 17-18 (CIT

June 25, 2001). The Court will not simply assume that any

discernible impact is necessarily adverse. See id.

Upon review, this Court concludes that the Commission has

failed to provide substantial evidence for its conclusion that

Taiwanese imports of subject merchandise would have even a

discernible impact on the domestic industry, much less an impact

that would be adverse. The United States industry, as acknowledged

by the Commission, produces only high-end top-of-the-stove

stainless steel cookware. See Review Determ. at 24. Taiwan, on

the other hand, exports primarily low-end and mid-range products to

the United States. See id. at 24, Table I-4 (revealing

substantially lower total value and average unit value for

Taiwanese imports compared to Korean imports).5 Thus, even if the

Taiwanese industry is able to increase exports to the United States

market and is in fact “export oriented,” these findings, standing

alone, do not establish that Taiwanese exports would be of high-end
Court No. 00-05-00212 Page 21

6The evidence establishes only that non-subject countries

produce low-end and mid-range products, and says nothing to

indicate that the Taiwanese response would be to upgrade its

product rather than compete with the non-subject countries. See

Hearing Tr. at 57, 121-23; Field Trip Notes, C.R. Doc. No. 246

(Jan. 21, 2000).

products, such that they would impact the domestic industry at all,

much less adversely.

Further, the Commission cites no relevant evidence in support

of its finding that Taiwanese producers have an incentive to

increase sales in the direct sales channel.6 And while there is

some evidence that Taiwanese products have been sold to

distributors considered to engage in direct sales, see Review

Determ. at 25 n.164, there is insubstantial evidence to support the

Commission’s related finding that Taiwan exports high-end cookware

such that it would compete with and harm the domestic industry.

See id. at 24-26 & n.160. The Commission relies on the evidence

cited in its “reasonable overlap of competition” analysis to

support this finding. See id. at 24-25 & n.160. This analysis

recognizes that “[s]ubject imports from Taiwan have a low average

unit value relative to subject imports from Korea and the domestic

like product, which suggests a preponderance of low-end and midrange products,” yet concludes that “subject merchandise from

Taiwan includes at least some high-end cookware.” Id. at n.160.

The Commission first cites testimony from the president of

domestic producer and Committee member Regal Ware, who states,
Court No. 00-05-00212 Page 22

7This testimony continues, “The real issue here is the fact

that the Taiwanese do produce a product of equal quality....

And as we’ve talked about the Taiwanese products that are here at

the end of the table, although they are not cook ware products,

they are produced on the exact same equipment and produced in the

exact same way, so that it would easily, easily transferrable

from kitchenware to cook ware.” Hearing Tr. at 113 (emphasis

added). Again, this evidence is purely speculative, and

emphasizes the lack of concrete data or trends upon which to base

the Commission’s finding that high-end cookware is or will be

exported from Taiwan to the United States.

“[T]o the best of my knowledge, there are no Taiwanese specific

cook ware set programs. There are Taiwanese pieces of cook ware

that are sold through direct sales and add on. It may be a premium

that goes with a set.” Hearing Tr. at 113 (emphasis added). While

there may be pieces of Taiwanese cookware sold through the direct

sales channel, this anecdotal testimony offers only speculative

evidence that such cookware is high-end.7 In any event, even

assuming there are some high-end imports of Taiwanese imports,

there is no evidence that such imports would adversely affect the

domestic industry.

The Commission next cites to the Committee’s Prehearing Brief,

which makes the unremarkable observation that the higher unit value

of some individual pieces in a set of Taiwanese cookware is not

reflected in the average unit value of Taiwanese imports, which

also includes lower-priced pieces such as lids and other parts of

stainless steel cookware. See Committee Prehearing Br., C.R. Doc.

No. 11 at 39, P.R. Doc. No. 134 at Ex. 15 (Jan. 11, 2000). The

Committee presents import statistics that exclude Taiwanese imports
Court No. 00-05-00212 Page 23

8The Korean producers report that in 1998, the average unit

value for Korean imports of the subject merchandise was $9.25 per

piece. See Korean Producers’ Response, P.R. Doc. No. 36 at 29

(Mar. 23, 1999); Review Determ. at Table I-4.

valued at less than six dollars – a figure it deems “comparable” to

the average unit value of Korean cookware8 - and based on these

statistics, urges that “the Commission should not infer from the

low unit value of the imports from Taiwan that premium stainless

steel cookware is not being imported from Taiwan.” Committee

Prehearing Br., C.R. Doc. No. 11 at 39 (Jan. 11, 2000). While

there may be some pieces of Taiwanese cookware that are priced

higher than six dollars per unit, that fact is not meaningful when

the comparison figure used is the average unit value for Korean

cookware, which includes the same lower-priced pieces that were

excluded from the Taiwanese statistics. The Committee’s statistics

fail to make a fair comparison, and thus are not evidence that

Taiwan is producing high-end stainless steel cookware.

Lastly, the Commission cites to an affidavit discussing [

]. See Committee’s Prehearing Br., C.R. Doc. No.

11 at Ex. 41. This is purely circumstantial evidence that

Taiwanese producers export high-end subject merchandise to the

United States, and, given the complete lack of direct evidence to

otherwise support this conclusion, cannot be deemed substantial.

Though the Court recognizes that the Taiwanese producers did
Court No. 00-05-00212 Page 24

9This uncontested evidence also supports a finding that

imports from Korea compete with domestic cookware, but, as

described above, the Court cannot conclude that Korean imports

and Taiwanese imports compete for purposes of a cumulation

determination.

not cooperate in this investigation, the evidence on the record is

simply not “such relevant evidence as a reasonable mind might

accept as adequate to support” the Commission’s conclusion that

high-end cookware is being, or will be, exported from Taiwan to the

United States. Gold Star, 12 CIT at 709, 692 F. Supp. at 1383-84.

Consequently, the Commission has failed to provide substantial

evidence in support of its conclusion that subject imports from

Taiwan are likely to have a discernible adverse impact upon the

domestic industry if the orders are revoked. Furthermore, the

Commission’s conclusion that there is a reasonable overlap of

competition between Taiwanese and Korean and Taiwanese and domestic

products relies to a great extent on finding that all three

countries produce high-end merchandise. See Review Determ. at 24.

As to Korea, it is undisputed that most Korean exports are of

high-end cookware, see Pl.’s Br. at 39, and that at least some

Korean cookware is sold in the direct sales channel. See id. at

47. There is thus substantial evidence supporting the Commission’s

conclusion that there would be a likely discernible impact on the

domestic industry if the orders on Korean subject merchandise were

revoked.9

Whether that impact would be adverse depends on the
Court No. 00-05-00212 Page 25

10Defendant contends that Plaintiffs failed to exhaust their

administrative remedies with regard to this issue. See Def.’s

Mem. at 36-37. Plaintiffs assert, to the contrary, that they

“had no opportunity to comment on this methodology at the

administrative level since the first time these calculations were

Commission’s findings regarding Korean export orientation and

“flexibility to increase exports” of high-end products in a

significant quantity and in a significant proportion through the

direct sales channel such as to adversely affect the domestic

industry. Review Determ. at 24. The purported ability of Korean

producers to increase exports to the United States is based on

evidence that imports of subject merchandise from Korea from all

producers “increased by more than 70% in the first nine months of

1999,” compared to the same period in 1998, and that the imports

from non-responding Korean producers increased during the same

period by 146%. See Review Determ. at 26 n.167. Chefline objects

to the method used by the Commission to arrive at these figures,

which subtracted the volume of imports of cookware reported by the

responding firms from the total volume of imports under subheading

7323.93.0030, HTSUS, to arrive at the volume of subject imports

from nonresponding firms. See Pl.’s Br. at 34; Def.’s Mem. at 34.

Chefline claims that the Commission’s method overstates the imports

from non-responding producers. See Pl.’s Br. at 34.

The Court agrees that, on the basis of the record presented

here, the methodology used by the Commission cannot be sustained,

and orders the Commission to address the issue on remand.10 Most
Court No. 00-05-00212 Page 26

performed was in the context of the Commission’s [Remand

Determination].” Pl.’s Br. at 33 n.93. The Court agrees with

Plaintiffs that, even though the official import statistics were

set forth earlier in the administrative process, Plaintiffs could

not know how the Commission would use those statistics until the

Review Determination was issued. Thus, there was no burden on

the Plaintiff to object at an earlier stage.

importantly, the Commission used a similar calculation in the

Original Determination, but adjusted the total volume of imports to

account for the volume and quantity of non-subject merchandise

classified under the equivalent subheading of the TSUS. See

Original Determ. at A-34 & n.1, A-35 (Table 17) & n.1; Review

Determ. at I-13 n.12 (noting that “subheading 7323.93.00 covers a

range of products of stainless steel”). While it was reasonable

for the Commission to rely on official import statistics given the

lack of other data, it was not reasonable for the Commission to

change its methodology without explanation. See Allegheny Ludlum

Corp. v. United States, 24 CIT __, __, 112 F. Supp. 2d 1141, 1147

(2000).

Moreover, the evidence the Commission cites in support of its

finding that imports from Korea increased shows that imports from

the responding producers in fact decreased over the relevant time

period. See Review Determ. at Table IV-6. This means that all of

the substantial increase of imports of Korean cookware found by the

Commission is attributable to non-responding firms only. Given

that the classification statistics relied on include a variety of

stainless steel products, the Commission should at least consider
Court No. 00-05-00212 Page 27

whether it accurately attributed all the imports not claimed by

responding firms to non-responding firms, or whether some of the

imports not claimed by responding firms were in fact not of the

subject merchandise. The Commission should also consider whether

using a value-based instead of a quantity-based statistic would, as

Chefline suggests, give a more accurate picture of imports of

Korean subject merchandise. See Pl.’s Br. at 37.

On remand, the Commission is required to address the

deficiencies in the evidence discussed above. The Commission must

reconsider its finding that the subject imports from each country

are likely to have a discernible adverse impact, and explain its

finding in the manner described in Neenah Foundry. Further, the

Commission must reconsider its finding that there is a reasonable

overlap of competition between Korean and Taiwanese cookware and

domestic and Taiwanese cookware, given the lack of substantial

evidence that Taiwanese producers sell high-end products, and the

scant evidence that Taiwanese producers sell through the direct

sales channel of distribution. If the Commission decides not to

cumulate, the Commission is instructed on remand to revisit its

determination that revocation of the orders would, within a

reasonably foreseeable time, likely lead to continuation or

recurrence of material injury to the domestic industry, considering

separately the likely volume, the likely price effects, and the
Court No. 00-05-00212 Page 28

likely impact of imports from Korea and Taiwan.

Conclusion

The Commission shall reconsider its determination in a manner

consistent with this opinion, pursuant to 19 U.S.C. § 1516a(c)(3).

The Commission shall file its remand determination with the Court

within 90 days. Plaintiffs are granted 30 days to file comments on

the remand determination. The Commission may respond to any

comments filed within 20 days.

_________________________

Donald C. Pogue

Judge

Dated: September 26, 2001

New York, New York