                                       SLIP OP . 04-152

                      UNITED STATES COURT OF INTERNATIONAL TRADE

BEFORE : RICHARD K. EATON , JUDGE
__________________________________________
                                          :
ELKEM METALS CO ., APPLIED                :
INDUST RIAL MATERIALS CORP ., AND         :
CC METALS & ALLOYS, INC.                  :
                                          :
                   PLAINTIFFS ,           :
                                          :
      V.                                  :               CONSOL. COURT NO . 99-00628
                                          :
UNITED STATES OF AMERICA ,                :
                                          :
                   DEFENDANT.             :
__________________________________________:

[Defendant’s motion for reconsideration denied; opinion and order in Elkem VI modified and
clarified]

                                                          Dated: December 3, 2004

        Piper Rudnick, LLP (William D. Kramer, Martin Schaefermeier, and Clifford E. Stevens,
Jr.), Eckert Seamans Cherin & Mellott, LLC (Dale Hershey), and Howrey Simon Arnold &
White, LLP (John W. Nields, Jr. and Laura S. Shores) for Plaintiff Elkem Metals Co.

       Williams Montgomery & John, Ltd. (Theodore J. Low) for Plaintiff Applied Industrial
Materials Corp.

       Arent Fox Kintner Plotkin & Kahn, PLLC (George R. Kucik) for Plaintiff CC Metals &
Alloys, Inc.

       Dangel & Mattchen, LLP (Edward T. Dangel, III) for Plaintiff-Intervenor Globe
Metallurgical, Inc.

       Lyn M. Schlitt, General Counsel, United States International Trade Commission, James
M. Lyons, Deputy General Counsel, United States International Trade Commission (Marc A.
Bernstein) for Defendant.

       Kaye Scholer, LLP (Julie C. Mendoza) for Defendant-Intervenor Ferroatlantica de


                                              1
CONSOL. COURT NO . 99-00628                                                                 PAGE 2

Venezuela.

        Hogan & Hartson, LLP (Mark S. McConnell) for Defendant-Intervenor General Motors
Corp.

        Greenberg Traurig, LLP (Philippe M. Bruno) for Defendant-Intervenors Associao
Brasileira dos Productores de Ferroligas e de Silico Metalico, Companhia Brasileira &
Companhia Ferroligas, Nova Era Silicon S/A, Italmagnesio S/A-Industria e Comercio, Rima
Industrial S/A, and Companhia Ferroligas Minas Gerais-Minasligas.



                              MEMORANDUM OPINION AND ORDER

EATON , Judge: This matter is before the court on the motion for reconsideration of Defendant

United States International Trade Commission (“ITC” or “Commission”) pursuant to USCIT

Rule 59(a), (e). By its motion, the ITC asks the court to reconsider portions of its most recent

decision in this action. Familiarity with that decision is presumed. See Elkem Metals Co. v.

United States, 28 CIT __ , slip op. 04-49 (May 12, 2004) (not reported in the Federal

Supplement) (“Elkem VI”). In Elkem VI, the court considered whether an established price-fixing

conspiracy was a significant condition of competition that had affected prices charged by U.S.

ferrosilicon producers during the Prior Period, the Conspiracy Period, and the Subsequent

Period.1 Id. at 28 CIT __, slip op. 04-49 at 8. As the court has sustained the ITC’s determination




        1
                The “Original POI” covered the period from 1989 through 1993. See Elkem
Metals Co. v. United States, 27 CIT __, __, 276 F. Supp. 2d 1296, 1299 (2003) (“Elkem V”). The
“Conspiracy Period” is the period from late-1989 through mid-1991. Id., 27 CIT __, __, 276 F.
Supp. 2d at 1300. The portion of the Original POI preceding the Conspiracy Period, i.e., the first
three quarters of 1989, is referred to as the “Prior Period.” The portion of the Original POI
following the Conspiracy Period, i.e., from mid-1991, to mid-1993, is referred to as the
“Subsequent Period.”
CONSOL. COURT NO . 99-00628                                                                   PAGE 3

with respect to the Prior Period and the Conspiracy Period,2 the Commission directs its motion to

matters relating to the Subsequent Period. The court has jurisdiction pursuant to 28 U.S.C. §

1581(c) (2000) and 19 U.S.C. § 1516a(a)(2)(B)(ii) (2000). The granting of a motion for

rehearing, reconsideration, or retrial under Rule 59(a) is within the sound discretion of the court,

Kerr–McGee Chem. Corp. v. United States, 14 CIT 582, 583 (1990) (not reported in the Federal

Supplement); however, a court will not normally do so unless the decision at issue is “manifestly

erroneous.” Ammex, Inc. v. United States, 26 CIT __, __, 201 F. Supp. 2d 1374, 1375 (2002).

Although the ITC’s arguments do not rise to the level of the “manifestly erroneous” standard,

they are meritorious in some respects. Therefore, the court will treat the Commission’s motion

as one for modification and clarification. See Federal-Mogul Corp. v. United States, 17 CIT

1110, 834 F. Supp. 1388 (1993).



       By its motion, the ITC seeks reexamination of the court’s holding that substantial

evidence did not support the Commission’s finding that the price-fixing conspiracy affected

prices during the Subsequent Period. In the brief supporting its motion, the ITC insists that the

court erred in three specific respects: (1) that “[t]he Court misunderstood a [c]entral [ITC]

[f]inding” with respect to pricing patterns, (2) that “the Court improperly remanded [to] the [ITC]

on grounds not raised by Plaintiffs,” and (3) that “[s]everal of the remand instructions . . . appear

to require the [ITC] to engage in inquiries that do not reflect the requirements of the antidumping


       2
               The court sustained the finding that the price-fixing conspiracy was a significant
condition of competition that affected prices during the Conspiracy Period, see Elkem V, 27 CIT
at __, 276 F. Supp. 2d at 1313; and, following remand, that the price-fixing conspiracy was not a
significant condition of competition during the Prior Period, see Elkem VI, 28 CIT at __, slip op.
04-49 at 8.
CONSOL. COURT NO . 99-00628                                                                     PAGE 4

and countervailing duty laws.” Mot. of Def. ITC for Reconsideration (“Def.’s Mot.”) at 8, 10, 5.

For the reasons set forth below, the court modifies and clarifies portions of its Opinion and Order

in Elkem VI.



                                            DISCUSSION

I.     The Court Did Not Misunderstand a Central Commission Finding

       First, the ITC claims that the court misunderstood the “cental commission finding” that

“‘the conspirators’3 pricing patterns did not significantly shift in the period following the

Conspiracy Period. . . .” Def.’s Mot. at 8. In Elkem VI, the court found that

               substantial evidence does not support the ITC’s conclusion that the
               price-fixing conspiracy affected prices during the Subsequent
               Period. The ITC based this conclusion on its finding that “there
               are no significant differences in pricing patterns between the latter
               part of the Conspiracy Period and the Subsequent Period.” The
               ITC found that the effects of the conspiracy were felt in the
               Subsequent Period because . . . there was “no significant shift in
               the conspirators’ pricing patterns with respect to other domestic
               producers in the period following the Conspiracy Period,” i.e., the
               Conspirators “frequently maintained higher prices or failed to
               match domestic competitors’ price declines in the Subsequent
               Period . . . .”

Elkem VI, 28 CIT at __, slip op. 04-49 at 15–16 (internal citation omitted). Consequently, as part

of its holding, the court found that substantial evidence did not support the ITC’s finding that the

Conspirators “frequently maintained higher prices.” Id. at 16.




       3
               The conspirators were plaintiffs Elkem Metals Co., American Alloys, Inc., and
SKW Metals & Alloys, Inc., the predecessor firm to CC Metals & Alloys, Inc. See Elkem V, 27
CIT at __, 276 F. Supp. 2d at 1300.
CONSOL. COURT NO . 99-00628                                                                 PAGE 5

       The ITC, however, argues that the court misunderstood the Commission’s finding:

               The manner in which the Court framed the Commission’s finding
               does not comport with the Commission’s description of its finding
               quoted above. In its opinion, the Commission did not make a
               categorical finding that the Conspirators “frequently maintained
               higher prices.” Instead, it stated that the Conspirators “frequently
               maintained higher prices or failed to match competitors’ price
               declines” . . . the word “frequently” was clearly intended to modify
               both clauses of the sentence.

Def.’s Mot. at 9 (emphasis in original). Thus, the ITC apparently claims that its finding should

properly be read as—the Conspirators frequently maintained higher prices or frequently failed to

match competitors’ price declines. Indeed, that is how the court read the Commission’s words.

This being the case, it is difficult to see how the ITC would be relieved from the requirement that

it support, with substantial evidence, its finding that the conspirators “frequently maintained

higher prices.” Elkem VI, 28 CIT at __, slip op. at 16. As CC Metals (“CCM”) points out:

               [T]he agency asks that Part II.B. of the opinion be rescinded
               because the Court read the first part of the ITC’s statement that the
               conspirators “frequently maintained higher prices or failed to
               match competitors price declines,” to mean what it plainly says –
               that the conspirators frequently maintained higher prices.

CCM’s Opp’n to Def.’s Mot. for Reconsideration (“CCM’s Opp’n”) at 3.



       It may be that the Commission wished to express a different thought than was conveyed

by the plain meaning of the words used in the Second Remand Determination.4 Nonetheless, the

record contains only the quoted words, and it is those that must be considered. The court finds



       4
                See Ferrosilicon from Brazil, China, Kazakhastan, Russia, Ukraine, and
Venezuela, USITC Pub. 3627, Invs. Nos. 303-TA-23, 731-TA-566-570, and 731-TA-641 (Sept.
2003), List 1, Doc. 620R (“Second Remand Determination”).
CONSOL. COURT NO . 99-00628                                                                     PAGE 6

that, as the ITC relies on the entire sentence to justify its determination, it must provide

substantial evidence to support the meaning of the entire sentence. On remand, the ITC may

explain itself more clearly but, in any event, it must support its findings by complying with the

evidentiary standard.



       The ITC also insists that the court’s criticism with respect to its failure to address

marketplace conditions was the result of the court’s misunderstanding of the Commission’s

Remand Determination. See Def.’s Mot. at 9. Here, however, the ITC appears to have

misunderstood the court’s criticism. The ITC states that it need not examine marketplace

conditions in order to justify its findings based on a comparison of the prices charged by the

conspirators, and those charged by non-conspiring domestic producers, because both “were

facing the same marketplace conditions.” Def.’s Mot. at 10. In this assertion, the ITC is no

doubt in the right. The court’s observations, however, were substantially directed at the ITC’s

conclusion that “prices charged by both the conspirators and the domestic industry as a whole

during the Subsequent Period were not the result of competitive marketplace conditions.” Elkem

VI, 28 CIT at __, slip op. 04-49 at 22 (quoting Second Remand Determination at 13) (emphasis

added). Absent a discussion of market conditions, the court found the Commission’s assertion

that non-market factors elevated all domestic producers’ prices to be unjustified. Indeed, it is not

immediately obvious to the court how the ITC can continue to make this finding without

discussing marketplace conditions. That is, if the Commission believes prices for the industry as

a whole were not set by the market, it must substantiate this belief. Because a discussion of

market conditions would have been useful in determining if the Commission’s findings were
CONSOL. COURT NO . 99-00628                                                                  PAGE 7

supported by substantial evidence, the court declines to accept the ITC’s invitation to reconsider

its opinion in this respect.



II. The Court Properly Remanded to the ITC

        The ITC next argues that the court improperly remanded this matter on grounds not raised

by Plaintiffs. Def.’s Mot. at 10. Specifically, the ITC argues that CCM, the lone responding

party, did not challenge the findings relating to pricing patterns and the effect of long-term

contracts on those pricing patterns. As a result, the ITC maintains:

                The Court should reconsider its decision to review [the]
                Commission[’s] factual findings sua sponte. There is no authority
                of which we are aware–and none is cited by the Court–providing
                the Court the authority to challenge a factual finding in a
                Commission determination when a litigant has not done so. To the
                contrary, 28 U.S.C. § 2639(a)(1) emphasizes that, in actions such
                as the instant case brought before the Court of International Trade:

                        the decision of the . . . International Trade
                        Commission is presumed to be correct. The burden
                        of proving otherwise shall rest upon the party
                        challenging such decision.

                Consequently, the plain language of the statute makes clear that a
                litigant has the burden of challenging the Commission’s decision.
                When a litigant does not attempt to discharge this burden, the
                Commission’s decision must be presumed to be correct. The
                statute does not contemplate that a reviewing court can challenge
                the Commission’s decision on theories it raises sua sponte.

Def.’s Mot. at 11–12.



        First, 28 U.S.C. § 2639(a)(1) (2000), the statute cited by the Commission, primarily

addresses the burden of proof as between the litigants. The scope and standard of review for this
CONSOL. COURT NO . 99-00628                                                                    PAGE 8

case, however, is governed by 28 U.S.C. § 2640(b) (2000) and 19 U.S.C. § 1516a(b)(1)(B)(i)

(2000), which provide that the Court of International Trade “shall hold unlawful any

determination, finding, or conclusion found . . . unsupported by substantial evidence on the

record, or otherwise not in accordance with law.” Thus, the court bases its holding on its review

of the record.



       Second, from the commencement of this case, the Plaintiffs’ central claim has been that

the price-fixing conspiracy was ineffective. See, e.g., CCM Compl. ¶ 56 (Oct. 28, 1999) and

CCM Compl. ¶ 56 (April 19, 2001) (stating that the Commission’s presumption that “the price-

fixing conspiracy had successfully eliminated price competition between the U.S. commodity

ferrosilicon producers and the importers [was] factually and legally erroneous . . . and otherwise

not in accordance with the law”); see also Elkem Comments on ITC’s Remand Determination at

6 (“[I]n this particular case, the conspiracy to keep prices up was largely ineffective in the face of

the flood of low-priced imports.”) ( Oct. 18, 2002). Hence, the ITC cannot now claim that this

issue has been raised here for the first time, or that it is surprised in any way that questions

continue to be raised about the effect of the conspiracy during the Subsequent Period.



       Third, this matter is now before the court following remand, and the court is examining

the extent to which the ITC has complied with, or failed to comply with, the court’s remand

instructions beginning with Elkem V.5 “There can be no question that courts have inherent power


       5
                 The court in Elkem V instructed:

                        On remand the ITC shall . . . (1) state with specificity the
CONSOL. COURT NO . 99-00628                                                                    PAGE 9

to enforce compliance with their lawful orders . . . .” Shillitani v. United States, 384 U.S. 364,

370 (1966); see Hook v. Arizona, Dept. of Corrections, 972 F.2d 1012, 1014 (1992) (“A district

court retains jurisdiction to enforce its judgments . . . .”); cf. 28 U.S.C. § 1585 (2000) (“The

Court of International Trade shall possess all the powers in law and equity of . . . a district court

of the United States.”). Thus, the court is unconvinced by the Commission’s contention that it

may not review underlying issues pertaining to its own remand instructions.



III.   The Court’s Remand Instructions

       A.      True Market Price

       With respect to the remand instructions themselves, the ITC complains that

               several of the remand instructions the Court formulated . . . appear to
               require the Commission to engage in inquiries that do not reflect the
               requirements of the antidumping and countervailing duty laws. These
               [instructions] direct the Commission to quantify price effects and to
               attempt to calculate what market prices would have been under
               different conditions of competition than those actually present in the
               market.

Def.’s Mot. at 5. The ITC then directs its attention to three of these instructions.

       The first instruction to which the ITC objects reads: “On remand, the ITC shall (1)


                       evidence that the price-fixing conspiracy affected prices
                       during the entire Original POI; (2) weigh the evidence in
                       the record concerning those portions of the Original POI
                       where the conspiracy was not judicially found to be
                       operative [i.e., the Prior Period and Subsequent Period];
                       and (3) explain with specificity what information in the
                       record, if any, supports the adverse inference made on
                       remand that the conspiracy affected prices during the
                       periods preceding and following the Conspiracy Period.

Elkem V, 27 CIT at __, 276 F. Supp. 2d at 1315-16.
CONSOL. COURT NO . 99-00628                                                                    PAGE 10

determine the ‘true’ market price the ITC referenced in its Second Remand Determination at 10

. . . .” Elkem VI, 28 CIT at __, slip op. 04-49, at 19. According to the ITC, “[T]he Court’s

instructions compelling the [ITC] to derive quantitative measures of pricing on remand is not

consistent with the statutory provisions of the antidumping and countervailing duty laws, their

legislative history, or the pertinent case law.” Def.’s Mot. at 7. In other words, the ITC claims

that the antidumping and countervailing duty laws do not require it to quantify its findings. This

instruction, however, like the other remand instructions to which the ITC specifically objects, is

based on the court’s conclusion that substantial evidence did not support the ITC’s findings as to

pricing. Specifically, the first challenged instruction was meant to address a portion of the ITC’s

conclusion that “the data indicate that there were no sudden shifts in domestic ferrosilicon

producers’ pricing patterns immediately after the conclusion of the Conspiracy Period.” Elkem

VI, 28 CIT at __, slip op. 04-49 at 16 (internal quotation omitted). In its Second Remand

Determination, the ITC stated:

               [I]n the third quarter of 1991 (the quarter immediately following
               the last quarter of the Conspiracy Period), prices charged by both
               the conspirators and the domestic industry as a whole were higher
               than those of the immediately preceding quarter. By contrast, if the
               effects of the conspiracy on prices were limited solely to the
               Conspiracy Period, one would expect an immediate decline from
               prices established by a conspiracy, which would be at inflated
               levels relative to a “true” market price, to prices established by
               marketplace considerations.

Second Remand Determination at 11 (emphasis added).



       As noted by CCM, it was the Commission, not this court, that introduced the notion of a

“true” market price into these proceedings. CCM’s Opp’n at 2 (“[T]he ITC asks that it not be
CONSOL. COURT NO . 99-00628                                                                 PAGE 11

required to respond to this Court’s demand for further evidence and explanation to support

findings that were made by the ITC itself in the decision under review.”) (emphasis omitted).

The purpose of the ITC’s finding, as to an expected drop in prices following the Conspiracy

Period, was to substantiate its conclusion that the conspiracy affected prices beyond the

Conspiracy Period. Having stated that finding, however, the ITC must support it with substantial

evidence. As counsel for the ITC noted at oral argument:

               I think it’s acknowledged by all the parties that a conspiracy would
               raise prices to levels higher than they would be absent a conspiracy
               and that was frankly the concept that the Commission was trying to
               get across. If on the termination date of the Conspiracy Period the
               conspiracy ceased to exist and everything was determined by
               truly–by solely marketplace forces there would be other
               things–other things being equal . . . a decline in prices.

Tr. Civ. Cause for Mot. Reconsideration at 18.



       The ITC’s counsel has put his finger precisely on the problem, i.e., that “all other things

[were] equal.” Simply put, there is no indication that the ITC made an effort to determine if

marketplace conditions did remain equal, or changed in some material respect following the

Conspiracy Period. The ITC cannot simply rely on the idea that “one would expect an immediate

decline from prices established by a conspiracy” without demonstrating that this expectation was

warranted by then-existing conditions. Second Remand Determination at 11. Thus, the ITC

must establish that the term “true market price” has some useful meaning.



       On the invitation of the court following oral argument, the ITC now proposes that, if it

should continue to rely on the term “true market price,” it will define the term and provide
CONSOL. COURT NO . 99-00628                                                                   PAGE 12

substantial evidence supporting any findings it makes based on the use of the term, but should

not be required to quantify the term. See Letter from ITC to the court of 8/30/04, at 2.6



       Elkem objects to the ITC’s proposal because, in its view, the change would mean that the

ITC could “no longer . . . be required to provide substantial evidence in support of any finding

regarding price changes that should have occurred absent continued effects from the conspiracy.”

Elkem’s Comments on ITC’s Proposed Remand Instructions (“Elkem’s Comments”) at 6. “The

court should make clear that, while quantification of the term “‘true’ market price” is not

required, any such finding must be supported by substantial evidence.” Id.



       Although the ITC’s complaints do not rise to a level sufficient for a finding that the

remand instruction is “manifestly erroneous,” they do have merit. Thus, the court finds that it



       6
               The ITC proposes to the court the following revised instructions pertaining to
“true market price”:

               The ITC shall (1) define the term “‘true’ market price” it
               referenced in its Second Remand Determination at 10, should it
               continue to desire to rely on the term, and provide substantial
               evidence supporting any findings it makes based on use of the
               term, but is not required to provide a quantification of the “‘true’
               market price,” (2) account for the factors it relied upon so heavily
               in its prior determinations, e.g., demand and U.S. apparent
               consumption, (3) clearly explain how these factors either support
               or do not support its finding that the conspiracy affected domestic
               prices in the Subsequent Period, and (4) evaluate the relevant
               economic factors it finds to exist in the marketplace for the entire
               Subsequent Period, not merely the first quarter of the Subsequent
               Period.

Letter from ITC to the court of 8/30/04, at 2.
CONSOL. COURT NO . 99-00628                                                                  PAGE 13

may be possible for the ITC to make findings based on “true market price” that are supported by

substantial evidence without quantifying the actual price itself. The court also finds that the ITC

may abandon the use of the term “true market price,” although it is difficult to see how it can

persist in maintaining that the conspiracy affected prices in the Subsequent Period if it does so.

In order to clarify that all findings must be supported by substantial evidence, however, the court

incorporates Elkem’s proposed instructions7 into those proposed by the ITC. The modified

remand instruction regarding “true market price” shall read as follows:

               Should it continue to rely on the term “true market price,” the ITC
               shall (1) define the term “true market price” it referenced in its
               Second Remand Determination at 10, and provide substantial
               evidence supporting any findings it makes regarding price changes
               that should have occurred in the absence of continued effects from
               the conspiracy, including any findings based on use of the term
               “true market price,” but is not required to provide a quantification
               of that term; (2) account for the factors it relied upon heavily in its
               prior determinations, e.g., demand and U.S. apparent consumption;
               (3) clearly explain how these factors either support or do not
               support its finding that the conspiracy affected domestic prices in
               the Subsequent Period; and (4) evaluate the relevant economic
               factors it finds to exist in the marketplace for the entire Subsequent
               Period, not merely the first quarter of the Subsequent Period.



       7
               Elkem proposes the following revised language to the court’s instructions
regarding “true market price”:

               The ITC shall . . . define the term “‘true’ market price” it
               referenced in its Second Remand Determination at 10, should it
               continue to desire to rely on the term, and provide substantial
               evidence supporting any findings it makes regarding price changes
               that should have occurred in the absence of continued effects from
               the conspiracy, including any findings based on use of the term
               “‘true’ market price”, but is not required to provide a
               quantification of that term. . . .

Elkem’s Comments at 6 (emphasis added).
CONSOL. COURT NO . 99-00628                                                                     PAGE 14



       B.      ITC Must State Price Differences With Specificity

       Next, the ITC claims that, on remand, it should not be required to “state with specificity

what difference in price it would consider material in the context of this inquiry, and why.”8

Def.’s Mot. at 5 (internal citation omitted). This instruction results from the ITC’s finding that

there was “no significant shift in the [C]onspirators’ pricing patterns with respect to other

domestic producers in the period following the Conspiracy Period” and “prices charged by both

the [C]onspirators and the domestic industry as a whole during the Subsequent Period were not

the result of competitive marketplace conditions.” Second Remand Determination at 11, 13.


       8
               On remand, the court instructed the ITC to

                       revisit its finding that the Conspirators frequently
                       maintained higher prices than their domestic
                       competitors in the Subsequent Period and (1)
                       consider evidence with respect to the non-price
                       factors that existed during the entire Subsequent
                       Period, not only the first, second, third, and fourth
                       quarters of that period, or explain the absence of
                       such evidence in the record and the steps it has
                       taken to account for any missing data, (2) state with
                       specificity the non-price factors it found to exist
                       during the Subsequent Period and explain their
                       relevance to the ITC’s finding that the Conspirators
                       frequently maintained higher prices than their
                       domestic competitors, (3) consider data for each of
                       the Conspirators, i.e., disaggregate the pricing data,
                       and either (a) identify sufficient record evidence to
                       support its finding, or (b) reconsider whether the
                       record fairly supports its finding, and (4) state with
                       specificity what difference in price it would
                       consider material in the context of this inquiry, and
                       why.

Elkem VI, 28 CIT at __, slip op. 04-49 at 26–27.
CONSOL. COURT NO . 99-00628                                                                    PAGE 15

While the court found that substantial evidence supported some of the ITC’s findings used to

reach this conclusion (i.e., “that the Conspirators’ prices, considered in the aggregate, either

declined by less or increased by fractions of a penny more than those of other domestic

producers,” Elkem VI, 28 CIT __, slip op. 04-49 at 22), the court also found that substantial

evidence did not support the finding that the “Conspirators frequently maintained higher prices

than their non-conspiring domestic competitors during the Subsequent Period.” Id. at __, slip op.

04-49 at 23 (internal quotation omitted). The court discussed the evidence relating to this

conclusion at some length in Elkem VI. Since the record indicates that “the data from the

quarters considered by the ITC are, at best, mixed,” the ITC must establish its finding “that there

was ‘no significant difference’ in the incidence of underselling during the Conspiracy Period and

the Subsequent Period” by substantial evidence.9 Elkem VI, 28 CIT at __, slip op. 04-49 at 26, 32

(internal citation omitted). The remand instruction about which the ITC complains is designed to

elicit from the ITC—even granting some greater prices—what price differential would be

significant. As the court used the word “material” rather than the word “significant” in its

instruction, the ITC may, if it wishes, comply with the instruction by substituting the word

“significant.”



       C.        Baseline Price

       The ITC further objects to the court’s observation that “[s]hould the ITC hope to establish

by substantial evidence that the conspiracy affected prices during the Subsequent Period, a



       9
              The “data” referred to here was evidence examined by the court in Elkem VI. See
generally Elkem VI.
CONSOL. COURT NO . 99-00628                                                                    PAGE 16

baseline [price] would be useful.” Def.’s Mot. at 5 (quoting Elkem VI, 28 CIT at __, slip op. 04-

49 at 32). This observation refers to the ITC’s underselling analysis and was preceded by the

sentence:
               While it is true that the ITC was not explicitly obliged to go
               through the exercise of quantifying the effects the conspiracy had
               on prices during the Subsequent Period in order to find that the
               conspiracy affected prices during that time frame, it may well be
               that the demands of substantial evidence indicate its necessity in
               light of its previous findings.

Elkem VI, 28 CIT at __, slip op. 04-49 at 32.


       Here, the court’s observation should not be construed as a remand instruction but, rather,

as guidance from the court as to the type of evidence that might be useful in order to satisfy the

demands of substantial evidence, should the ITC continue to find that the conspiracy affected

prices in the Subsequent Period.



       D.      Disaggregation of Data

       Finally, the ITC appears to object to the court’s remand instruction that, in revisiting its

finding that “the Conspirators frequently maintained higher prices than their domestic

competitors in the Subsequent Period,” it should “consider the data for each of the Conspirators,

i.e., disaggregate the pricing data, and either (a) identify sufficient record evidence to support its

finding, or (b) reconsider whether the record fairly supports its finding . . . .” Elkem VI, 28 CIT

at __, slip op. 04-49 at 26. The ITC claims that “there is no explanation in the Court’s opinion

concerning why its instruction . . . is one required by the antidumping and countervailing duty

law.” Def.’s Mot. at 7.
CONSOL. COURT NO . 99-00628                                                                    PAGE 17

       While not specifically asking for any particular relief, it is apparent to the court that the

ITC finds the instruction objectionable. It is true that “the ITC has broad discretion in the choice

of its methodology.” CEMEX v. United States, 16 CIT 251, 255, 790 F. Supp. 290, 294 (1992),

aff’d, 989 F.2d 1202 (Fed.Cir. 1993) (“As long as the agency’s methodology and procedures are

reasonable means of effectuating the statutory purpose, and there is substantial evidence in the

record supporting the agency’s conclusions, the court will not . . . question the agency’s

methodology”) (internal quotation omitted). Conclusions based on a chosen methodology,

however, must still be based on substantial evidence. The court has previously gone through the

exercise of examining the pricing data found in the Remand Staff Report and found that it tended

not to support the conclusion that “the Conspirators frequently maintained higher prices.” Elkem

VI, 28 CIT at __, slip op. 04-49 at 26. Even with this in mind, the Commission’s objections have

some merit and it is possible that the ITC can respond to the court’s concerns without

disaggregating the data. Thus, the court’s remand instruction is amended to read as follows:

               (3) in revisiting its finding that the Conspirators frequently
               maintained higher prices than their domestic competitors during
               the Subsequent Period, consider the data for each of the
               Conspirators and either (a) disaggregate the pricing data or (b)
               explain why its method of aggregating the data is reasonable
               considering the court’s discussion of that data, and, in any event,
               identify sufficient record evidence to support its finding, and
               explain how that evidence supports its finding.



                                           CONCLUSION


       Upon consideration of the issues discussed herein, the court modifies and clarifies its

Opinion and Order in Elkem VI as described herein, and denies the ITC’s motion for
CONSOL. COURT NO . 99-00628                                                                    PAGE 18

reconsideration.



       This matter continues to be remanded to the ITC. Remand results are due within ninety

days of the date of this order, comments are due thirty days thereafter, and replies to such

comments eleven days from their filing. Neither comments nor replies to such comments shall

exceed thirty pages in length.



                                                               /s/ Richard K. Eaton
                                                                   Richard K. Eaton
Dated: December 3, 2004
       New York, New York
