On Appeal from the United States District Court for the Eastern District of Pennsylvania.
Seitz, Chief Judge, Gibbons and Meskill,*fn* Circuit Judges.
The procedural history of this complex antitrust litigation has been set forth in the immediately preceding opinion. As described in that opinion, plaintiffs are Zenith Radio Corporation [Zenith] and National Union Electric Corporation [NUE]. Defendants are various Japanese and American companies. This opinion addresses plaintiffs' claims under section 801 of the Revenue Act of 1916, commonly known as the Antidumping Act of 1916 [1916 Act], 15 U.S.C. § 72 (1976).
Plaintiffs' complaints charge that from as early as 1960 to the filing of the complaints, defendants, individually and collectively, have engaged in illegal dumping by selling consumer electronics products [CEPs] in the United States at prices substantially lower than in Japan. Dumping is "price discrimination between purchasers in different national markets." J. Viner, Dumping: A Problem in International Trade 4 (1923, reprinted in 1966). Analysis of plaintiffs' dumping claims in this case thus requires a price comparison between imported CEPs sold in the United States and CEPs sold in Japan.*fn1
The 1916 Act makes it illegal to dump imported goods on the United States market with the purpose of destroying or injuring United States industry. The relevant text of the 1916 Act provides:
It shall be unlawful for any person importing or assisting in importing any articles from any foreign country into the United States, commonly and systematically to import, sell, or cause to be imported or sold such articles within the United States at a price substantially less than the actual market value or wholesale price of such articles . . . . in the principal markets of the country of their production . . . .: Provided, That such act or acts be done with the intent of destroying or injuring an industry in the United States . . . .
15 U.S.C. § 72 (1976) (emphasis in original).
Plaintiffs' dumping claims reach this court from two different stages in the extended litigation of this complex antitrust case. First, the district court granted partial summary judgment against plaintiffs and dismissed the majority of their individual and conspiracy dumping claims. Zenith Radio Corporation v. Matsushita Electric Industrial Company, 494 F. Supp. 1190 (E.D. Pa. 1980). That ruling was based on the district court's determination that all of the television products that defendants imported or sold in the United States, and those non-television products imported or sold in the United States that operated without batteries or that received FM transmissions, were not comparable under the 1916 Act to similar products sold in Japan. Because there can be no liability under the 1916 Act absent a price differential between comparable products, the district court dismissed all of plaintiffs' dumping claims as to these products.
Finding that there was a "substantial ground for difference of opinion" over the interpretation of the Act's comparability requirement, the district court certified its partial summary judgment order for interlocutory review by this court under 28 U.S.C. § 1292(b) (1976). Plaintiffs filed a timely notice of appeal. Sharp Electronics Corporation separately urges affirmance of the summary judgment order on the alternative ground that the district court erred in ruling that the 1953 Treaty of Friendship, Commerce, and Navigation with Japan [Treaty], 4 U.S.T. 2063, T.I.A.S. No. 2863 (1953), did not bar plaintiffs' dumping claims under the 1916 Act. The order granting partial summary judgment is before this court as appeal No. 80-2080.
Before this court resolved that interlocutory appeal, the district court dismissed all of plaintiffs' antitrust claims and Zenith's residual dumping claims*fn2 and entered a final judgment on these claims under Fed. R. Civ. P. 54(b). Zenith Radio Corporation v. Matsushita Electric Industrial Company, 513 F. Supp. 1100 (E.D. Pa. 1981). We have jurisdiction over Zenith's residual dumping claims under 28 U.S.C. § 1291 (1976). This court ordered that oral argument on appeal No. 80-2080 be consolidated with argument on the appeals from the final judgment order. We address in this opinion the dumping issues presented by all those appeals.
On appeal from summary judgment, plaintiffs' claims under the 1916 Act present four issues. First, we must determine whether the Treaty bars any of plaintiffs' dumping claims. If any of plaintiffs' dumping claims survive that inquiry, we must determine the degree of product comparability required by the 1916 Act. If any of the products that defendants imported or sold in the United States are sufficiently comparable under the 1916 Act to products sold in Japan, we must then determine whether evidence in this summary judgment record creates a genuine issue of fact as to whether defendants "commonly and systematically" sold or agreed to sell CEPs in the United States at prices that were "substantially" lower than the prices at which comparable products were sold in Japan. Finally, we must determine whether evidence in this summary judgment record creates a genuine issue of fact as to whether defendants acted with specific predatory intent. Our standard of review is plenary.
Sharp Electronics Corporation [SEC] is the only defendant to argue that the 1953 Treaty with Japan bars plaintiffs' claims under the 1916 Act. SEC is a New York corporation with its principal place of business in New Jersey. It is a wholly owned subsidiary of another defendant, Sharp Corporation, a Japanese corporation.
SEC imports CEPs from Japan and resells them in this country. It sells no CEPs in Japan. SEC argues that the Treaty bars application of the 1916 Act to its domestic resale pricing of Japanese-made CEPs and maintains that all of plaintiffs' dumping claims against it should be dismissed.
SEC relies on Article XVI of the Treaty, which provides as follows:
Products of either Party [Japan or the United States] shall be accorded, within the territories of the other Party, national treatment . . . . in all matters affecting internal ...