U.S. Court of International Trade Reverses ITC Decision in Antidumping Dispute

(Washington, D.C.) -- The U.S. Court of International Trade issued a long-awaited opinion yesterday in a controversial international trade dispute involving the alleged dumping of vector supercomputers imported from Japan by Fujitsu Limited and NEC Corporation.

Warren E. Connelly and Valerie A. Slater of Akin, Gump, Strauss, Hauer & Feld, L.L.P. are representing Fujitsu in the dispute.

Judge Donald C. Pogue of the Court of International Trade reversed an October 1997 decision by the U.S. International Trade Commission holding that Cray Research, Inc., the sole domestic producer of vector supercomputers, was “threatened with material injury” by the two Japanese supercomputer manufacturers.

In July 1996 Cray filed an antidumping petition claiming that Fujitsu and NEC were engaged in aggressive sales tactics in the United States. Cray further alleged that these tactics caused Cray to lose a potential major sale to the National Center for Atmospheric Research.

In October 1997 the ITC upheld Cray’s threat-of-material-injury allegation. The Commerce Department then issued an antidumping order, which has blocked all Japanese imports.

In his opinion, Judge Pogue found that the Commission applied the incorrect legal standard and made inherently contradictory and unconvincing factual findings on the issue of whether the pricing of Japanese supercomputers had any adverse effect on Cray. Judge Pogue remanded the decision to the ITC “for further explanation or reconsideration” within 90 days.

Mr. Connelly commented, “We hope that Judge Pogue’s decision is the first step in vindicating Fujitsu’s claim that the extremely small Japanese presence in the U.S. supercomputer market could not possibly have any material adverse effect on Cray. Cray’s problems were, and continue to be, attributable to factors entirely unrelated to Japanese imports, including the dramatic increase in competition from other domestic producers and the significant reduction of vector supercomputer purchases by government agencies, upon whom Cray has long depended.”

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