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Chief ALJ Bullock Grants Summary Determination That Domestic Industry Investments are Not Significant or Substantial

(as published by ITC TLA)

In the Matter of CERTAIN CARBURETORS AND PRODUCTS CONTAINING SUCH CARBURETORS, Inv. No. 337-TA-1123, Initial Determination Granting Summary Determination 

Before Chief ALJ Bullock

Summary: On August 12, 2019, Chief ALJ Bullock held that the complainant Walbro, LLC’s domestic industry investments were not quantitatively “significant” or “substantial,” as required by Section 337(a)(3). Therefore, Chief ALJ Bullock granted summary determination that Walbro failed to satisfy the economic prong of the domestic industry requirement and stayed the procedural schedule pending Commission review.
At the outset, Chief ALJ Bullock determined that it was inappropriate to consider the absolute value of Walbro’s U.S. investments even though the dollar amounts “appear large.” Instead, Chief ALJ Bullock determined that it was necessary to view Walbro’s U.S. investments in the context of other financial data. Relevant context surrounding the U.S. investments was “particularly important” because “Walbro is a large, multinational company.” Although Chief ALJ Bullock acknowledged that there is no minimum dollar amount to satisfy the domestic industry requirement, he concluded that “large multinational companies should be expected to invest larger dollar amounts for theirinvestments to be deemed ‘significant’ or ‘substantial.’”

Chief ALJ Bullock compared Walbro’s U.S. investments with Walbro’s U.S. sales of the domestic industry products. Although the exact percentages were redacted from the public version of the opinion, Walbro’s U.S. investments in all but one category amounted to less than 5% of U.S. sales. Chief ALJ Bullock “was unable to locate any opinion in the past four years in which the Commission has held that an investment amounting to less than 5% of sales qualified as ‘significant’ or ‘substantial.’” As a result, he found that Walbro’s investments amounting to less than 5% of U.S. sales were not significant or substantial.

Walbro’s investments in one category amounted a percentage “that the Commission has deemed significant in the past.” However, Chief ALJ Bullock found that comparing Walbro’s U.S. investment to U.S. sales was misleading for this particular investment. In Chief ALJ Bullock’s view, the proper context for this investment accounted for Walbro’s worldwide sales. Taking worldwide sales into account, Chief ALJ Bullock concluded that Walbro’s U.S. investments were “clearly minimal” and did not qualify as significant or substantial.

Walbro has petitioned for review of the initial determination, and the Commission’s deadline for determining whether to review the ID is currently set for October 11, 2019.