American Lamb Company v. United States: Application of the Reasonable Indication Standard

Paik, Nam H. | January 1, 1988

The utilization of non-tariff barriers in international trade has taken on significant importance in protecting United States industries from unfair trading practices by foreign competitors. Non-tariff barriers such as antidumping and countervailing duty measures are designed to regulate “unfair methods of competition and unfair acts” by foreign concerns. The regulations promulgated by the International Trade Administration (“ITA”) of the Department of Commerce and the International Trade Commission (“ITC”), contain the appropriate measures followed by these agencies in their investigations of potential dumping and countervailing duty violations. If the ITA determines that an investigation is warranted after considering information reasonable available to it, then the ITC renders a preliminary injury determination. This preliminary determination is based on the best information available as to whether a “reasonable indication” exists that an United States industry has been materially injured, threatened with material injury, or materially retarded from imports that have been allegedly sold at less than fair value or subsidized. However, in American Lamb Company v. United States, the United States Court of Appeals for the Federal Circuit rejected the Court of International Trade’s interpretation of the reasonable indication standard. The Court of Appeals for the Federal Circuit held that the ITC’s practice of examining conflicting evidence to ascertain the presence or absence of a reasonable indication of injury or threat of injury in its preliminary determination “accords with clearly discernible legislative intent and is sufficiently reasonable.”