A federal judge here dismissed a complaint from a North Carolina steelrod producer yesterday who wanted the Carter administration to reinstate a procedure designed to trigger automatically a government investigation of charges that foreign companies are selling products here below costs.
U.S. District Court Judge Aubrey Robinson Jr. ruled that the procedure, known as a trigger price mechanism, was in effect a policy statement which didn't require the government to meet certain procedural rules before the policy was suspended in March.
The trigger price is geared to the cost of production for the most efficient foreign producer, now Japan. When products appeared in the U.S. market below that price, a government investigation was set off immediately.
Robinson said yesterday in a brief opinion that even without the trigger price mechanism, domestic companies still retain the right to file petitions with the government that would prompt the same type of investigation.
Although the government has a legal obligation to monitor imports and initiate antidumping investigations when foreign products are sold below cost, it isn't required to carry out that duty through a trigger price mechanism, Robinson said.
The question was brought to the federal court by Korf Industries Inc., which claimed that the administration's decision to suspend the two-year-old price system was arbitrary and violated a contract between the government and Korf in which the government agreed to use the trigger price mechanism to carefully monitor wire rod products.
The dispute had its beginnings in March when U.S. Steel Corp. filed antidumping petitions after the Carter administration refused to raise trigger prices for the second quarter of this year. In response, the Commerce Department suspended the trigger price system as it had repeatedly threatened to do if any such private petitions were filed.
The trigger price mechanism was set up to avoid such individual actions by domestic producers, which the government feared could set off an international trade war.
When U.S. Steel filed its petitions, it argued that seven European countries were selling below cost and that in refusing to increase the trigger price, the government had failed to protect domestic steel producers.
In April, Korf went to the federal court and asked that the price mechanism be reinstated, calling the government's decision to drop the system an overreaction to the action of one company -- U.S. Steel.
A Korf official said at the time that the government was "holding the rest of the industry hostage." The company alleged that the government was ignoring the effects of its decision on the steel industry and on the jobs of thousands of steel workers.
The government argued that it had no contractual obligation with Korf to keep the trigger price mechanism in effect, and Robinson agreed.