A federal judge in Washington is expected to decide soon whether the Carter administration must reinstate the controversial trigger price mechanism which was suspended last March in response to antidumping complaints filed by U.S. Steel Corp.
U..s District Judge Aubrey E. Robinson Jr., during oral arguments yesterday on the case filed by Korf Industries, Inc., said he must decide whether the administration could suspend the trigger price mechanism, as it has done.
If Korf had any rights to the trigger prices, "they can't be given away arbitrarily," Robinson said.
Korf, a Charlotte, N.C. steel rod producer, had filed a request for a preliminary injunction in U.S. District Court here against several Commerce Department officials who suspended the trigger prices after U.S. Steel filed complaints against steelmakers in seven European countries. U.S. Steel alleged that the companies were selling products here at prices below their fair values which subsequently injured the domestic market.
The two-year-old price system is intended to result in an automatic government investigaton (leading to stiff duties against foreign producers) if foreign firms sell a particular product in the United States below the trigger price.
The price is based on the cost of production by the most efficient producer, which is Japan.
For months the Carter Administration threatened to suspend the steel trigger prices if a major antidumping case were filed. U.S. Steel had threatened to file complaints if nothing was done to help domestic steelmakers. t
U.S. Steel filed the complaint after the administration refused to raise trigger prices for the second quarter this year.
The Korf suit alleges that the suspension of the trigger prices was "arbitrary and capricious," violates a written agreement between government officials and the company and was made without consideration of its effects on the steel industry "or the jobs of tens of thousands of steel workers."
The suspension "is a deliberate expression of Commerce's intentions not to enforce the Antidumping Act," the Korf suit said.
In addition, the company alleged that the government agreed to continue to monitor carefully wire rod products under the trigger price mechanism in a 1977 writtern agreement with Korf.
The Justice Department argued yesterday in support of its request for dismissal of the suit or for a summary judgment that the trigger price mechanism affected no legal rights of any party and that the government isn't obligated to have it since it wasn't instituted by statute or regulation.
The trigger price mechanism isn't required under the Antidumping Act, Justice Department attorney Michael Hertz said. Administration officials repeatedly said that if antidumping suits were filed the trigger prices would be suspended, Hertz said.
Korf contended that in 1977 it withdrew dumping suits against two European countries after the administration promised to introduce the trigger prices.
But Hertz argued that the administration never said trigger prices would last forever and it has no contractual agreement with Korf to continue them.