Judge Denies TKS Retrial, Reversal Motions

By: Jim Rosenberg The federal judge who presided over Goss International's lawsuit filed four years ago against Tokyo Kikai Seisakusho (TKS) and its U.S. subsidiary late last week denied the defendants' motions for a new trail and for reversal of the jury's verdict.

In the only suit to be tried under the seldom-invoked Antidumping Act of 1916, the jury in U.S. District Court in Cedar Rapids, Iowa, concluded after an 11-day trial that TKS had sold large, Japanese-made newspaper presses in the U.S. at unfairly low prices. For injury resulting from sales to The Dallas Morning News, Orlando Sentinel and The Star-Ledger, Newark, N.J. (see April E&P), the jury awarded Goss $10.5 million, an amount which, in accordance with the 1916 law, the judge tripled.

The Antidumping Act requires that U.S. pricing of an imported product not only be less than that in the foreign manufacturer's home market, but that it also be set with intent to harm the U.S. industry.

TKS and Goss disagreed over how well the evidence supported the verdict, jury instructions, and admission and exclusion of evidence. Citing selected testimony and documents related to TKS's sale to Dallas, Judge Linda R. Reade found the verdict "well supported by the evidence presented." A similar review led her to conclude that "the jury's award relating to [The Star-Ledger] sale was not against the weight of the evidence." With respect to Goss' $900,000 profit on its sale to Orlando, the judge affirmed that profit-erosion/price-suppression damages are available under the 1916 law. (The jury allocated damages of $1.06 million for lost profits on the sale to the Sentinel.)

The court rejected TKS arguments concerning the jury's instructions about product comparability, price comparison, a definition of "intent," and lost sales and price-suppression damages.

The court also found that "evidence regarding TKS's secret rebate to [The Dallas Morning News] was relevant," and that its "probative value was not substantially outweighed by unfair prejudice, nor did it confuse the jury." Of the excluded evidence, the court held to its position that "evidence with respect to customer complaints [about Goss] concerning sales not at issue in this case was irrelevant."

As to TKS's motion for judgement as a matter of law, the judge deferred to the jury, finding Goss' evidence sufficient to conclude that: TKS "commonly and systematically" sold in the Untied States "at prices substantially below the prices of comparable printing units in Japan;" such dumping in the United States carried "an intent to injure or destroy Goss"; and that "Goss was injured by TKS's conduct."

TKS earlier said it intended to appeal last December's verdict. When its post-trial motions failed, the company issued a statement saying it "will vigorously pursue all available remedies to correct this unjust decision."
For its appeal, TKS retained the international law firm Sidley Austin Brown & Wood and the law offices of Hoken S. Seki.

According to TKS, a result of the first Antidumping Act verdict is that "ordinary and vigorous competition has been mistakenly equated with an intent to harm U.S. industry."

Noting that the World Trade Organization found the act violates U.S. trade treaty obligations, TKS said Japan's government "is continuing its formal protest of this decision through the Dispute Settlement Body of the WTO. It will also support TKS's position through the filing of an amicus curiae brief in the United States Court of Appeals for the Eighth Circuit in St. Louis."

In a statement released this afternoon, Goss CEO Bob Brown said the decision "confirms again that TKS violated U.S. law and the rules of fair trade, and then tried to cover up its actions with secret rebates and by destroying documents. We are gratified that the court has upheld the jury