author: MENTZ, District Judge.

text:
    Wilmot H. WILLIAMS v. AMERICAN HOIST & DERRICK COMPANY.
    Civ. A. No. 83-3293.
    United States District Court, E.D. Louisiana.
    March 21, 1985.
    Ronald L. Menville, William S. Bordelon, Houma, for plaintiff.
    Michael J. McGinnis, McGlinchey, Stafford, Mintz, Cellini and Lang, New Orleans, for defendant.
   OPINION

MENTZ, District Judge.

FINDINGS OF FACT

Plaintiff, Wilmot H. Williams, a forty-two year old crane operator, was formerly employed by Raymond Fabricators. During that employment he operated an American Hoist Model 9270 crawler crane. In this action he has sued American Hoist and alleged that the crane was defectively designed because there was no ladder or step system extending continuously from the crane cab to the ground. Jurisdiction, based upon diversity of citizenship, 28 U.S.C. § 1332, was uncontested.

On December 9,1982, plaintiff was allegedly injured while dismounting the American Hoist Model 9270 crane he was operating. He had stepped down from the crane’s cab to the crawler tread from which he admitted intending to jump the remaining four feet to the ground. Before plaintiff could squat on the tread prior to jumping, he said his right foot slipped, causing him to jump without first squatting. He then allegedly pulled the arch muscle in his foot and/or injured a cartilege. Plaintiff reported the accident and then continued back to work. The next day, plaintiff was terminated due to a cut back in personnel at Raymond Fabricators.

At trial, American Hoist presented testimony that it is standard industry practice for an operator to descend from the cab to the tracks, proceed to the end of the tracks, and then climb down the tread “ladder fashion” to the ground. In the alternative, an operator could sit down on the end of the tread and, his legs dangling close to the ground, slide off. There have been no other reported accidents on the Model 9270 insofar as mounting and dismounting, and American Hoist has never received a request to improve the ingress/egress capabilities of this model.

Plaintiff presented testimony and exhibits which showed that the Society of Automotive Engineers, Rule J185, provides for construction machinery as follows: Section 4.7: “Steps, ladders and grab parts should be designed to invite the operator to have three limbs on the system at all times” (two hands and one foot or one hand and two feet). Sections 5 and 6 cover the design of steps and ladders.

Plaintiff also introduced OSHA standards, Subpart N, Section 1926.550-A-13 which states: “Guard-rails, hand-holds, and steps shall be provided on cranes for easy access to the car and cab, conforming to the American National Standards Institute Rule B 30.5.” The latter rule provides: “On all crawler, truck and wheel mounted cranes, suitable hand holds and/or steps shall be provided to facilitate entrance to and exit from the operator’s cab.” Safety Code for cranes and derricks by American Society of Mechanical Engineers (USAS-B 30.5) at Section 5-I.83(b).

American Hoist argues that it substantially complied with these standards as: A hand hold is provided at the front of the cab, and a walkway and step are attached to the rotating cab of the crane. An operator can easily and safely climb up the crawler pads to the top of the tread. Then, the operator takes two steps to the step up to the cab walkway where he can grab the hand hold and step up to the walkway. Once on the walkway, the operator can then open the cab door and enter the cab.

The Court was favored by the testimony of Dr. Tarek Khalel, an expert in ergonomics or bio-technology. His opinion was that the use of the treads themselves to mount or dismount invites slipping and falling. He also felt it was dangerous to jump the four feet from the top of the track to the ground. However, he was unaware of any citations by the Society of Automotive Engineers, or any violation of OSHA regulations, to any crane manufacturer for failure to furnish the sort of steps plaintiff alleged were required.

The expert, Professor Lehmen, was of the opinion that the Model 9270 does not comply with safety standards of ingress and egress, and that a design which forces the operator to choose between two unsafe methods is not acceptable. However, he did not know of any crawler cranes which met the Society of Automotive Engineers J 185 standards.

Defendant’s expert, Ted Olson, vice-president of engineering for American Hoist, stated that the American Society of Mechanical Engineers B30.5 rule is standard, and that the American Hoist Model 9270 crawler crane provides a suitable means of ingress/egress for its operator. Because this crawler has a rotating superstructure with a large, protruding rear counterweight, this feature was considered in light of Rule B 30.5 before installing an operator’s ladder. Mr. Olson further testified that “pinch points” were also to be avoided. (These are scissor-like angles created by the rotating cab and the two treads. A person could get caught in this space when the cab is rotated by the operator if a ladder was improperly positioned.) American Hoist had attempted to mount a step on the Model 9260, but found that it was a hazard when attached and therefore removed it for reasons of safety.

The expert Enfield was of the opinion that the Model 9270 meets all ingress/egress safety standards. In regard to ingress/egress, he pointed out that many operators squat down on the tread, dangle their legs, and then drop the short distance to the ground. He also testified that operators employ other methods of dismounting, such as jumping off the tracks or dismounting by using the tread pads as a ladder.

CONCLUSIONS OF LAW

The subject accident took place when the Model 9270 was at rest, with its engine off, the clutch disengaged and the brakes on. Therefore, this case does not involve a hazard posed by dangerous moving equipment such as the mud pump in Cutchall v. Great American Pump Co., 460 So.2d 1106 (La. App. 2nd Cir.1985), or the electric band saw in Scott v. Black and Decker, 717 F.2d 251 (5th Cir.1983), or even the hammer which chipped in Chappuis v. Sears, Roebuck, Inc., 358 So.2d 926 (La.1978).

Plaintiff was an experienced crane operator who had worked for Raymond Fabricators for three years and eight months. Previous thereto, he was employed as á crane operator for Daniel Construction Company, but was fired for negligence. He admits there was a step from the cab catwalk to the tread, then a distance of two feet from there to the place on the tread from which you would dismount.

As stated in the Black and Decker case, supra, “the plaintiff must show that the product was defective, i.e., unreasonably dangerous to normal use, and that the defect caused the injury, and that the plaintiff was without fault.” Unquestionably, the crawler crane was not only in normal use but was, in fact, turned off and secured by plaintiff. The evidence falls far short of demonstrating that the means of ingress/egress was dangerous, much less unreasonably dangerous.

Plaintiff, who produced evidence that he was with the Eighty-second Airborne Division and had qualified in jump school, claims that his 5% disability of the knee rendered him fully disabled, in view of its interaction with his pre-existing psychological condition. The psychologist, Dr. Nathan Lubin, concluded that plaintiff suffers from a profound psychological disturbance, not caused by the accident, but that the accident served as a catalyst which activated these conditions in plaintiffs mind. However, Plaintiffs treating physician had given him a release to return to work on April 5, 1983, with some restrictions. Therefore, there is a serious question as to whether Plaintiffs psychological overlay resulted from his termination on December 10, 1982, rather than his alleged injuries. In any event, plaintiff has failed to prove, by a preponderance of the evidence, that the crane was defective, and accordingly, his suit must be and is DISMISSED.

      . The approximate space between each shoe or track is three inches, permitting a person to turn around and dismount by inserting his . shoes between the treads while holding on to the tracks with both of his hands.

      . The application of biological and engineering data to problems relating to man and machine.


source: Caselaw Access Project

author: CAFFREY, Chief Judge.

license: Public Domain

text:
    UNITED STATES of America, Plaintiff, v. William Bull PRINGLE, III, et al., Defendants.
    Crim. No. 82-249-C.
    United States District Court, D. Massachusetts.
    March 22, 1985.

      John C. Doherty, U.S. Atty., Boston, Mass., for U.S.
    Joseph Oteri, James W. Lawson, Oteri, Weinberg & Lawson, Boston, Mass., Herbert S. Moncier, Knoxville, Tenn., for defendant MacAfee.
    Robert W. Ritchie, John E. Eldridge, Knoxville, Tenn., for defendant Parker.
    Michael A. Laurano, Robert Muse, Boston, Mass., for defendant Pringle.
   CAFFREY, Chief Judge.

This case is before the Court on remand from the Court of Appeals for the First Circuit. The defendants appealed their convictions for conspiracy to possess marijuana with intent to distribute and possession of marijuana with intent to import it into the United States. The Court of Appeals vacated this Court’s order denying defendant’s motion to dismiss for violation of the Speedy Trial Act, 18 U.S.C. § 3161, and remanded the case for redetermination of that motion. United States v. Pringle, et al., 751 F.2d 419 at 436 (1984). The Court of Appeals identified sixty-two non-excludable days in the case exclusive of the period from January 10, 1983 to May 23, 1983 and directed this Court to examine whether any or all of that period was ex-cludable. The Court of Appeals ruled that if any more than eight non-excludable days were found, the case must be dismissed for violation of the seventy day Speedy Trial Act limit.

The circumstances surrounding the delay of this .trial are somewhat complex. In November 1982 the case was on the docket of a three-judge panel, chaired by Judge Garrity, but was scheduled for reassignment to a single judge in December of 1982. On November 17, 1982 the defendants moved for a continuance of the hearing on dispositive motions then scheduled for November 29 and a continuance of the trial which was scheduled for December 6, 1982. In support of that motion for continuance, counsel for all three defendants filed affidavits reciting extensive commitments before other courts and tribunals as distant as Tennessee, Oregon, and Florida. These other matters in other courts included two capital cases, a disciplinary proceeding against a member of the bar of the State of Tennessee, a criminal case involving seven co-defendants and hearings before the Merit Systems Protection Board.

Defendant’s motion to dismiss also contained the following statement: “6. ... all defendants in the above-captioned matter waive their rights to a speedy trial.”

Judge Garrity allowed the motion and tentatively rescheduled the trial for January 10, 1983 “subject to confirmation by judge to whom case is reassigned.” There was, however, no .hearing on any other proceeding on the case until May 23, 1983. During the interim, the matter was redrawn to the undersigned but did not come to the Courts attention until mid-May, at which time the May 23 status conference was promptly scheduled. •

The Court of Appeals has made it clear that because of the public interest in speedy trials a defendant may not waive his interest in a speedy trial. Therefore, the purported waiver found in defense counsel’s motion for continuance was ruled ineffective. Id. at 33. However, speaking for the Court of Appeals, Judge Bownes observed “[W]here a waiver creates delay, such delay will be excludable. [d]efense counsel, as officers of the Court have a responsibility to keep in mind the two-fold purpose of the Speedy Trial Act ... [d]efense counsel may not simultaneously use the Act as a sword and shield. We think it unethical and dishonest for defense counsel to waive the Act in the trial court and then disclaim such waiver upon appeal.” Judge Bownes also observed (at p. 31) “[I]t is not clear, however, whether the period of delay following the waiver should be considered nonexcludable. This depends on whether or not the waiver caused or contributed to the delay.”

Subsequent to the remand, an evidentia-ry hearing was held to resolve the question of whether or not the above-quoted waiver caused or contributed to the delay from January 10 to May 23, 1983.

At the hearing, the government called former Assistant United States Attorney John L. Doherty as a witness and affidavits were submitted by Attorney Doherty, who was trial counsel for the United States and by Attorneys Herbert S. Moncier, counsel for MacAfee and Attorney Robert W. Rit-chie, counsel for defendant Parker. On the basis of the sworn testimony of Mr. Doherty, and having in mind the contents of the affidavits from other counsel, I find that the government did not “accelerate the pace” of the scheduling of this case nor did it press the defendants or the Court to agree on an earlier trial date because of Mr. Doherty’s reliance on the representations, in the motion for continuance, to the effect that defendants (without limitations of any kind) waived their rights to a speedy trial. I find that this delay was further caused by Mr. Doherty’s reliance on a number of conversations with defense counsel which Mr. Doherty had during the months following the filing of the waiver. For example, Attorney Ritchie described in detail to Mr. Doherty his extensive commitments to criminal trials in many other parts of the United States. Attorney Lawson, co-counsel for. MacAfee, told Mr. Doherty that his law firm was extremely busy with major criminal trials scheduled in Miami and New Orleans and also that his firm was concerned with “more pressing matters.” Mr. Doherty relied on the fact that Attorney Muse, counsel for Pringle, was not anxious to schedule trial because Mr. Muse told Mr. Doherty that he (Muse) was afraid that the redrawing of the case gave his client “maximum exposure” as a result, Mr. Muse made it clear that he was not in a hurry for Mr. Doherty to try and establish a trial date.

I believe Mr. Doherty’s testimony that at no time during many conversations with counsel for all three defendants did any defense counsel state or hint to Mr, Doherty that any defense counsel or his client had any interest in the Speedy Trial Act or in a speedy trial. Quite to the contrary, counsel for all three defendants stated to Mr. Doherty that they were of the opinion that the case was a “loser and that the defendants, all of whom were enlarged on bail, were content with the situation.” Mr. Doherty testified that he was of opinion that the delay was also caused by the pre-Mitchell opinion erroneously held by all counsel that all time during the pendency of a dispositive motion was excludable and Mr. Doherty also testified that problems related to the Classified Information Procedures Act was a minor factor in the delay.

On all the evidence, I find that the defendants’ waiver was the substantial, predominant, and proximate cause of the leisurely pace at which the case proceeded and I find that this waiver coupled with the above-described conversations between Mr. Doherty and defense counsel caused and contributed to the delay.

I credit Mr. Doherty’s statement that had it not been for the waiver, he would have pressed the Court for an earlier trial date and would have attempted to accelerate the pace of the litigation.

It should be noted that Mr. Doherty’s affidavit establishes that no defendant pressed for a trial date or raised a Speedy Trial claim until June 9, 1983. Significantly, after Attorney Muse filed his speedy trial claim, Mr. Doherty was advised by Attorneys Lawson, Ritchie and Eldridge (an associate of Ritchie’s) that they were unhappy because Muse had filed the motion stating to Mr. Doherty “we had an agreement.” I rule that the statement in Mr. Ritchie’s affidavit as to his unarticu-lated intent that the waiver by his client not be indefinite, has no probative value in the context of this case because the unar-ticulated intention, even assuming it existed, would have no effect on the reasonableness of Mr. Doherty relying on the unqualified motion for a waiver which stated no time limit. On the basis of the foregoing, I find and rule that former Assistant United States Attorney John Doherty’s reliance on the unqualified waiver was reasonable on his part in the light of his many conversations with defense counsel discussed above, and I find that the waiver was the major and proximate cause and a contributing factor to the delay. Accordingly, I rule that an order should enter denying the motions to dismiss for violation of the Speedy Trial Act in order to prevent defense counsel from simultaneously using the Act as a sword and shield by waiving the provisions of the Speedy Trial Act in this Court and then attempting to disclaim the waiver in the Court of Appeals. A hearing on the question of sanctions, referred to in page 38 of Judge Bownes’ opinion, will be scheduled for 2:00 p.m. on April 22, 1985.

Order accordingly.


author: SWEET, District Judge.

text:
    UNI-PETROL GESELLSCHAFT FUR MINERALOEL PRODUKTE, M.B.H., Plaintiff, v. MT LOTUS MARU, her tackle, boiler, engines, etc.; Norsk Olje, A/S; Lagon Overseas Ltd.; Ebisho Shipping KK; and Sumitomo Shintaku Ginko KK, Defendants.
    84 Civ. 2104 (RWS).
    United States District Court, S.D. New York.
    March 28, 1985.

      Halley & Chalos, New York City, for plaintiff; Richard J. Deely, New York City, of counsel.
    Walker & Corsa, New York City, for defendants; Vera E. Weinberg, New York City, of counsel.
   OPINION

SWEET, District Judge.

Uni-Petrol Gesellschaft Fur Mineraloel Produkte MBH (“Uni-Petrol”) brought this action against defendants M/T LOTUS MARU, Ebisho Shipping, K.K., Sumitomo Shintaku Ginko K.K., Norsk Olge A/S (“Norsk”) and Lagon Overseas Ltd. (“La-gon”), to recover damages for the alleged loss, shortage and non-delivery of a shipment of gasoline transported aboard the LOTUS MARU from Amsterdam to New York in March of 1983. Norsk now moves for an order pursuant to Fed.R.Civ.P. 12(b) dismissing the complaint against Norsk for lack of in personam jurisdiction. The motion is granted.

Norsk is a corporation organized under the laws of Norway and located in Oslo, Norway. Norsk does not have a place of business or any officers, directors or employees in New York, nor is it authorized to do any business in New York. Norsk does not have any real estate, assets, chattels or bank accounts in New York.

By time charter dated December 2, 1982, Norsk time chartered the M/T LOTUS MARU from Conoco Shipping Company of Monrovia, Liberia (“Conoco”), the time-chartered owner of the vessel. A New York broker was involved in some capacity with the charterparty arrangements, but the time charter was not signed in New York. The charterparty provides for payment to the owner’s New York account and also provides for arbitration of disputes arising under the charter in “London/New York.”

On March 8, 1983, Norsk entered into a voyage charterparty with Lagon. The charterparty provided that Lagon could order the vessel to discharge cargo in New York and provided for additional remuneration to Norsk in the event that the vessel discharged in New York north of the George Washington Bridge. The shipment at issue in this action took place while the voyage charter was in effect.

Discussion

A plaintiff has the burden of establishing in personam jurisdiction over a defendant. New York law provides for personal, jurisdiction over a foreign corporation on two grounds. NYCPLR § 301 provides for in personam jurisdiction if a corporation is “doing business” within the state of New York. NYCPLR § 302 permits the exercise of in personam jurisdiction over a foreign corporation if the plaintiff’s claim arises out of the corporation’s transaction of business within the state. Beacon Enterprises, Inc. v. Menzies, 715 F.2d 757 (2d Cir.1983); McGowan v. Smith, 72 A.D.2d 75, 423 N.Y.S.2d 90 (1979), aff'd 52 N.Y.2d 268, 437 N.Y.S.2d 643, 419 N.E.2d 321 (Ct.App.1981). The exercise of in personam jurisdiction must also comply with the constitutional requirements of due process set out in International Shoe Company v. Washington, 326 U.S. 310, 66 S.Ct. 154, 90 L.Ed. 95 (1954). The parties do not dispute that Norsk is not doing business in New York. Uni-Petrol contends, however, that Norsk is “transacting business” in New York within the provisions of NYCPLR § 302.

Uni-Petrol contends that various elements of the two charterparties into which Norsk entered reflect the purposeful transaction of business in New York by Norsk. It asserts that as to the Norsk/Conoco time charters, the use of a New York broker and the provisions requiring payment to Conoco in New York and the resolution of disputes by arbitration in New York reveal that Norsk intended to avail itself of the protections and benefits of New York. As to the Norsk/Lagon voyage charter, Uni-Petrol claims that the provisions noting that the vessel would call at “one or two safe ports United States Atlantic Coast” and requiring additional remuneration if the vessel discharged in New York north of the George Washington Bridge also reflect purposeful and affirmative contacts between Norsk and the forum which were foreseen by Norsk and from which Norsk stood to gain financially.

In my view, the contacts relied upon by Uni-Petrol to establish jurisdiction are not sufficient to satisfy the requirements of due process. None of the provisions in the Norsk/Conoco time charter reveal that Norsk “purposely avail[ed] itself of the privilege of conducting activities within” New York, Hanson v. Denckla, 357 U.S. 235, 78 S.Ct. 1228, 2 L.Ed.2d 1283 (1958); the agreement was not signed in New York, there is no evidence that the New York broker acted on behalf of Norsk, and the mere inclusion of a provision requiring payment in New York and permitting arbitration there is not enough under these circumstances to constitute the transaction of business. Similarly, jurisdiction cannot be exercised over Norsk merely because Norsk entered into the Norsk/Lagon contract. The voyage charter provides that the vessel could be discharged “at any port ... as ordered by charterers.” (Defendants’ Exhibit C, Clause 7). Norsk should not be required to litigate in whatever forum its charterers chose to enter. As the Supreme Court noted in World Wide Volkswagen v. Woodson, 444 U.S. 286, 297, 100 S.Ct. 559, 567, 62 L.Ed.2d 490 (1980), “defendants conduct and connection with the forum must be such that he should reasonably anticipate being haled into court there.” Norsk’s conduct in New York was not enough to meet the requirements of due process or to qualify as the transaction of business under CPLR § 302.

Even if the various provisions of the charter parties did represent sufficient contacts to constitute the transaction of business within the meaning of CPLR § 302 by Norsk, Uni-Petrol has not alleged that its cause of action arises out of the business transacted by Norsk in New York. Uni-Petrol argues that the short discharge complained of “arises as a direct consequence of Norsk’s affirmative transactions in this state.” (Plaintiff's Memorandum at 3). However, the action does not involve a breach of contract for a violation of either charterparty agreement nor does it relate to irregularities in arrangements of payment of freight to Conoco or from Lagon. Uni-Petrol is not a party to either contract, nor is it entitled to envoke the arbitration clause between Norsk and Conoco. The case does not arise out of a contract by Norsk to supply goods and services within the state, see Tonns v. Spiegel’s, 90 A.D.2d 548, 455 N.Y.S. 125, 127 (1982). Uni-Petrol has not presented any authority that would support the exercise of jurisdiction over Norsk. Under these circumstances, Uni-Petrol’s claim for loss, shortage and nondelivery of gasoline shipped pursuant to a bill of lading does not arise out of the transaction of business within New York by Norsk. See Bangladesh Agricultural Development Corporation v. Transcontinental Imex, Inc., slip op. at 4, 81 Civ. 6377 (S.D.N.Y. December 23, 1982).

For the reasons discussed above, Norsk’s motion is granted and the complaint will be dismissed as to defendant Norsk.

IT IS SO ORDERED.


author: FILIPPINE, District Judge.

text:
    Denise A. HILLARD, Plaintiff, v. AL DOBELMAN, Gregory Pence, and James Henson, Defendants.
    No. 84-2936C(2).
    United States District Court, E.D. Missouri.
    March 28, 1985.
    Morgan Stewart, St. Louis, Mo., for plaintiff.
    Harold I. Elbert, Charles S. Elbert, St. Louis, Mo., for defendants.
   MEMORANDUM

FILIPPINE, District Judge.

This matter is before the Court on plaintiff’s motion to remand for lack of subject matter jurisdiction and defendants’ motion to dismiss and for summary judgment.

MOTION TO REMAND

This case involves the petition for tor-tious interference with contract filed by plaintiff in the Circuit Court for the City of St. Louis. The petition was subsequently removed by defendants to this Court. Plaintiff has filed a motion to remand the case to the state court for lack of subject matter jurisdiction arguing that defendants have failed to show that plaintiff’s claim involves a federal question. Defendants have filed a memorandum in opposition to the motion to remand.

Plaintiff brings this suit against three defendants, each of whom were employees at Laclede Gas and in a supervisory capacity over her. Her petition alleges that on May 4, 1984, defendant Pence, based on information supplied to him by defendant Henson, suspended plaintiff indefinitely from her position as a customer service representative at Laclede Gas and that on May 21, 1984, Pence and Dobelman, again based on information supplied by Henson, induced Laclede Gas to terminate its employment relationship with plaintiff. Based on these allegations plaintiff prays for $500,000 in damages.

Defendants argue that plaintiff’s suit, although couched in the language of a state law claim for tortious interference with contract, is in reality a claim properly brought under section 301 of the Labor Management Relations Act, 29 U.S.C. § 185 (Section 301). Section 301(a) provides that:

[sjuits for violation of contracts between an employer and a labor organization .representing employees in an industry affecting commerce as defined in this chapter, or between any such labor organizations, may be brought in any district court of the United States having jurisdiction of the parties, without respect to the amount in controversy or without regard to the citizenship of the parties.

Defendants argue that plaintiff’s suit, although “artfully pleaded,” is in reality a suit against her employer for breach of the collective bargaining agreement to which both are subject.

The Court agrees with defendants. Looking carefully at the complaint it is apparent that plaintiff attempts to sue her employer, Laclede Gas, for unjustly discharging her. The three named defendants are all employees of Laclede Gas and were in a supervisory capacity over plaintiff. Henson, a supervisor in the Customer Relations Department, was plaintiff’s immediate supervisor. Henson works under defendant Pence, who is the Assistant Manager of Laclede’s Customer Relations Department. Pence, in turn, reports to one Ina Wilson, not a defendant herein, who reports to defendant Dobelman, Director of Laclede’s Customer Relations Department. Affidavit of Clarke M. Rainey, W 17-21. Each of the defendants were agents of Laclede Gas acting for Laclede within the scope of their authority. Id., ¶ 22. Each had the authority to hire, promote discharge, discipline or otherwise affect changes in the status of employees, or to effectively recommend such action. Id., ¶ 21. Thus it is apparent from these uncontroverted facts that defendants were acting on behalf of Laclede Gas and that plaintiff is in reality suing Laclede for having discharged her in violation of the Labor Agreement. As such, her claim properly arises under § 301 of the LMRA and this Court has subject matter jurisdiction. “[T]he application of federal preemption cannot be avoided by attempts to allege only state contract or tort theories...,” Moore v. General Motors Corp., 739 F.2d 311, 317 (8th Cir.1984).

MOTION TO DISMISS AND FOR SUMMARY JUDGMENT

Defendants move to dismiss this case or for summary judgment. Because the Court will consider matters outside the pleadings, i.e., the affidavit of Clarke M. Rainey, Vice President of Personnel and Industrial Relations at Laclede Gas, the Court will treat the motion as one for summary judgment.

The basis of defendants’ motion is that plaintiff has failed to exhaust her contractual remedies under the Labor Agreement. After plaintiff’s discharge from employment at Laclede, Local 5-194 invoked arbitration procedures on plaintiff’s behalf pursuant to Article III of the Labor Agreement. Affidavit of Clarke M. Rainey, Exhibit C. On October 18, 1984, an arbitration proceeding was heard before Arbitrator Joseph Rohlek. A transcript has been prepared and briefs are currently being prepared by the parties to be submitted to the Arbitrator for a final decision. Id. ¶¶137-39. Defendants argue that because the Arbitrator has not yet rendered his decision, plaintiff’s action must be dismissed as she has failed to exhaust her administrative remedies. The Court agrees. The Labor Agreement entered into by plaintiff and Laclede Gas requires that plaintiff resort to the grievance procedures set forth therein. Id., Exhibit C. “Failure to exhaust the grievance procedures of the [Agreement] is a defense to a suit on the [Agreement]. Hines v. Anchor Motor Freight Inc., 424 U.S. 554, 562, 96 S.Ct. 1048, 1055, 47 L.Ed.2d 231 (1976); Vaca v. Sipes, [368 U.S. 171, 184, 87 S.Ct. 903, 913, 17 L.Ed.2d 842 (1976) ].” Moore v. General Motors, 739 F.2d 311, 317 (1984). Accordingly, plaintiff’s suit must be dismissed.

      . In October of 1982, Laclede Gas and the Oil, Chemical and Atomic Workers, International Union, Local Union 5-194, entered into a Labor Agreement effective from August 1, 1982, until midnight July 31, 1985. The Agreement covered plaintiff in her position as a Customer Service Representative. See Removal Petition, ¶ 6; Affidavit of Clarke M. Rainey, ¶ 3.


author: JACKSON, District Judge.

text:
    INTERNATIONAL LONGSHOREMEN’S ASSOCIATION, AFL-CIO, Plaintiff, v. NATIONAL MEDIATION BOARD, et al., Defendants.
    Civ. A. No. C.A.82-2216.
    United States District Court, District of Columbia.
    March 28, 1985.
    Thomas W. Gleason, New York City, for plaintiff.

      Dennis P. Myers, N.C. Dept, of Justice, Raleigh, N.C., for defendants.
   MEMORANDUM AND ORDER

JACKSON, District Judge.

Plaintiff International Longshoremen’s Association, AFL-CIO (“ILA”), challenges a decision of the National Mediation Board (“NMB” or “Board”) that it no longer possesses jurisdiction over employees of the North Carolina State Ports Authority (“SPA” or “Ports Authority”), because the Ports Authority has ceased to be a “carrier” within the meaning of the Railway Labor Act, 45 U.S.C. § 151 et seq. (“RLA” or the “Act”). The result of the determination is that the ILA ceases to be the Board-certified representative of the SPA’s employees for collective bargaining purposes.

The parties have filed cross-motions for summary judgment which present two issues: first, whether judicial review of the NMB’s determination is available at all; second, whether the Board’s finding that the SPA is not a carrier is erroneous. For the reasons set forth below, the Court concludes that it is itself without jurisdiction to review the Board’s decision and will, therefore, grant defendants’ motion for summary judgment and dismiss .the complaint with prejudice.

The material facts appear from the administrative record and are not in dispute.

Plaintiff ILA is a labor organization representing workers in the longshore, warehouse and railroad industries. Defendant SPA is an agency of the State of North Carolina which owns and operates seaport facilities at Wilmington and Morehead City, North Carolina. In 1970, when the SPA also owned and operated terminal railroads connecting the ports with two main trunk line haul railroads passing through the, state, the NMB, after a proper election, certified the ILA as the collective bargaining representative of the SPA’s dockmen, warehousemen and security guards. There then followed a period of litigation concerning both the certification and the SPA’s corresponding obligation to bargain with the union. When it ended favorably to the ILA, two successive collective bargaining agreements were struck, the first covering the period July, 1975, through December, 1977, and the second January, 1978, through December, 1980.

In 1979, however, the North Carolina General Assembly passed “An Act to Establish the North Carolina Ports Railway Commission,” N.C.Gen.Stat. § 143B-469 et seq., creating the codefendant North Carolina Ports Railway Commission (“PRC” or “Railway Commission”), to take over and operate the SPA’s railroad facilities, and the SPA and PRC entered into a number of agreements to accomplish the transfer.

In August, 1980, the ILA initiated a Board investigation of a dispute with the SPA over rate-of-pay rules and working conditions. The following January the SPA moved to dismiss the case for lack of jurisdiction, asserting that the transfer of its railroad equipment and functions to the PRC had divested it of its character as a “carrier” under the Act. Following a series of hearings in June and July, 1981, the NMB issued its “Findings Upon Investigation,” 9 NMB No. 120, of June 8, 1982, in which it concluded that the SPA was, in fact, no longer a carrier, and the ILA’s authority to represent its employees therefore at an end. Plaintiff filed this action on July 30, 1982.

The threshold issue is whether this Court has jurisdiction to review the NMB’s decision at all. A general grant of jurisdiction is found in 28 U.S.C. § 1337(a), which gives the district courts original jurisdiction “of any civil action or proceeding arising under any Act of Congress regulating commerce.” And the Administrative Procedure Act (“APA”), 5 U.S.C. § 551 et seq., provides that:

[Ejxcept to the extent that—
(1) statutes preclude judicial review; or
(2) agency action is committed to agency discretion by law....
A person suffering legal wrong because of agency action, or adversely affected or aggrieved by agency action within the meaning of a relevant statute, is entitled to judicial review thereof.

5 U.S.C. §§ 701, 702. Thus, the presumption of the availability of judicial review created by the APA might indicate that, absent a statutory command to the contrary, the NMB’s actions are as subject to scrutiny as those of any other agency.

Defendants contend, however, that the Supreme Court found just such a command when it decided Switchmen’s Union v. National Mediation Board, 320 U.S. 297, 64 S.Ct. 95, 88 L.Ed. 61 (1943), an appeal from the NMB’s resolution of a dispute between two unions representing yardmen employed by a single railroad company, as it had earlier in American Federation of Labor v. NLRB, 308 U.S. 401, 60 S.Ct. 300, 84 L.Ed. 347 (1940) in connection with an attempt to appeal a National Labor Relations Board certification order. Reversing the court of appeals which had affirmed a district court decision upholding the Board on the merits, the Supreme Court held in Switchmen’s Union that the district court had no jurisdiction to review the NMB’s certification decision notwithstanding it might have been based upon an erroneous interpretation of the statute. The Court discerned a congressional intent to appoint the Board the “last terminal point” for the resolution of such matters; “[tjhere was to be no dragging out of the controversy into other tribunals of law.” 320 U.S. at 305, 64 S.Ct. at 99. Congress, it said, would have “made its desire plain,” as it had in other sections of the RLA, if it had wanted to provide for review of Board decisions in the federal courts. Id. at 303, 305-06, 64 S.Ct. at 98, 99-100.

In all the years since Switchmen’s Union the Supreme Court has recognized but a single exception to the general rule of nonreviewability of domestic labor representation decisions: federal courts do have jurisdiction to “strike down an order of the Board made in excess of its delegated powers and contrary to a specific prohibition in the Act.” Leedom v. Kyne, 358 U.S. 184, 188, 79 S.Ct. 180, 183, 3 L.Ed.2d 210 (1958). But it has reaffirmed both Switch-men’s Union and American Federation of Labor v. NLRB to thwart attempts to bring other labor representation cases to court; these cases still stand as islands of administrative invulnerability awash in the tide of judicial review which has engulfed other agencies since passage of the APA. See Brotherhood of Railway & Steamship Clerks, etc. v. Association for the Benefit of Non-Contract Employees, 380 U.S. 650, 85 S.Ct. 1192, 14 L.Ed.2d 133 (1965); Boire v. Greyhound Corp., 376 U.S. 473, 84 S.Ct. 894, 11 L.Ed.2d 849 (1964).

The ILA argues that the Board’s refusal to exercise jurisdiction effectively denies it access to any forum to vindicate its rights, a circumstance which the Supreme Court itself acknowledged in Switchmen’s Union might be of significance. 320 U.S. at 300, 64 S.Ct. at 96. And other circuits have found themselves possessed of jurisdiction to review so-called “jurisdictional” decisions of the NMB. See Delpro v. Brother hood Railway Carmen of the U.S. and Canada, AFL-CIO, 676 F.2d 960 (3d Cir.), cert. denied, 459 U.S. 989, 103 S.Ct. 343, 74 L.Ed.2d 384 (1982). The Court of Appeals for this Circuit, however, has twice recently rejected the contention that labor representation decisions of the NLRB are reviewable, holding that it is only when the agency has violated a clear and mandatory legislative provision (as it did in Leedom v. Kyne), and the party aggrieved has no alternative means of redress, that district courts may entertain actions to review its decisions, Physicians National House Staff Association v. Fanning, 642 F.2d 492 (D.C.Cir.1980), cert. denied, 450 U.S. 917, 101 S.Ct. 1360, 67 L.Ed.2d 342 (1981); Hartz Mountain Corporation v. Dotson, 727 F.2d 1308 (D.C.Cir.1984), and no reason suggests itself for treating similar decisions of the NMB any differently.

The issue before the NMB upon which its “jurisdiction” depended in the instant case was whether the Ports Authority retained its identity as a railroad “carrier,” notwithstanding the North Carolina legislature’s intention to separate the dockside and inland transport aspects of the movement of goods through the state to market. In undertaking to decide that issue the NMB took evidence on the relationship between the State, the Ports Authority, and the Railway Commission, and made findings with respect to the genuineness of their independence of one another — all subjects which are entrusted, not prohibited, to the Board by the Act. Then, in reliance upon, and in accordance with one of its earlier decisions in the case of South Carolina State Ports Authority, 5 NMB 265 (November 4, 1969), the Board concluded:

The facts and circumstances of the present case are virtually identical to those in South Carolina Ports Authority. No evidence has been presented to warrant a decision different from the one in that case. The Board finds that the Railway Commission is not directly or indirectly owned or controlled by the Ports Authority. The Railway Commission has established its offices geographically and organizationally apart and independent of the Ports Authority. The Railway Commission keeps its own records, conducts its own labor relations policy and conducts its business transactions separate from those of the Ports Authority. Thus, any basis the Board had for asserting jurisdiction over any employees of the North Carolina State Ports Authority has been removed.
The facts, however, show that the Railway Commission has now assumed the Ports Authority’s railroad operations. The Board, therefore, finds that the North Carolina Railway Commission is a carrier subject to the jurisdiction of the Railway Labor Act pursuant to Section 1, First, of the Act.
The Board further finds, on the record before it, that the Railway Commission is independent of the Ports Authority. Accordingly, the certifications held by the ILA are no longer of any effect since the Ports Authority is no longer a carrier within the meaning of the Railway Labor Act.

Whether or not the Board’s findings are correct, in making them it resolved what were, in essence, “purely factual issues that may not be addressed on direct review under [Leedom v. ] Kyne,” Hartz Mountain Corp. v. Dotson, 727 F.2d at 1315, for the merits of its decision should not be re-examined by this or any court “in the guise of determining jurisdiction,” whether the Board’s or its own. Id. at 1314 (quoting R. Gorman, Basic Text on Labor Law 64-65 (1976)).

Therefore, for the foregoing reasons, it is, this 28th day of March, 1985,

ORDERED, that plaintiff’s motion for summary judgment is denied; and it is

FURTHER ORDERED, that defendants’ motion for summary judgment is granted, and the complaint is dismissed with prejudice.

      . A third issue — whether the NMB exceeded its statutory authority when, on June 1, 1982, it delegated its authority to exercise all official functions of the Board to a single member who then proceeded to decide this case — has since been resolved by this Circuit in Railroad Yardmasters of America v. Harris, 721 F.2d 1332 (D.C.Cir.1983), holding that a single member may act for the. Board pursuant to a validly issued delegation order.

      . International Longshoremen’s Association v. North Carolina Ports Authority, 463 F.2d 1 (4th Cir.), cert. denied, 409 U.S. 982, 93 S.Ct. 318, 34 L.Ed.2d 245 (1972); International Longshoremen’s Association v. North Carolina Ports Authority, 370 F.Supp. 33 (E.D.N.C.1974), aff’d, 511 F.2d 1007 (4th Cir.1975).

      . The term “carrier” is defined in 45 U.S.C. § 151, First.

      . Congress did expressly provide, for judicial review in 45 U.S.C. §§ 153, First (p) and 159, concerning disputes arising out of the failure of a carrier to comply with an order of the National Railroad Adjustment Board and impeachment of arbitration awards, respectively.

      . Decisions affecting foreign nationals are also an exception. See McCulloch v. Sociedad Nacional de Marineros de Honduras, 372 U.S. 10, 83 S.Ct. 671, 9 L.Ed.2d 547 (1963).

      . See also International Longshoremen's Association, AFL-CIO v. North Carolina Ports Authority, 463 F.2d 1 (4th Cir.), cert. denied, 409 U.S. 982, 93 S.Ct. 318, 34 L.Ed.2d 245 (1972) (Board’s jurisdictional determination that Ports Authority is a “carrier” is reviewable); U.S. v. Feaster, 410 F.2d 1354 (5th Cir.), cert. denied, 396 U.S. 962, 90 S.Ct. 427, 24 L.Ed.2d 426 (1969).


author: TOM S. LEE, District Judge.

text:
    Thomas E. KYNERD and Nancy A. Kynerd, Plaintiffs, v. UNITED STATES DEPARTMENT OF HOUSING AND URBAN DEVELOPMENT; Holiday Homes of Mississippi, Inc.; Albert Owings; City of Clinton, Mississippi; Kemmons Wilson; and William H. Purviance, Defendants.
    Civ. A. No. J84-0060(L).
    United States District Court, S.D. Mississippi, Jackson Division.
    March 29, 1985.

      Thomas E. Kynerd, pro se.
    George Phillips, U.S. Atty., Dan McDaniel, Asst. U.S. Atty., Howard C. Ross, Jr., Jackson, Miss., for William H. Purviance.
    W.F. Goodman, Jr. & David L. Ayers, George R. Fair, Watkins & Eager, Jackson, Miss., for Albert Owings & Kemmons Wilson Holiday Homes of Mississippi, Inc.
    Kenneth R. Dreher & Jerry L. Mills, Pyle, Harris, Dreher & Mills, Jackson, Miss., for City of Clinton.
   MEMORANDUM OPINION

TOM S. LEE, District Judge.

This cause is before the court on the motion of the United States Department of Housing and Urban Development (HUD) to dismiss for failure to state a claim upon which relief can be granted. The court, having reviewed the memoranda with attachments submitted by the parties, is of the opinion that HUD’s motion is well taken and should be granted.

The plaintiffs instituted suit against HUD on January 24, 1984, seeking recovery under the Federal Tort Claims Act for damages resulting from HUD’s alleged negligent inspection and appraisal of a house they purchased from Jack L. Sledge and Bobbie Sledge in December of 1974. The original purchasers had financed the construction of the house through a mortgage insured by HUD under the National Housing Act, 12 U.S.C. § 1709(b). In 1978, the Kynerds noticed that small cracks had developed in one of the ceilings of their home, which later widened and began to appear in other ceilings and the walls of the home. In 1980, the plaintiffs contacted building contractors, who advised that it would be necessary to repair the foundation of the house or supplement the foundation with additional foundation fittings or piers, but warned that these repairs would not assure that the problems would not reappear. The plaintiffs then examined certain HUD documents and the requirements set forth in the City of Clinton Building Code and concluded that the proper depth for the foundation footings was eighteen inches. Excavation of the foundation revealed that the depth of the foundation footings was less than ten inches. Obtaining no relief by pursuing administrative remedies, the plaintiffs instituted suit in this court.

The United States is immune from suit except to the extent that immunity has been waived by Congress under the Federal Tort Claims Act (FTCA), 28 U.S.C. §§ 1346(b), 2671-2680. FTCA permits recovery in tort only “under circumstances where the United States, if a private person, would be liable to the claimant in accordance with the law of the place where the act or omission occurred”. 28 U.S.C. § 1346(b). Therefore, for the plaintiffs to prevail, they must demonstrate that HUD, if a private person, would be liable to them under Mississippi law. The purchasers, proceeding pro se, charge negligence as the basis for their claim. HUD contends that the only conceivable avenue of recovery is under section 324A of the Restatement (Second) of Torts (1965), which imposes liability on one who gratuitously undertakes to render services to another for the benefit or protection of third persons and who fails to exercise reasonable care in the performance of the gratuitous undertaking.

A duty owed by one to another must first be shown to exist before recovery under negligence principles will be allowed. The United States Supreme Court has specifically stated that the objective of an inspection and appraisal of property by HUD for mortgage insurance purposes is the “protection of the Government and its insurance funds” and would only “inure incidentally, to the benefit of respective home purchasers ....” United States v. Neustadt, 366 U.S. 696, 708-09, 81 S.Ct. 1294, 1301-02, 6 L.Ed.2d 614 (1961); see also Baroni v. United States, 662 F.2d 287, 289 (5th Cir.1981) (no federal duty created by the National Housing Act; the primary purpose of government’s undertaking is to insure that homes with FHA mortgages are constructed to standards warranting mortgage guarantee protection). Because HUD does not owe any legal duty to prospective purchasers of a home to inspect and appraise accurately property on which the purchasers seek to obtain mortgage insurance, the purchasers cannot recover against HUD on the basis of negligence.

Since recovery for negligence is not available, HUD asserts that the only remedy that might conceivably be available to the plaintiffs is through application of the “Good Samaritan” doctrine, expressed in the Restatement (Second) of Torts, section 324A (1965), which states:

One who undertakes, gratuitously or for consideration, to render services to another which he should recognize as necessary for the protection of a third person or his things, is subject to liability to the third person for physical harm resulting from his failure to exercise reasonable care to protect his undertaking, if (a) his failure to exercise reasonable care increases the risk of such harm, or (b) he has undertaken to perform a duty owed by the other to the third person, or (c) the harm is suffered because of reliance of the other or the third person upon the undertaking.

Id. Although the Mississippi Supreme Court has expressly reserved ruling as to whether or not the court will adopt this section of the Restatement, the Fifth Circuit has assumed that the Mississippi court would adopt section 324A if presented with, the issue for decision. See Trosclair v. Bechtel Corp., 653 F.2d 162, 163 n. 1 (5th Cir.1981). However, considering this doctrine, it is apparent that recovery thereunder is foreclosed for the same reason that recovery in negligence is excluded — that the purpose of HUD’s inspection was not to benefit the original purchasers, much less the subsequent purchasers, the Kynerds. U.S. v. Neustadt, 366 U.S. at 709, 81 S.Ct. at 1301-02; Hartford Steam Boiler Insp. & Ins. v. Cooper, 341 So.2d 665, 667 (Miss.1977) (to come within section 324A, plaintiff must show a duty owed to make inspections and reliance thereon).

The plaintiffs have not only failed to meet the preliminary requisite of section 324A but also have not demonstrated the existence of any of the other elements necessary for application of the section. According to Patentas v. United States, 687 F.2d 707 (3rd Cir.1982), in order to show that HUD’s inspection increased the risk of harm to the plaintiffs’ house, they must identify “sins of commission rather than omission”. Id. at 716. HUD’s alleged failure to discover the placement of the foundation footings at an insufficient depth can only be characterized as a sin of omission and not of commission.

Further, HUD did not inspect the Kyn-erd’s house in the performance of a duty owed by “the other to the third person”, or by the original purchasers to the subsequent purchasers. As stated in Neustadt, supra, HUD owed no duty to the original purchasers, much less to any subsequent purchasers.

The remaining element in section 324A is that the plaintiff must demonstrate that the harm suffered due to another’s gratuitous undertaking results because of reliance by the party for whom the gratuitous undertaking was rendered. As stated previously, the Kynerds could not have relied on HUD’s inspection and appraisal since they did not examine the HUD documents until nearly four years after their purchase of the house. See Patentas v. United States, 687 F.2d 707, 717 (3rd Cir.1982) (where the appellants did not allege knowledge of the purpose of Coast Guard’s inspection, they could not have relied on Coast Guard’s conclusion resulting from inspection); compare with Indian Towing Co. v. United States, 350 U.S. 61, 69, 76 S.Ct. 122, 126-7, 100 L.Ed. 48 (1955) (where tugboat pilot knew about lighthouse service operated by Coast Guard, Coast Guard was obligated to keep light in good working order).

The court also notes that the plaintiffs’ action against HUD is barred by the statute of limitations set forth in Mississippi Code Annotated § 15-1-41 (Supp.1984). This statute provides that “No action may be brought to recover damages for injury to property, real or personal ... arising out of any deficiency in the design, planning, supervision or observation of construction ... more than ten years after the written acceptance or actual occupancy or use, whichever occurs first....” The Sledges began occupancy of the house in question in November of 1970. HUD’s inspection and appraisal fits within the language of the statute forbidding recovery for a deficiency in the “supervision or observation of construction”. Therefore, any negligent inspection or inaccurate appraisal by HUD was barred as of November 1980.

For the reasons expressed herein, it is the court’s opinion that HUD’s motion to dismiss for failure to state a claim should be granted. Judgment will be entered separately pursuant to the local rules.

      . The plaintiffs rely on Block v. Neal, 460 U.S. 289, 103 S.Ct. 1089, 75 L.Ed.2d 67 (1983), to support their allegation that tort actions based on negligence are not barred by 28 U.S.C. § 2680(h). Plaintiffs have apparently misconstrued HUD’s argument, for HUD cites United States v. Neustadt, supra, for the limited proposition that HUD owed no legal duty either to the original purchasers, the Sledges, nor the subsequent purchasers, the plaintiffs herein, to conduct an accurate inspection and appraisal. HUD does not rely on Neustadt for that case’s holding that the purchasers’ action against the Federal Housing Administration (FHA), a branch of HUD, was foreclosed by the misrepresentation exception, 28 U.S.C. § 2680(h), since the report issued by the FHA allegedly contained an inaccurate inspection and appraisal, constituting a "negligent misrepresentation”. 366 U.S. at 711. The reason for HUD’s not relying on this principal holding in Neustadt is that in this case, unlike the factual circumstances in Neustadt, the Kynerds, according to their complaint, did not rely on HUD’s inspection and appraisal when they purchased their home in 1974; rather, they examined the HUD documents only after the cracks in the ceilings began to appear in 1978. The tort of negligent misrepresentation requires both reliance and an overt act or transaction. Ware v. United States, 626 F.2d 1278, 1283 (5th Cir.1980). The Neustadts read the FHA report and relied on it to their detriment in purchasing their negligently constructed home; the plaintiffs herein did not rely on the HUD documents in purchasing their home. The Supreme Court in Block v. Neal, 460 U.S. 289, 103 S.Ct. 1089, 75 L.Ed.2d 67 (1983), held that the purchaser’s claim did not arise out of the tort of misrepresentation so as to be barred by section 2680(h) since in Neal’s case, unlike in Neustadt, any misstatements made by the Farmers Home Administration in inspecting and supervising construction of the purchaser’s home were not essential to the purchaser's claim. Since HUD does' not rely, or attempt to rely, on the misrepresentation exception to the Federal Tort Claims Act, Block v. Neal, supra, is inapplicable.

      . The recent Mississippi Supreme Court decision of Keyes v. Guy Bailey Homes, Inc., 439 So.2d 670 (Miss.1983), does not substantiate plaintiffs’ argument that HUD’s inspection was in performance of the duty owed both to the original purchasers and to the subsequent purchasers. That case only held that a builder vendor of a home could be held liable in negligence or for breach of implied warranty to subsequent purchasers even though no privity of contract existed for a period not to exceed ten years after construction in accordance with Miss.Code Ann. § 15-1-41 (Supp.1984). Id. at 672-73. The Keyes decision cannot be interpreted to impose liability on an insurer of a mortgage to subsequent purchasers.


author: WILLIAM C. CONNER, District Judge:

text:
    In the Matter of the Arbitration between FILS ET CABLES D’ACIER DE LENS, Petitioner and Cross-Respondent, v. MIDLAND METALS CORPORATION, Respondent and Cross-Petitioner.
    No. 83 Civ. 7073 (WCC).
    United States District Court, S.D. New York.
    March 29, 1985.
    Surrey & Morse, New York City, for petitioner and cross-respondent Fils et Cables D’Acier de Lens; Barry R. Satine, New York City, of counsel.
    Moses & Singer, New York City, for respondent and cross-petitioner Midland Metals Corp., Arnold A. Jaffe, Richard W. Brewster, David B. Picker, New York City, of counsel.
   OPINION AND ORDER

WILLIAM C. CONNER, District Judge:

This controversy arises out of two 1980 contracts by which petitioner Fils et Cables d’Acier de Lens (“FICAL”) agreed to sell and respondent Midland Metals Corporation (“Midland”) agreed to buy galvanized steel wire. Pursuant to New York arbitration clauses in the contracts, the parties submitted to arbitration a dispute respecting the quality of the product delivered under the contracts and the resulting nonpayment of the purchase price. On September 23, 1983 the arbitrators rendered their decision awarding specified principal amounts to each party plus interest on certain of the principal amounts due from Midland to FICAL. FICAL petitioned this Court for confirmation of the award and Midland cross-petitioned for modification of the award under an unusual contract provision stipulating that any arbitration award would be subject to judicial review to determine whether the arbitrators’ findings of fact are “supported by substantial evidence” and whether “as a matter of law based on said findings of fact the award should be affirmed.”

On April 5, 1984, this Court rendered an Opinion confirming the arbitration award insofar as it determined the principal amounts due from each party to the other, but remanded the matter to the arbitrators for further findings or explanation respecting the basis for their award of interest oh the principal amounts due FICAL but not on the principal amount due Midland. 584 F.Supp. 240.

On September 24, 1984, the arbitrators rendered a supplemental award to explain their rationale respecting the award of interest. The matter is now before the Court on FICAL’s petition to confirm the supplemental award and Midland’s cross-petition to modify it.

The Court’s opinion of April 5, 1984 is referred to for a fuller exposition of the background of the controversy. For present purposes, the following brief summary will suffice.

Factual Background

On June 4, 1980, the parties entered into a. contract by which FICAL agreed to sell and Midland agreed to buy 650 metric tons of galvanized steel wire of specified quality which Midland intended to resell to Taiwan Power Co. (“Taiwan”). Although Taiwan accepted the wire and paid for it, Taiwan complained that the product failed to meet the contract specifications. On September 8, 1981, Midland sent FICAL a Telex demanding $862,154.56 (representing the full sales price of $818,154.56 plus $44,000 — the amount of the performance bond which Midland had posted to guarantee delivery pursuant to the contract). Midland indicated that it was withholding $266,217.30 which was due from it to FICAL because of the dispute over the quality of the product.

After lengthy negotiations, Midland entered into a settlement with Taiwan by which the $44,000 performance bond was forfeited as of January 19, 1982 and Midland paid Taiwan an additional $181,104.14 on February 17, 1983. In addition, during the period up to February 17, 1983, Midland incurred expenses of $24,920.86 in connection with the dispute and its settlement, making a total of $250,025 paid by Midland because of the failure of the wire to meet specifications.

The parties entered into a second contract dated December 4, 1980 by which Midland agreed to purchase from FICAL an additional quantity of galvanized steel wire intended in part for delivery to other customers and in part for Midland’s inventory. The contract price for this wire was payable in French francs (“ff”) 90 days after the invoice dates.

In their original award, the arbitrators ruled that Midland should pay FICAL the following principal amounts:

$266,217.30 for wire sold to Taiwan
$4,788.97 for wire sold to other customers
ff 1,004,503 for wire in inventory and in hands of customers

plus the following interest:

$25,000 (the manner of computation was unspecified)
ff 135,000 (representing interest on ff 708,915.10 through December 13,1982)
11% on ff 834,915 from 12/10/82 to 9/10/83

The arbitrators also ruled that FICAL should reimburse Midland in the sum of $250,025 which Midland had paid in connection with its settlement with Taiwan, but with no provision for interest thereon.

Contentions of the Parties

In their supplemental award, the arbitrators explained their failure to award interest on the principal amounts due Midland as follows:

The arbitrators decided on interest to [FICAL] ... and not to Midland ... because Midland was responsible for the interest on the monies it retained to ensure reimbursement from [FICAL] for settlement costs due to the quality problems in Taiwan. Furthermore, the Taiwan settlement was not paid by [Midland] until long after the litigation had been initiated. [Midland] was in possession of these funds and in a position to earn a return until February, 1983 when it made the payment to the Central Trust of China.

Midland contends (1) that it was improper to award FICAL interest on the full $266,217.30 due it on the Taiwan wire, because FICAL was owed a net amount of only $20,981.27 ($266,217.30 plus $4,788.97 minus $250,025); and (2) that in awarding 11% interest on the ff 834,915, the arbitrators awarded interest on interest (impermissible compound interest) because this amount of ff 834,915 includes ff 135,000 of interest which was awarded on ff 708,915.-10 of the total of ff 1,004,503 principal amount due FICAL for wire in inventory and in customers’ hands.

FICAL counters (1) that the arbitrators properly refused interest on the "award of $250,025 to Midland because they recognized that this amount was not paid by Midland in settlement of Taiwan’s claim until long after Midland had received from Taiwan and had withheld the amount of $266,217.30 due to FICAL; (2) that FICAL was not awarded any interest on the $266,-217.30 due it because the $25,000 FICAL was awarded represented interest on another principal amount of $79,788.97 (the $4,788.97 due to FICAL for wire in customers’ hands plus $75,000 which Midland paid FICAL after the arbitration was underway); and (3) that FICAL is also entitled to interest on the additional principal amount of ff 296,587.71 on which the arbitrators unaccountably failed to award interest. Discussion

There is some merit in the contentions of both parties.

The arbitration award, even after being augmented by the supplemental award, leaves many unanswered questions as the basis of computation of the interest awards and of the underlying rationale of the arbitrators. However, the parties are in agreement on at least one matter: that another remand to the arbitrators for further findings or clarification offers little promise of benefit. The Court, then, is left to resolve the matter as logically and equitably as it can on the basis of the present record.

In the absence of any clear justification for an award of interest on some of the principal amounts due and not on others, the Court concludes that logic and equity require the award of interest at the same rate on all amounts awarded from the dates on which they were respectively due. Thus FICAL will be awarded interest on:

$266,217.30 from September 8, 1981
$ 4,788.97 ) „ Q. , ., . . from 90 days after the in-.
ff 1,004,503 )V0icedateS

And Midland will be awarded interest on:

$44,000.00 from January 19, 1982
$206,025.00 from February 17, 1983

These awards of interest are in lieu of the interest awards of the arbitrators.

This resolution of the controversy will eliminate any apparent inconsistencies, anomalies or omissions in the arbitrators’ award, such as the denial of all interest to Midland on the amounts due it because it had the “use” for different periods of different amounts due to FICAL; the unexplained failure to award interest on ff 296,-587.71 of the ff 1,004,503 owed to FICAL; and the awarding of interest on the award of ff 135,000 in interest.

Neither party has contested the arbitrators’ decision to award interest at the rate of 11% per annum, and the Court will accordingly confirm the use of that rate. All interest awards will run to the date of the judgment.

Counsel for FICAL are directed to submit to counsel for Midland, within 10 days of the date of this Opinion and Order, a proposed judgment order, for settlement on five days’ notice, providing for the net award to FICAL computed as provided herein and in the Court’s Opinion of April 5, 1984.

SO ORDERED.


author: BERNARD NEWMAN, Senior Judge:

text:
    JEANNETTE SHEET GLASS CORPORATION, Plaintiff, v. UNITED STATES, Defendant, and Crystal International Corporation, and Flachglas A.G., Intervenors, Glaverbel, S.A., Intervenor, Erie Scientific Company, A Division of Sybron Corporation, and Erie-Electroverre, S.A., A Wholly Owned Subsidiary of Sybron Corporation, Intervenors.
    Court No. 83-5-00729.
    United States Court of International Trade.
    March 22, 1985.

      Stewart & Stewart, Washington, D.C., Eugene L. Stewart, Terence P. Stewart, James R. Cannon, Jr. and Charles A. St. Charles, Sp. Counsel, Washington, D.C., for plaintiff.
    Michael P. Mabile, Acting General Counsel and Catherine R. Field, Office of General Counsel, United States International Trade Commission, Washington, D.C., for defendant.
    Mudge Rose Guthrie Alexander & Fer-don, Washington, D.C. (N. David Palmeter, David P. Houlihan, Washington, D.C., and Alan H. Price, of counsel), for intervenors Crystal International Corporation and Flachglas A.G.
    Ulmer, Berne, Laronge, Glickman & Curtis, Cleveland, Ohio (Morton L. Stone and Ronald H. Isroff, Cleveland, Ohio, of counsel), for intervenor Glaverbel, S.A.
    Hodgson, Russ, Andrews, Woods & Goodyear, Buffalo, N.Y. (Victor T. Fuzak, Anthony L. Dutton and Craig M. Indyke, Buffalo, N.Y., of counsel), for intervenors Erie Scientific Company and Erie-Electro-verre, S.A.
    Max N. Berry, Washington, D.C. (Marsha A. Echols, Washington, D.C., of counsel), for amicus curiae Donnelly Corporation.
   BERNARD NEWMAN, Senior Judge:

Introduction

By this action, plaintiff challenges the preliminary negative determinations of the International Trade Commission (“Commission”) issued in antidumping investigations pursuant to 19 U.S.C. § 1673b(a). In the preliminary determinations under review the Commission found there was no “reasonable indication” that plaintiff, Jeannette Sheet Glass Corporation (“plaintiff” or “Jeannette”), the sole domestic producer of thin sheet glass, is materially injured or threatened with material injury by reason of imported “regular quality” thin sheet glass from Switzerland, Belgium or the Federal Republic of Germany; and that plaintiff is not materially retarded in the establishment of a “high quality” thin sheet glass industry by reason of imports of such glass from Belgium or the Federal Republic of Germany. Thin Sheet Glass from Switzerland, Belgium and the Federal Republic of Germany, Inv. Nos. 731-TA-127, 128 and 129 (Preliminary), USITC Pub. No. 1376 (May 1983). In view of the negative determinations, the antidumping investigations were terminated and notice of such termination was published on May 11, 1983 (48 Fed.Reg. 21213 (1983)).

. Plaintiff seeks review of the Commission’s preliminary determinations upon the agency’s record pursuant to Rule 56.1 of the rules of the Court, and presents basically three contentions:

1)The Commission’s determinations are not in accordance with the “reasonable indication” standard as articulated in Republic Steel Corp. v. United States, 8 CIT —, 591 F.Supp. 640 (July 11, 1984), reh’g denied, 9 CIT —, Slip Op. 85-27 (March 11, 1985).

2) The determinations with respect to regular quality thin sheet glass are arbitrary, capricious, an abuse of discretion and otherwise not in accordance with law.

3) The determinations respecting material retardation of the establishment of a domestic high quality thin sheet glass industry are arbitrary, capricious, an abuse of discretion, and otherwise not in accordance with law.

For the reasons that follow the case is remanded to the Commission for reconsideration of its preliminary negative determinations as to material injury or the threat of material injury to an industry in the United States producing regular quality thin sheet glass in compliance with the standard of review articulated in Republic Steel Corp., supra. The Commission’s preliminary negative determinations respecting materia] retardation of the establishment of a high quality thin sheet glass industry in the United States are affirmed.

Background

On March 16,1983 Jeannette filed a petition with the Commission and the Department of Commerce alleging that imports of thin sheet glass from Switzerland, Belgium and the Federal Republic of Germany are being sold in the United States at less than fair value (“LTFV”), and that as a result the domestic industry producing thin sheet glass (viz., Jeannette) is materially injured or threatened with material injury. The petition distinguished between the “regular quality” thin sheet glass, that Jeannette produced, used primarily in the production of microscope slides, cosmetic mirrors, and lantern slides for slide projectors, and “high quality” thin sheet glass, used primarily as optical coating glass for instrumentation having light emitting diodes or liquid crystal display, and for photographic slide glass. On April 6, 1983 Jeannette amended its petition to allege that LTFV imports of high quality thin sheet glass from Belgium and the Federal Republic of Germany are retarding the establishment of a high quality thin sheet glass industry in the United States.

On April 27, 1983, after conducting its preliminary investigations, the Commission (Chairman Alfred Eckes and Commissioner Veronica A. Haggart; Commissioner Paula Stern dissenting in part) determined that there is no reasonable indication that the domestic regular quality thin sheet glass industry (viz., Jeannette) is materially injured or threatened with material injury by reason of imports of regular quality thin sheet glass from Switzerland, Belgium or the Federal Republic of Germany, allegedly sold at LTFV. Additionally, the Commission unanimously found there is no reasonable indication that the establishment of a high quality thin sheet glass industry in the United States is being materially retarded by reason of imports of high quality thin sheet glass from Belgium or the Federal Republic of Germany, allegedly sold at LTFV. Material retardation was not alleged concerning Switzerland because that country does not export high quality thin sheet glass to the United States.

Jeannette commenced this action on May 17, 1983 challenging the Commission’s negative determinations. Pursuant to Rule 56.1(a) of the Rules of the Court, Jeannette filed on May 29, 1984, a motion for an order directing that this matter be submitted for review upon the agency record. On July 17, 1984, this Court granted Jeannette’s motion. Thereafter on August 7, 1984, Jeannette filed the present motion together with a supporting memorandum; and on August 15, 1984 the Commission moved for a stay of this action pending a decision on a motion for reconsideration to be filed in Republic Steel, supra, or a decision on appeal in that case.

On October 4,1984, the Commission filed a motion for reconsideration in Republic Steel of that portion of Judge Watson’s decision relating to the “reasonable indication” standard applicable to the Commission’s preliminary investigations. Plaintiffs in Republic Steel also requested reconsideration of the issue of cumulation. The Commission’s motion for a stay of the present proceeding was denied by this Court on October 2, 1984. The Commission’s motion for reconsideration in Republic Steel was denied by Judge Watson on March 11, 1985. 9 CIT —, Slip Op. 85-27.

Following the submission of briefs on plaintiff’s motion for review in the present case, oral argument was heard on January 17, 1985.

Commission’s Determination that there is No Reasonable Indication of Material Injury or Threat of Material Injury to the Regular Thin Sheet Glass Industry

We first review the Commission’s preliminary determinations respecting material injury or threat of material injury to the regular quality thin sheet glass industry. Commission’s findings

Jeannette, wholly owned by its employees and managers, began producing thin sheet glass in March 1980 when it reopened a plant formerly owned by ASG, Inc. and Fourco Glass Co., which was shut down in November 1978. The former employees of ASG provided capital, and with government guarantees and additional funds from private lenders, purchased the plant and refurbished it.

The Commission also found:

1. Throughout the period of investigation, production of regular quality thin sheet glass was profitable and the profits remained comparatively stable.

2. Domestic production, shipments and capacity utilization rose from 1980 to 1981, but then declined from 1981 to 1982.

3. Employment remained stable and hours worked increased from 1980 to 1981, but both factors declined from 1981 to 1982.

4. Inventories of regular quality thin sheet glass increased throughout the period under investigation.

In determining whether the “difficulties” experienced by the domestic industry were caused by the alleged LTFV imports, the Commission considered, among other things, underselling by the imports, lost sales, and price suppression resulting in lost revenues. In instances where there was underselling by the imports, the majority Commissioners found the margin of underselling “minimal”. Lost sales and revenues were attributed to the lower quality of the domestic product, and the majority found that price was not a determinative factor.

Pertaining to threat of material injury, the Commission majority found in the negative on the basis of the limited productive capacity or high levels of capacity utilization of the exporters (Erie-Electroverre of Switzerland; Glaverbel of Belgian; and Flachglas, the West German firm). The Commission majority also noted the absence of plans by the exporters to expand shipments to the United States.

Dissenting Commissioner Stem’s views

Commissioner Stern found that Jeannette is currently experiencing economic difficulties with respect to the regular quality thin sheet glass product, as did the majority commissioners. Specifically, Commissioner Stem pointed to the evidence of record that domestic production, shipments, capacity utilization, employment and sales of thin sheet glass declined substantially between 1980 and 1982; that operating income, net income, and cash flow followed a similar downward trend. Further, Commissioner Stern observed that Jeannette’s share of the domestic market for regular quality thin sheet glass, while small relative to the imports, is declining. In contrast to the foregoing fact, Commissioner Stern found that the respective market shares held by the imports from Belgium and West Germany had grown, and Switzerland’s market share — which is significant — has remained relatively stable.

While conceding that “the information on the record is mixed”, Commissioner Stern found indications that the imports from Belgium and Switzerland have undersold the domestic product, particularly in 1982, and that many purchasers have shifted their sourcing from the domestic producer to each of the imports under investigation. As perceived by Commissioner Stern, “[t]he key issue in this investigation has been whether this shift occurred solely due to alleged quality problems with the domestically produced product”. USITC Pub. No. 1376 at p. 24. On this crucial aspect of the investigations, Commissioner Stern concluded, but not definitively, that the quality issue alone does not explain why customers shifted from Jeannette to the imports. In that connection, it was pointed out by the dissent that while quality is clearly an important factor, the parties to the investigation agreed that both price and the quality of the product are important considerations in the purchasing decision; that increased yield resulting from the use of a product of good quality may offset the greater price of the better quality product; and that quality did not constitute a problem for at least two customers contacted by the Commission staff.

Finally, Commissioner Stern observed that LTFV margins may be used, in effect, to underwrite a smaller quality premium than the market would otherwise generate, and determined that “there is reasonable indication that such a situation is present in each of these investigations before us.” Id. at 26. In sum, Commissioner Stern was not able to “discount the possibility that LTFV sales of the imports have materially injured the domestic industry”. Id. at 26.

“Reasonable indication” standard

The Court now reaches plaintiff’s contention that the Commission misapplied the “reasonable indication” standard prescribed by 19 U.S.C. § 1673b(a) by weighing conflicting evidence of record. In support of its position, plaintiff relies upon Republic Steel, where Judge Watson held that in a preliminary, unlike a final, investigation the Commission may not weigh conflicting evidence and determine on balance whether material injury or the threat thereof exists; rather, the Commission’s responsibility at the preliminary stage is simply to find whether any facts reasonably raise the possibility of injury. 591 F.Supp. at 650.

While defendant concedes that the reasonable indication standard establishes a low threshold for continuing an investigation, the Commission insists that it may weigh the evidence developed during a preliminary investigation and make a negative determination when clear and convincing evidence exists that imports are not possibly causing material injury or the threat of material injury to the domestic industry. The Commission maintains that respecting the investigations under review it properly applied the reasonable indication standard when it “evaluated” all of the evidence on the record and resolved the conflicting evidence against the plaintiff. The Commission admits, however, that measured against the standard laid down in Republic Steel, the determinations reviewed in the instant case as to material injury and threat of material injury are unlawful and that the action must be remanded to the Commission.

Defendant and intervenors attempt to sidestep Republic Steel by pointing to the decision of our Court of Appeals in United States v. Roses, Inc., 706 F.2d 1563 (Fed.Cir., 1983). In Roses the Court held that the Commerce Department in a sufficiency evaluation of a dumping petition should apply its expertise to evaluate the petition and supporting data “in light of a wide body of other information.” The Appellate Court in Roses did not, however, go so far as to hold that the agency should prejudge the matter and screen out petitions on the ground that it knows of conflicting evidence.

Reliance by intervenors Crystal International Corporation, and Flachglas A.G. on Budd Company Railway Division v. United States, 1 CIT 67, 507 F.Supp. 997 (1980) is also misplaced since the issue presented here was not raised.

While the Commerce Department, of course, should avoid commencement of unwarranted investigations, Congress never intended the agency at the initial stage of the antidumping proceedings to summarily reject petitions simply because the agency has knowledge of conflicting evidence. This conclusion is inescapable in light of the statutory requirement that the agency must make a preliminary affirmative determination of LTFV sales if “there is a reasonable basis to believe or suspect” that the merchandise under investigation is being sold at LTFV. 19 U.S.C. § 1673b(b)(l). This provision is a clear expression of Congressional intent to provide extremely low threshold standards at the preliminary investigatory stages of antidumping proceedings. Clearly, the “reasonable indication” standard applicable to the Commission’s preliminary investigations, like the “reasonable basis to believe or suspect” standard applicable to the Commerce Department’s preliminary LTFV investigations, was intended by Congress to be administered as a very low evidentiary threshold for an affirmative preliminary determination, which permits the investigation to continue to the final investigatory stage where the record may be more fully developed.

Here, the Commission’s preliminary injury determinations did not address the question of whether there is sufficient information in the record to raise the possibility of injury, but rather sought to definitively resolve the issues by weighing the conflicting evidence. Put another way, the Commission’s “preliminary” determination, in effect, constituted a final determination predicated solely upon data submitted in the forty-five day period permitted at the preliminary stage.

Since the Commission misapplied the reasonable indication standard in contravention of Republic Steel, this action is remanded to the Commission for reconsideration of whether there is reasonable indication of material injury or threat of material injury to the domestic industry by reason of the subject imports in compliance with Republic Steel.

Cumulation and volume of imports

Plaintiff also contends that the Commission’s failure to cumulate and consider the volume of imports were errors in the determinations.

In Republic Steel, the Court held that the proper test for cumulation is whether the imported products are competing with the product of a domestic industry, and not the volume or trend in the volume of a particular segment of importations. While Republic Steel required cumulation in the context of a countervailing duty case, the underlying principle is equally applicable in an antidumping investigation due to the parallel functions of the Commission in both types of investigations. The record before the Commission in this case shows that the imported regular quality thin sheet glass was in direct competition for sales to the same community of purchasers. Thus, the Commission’s methodology in considering the level of imports from the three countries individually was incorrect. However, since on the question of causation the Commission, in effect, conceded the existence of a significant level of imports from each individual country, cumulation of the imports from the three countries in itself would not have altered the result reached by the Commission.

It is further contended by plaintiff that the Commission’s failure to discuss the volume of imports in its decision is a material error. Plaintiff’s contention is without merit.

The Trade Agreements Act of 1979 directs the Commission to “consider” a number of factors in rendering an injury determination, including the volume of imports and their consequent impact. 19 U.S.C. § 1677(7)(B), (C). While ideally the Commission’s decision would discuss every factor considered and make findings and conclusions with respect thereto, Congress did not impose such a stringent requirement. Congress was well aware of the complexity of antidumping investigations and in recognition of the multifaceted decisional process provided that:

The presence or absence of any factor which the. Commission is required to evaluate under subparagraph (C) or (D) shall not necessarily give decisive guidance with respect to the determination by the Commission of material injury. 19 U.S.C. § 1677(7)(E)(ii).

And that:

[The Commission] shall notify the petitioner, other parties to the investigation, and the other agency of its determination and of the facts and conclusions of law upon which the determination is based * * *. 19 U.S.C. § 1673b(f) [emphasis added].

Hence, it is plain that Congress did not mandate the Commission to discuss every facet of its investigation, but only “material issues of law or fact.” House Doc. No. 96-153, 96th Cong., 1st Sess. 27 (1979), reprinted in 1979 U.S.Code Cong. & Ad. News 381, 665, 685.

As previously noted, the negative determinations of the Commission conceded a significant level of imports from each of the individual countries covered by its investigations and in view of the Commission’s other findings and conclusions, no further discussion of the volume of imports was necessary. Fundamentally, of course, the Commission is not required to issue findings and conclusions on an issue concerning a statutory element simply because it was presented by the petitioner. Pasco Terminals, Inc. v. United States, 83 Cust.Ct. 65, 85, 477 F.Supp. 201, 218 (1979), aff'd 68 CCPA 8, C.A.D. 1256, 634 F.2d 610 (1980); British Steel v. United States, 8 CIT —, 593 F.Supp. 405 (1984). Absent a showing to the contrary, the Commission is presumed to have considered all of the evidence in the record. Rhone Poulenc, S.A. v. United States, 8 CIT —, 592 F.Supp. 1318 (1984). The record in the subject investigations contains import statistics relating to the volume of imports, and the Commission must be presumed to have considered them. If upon reconsideration of its determinations on remand of this action, the Commission is of the view that the volume of imports is material to its redeterminations, then of course the Commission must state its findings of fact and conclusions of law on that aspect of its investigations.

Yield factor

Plaintiff urges that the Commission’s analysis of the data concerning underselling and price suppression was flawed because it failed to take into account the “yield factor”. Briefly stated, the yield factor relates to the quantity of marketable product that may be produced from thin sheet glass (e.g., the total number of microscope slides obtainable from a given amount of glass). Inasmuch as individual customers have different end uses for thin sheet glass and have different quality requirements, equipment and capabilities to process sheet glass as purchased from the manufacturer, a pricing analysis that attempts to quantify the yield or quality factor for each end-user is impracticable, and the selling price is the relevant statutory criterion. Cf. British Steel Corp., supra.

Material Retardation

Jeannette claims that the Commission erred in its determination that imports of high quality thin sheet glass from Belgium and West Germany have not materially retarded the establishment of a high quality thin sheet glass industry in the United States. The issue of “material retardation” is judicially of first impression.

As stated above, in its preliminary investigations the Commission had to determine whether there is a reasonable indication of the alleged retardation. But unlike the Commission’s injury determinations under review, the negative determinations of the Commission in this case respecting material retardation did not hinge on the weighing of conflicting evidence. Rather, the Court perceives the crucial issues to be whether the Commission applied a rational criterion for applying the material retardation provision of the statute, and whether the Commission relied upon factors appropriate to the criterion.

The legislative history of the Trade Agreements Act of 1979 gives no specific guidance as to the meaning of the phrase “material retardation” or the standards for implementing such provision. Nevertheless, we are clear that like the standard of review applicable to the Commission’s preliminary determinations respecting injury, the Court must affirm a preliminary determination of material retardation unless the Commission’s determination is “arbitrary, capricious, an abuse of discretion or otherwise not in accordance with law.” 19 U.S.C. § 1516a(b)(l)(A).

In arriving at its determinations on the material retardation question in the instant investigations, the Commission applied the “substantial commitment” test. In essence, the Commission’s position is that in investigations involving an industry that has not yet commenced production, there must be a sufficient indication that the industry has made a substantial commitment to commence production, and that fact must be determined on a case by case basis. See also Certain Dried Salted Codfish from Canada, Inv. No. 731-TA-199 (Preliminary), USITC Pub. 1571 (Sept. 1984) (Commission found a substantial commitment and reached an affirmative preliminary determination on the issue of material retardation). The substantial commitment criterion is a pragmatic approach designed to screen out applicants for relief who merely intend or wish to become established in an industry but have taken no substantial steps toward becoming so established. In the instant investigations, the Commission concluded that “despite its apparent interest in entering the market, Jeannette’s efforts to date have not demonstrated a substantial commitment to commence production of high quality thin sheet glass.” USITC Pub. No. 1376 at 14. On the basis of the record before the Commission, the Court cannot agree with plaintiffs contention that the Commission’s finding was arbitrary or capricious.

Plaintiff argues that Jeannette’s substantial commitment to commence production of high quality thin sheet glass is demonstrated by the facts that Jeannette possessed the plant, equipment, skilled personnel and marketing expertise to produce both regular and high quality thin sheet glass; and that Jeannette has made certain improvements in its production facilities which affect the production of both regular and high quality thin sheet glass. According to Jeannette, the main impediment to volume production of the high quality product is the lack of flatness testing equipment, which would cost approximately $250,000.00, and would allow Jeannette to sort glass currently produced into high quality and regular quality: Jeannette asserts that the expenditure of funds for flatness testing equipment is now prohibited by the fact that the market prices of the imports are below Jeannette’s projected cost of producing high quality glass and by Jeannette’s present financial situation, which allegedly has been adversely impacted by the LTFV imports. Significantly, however, Jeannette has taken no steps that are targeted for the production or marketing of high quality thin sheet glass except the submission of samples to several potential customers for high quality glass. But, as found by the Commission, Jeannette’s samples did not meet the customers’ quality requirements in their final evaluation.

The Court is unable to agree with plaintiff’s criteria of a substantial commitment to commence production of high quality thin sheet glass. Rather, the record establishes that on the basis of such fundamental indicia as production capability, financial commitment, and marketing efforts, plaintiff's “commitment” to the production of the high quality product was not “substantial”. On this aspect, Jeannette’s refurbishment activities were clearly aimed at resurrecting general sheet glass production, and not specifically at producing high quality thin sheet glass. The argument advanced by Jeannette that the installation of an energy saving computer on the firm’s furnace should be regarded as evidence of its substantial commitment to commence production of high quality thin sheet glass is untenable since, as noted by the Commission, the computer was not directly related to Jeannette’s problems in entering the high quality sheet glass market. Further, as for the proposed purchase of a $250,000 flatness testing machine, the Court agrees with the Commission’s finding that this equipment would not directly affect the quality of the glass produced.

Finally, the Court cannot agree with plaintiff’s contention that it is materially retarded in the establishment of a high quality thin sheet glass industry by reason o/the relatively low market prices of the imports from Belgium and West Germany as compared with the projected production costs for high quality thin sheet glass. That argument presupposes the propriety of the Commission’s reaching the issue of causation in considering the question of material retardation. However, since the Commission made no threshold finding of substantial commitment to commence production of high quality thin sheet glass, the Commission was not required to reach the issue of causation. See American Spring Wire Corp. v. United States, — CIT —, 590 F.Supp. 1273 (1984).

In sum, the Court holds that the Commission’s negative material retardation determinations are based upon a rational criterion, and that appropriate factors were considered in support of the finding that Jeannette has not made a substantial commitment to commence production of high quality thin sheet glass. The Court also concludes that the Commission’s application of the substantial commitment test in the present case did not violate the low threshold standard of review articulated in Republic Steel.

Conclusion

For the foregoing reasons, it is hereby ordered:

1. This action is remanded to the Commission for reconsideration of its preliminary negative determinations respecting material injury and threat of material injury in conformity with the standard of review set forth in Republic Steel and in conformity with this decision.

2. The Commission shall report its findings and redeterminations to this Court within thirty days after the date of entry of this order.

3. The Commission’s determinations respecting material retardation are affirmed.

      . The Commission made separate determinations concerning regular quality and high quality thin sheet glass. Commissioner Stern dissented only with respect to regular quality thin sheet glass, finding that there is a reasonable indication of material injury.

      . In its motion for extension of time for filing its response to plaintiff's motion for review upon the agency record, counsel for the Commission stated that "resolution of the reasonable indication issue [in Republic Steel] could be dispositive of this case." (Motion at 2.)

      . This is not to say that the yield experienced by a particular customer could not possibly be monitored and the impact of yield on price quantified. Yield is one of a number of cost factors that an end-user of thin sheet glass takes into account in deciding its source of supply and the price to be paid for the product. However, the Court holds that the statute does not require an adjustment of prices for various cost factors for the reasons expressed in British Steel.

      . The Commission found that: "In two instances Jeannette's glass passed preliminary tests, but after further processing and testing, these companies discovered quality deficiencies in Jeannette’s glass”; and that “a fundamental question exists regarding whether Jeannette can actually produce the high quality product. This fundamental problem overshadows Jeannette’s other efforts to enter the market.” USITC Pub. No. 1376 at 15-16.